TCR_Public/971014.MBX T R O U B L E D   C O M P A N Y   R E P O R T E R

     Tuesday, October 14, 1997, Vol. 1, No. 37


CAMBEX: Files for Voluntary Reorganization
CINCINNATI MICROWAVE: Still Trying to Sell Building
GREAT AMERICAN: Consolidation of Claims Settlement
HERMANíS SPORTING GOODS: To Sell Trademarks and Tradenames
KOENIG SPORTING GOODS: Assigns Leases, Sells Assets

MONTGOMERY WARD: Bank Group Objects to Settlement Procedures
MONTGOMERY WARD: More Store Closings Affect 3,800 Employees
OLD AMERICA: Employee, Officer Retention Plans Announced
PAYLESS CASHWAYS: Wonít Honor Prepetition Check
SILAS CREEK: Asset Purchase Agreement Submitted

STEINBERGíS: Wants To Start Out-Of-Business Sale
UNITED HEALTHCARE: Public Auction Set for N.J. Properties

Meetings, Conferences and Seminars


CAMBEX: Files for Voluntary Reorganization
Cambex Corp., a supplier of direct access storage products
used with IBM mainframe and client/server computers,
announced it has filed a voluntary petition for
reorganization under Chapter 11 in Boston, Massachusetts.  
By filing this petition, Cambex will be given the
opportunity to reorganize and restructure its indebtedness
under court protection.

"We took this course of action to allow us to implement our
strategies while supporting our customer base," Joseph F.
Kruy, Cambex president and CEO, commented.

CINCINNATI MICROWAVE: Still Trying to Sell Building
Cincinnati Microwave, Inc.'s efforts to sell its Deerfield
Township building to Home Depot and to continue going out of
business hinge on an agreement being hammered out by
attorneys in its bankruptcy case.

Bankruptcy attorneys are asking U.S. Bankruptcy Judge Burton
Perlman to approve a settlement between Microwave and Escort
Inc., which has purchased Cincinnati's Escort radar detector
business through Chapter 11.

Escort had agreed to pay $11.2 million for the business and
its 177,000-square-foot headquarters and plant. Escort
occupied the structure but later declined to complete the
building purchase after determining it wasn't suitable.

The companies have reached a tentative settlement that would
mean an additional $643,000 to help Cincinnati settle its
bankruptcy case. It also would allow Escort to vacate the
Deerfield Township building so it can be sold to Home Depot
for $4.9 million.

"While this settlement represents a lot of money to the
debtor, it's equally important to get Escort out of the real
estate," Edmund Adams, an attorney representing Cincinnati,
said at a bankruptcy court hearing in Cincinnati. He told
the court that postponing Escort's move from the building
could jeopardize plans to sell it to Home Depot, which has
received zoning approval to open a store on the site.

According to the Cincinnati Post, an objection by unsecured
creditors has delayed the settlement.  The creditors want a
guarantee that Cincinnati and Escort will be joint
plaintiffs in a patent infringement lawsuit against
competitor Whistler Corp. The lawsuit could be worth a
sizable amount of money, although attorneys won't say how
much. Lou Solimine, representing the unsecured creditors,
wants to make sure a fair portion goes to Cincinnatiís
bankruptcy case.

GREAT AMERICAN: Consolidation of Claims Settlement
Great American Recreation, Inc., has reached a settlement
agreement with Robert Morgenroth and Parkway Power
Corporation regarding their claims for $524,610 and
$1.4o7,314, respectively. After objections from the
claimants that their claims could not be considered
identical and thus consolidated under the debtorsí estates.

To avoid further costly litigation of the merits of the
claims, the parties have agreed to the following, subject to
court approval. The Morgenroth claims for $524,610 against
Princeton-New York Investors, Inc., and $250,000 against GAR
are allowed; a claim against Great Mountain Development will
be dismissed and expunged. The Parkway Power claims against
P-NYP for $1,407,314 and $650,000 against GAR are allowed; a
claim against GMD will be disallowed and expunged.

HERMANíS SPORTING GOODS: To Sell Trademarks and Tradenames
Hermanís Sporting Goods, Inc., has asked the District of New
Jersey bankruptcy court for permission to sell its
tradenames and trademarks under separate private agreements,
subject to higher and better offers, to further its orderly
liquidation of assets.

