TCR_Public/971001.MBX   T R O U B L E D   C O M P A N Y   R E P O R T E R

     Wednesday, October 1, 1997, Vol. 1, No. 28
                       
                   In This Issue

ALL FOR A DOLLAR: Trustee Seeks Chap. 7
ARROW: Court Approves Sale
BARRY’S JEWELERS: Committee to Hire Counsel
CLOTHESTIME STORES: Emerges From Bankruptcy
COUNTY SEAT: Hearing To Reject Real Property Leases

EDISON BROTHERS: Wants to Compromise L/C Claims
ENVIRONMENTAL WASTE: Assets and Business Sold
L. LURIA: Hearing to Employ Deloitte & Touche
L. LURIA: Seeks Real Estate Consultants
PAYLESS CASHWAYS: Claimants Seek Hearing

PHAR-MOR: New Officers, Shareholders To Meet
TODAY’S MAN: Files 2nd Amended Plan
U.S. HEALTHCARE: Sale of Certain Assets
WESTERN FIDELITY: Committee Seeks Counsel

                 -----

ALL FOR A DOLLAR: Trustee Seeks Chap. 7
---------------------------------------
Upon the application of the United States Trustee
for the Eastern District of New York, a hearing
will be held on October 28, 1997,  for an order
converting this Chapter 11 case to a case under
Chapter 7 of the Bankruptcy Code.


ARROW: Court Approves Sale
----------------------------
The US Bankruptcy Court for the District of Oregon
has entered an order authorizing Arrow
Transportation Co. of Delaware to sell certain
personal property, to reject real property leases
and personal property  leases and executory
contracts and  authorizing Arrow to reject
collective bargaining agreements.

Arrow is authorized to sell personal property to
Matlack, Inc. for the purchase price of $5,445,000,
subject to certain adjustments.  Arrow will deposit
proceeds totaling $4,058,035.51 on account of
alleged liens and claims in a segregated interest
bearing account for certain creditors including
Associates Commercial Corp., Concord Commercial
Corporation, Mellon US leasing and Deer Park
(Texas) Independent School District.  


BARRY’S JEWELERS: Committee to Hire Counsel
-------------------------------------------
Barry’s Jewelers, Inc'’s Official Unsecudre
Creditors’ Committee has applied to the Office of
the United States Trustee to hire Whitman, Breed,
Abbott & Morgan L.L.P. as its counsel.


CLOTHESTIME STORES: Emerges From Bankruptcy
--------------------------------------------
Clothestime Stores, Inc., announced it has
officially emerged from bankruptcy, effective
September 28, 1997.

The joint Chapter 11 reorganization plan submitted
by The Clothestime, Inc., and its five debtor
affiliates was confirmed by Judge John J. Wilson of
the United States Bankruptcy Court for the Central
District of California on September 10, 1997.

Clothestime Stores is emerging from Chapter 11 as a
privately held company.  All common stock and other
equity securities of The Clothestime have been
canceled under the plan and, accordingly, have no
value.

David Sejpal, chairman, president, and CEO of
Clothestime Stores, expressed his gratitude to the
over 1,700 Clothestime associates, numerous
suppliers, and loyal customers for their tremendous
dedication throughout the course of the bankruptcy
proceedings.

COUNTY SEAT: Hearing To Reject Real Property Leases
---------------------------------------------------
On October 15, 1997 at 9:30 AM, the debtor, County
Seat Inc., and its direct and indirect
subsidiaries, County Seat Stores, Inc. and CSS
Trade Names, Inc. are seeking to reject 67  
nonresidential real property leases.  

The debtors claim that in an effort to reduce post-
petition administrative costs and in the exercise
of sound business judgment, County Seat has
determined that rejecting the leases provides the
best possible recovery for County Seat’s
stakeholders.  County Seat requests that the
rejection be deemed effective as of either October
31, 1997, January 15, 1998 or January 31, 1998 in
order to allow a liquidation of the stores’
inventory without the necessity of removing it from
the premises.  Most significant to the debtors, the
rejection of the leases would improve the debtors’
cash flow.

