TCR_Public/980311.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, March 11, 1998, Vol. 2, No. 48                

AUTO WORKS: Bar Date for Administrative and Pre-BK Claims
BRITWILL INVESTMENTS: Seeks 90 Days to Evaluate Leases
BRUNO'S: Approval to Buy Four Delchamps Stores
BUSTER BROWN: Committee Investigates Leveraged Buy-Out
CAMPO ELECTRONICS: Court Grants Extensions

DOW CORNING: Implant Plaintiffs Have Their Own Solution
DOWNTOWN ATHLETIC: Case Summary & 20 Largest Creditors
DYNASTY INC: Shareholders Approve Sale to Jockey Games
FLAGSTAR: Receives Extension to Object to Claims
GAYLORD COMPANIES: Court Extends Use of Cash Collateral

GRANITE PARTNERS: Judge Cuts Willkie Farr's Fee
HEARTLAND WIRELESS: Reported Prepack Bankruptcy in Future
HOMELAND: Out of Bankruptcy - Claims Solid Profitability
MOBILEMEDIA: Panel Receives OK to Probe Plan Values
MOLTEN METAL: Court Approves $20 Million Loan Facility

PARAGON: Order Approves Joint Defense Agreement
PEGASUS GOLD: To Retain Houlihan Lokey
SHEPPARD FOODSERVICE: Hearing on Sale Continued
THE SLED DOGS: Hearing on Disclosure Statement
TOHO MUTUAL: Proposes New Joint Venture with GE Capital

TRI-LITE: Partial Payments Made According to Plan
WESTERN FIDELITY: Extension of Time to File Disclosure Stmt


AUTO WORKS: Bar Date for Administrative and Pre-BK Claims
April 30, 1998 will be the deadline for filing with the
Office of the US Bankruptcy Court pre-petition proofs of
claim as well as administrative claims against the debtor,
Auto Works, Inc.

BRITWILL INVESTMENTS: Seeks 90 Days to Evaluate Leases
Britwill Investments-I Inc., Britwill Investments-II Inc.,
and Britwill Indiana Partnership, debtor, are seeking an
additional 90 day extension, up to and including June 8,
1998, to determine which leases of the debtors should be
assumed, and which leases should be rejected.

The debtors are currently lessees under 25 leases for
residential health car and managed care facilities.  The
debtors state that the leases are the central, critical
component of debtors' operations, and ultimately of a
successful plan of reorganization.

Omega Healthcare Investors, Inc. is the lessor of most of
the facilities.  Omega claims that the debtors are in
default under the leases, and is attempting to terminate
the leases.  The dispute between the parties will not be
resolved within the sixty day period, and that is an
additional reason that the debtors are requesting the
extension, as the debtors do not know if the leases will be
terminated due to the alleged defaults.

BRUNO'S: Approval to Buy Four Delchamps Stores
Bruno's Inc. received court approval to buy four Delchamps
Inc. stores in strategic locations for $1.5 million cash.  
Delchamps, a supermarket chain with approximately 218
stores in Alabama, Florida, Louisiana, and Mississippi, was
seeking a purchaser for four of its stores in Alabama.
Three of the stores are located in markets where Bruno's
also has stores, however, the Delchamps stores have better
facilities or superior locations. (Federal Filings, Inc.

BUSTER BROWN: Committee Investigates Leveraged Buy-Out
After investigating the leveraged buy-out of Buster Brown,
to the extent possible without formal discovery, the
creditors' committee said it is likely that "meritorious
claims exist against parties to the LBO, which, if
successfully pursued, would provide substantial benefit to
the Debtor's estate and the general unsecured creditors."  
The committee is seeking leave to conduct Rule 2004
examinations and, if appropriate, file adversary
proceedings on the company's behalf to avoid transfers made
in connection with the LBO and/or subordinate claims as
required to pay unsecured creditors in full. (Federal
Filings, Inc. 24-Feb-1998)

CAMPO ELECTRONICS: Court Grants Extensions
The court in the case Campo Electronics, Appliances and
Computers, Inc. granted a 90 day extension until May 2,
1998 to assume or reject unexpired leases for stores in
Hattiesburg, Mississippi; Birmingham, Alabama and Panama
City, Florida.