A hearing is set for November 17, 1997, in Trenton, New
Jersey, to approve any private sale agreements submitted by
the private bid deadline November 10 or to hear higher and
better offers. Hermanís will accept the highest or best cash
offer for each name or mark sold as is where is, and will
provide to all bidders a schedule showing the highest and
best cash offer received by the deadline. All offers must be
cash, payable by wire transfer or an endorsed bank or
certified check.

Following the courtís decision on the private sale
agreements, an auction will be held for unsold names and
marks, to be offered first in bulk, then separately to the
highest or best cash bidder.  The closing of the sale will
occur within one day of the hearing.

KOENIG SPORTING GOODS: Assigns Leases, Sells Assets
Koenig Sporting Goods, Inc., has been granted leave by
bankruptcy Judge David P. Snow of the Northern District of
Ohio, Eastern Division, to assign certain leases and
subleases and executory contracts. On the closing date,
Koenig will pay an agreed amount by certified check to
contract parties from the proceeds of the sale of its assets
to Kinney Corporation. If Koenig and the contract party
cannot agree, Koenig will reserve proceeds from the sale in
an amount not less than the amount the contract party
reasonably asserts is required. Kinney will assume the
unexpired leases and subleases of 27 stores.

MONTGOMERY WARD: Bank Group Objects to Settlement Procedures
Montgomery Ward Holding Corp.ís motion for settlement and
payment of reclamation demands is not acceptable to its bank
group of creditors.  The bank group says that the settlement
agreement grants preferential treatment to certain favored
classes of unsecured creditors and equity holders, i.e., it
would unreasonably and improperly benefit Wardís vendors.

The group argues the arrangement would give Ward the
unilateral power to decide the validity and amount of
approximately $150 million in reclamation demands and allow
Ward to pay them in full in cash immediately. Ward believes
the sellers represent a critical constituency whom they must
make and keep happy, while the only concession the sellers
must make to receive their extraordinary treatment under the
Reclamation Procedures Order is an obligation to provide
credit terms to Ward. This is, says the group, a minimal
benefit since virtually all of them have already been giving
Ward trade credit. Furthermore, this provision is adapted
primarily for General Electric Capital Corporation, the
largest equity owner and creditor.

The bank group concludes that Wardís reclamation procedures
as submitted would contravene provisions of the Bankruptcy
Code since the procedures would allow Ward to pay cash on
account, notwithstanding that section 546(c) expressly
limits the relief to which reclamation claimants possessing
valid claims are entitled. The procedures would deprive
creditors and others of their rights to notice and the
opportunity to be heard, which is especially important when
a debtor is seeking the extraordinary relief that Ward is.
And Ward would be granted the authority to negotiate and
settle with creditors that it, for independent reasons, has
a strong incentive to favor.

MONTGOMERY WARD: More Store Closings Affect 3,800 Employees
Montgomery Ward & Co., Incorporated announced it has
identified 48 underperforming store locations to be closed
as part of its strategy for returning to profitability. The
stores, dispersed throughout the national chain, were
identified after a store-by-store analysis of operations.

The closings, subject to bankruptcy court approval, include
an exit from the Orlando, Florida, and Albany, New York,
markets, leaving the company with a core of 294 full-line
department stores.

The proposed restructuring would impact approximately 3,800
full- and part-time employees, who will be offered
reassignment in other stores as possible.  Those who are not
reassigned will be offered location shutdown benefits and
outplacement assistance as appropriate.

"The decision to close stores is never an easy one and we
recognize the impact this has on the associates involved and
on our customers.  However, we believe that moving swiftly
to eliminate the source of a significant amount of Wards'
losses and taking the related financial charges in fiscal
1997 will enable us to focus solely on the future growth of
the business and our turnaround initiatives going forward,"
said Burnett Donoho, vice chairman and COO.

The store closings are expected to be substantially
completed by the end of December 1997.  The company has
already announced the closing of eight Ward locations and 44
Lechmere and Electric Avenue & More specialty stores this

OLD AMERICA: Employee, Officer Retention Plans Announced
Old America Stores, Inc., are seeking court approval for an
employee retention program, which includes a bonus program
for key employees and postpetition employment agreements for
its president and CEO and its CFO.

President and CEO Jerry Payton would receive an annual base
salary of $250,000 plus benefits and a $375,000 performance
bonus earned and payable on the earlier of the confirmation
of a Chapter 11 plan or the sale of substantially all the
debtorís assets. CFO Jim D. Schultz would receive a base
salary of $200,000 plus benefits and a performance bonus of
$150,000 on the same terms. Under the employee bonus
program, an estimated maximum potential cost of $622,000
would go to 86 store managers, an estimated maximum of
$60,000 to four regional managers, and an estimated maximum
of $208,000 for 15 essential corporate employees.