EDISON BROTHERS: Want to Compromise L/C Claims
-----------------------------------------------
Edison Brothers Retail Stores, Inc., according to
Bankruptcy Creditors' Service, told the bankruptcy
court prior to the petition date Banca Nazionale
del Lavoro issued certain stand-by letters of
credit to secure  Edison' insurance obligations.

The letters included $463,380 to Travelers
Insurance Co. for workers' comp insurance, $7
million to Kemper Insurance Companies for workers'
comp insurance, $100,000 to Enterprise Fleets,
Inc., for automobile insurance, and $50,000 to
State of New York W/C Board for workers' comp
insurance.

Edison Brothers said that all draws under the
letters of credit constituted prepetition claims.  
The beneficiaries said that any draw was a
postpetition obligation.  Roughly $2.5 million was
drawn during the Chapter 11 cases.

To avoid costly litigation, Edison Brothers, Banca
Nazionale, and Merrill Lynch (as transferee of a
participation in Banca Nazionale's claims) have
agreed to settle this dispute by allowing a
$300,000 administrative claim to be paid in cash on
the effective date of the plan, allowing the
balance of the claim as a general unsecured
claim, and continuing the letters of credit for a
period of 10 years with fees payable at a rate of
1.25 percent per year.


ENVIRONMENTAL WASTE: Assets and Business Sold
---------------------------------------------
Environmental Waste Reductions, Inc., a medical
waste hauler serving customers in the South, has
completed the sale of its assets and business to
Med/Waste, Inc., for $1,687,000 in cash less escrow
deposits and a $90,000 credit at EWR’s South
Carolina incinerator, which is being written off in
the transaction.  The unpaid balance of a $200,000
working capital line previously established for EWR
while in bankruptcy will be added to the purchase
price.

EWR generates approximately $4 million in annual
revenue by serving the medical waste needs of 80
hospitals and 2,400 small generators.  Med/Waste
acquired EWR's fixed assets, inventory, supplies,
as well as accounts receivables, cash, permits,
customer and referral lists, and contracts.

Daniel A. Stauber, Med/Waste's president and CEO,
commented, "Despite strong customer relationships,
EWR encountered financial problems and eventually
bankruptcy, because of excess overhead, inadequate
pricing, inefficient route planning and lack of
capital.  We have begun restructuring EWR by
relocating administration and management to our
corporate headquarters, eliminating duplicate
positions and by renegotiating rates with
customers.  Moreover, we are in the process of
seeking more favorable terms under operating
leases."


L. LURIA:  Hearing to Employ Deloitte & Touche
----------------------------------------------
A hearing will be held at 10:00 AM on September 29,
1997 to consider the application  of L.Luria &  
Son, Inc., debtor, to employ Deloitte & Touche, LLP
as Tax Accountants to the Debtor.


L. LURIA: Seeks Real Estate Consultants
---------------------------------------
L. Luria & Son, Inc. has applied to the US
Bankruptcy Court of the Southern District of
Florida for authorization to employ Universal
Realty & Development, Inc. and Florida Shopping
Center Group as real estate consultants and
advisors tothe debtor.  

The debtor seeks the assistance of real estate
consultants to evaluate the leases, to analyze the
distressed real eastate, to dispose the distressed
real estate and to develp a business plan and
design and implement marketing programs for the
debtor.


PAYLESS CASHWAYS: Hearing for Claimants
---------------------------------------
On  October 15, 1997 in The United States
Bankruptcy Court, Western District of Missouri, six
retiree claimants are seeking separate
classification of their deferred compensation
claims.  As part of Payless Cashways’ proposed plan
of reorganization all unsecured prepetition claims
are grouped in a single class, class 3A.  Because
the claims of the retiree claimants constitute
senior indebtedness under the senior subordinated
note indenture the movants claim they are not
“substantially similar” to claims under the senior
subordinated notes, and can not be placed in the
same class with senior subordinated notes.