The debtor's motion for extension of exclusivity to file a
plan and solicit acceptances thereto has also been
approved.  The exclusivity period for Campo to file a plan
and disclosure statement is extended 30 days until February
14, 1998 and Campo is granted a 30 day extension, or until
April 17, 1998 to solicit acceptances of its plan.

DOW CORNING: Implant Plaintiffs Have Their Own Solution
Lawyers who represent women  suing Dow Corning Corp.
with claims that silicone breast implants caused disease
proposed settling for $3.8 billion, $800 million more than
the company offered.

Under the women's plan, the company would pay $3.8 billion
over two to three years. Last month, the company offered to
pay the women $3 billion over 16 years. Lawyers for the
women complained that offer was too low because it was
to be paid out over such a long period.

The company has estimated about 200,000 women will file
claims as part of its bankruptcy proceeding.  "Our plan
provides for much quicker processing of claims," Ed
Blizzard, one of the lawyers representing the women, said
in The Wall Street Journal.

The company declined to comment directly on the plan today,
saying it had not yet seen the counterproposal. Dow Corning
spokesman Kevin Wiggins said the company had not seen the
proposal. However, from what he had heard about the plan,
the terms were similar to those proposed by the company.

He said the quicker payout scheme, however, "doesn't look
to the future for women who may not have a problem now."
The company's plan also requires some of its payments to be
conditional on a trial that would determine if silicone
causes disease. Blizzard said plaintiffs' object to that
clause. "We believe a single-issue causation trial is
inappropriate," he said.

DOWNTOWN ATHLETIC: Case Summary & 20 Largest Creditors
Debtor:  Downtown Athletic Club of New York City, Inc.
         19 West Street
         New York, NY 10004

Type of business: Athletic Club, Hotel and Restaurant

Court: Southern District of New York

Case No.: 98-B41419   Filed: 03/2/98    Chapter: 11

Debtor's Counsel: Hal M. Hirsch
                  Gainsburg & Hirsch
                  One Penn Plaza
                  New York, NY 10019
                 (212) 736- 3636

Total Assets:              $22,718,000.
Total Liabilities:         $12,122,207
                                                   No. of
                                         Amount    Holders
                                         ------    -------
Fixed, liquidated secured debt       $8,554,000          1
Contingent secured debt                      $0          0
Disputed secured debt                 $2,909,989         1        
Unliquidated secured debt                    $0          0

Fixed, liquidated unsecured debt        Unknown    Unknown
Contingent unsecured debt                    $0          0
Disputed unsecured debt                      $0          0
Unliquidated unsecured debt            $658,219        100

No. of shares of preferred stock              0          0
No. of shares of common stock         2,391,493        700  

20 Largest Unsecured Creditors:

   Name                              Nature         Amount
   ----                              ------         ------
Windels, Mark, Davies         Legal Services      $186,700
NY Marriott Marquis                    Trade      $144,550
Executive Sports                       Trade      $105,000
Granite Financial                      Trade       $44,499
Millar Elevator                        Trade       $32,464
Debragga & Spitler                     Trade       $22,261
Tony's Fish & Seafood                  Trade       $16,850
Deloitte & Touche                      Trade       $13,150
H.B. Day                               Trade       $12,713
City Blossoms                          Trade       $11,355
Newport Graphics                       Trade       $10,020
Gotham Promotions                      Trade        $9,245
Electra Transport, Serv.               Trade         $8659
M.Tucker & Co.                         Trade        $7,700
Cortel Business Systems                Trade        $6,634
Alpha Energy Associates                Trade        $6,630
Allaire                                Trade        $5,358
Tietelbaum Laundry                     Trade        $5,127
Herff Jones                            Trade        $5,113
Tribeca Transport                      Trade        $4,180

DYNASTY INC: Shareholders Approve Sale to Jockey Games
Goldrush Casino & Mining Corp. announced that at its annual
and extraordinary general meeting held on Feb. 27, 1998,
all business matters and resolutions put forth by the
management to its shareholder members were approved by the
members, including the sale of the company's wholly owned
subsidiary Dynasty Inc., located in Las Vegas.  The U.S.
Federal Bankruptcy Court previously approved the loan and
option-to-purchase agreement with Jockey Games LLC on Feb.
12, 1998.  The agreement calls for Jockey Games to provide
up to a US$16 million refinancing allowing Dynasty to exit
from bankruptcy.