The company says the retention program will encourage key
management and other employees to remain with the debtors
throughout Chapter 11 proceedings. These employees are
critical to Old Americaís ability to continue operations and
manage its affairs as well as fulfill administrative
obligations in the bankruptcy cases. The company feels its
ability to reorganize would be severely impaired if they
were to leave for new jobs. Given the companyís poor
financial condition, it believes it would have difficulty
hiring qualified replacements, and the time and expense
necessary to train them would be disruptive and costly.

There will be a hearing on October 24, 1997, before Judge
Peter J. Walsh, in the District of Delaware.

PAYLESS CASHWAYS: Wonít Honor Prepetition Check
Payless Cashways, Inc., has told the court that it does not
feel it should honor a $1,487,331 check issued to Georgia-
Pacific Corporation to pay a portion of a general unsecured
prepetition claim, When Payless filed for Chapter 11 on July
27, 1997, its bank had not cleared the check.  Payless says
there is no provision in the Bankruptcy Code that authorizes
payment of this type of prepetition debt.  Furthermore, its
DIP agreement states that such payment is an event of
default. Any default, says Payless, will jeopardize both the
continuation of the DIP Facility and its proposed pan of

SILAS CREEK: Asset Purchase Agreement Submitted
Silas Creek Retail, Inc., has filed its agreement with
Carolina Sales, Inc., (NEWCO) for the sale of assets with
the bankruptcy court in the District of Delaware. The $41
million sale is scheduled to close Nov. 22 and will affect
123 Piece Goods and Northwest Fabric stores nationally.

The agreement states that on the closing date, Silas will
sell, transfer, assign, convey, and deliver to NEWCO, and
NEWCO will purchase and acquire free and clear of any and
all encumbrances the right, tittle, and interest in and the
properties and assets of Silas used, usable, or useful in
the business of every kind, nature, character, and
description, wherever located and whether or not
specifically referred to, real, personal, or mixed,
tangible, or intangible, owned or held by Silas as of the
effective time, including all of Silasís right, title, and
interest in and to the properties and assets described.

The assets include all inventory; all real property with
buildings and other improvements; real estate leases; all
equipment, furniture, and fixtures and other fixed assets;
written contracts, leases, and obligations; written
prepetition executory contracts and unexpired real and
personal property leases; all cash and cash equivalents;
trademarks, tradenames, and patents; all customer, vendor,
and supplier lists and marketing materials; books and
business records and all acquisition deeds and title
documents; agreements, contracts, and understandings that
protect Silas from environmental, products, workersí
compensation, or other liabilities; all unliquidated and
liquidated claims and causes of action; all governmental
permits and other related agreements; all intellectual
property; all forms and supplies; all goodwill of the
business; unexpired real property leases for the GOB stores;
and all other tangible and intangible assets not otherwise
specifically excluded by the agreement.

NEWCO will assume the obligations named in the agreement and
the mortgage plus $6.4 million in cash and cash representing
70.75 percent of the total cost value of eligible inventory
up to $44 million and 100 percent of the total cost value of
eligible inventory over $44 million; cash representing 60
percent of the remaining balance due from customers on
layaway inventory; cash representing 100 percent of the
actual invoiced cost of prepaid domestic inventory; and cash
representing 100 percent of the actual invoiced cost of
prepaid imported inventory.

STEINBERGíS: Wants To Start Out-Of-Business Sale
Steinberg's Inc. wants to start its going-out-of-business
sale this week and plans to conduct the sale itself rather
than use a liquidator, company officials said. According to
the Cincinnati Post, Steinberg's, its unsecured creditors,
and Provident Bank are working on an agreement that would
keep the company operating after a cash collateral order
that provided working capital expired.

"We think we can sell it ourselves and still net a better
result," Thomas Noland, the company attorney, told a federal
bankruptcy court. "If we don't start the sale soon, the
expense of carrying the overhead eats into the inventory
values," Noland added.

Two of the locations, in Wilmington and Morristown,
Tennessee, have already closed, said Leonard Eppel, a crisis
manager working with the company.

UNITED HEALTHCARE: Public Auction Set for N.J. Properties
United Healthcare System, Inc., has had its procedures
approved by judge William F. Tuohey of the District of New
Jersey, for the sale of properties in Newark and East
Orange, New Jersey, at public auction.