The retiree claimants argue that because
subordination agreements such as the Indenture
governing their claims are enforceable in
bankruptcy, the retiree claimants must be paid in
full before any payment can go to the holders of
senior subordinated notes.  They claim  that the
reorganization plan, in its current form, fails to
provide a mechanism to implement the subordination.


PHAR-MOR: New Officers, Shareholder Meeting
--------------------------------------------
Phar-Mor, Inc., announced today that Abbey J.
Butler and Melvyn J. Estrin have been appointed co-
chairmen of the board and co-chief executive
officers.  Mr. Butler and Mr. Estrin currently hold
the same positions at Avatex Corporation, which
holds 39.1 percent of Phar-Mor's common stock.

Mr. Butler and Mr. Estrin also announced that David
Schwartz will remain president and COO of the
company.  In that capacity, he will continue to be
responsible for Phar-Mor's day-to-day operations.

"Dave Schwartz has done an outstanding job of
running Phar-Mor since joining the company in 1993
and we are delighted that he will continue to lead
Phar-Mor on a day-to-day basis," Mr. Butler and Mr.
Estrin said.  "Under Dave's leadership, Phar-Mor
has successfully emerged from Chapter 11, developed
two new store formats, revamped its marketing
strategy, and began the process of opening new
stores as well as remodeling and remerchandising
existing stores.  We look forward to working
closely with him in the future."

Phar-Mor also announced the election of Daniel H.
Levy and Monroe Osterman to the board of directors
to fill spots left open by the recent resignations
of Robert Haft and Linda Haft as directors of Phar-
Mor.  Daniel H. Levy currently works as a
consultant to retailers and was previously chairman
and CEO of Conrans, a 17- store operation based in
New York.  Monroe Osterman is the current president
of Gala Trading Corporation, an investment company
specializing in large purchases of diamonds from
Europe.

The company also announced that its first annual
meeting of shareholders will occur on January 28,
1998, in Washington, D.C.  Shareholders of record
at the close of business on December 2, 1997, will
be entitled to vote at the annual meeting, or any
adjournment thereof.


TODAY’S MAN: Files 2nd Amended Plan
------------------------------------
Today's Man, Inc., announced it has filed a second
amended plan of reorganization and disclosure
statement with the United States Bankruptcy Court
in Delaware.  The company believes that the amended
plan, which provides creditors with 100 percent
recovery of allowed claims, ensures an equitable
treatment of all stakeholders.

The Bankruptcy Court has set a hearing date of
October 14, 1997, to review the amended disclosure
statement.  A confirmation hearing is expected to
be scheduled in early December.

"The amended disclosure statement responds to
requests for revisions to the original disclosure
statement, and the amended plan enhances the
treatment of all constituencies," said David Feld,
chairman and CEO.  "We remain on track toward our
emergence from Chapter 11 and look forward to
gaining approval for our reorganization plan at a
confirmation hearing in early December."


U.S. HEALTHCARE: Sale of Certain Assets
---------------------------------------
U.S. Healthcare System, Inc., proposes to sell
certain assets free and clear to National Content
Liquidators for $1.55 million.  In the event of
competing bids there will be an open auction on
October 15, 1997.  Bids must provide for a
guarantee of $1.55 million cash and be accompanied
by a deposition not less than 25 percent of the
proposed purchase price in certified funds.  NCL
has the right to match any bid in which case is bid
shall be deemed to be the highest bid.

If no auction occurs, a hearing on the sale is set
for October 15, 1997, before Judge William F.
Tuohey, in Newark, New Jersey.


WESTERN FIDELITY: Committee Seeks Counsel
-----------------------------------------
Western Fidelity Funding, Inc.’s Unsecured
Creditors’ Committee has applied to the bankruptcy
court in the District of Colorado for permission to
hire the law firm of Lindquist, Vennum &
Christensen P.L.L.P. as counsel.


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
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