As further consideration, Dynasty granted to Jockey Games a
five-month irrevocable option to purchase the Las Vegas
property for the purchase price of US$46.5 million
commencing on the court approval date of Feb. 12, 1998.  

On Feb. 6, 1998, Dynasty completed the court-approved 12
percent, 12-month US$12 million loan from Jockey Games.  
The proceeds were used to retire the Shaco Inc. first and
second mortgages, thereby pre-empting a foreclosure action
from occurring on March 2, 1998.  

As a part of the Jockey Games-Dynasty agreement, an option
to purchase a total of 150,000 common shares of stock at
US$1 per share was granted to Jockey Games and to the
Jockey Games representative/ agent.

FLAGSTAR: Receives Extension to Object to Claims
The court entered an order extending the time to object to
proofs of claim to allow the debtors, Flagstar Companies,
Inc., Flagstar Corporation, and Flagstar Holdings, Inc.,
sufficient time to verify the proofs of claim and to
complete settlement discussions of disputed claims.  

The confirmed plan in this case anticipated that additional
time might be required to object to proofs of claims
because of the large number of claims (in excess of 275
claims) which have been filed.  The debtor now has until
and including May 8, 1998 to object to proofs of claim.  

The court further allowed that the debtors may request
additional extensions for cause if the time provided is

GAYLORD COMPANIES: Court Extends Use of Cash Collateral
The court entered an order on March 5, 1998 granting the
motion of Gaylord Companies, Inc. and its affiliates to
further continue use of cash collateral of their secured
lender, Greenfield Commercial Credit, LLC through and
including March 31, 1998. The debtors were also granted
authority to enter into and perform the Term Sheet
presented to the court by the debtors.

GRANITE PARTNERS: Judge Cuts Willkie Farr's Fee
Judge Stuart M. Bernstein said the law firm Willkie, Farr &
Gallagher is entitled to less than half the fees and
expenses that it sought in a high-profile bankruptcy case
because it failed to promptly disclose a conflict of

The judge said that Willkie's work in the case was
"tainted" by its failure to disclose it was doing work for
Merrill Lynch & Co. while investigating the securities
company on behalf of a court-appointed trustee.

Judge Bernstein ruled that Willkie, Farr is entitled to
only $2.2 million of the $5.2 million fee that it was

The conflict of interest arose in the bankruptcy case of
money manager David Askin's hedge funds, which emerged from
Chapter 11 proceedings last spring.  A court-appointed
trustee and hired Willkie to investigate and if necessary
to sue Merrill and other brokerage firms for their alleged
roles in the funds' 1994 collapse.

But Willkie caused an uproar by announcing that, after it
had found potential claims against Merrill and other
brokerages, but couldn't sue Merrill or the others because
it had done work for Merrill while performing its

Edward S. Weisfelner, a New York lawyer for the investors
in the Askin Funds was disappointed and reportedly said
that the message to bankruptcy professionals is: "If you
can make enough money from a conflicted representation go
ahead and do it."

HEARTLAND WIRELESS: Reported Prepack Bankruptcy in Future
Heartland Wireless's hired Wasserstein Perella to explore
financial alternatives for the wireless cable operator.
However, it is now reported that the company alluded that
it would enter some type of prepackaged bankruptcy in lieu
of making the interest payment on either its 13% or 14%
notes in April or October, respectively. Those indications
were received well by sources last week who said the
company at least has a growing subscriber base and $44
million in cash, instead of operating month-to-month the
way others such as CAI Wireless have been.