The properties are to be sold as is, where is.  Bids will be
accepted in writing or at the auction, and are subject to
higher and better offers.

Bidders (other than those with approved credit) must submit
a certified or bank check for $100,000 as a bid deposit.
Successful bidders must pay 20 percent of the purchase price
by certified or bank check within 24 hours of acceptance and
must agree to sign the contract of sale immediately.  The
balance must be delivered by certified or bank check,
federal funds, or by wire transfer at the closing on the
title to the properties, to occur on or before November 3,

Lien holders who have valid, undisputed liens on the
properties will have the right to credit bid their lien to
the extent of its value, provided the bid also includes
sufficient cash proceeds to satisfy any senior encumbrances
on the property. A successful PNC Bank credit bid on the
hospital will be subject to the disputed claim of Citicorp
North America, Inc., over which the court retains
postclosing jurisdiction.

A hearing on United Healthcareís motion for public auction
is set for October 24, 1997, in Newark. Objections must be
filed by October 21.

Meetings, Conferences and Seminars

October 16-19, 1997
      Annual Conference
         Philadelphia Marriott, Philadelphia, Pennsylvania
            Contact 1-803-957-6225

October 17-21, 1997
      6th National Conference on Consumer Rights Litigation
         New Orleans, Louisiana
            Contact 1-617-523-8010

October 24-28, 1997
      Annual Meeting
         Breaker Hotel, Palm Beach, Florida
            Contact 1-312-857-7734

October 30-31, 1997
      13th Annual Farm, Ranch and Agri-Business
      Bankruptcy Institute
         Holiday Inn--Lubbock Plaza, Lubbock, Texas
            Contact 1-806-794-1215

November 13-14, 1997
      "The Changing Landscape for the Commercial Law
         Hermitage Hotel, Nashville, Tennessee
            Contact 1-615-259-1450

November 17-18, 1997
      Commercial Loan Workouts
         Chicago, Illinois
            Contact 1-800-831-8333

November 19, 1997
      1997 Annual Bankruptcy Law Update
         Suffolk County Bar Center, Hauppauge, New York
            Contact 1-516-747-4464

November 21-24, 1997
      77th Eastern District Meeting
         New York Marriott World Trade Center, New York

December 3-4, 1997
      4th Annual Conference on Distressed Debt
         Crowne Plaza Hotel, New York, New York
            Contact 1-800-599-4950

December 4-6, 1997
      Winter leadership Conference
         La Costa Resort & Spa, Carlsbad, California
            Contact 1-703-739-1060

December 5-6, 1997
      22nd Annual Bankruptcy Seminar
         DoubleTree Surfside Resort Hotel,
         Clearwater Beach, Florida
            Contact 1-813-562-7830

DECEMBER 10-11, 1997
      Investment Opportunities in Workouts & Turnarounds
         Downtown Conference Center, New York, New York
            Contact 1-212-661-3500

December 11-13, 1997
      9th Annual Advanced Court of Study,
      The Emerged and Emerging New Uniform Commerical Code
         Sheraton New York Hotel, New York, New York
            Contact 1-800-CLE-NEWS, ext. 1630

January 29-February 1, 1998
      37th Southern District Annual Meeting
         Plaza San Antonio, San Antonio, Texas
            Contact 1-972-285-0391

February 22-25, 1998
      12th Annual Norton Bankruptcy Litigation Institute I
         Olympia Park Hotel, Park City, Utah
            Contact 1-770-535-7722

March 26-29, 1998
      10th Annual Norton Bankruptcy Litigation
      Institute II
         Flamingo Hilton, Las Vegas, Nevada
            Contact 1-770-535-7722

May 22-25, 1998
      50th New England District Annual Meeting
         Ocean Edge Resort & Golf Club, Cape Cod, Massachusetts
            Contact 1-617-720-1355

July 2-5, 1998
      Western Mountains Bankruptcy Law Institute
         Jackson Lake Lodge, Jackson Hole, Wyoming
            Contact 1-770-535-7722


Meetings, conferences and seminars appear every Tuesday.  

Bond pricing 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
Rebecca A. Porter, Editors.

Copyright 1997.  All rights reserved.  This
material is copyrighted and any commercial use,
resale or publication in any form (including e-
mail forwarding, electronic re-mailing and
photocopying) is strictly prohibited without prior
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Information contained herein is obtained from
sources believed to be reliable, but is not

The TCR subscription rate is $575 for six months
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