The company has existing cash, which it plans to use to
continue to buildout its rural wireless cable
television network, and for the first time reported
positive EBITDA for one quarter. EBITDA for the fourth
quarter of 1997 was $279,000, compared to a $9
million loss for the fourth quarter of  1996.  In addition,
the April payment on the 14% notes is escrowed.  On the
downside, the company has a $6.5 million interest payment
due in April on the 13% notes and is burning through cash
at a rate of  $1.5 million a month.

Even though this company is now beginning to report
positive earnings, competition for providing cable service
is heated. Heartland also hopes to provide Internet service
as well but the competition continues to increase in that
sector from companies which have more  cash and more
financial backing, however.
(Copyright American Banker Inc. - Bond Buyer 1998 High
Yield Report- 03/09/98)

HOMELAND: Out of Bankruptcy - Claims Solid Profitability
Homeland claimed solid profitability Friday, releasing its
1997 year-end results with $3.9 million in earnings,
excluding reorganization expense.  The company, which came
out of bankruptcy in August 1996, took a $14.5 million
reorganization expense for the year. That reduced net
earnings to a loss of $10.6 million.

Sales for the year were $527.99 million, compared with
$527.77 million.  The company remodeled 20 stores in 1997,
investing more than $15 million, according to Larry
Kordish, CFO. They also acquired four stores.

Increased competition, stiffer requirements for food
stamps, and lower food price inflation were cited as
reasons for the flat store sales. For the fourth quarter
ending Jan. 3, the company reported a loss on net
income of $2.4 million, compared with a loss of $2.2
million reported the year before. Without the $4.4 million
reorganization expense, however, the company
had income of $2 million, or 43 cents a share.

Sales for the quarter were $176.74 million, compared with
$164.48 million reported in the fourth quarter 1996. There
was, however, an extra week in the 1997 fourth quarter.
Kordisch predicts first quarter 1998 numbers to continue to
be soft. However, the remaining three quarters of 1998
should show improvement, he said.  Homeland has 70 stores
in four distinct marketplaces - Oklahoma City, Tulsa,
Amarillo and certain rural areas of Oklahoma, Kansas and
Texas. (Daily Oklahoman- 03/07/98)

MOBILEMEDIA: Panel Receives OK to Probe Plan Values
The MobileMedia Creditors' Committee has received approval
to conduct Rule 2004 examinations regarding, among other
things, valuations used in the paging company's
reorganization plan.  The court authorized the panel to
collect documents and examine advisors to the company and
bank group regarding plan formulation, valuation of
MobileMedia, any acquisition offers, any claims the company
may have against third parties, the acquisition and sale of
claims, and other relevant matters. (Federal Filings, Inc.

MOLTEN METAL: Court Approves $20 Million Loan Facility
Molten Metal Technology, Inc. (Nasdaq: MLTN) announced
today it received court approval today for a $20
million loan facility from affiliates of Morgens,
Waterfall, Vintiadis & Company, Inc.

"Following a detailed review of Molten Metal Technology,
Inc., we are pleased to extend longer term financing," said
Victor Simonte of Morgens, Waterfall, Vintiadis.  "We
believe that Molten Metal's CEP technology offers
great promise for addressing some of the world's most
challenging waste problems".

"Approval of this financing is a huge milestone for Molten
Metal and a validation from the financial community of
CEP's value to the marketplace," said F. Gordon Bitter,
chief executive officer of Molten Metal Technology. "I
expect this $20 million loan to allow us to achieve cash-
flow positive operations.  Our commercial plants in Oak
Ridge continue to operate successfully and we have retained
a core team of talented employees to move the company

The $20 million financing will be used to repay the $7
million in short- term financing received from Morgens,
Waterfall in December and to enhance the operations of
Molten Metal's two operating plants in Oak Ridge, Tenn.  
The loan is due at the end of 1999.  The company
anticipates that the loan closing and initial advance of
funds will take place within 11 days. Molten Metal
Technology announced in February 1998 that it had filed for
approval of the proposed $20 million financing from the
Federal Bankruptcy Court in Boston.

PARAGON: Order Approves Joint Defense Agreement
Paragon Trade Brands, Inc. filed a motion for authority to
enter into a joint defense agreement with The Chase
Manhattan Bank.  On March 4, 1998, Judge Margaret H. Murphy
entered an order approving the joint defense agreement.

PEGASUS GOLD: To Retain Houlihan Lokey
Pegasus Gold Corporation, and related entities, as debtors
are seeking an order authorizing them to retain and employ
Houlihan, Lokey, Howard & Zukin Capital as financial

The debtors state that they require the firm of Houlihan
Lokey in order to evaluate the marketability and
disposition value of the debtors' assets, and to develop
and analyze a variety of operating and capital structure
alternatives for the debtors.  The firm would review the
debtors' business and advise the debtors in formulating a
plan.  The firm will charge a monthly advisory fee of
$100,000 for the first three months and $80,000 per month
for each month thereafter.

SHEPPARD FOODSERVICE: Hearing on Sale Continued
An order was entered in the case of Sheppard Foodservice,
Inc. continuing until March 16, 1998 the debtor's emergency
motion for approval of sale of substantially all assets of
debtor and any higher and better offers.

THE SLED DOGS: Hearing on Disclosure Statement
A proposed disclosure statement dated February 27, 1998
regarding a plan of the same date was filed by The Sled
Dogs Company.  A hearing to consider approval of the
disclosure statement will be held on April 1, 1998.

TOHO MUTUAL: Proposes New Joint Venture with GE Capital
Toho Mutual Life Insurance Co. endorsed a plan at
an extraordinary general meeting Friday to give the right
to sell new insurance policies to its new joint venture
with GE Capital Services Corp. of the U.S., company
officials said. Toho Life will be left to manage existing
policies, but will also receive some revenue from the
joint venture.

According to a business plan presented the same day, Toho
Life expects its operations to remain profitable, supported
by revenues from the joint venture.
Toho Life will seek approval from the Finance Ministry to
start operations April 1 at the new joint venture, GE
Capital Edison Life Insurance Co., with GE Financial
Assurance, the wholly owned subsidiary of GE Capital
Services. The joint venture will reinsure the new contracts
with Toho Life, which will receive 90 billion yen over 10
years from the new unit in revenue.

If the joint venture boosts sales of new policy contracts
as planned, Toho Life expects to post 16.3 billion yen in
earnings in 10 years, up The new firm's failure to perform
as predicted, however, would restrict distribution of its
revenue to Toho Life. If the new venture fails to attain
the sales goal in five years, the transferred goodwill owed
to Toho Life will be reduced by up to 20 billion yen from
the 70 billion yen initially agreed. (The Nihon Keizai
Shimbun Saturday morning edition)

TRI-LITE: Partial Payments Made According to Plan
The reorganized debtor, Tri-Lite, Inc.'s plan was confirmed
on March 13, 1997.  The reorganized debtor's plan consists
of six classes of creditors and interest holders.  The
payments to date are as follows:

Class 1 -Star Bank- none under the plan

Class 2 - Richard Barnett- no payments have been made.
Negotiations are in process as to the agreed modification
of this obligation.

Class 3 Convenience Class (unsecured) - $29,468 has been
disbursed to members of this class.

Class 4 -General Unsecured over $500 - $348,502 has been
disbursed to members of this class. The claims objection
process has been completed

Class 5 - Helionetics; No payments have been made to this
claimant.  Negotiations are in process as to the agreed
modification of this obligation.

Class 6 - Interest Holders - no distributions have been

The reorganized debtor is in the process of securing
replacement financing.  The Class 4 Creditors' Committee is
in the process of realizing upon the pledge of stock in
laser Photonics, Inc. which will provide the balance of the
funding called for under the plan to the members of Class

WESTERN FIDELITY: Extension of Time to File Disclosure Stmt
In the case of Western Fidelity Funding, Inc. the court
granted an extension of time through and including April
10, 1998 to file the Amended Disclosure Statement.  The
request was filed by the debtor and the Creditors


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