TCR_Public/980406.MBX T R O U B L E D   C O M P A N Y   R E P O R T E R
     
   Monday, April 6, 1998, Vol. 2, No. 66              
                    
                   Headlines

BN1 TELECOMMUNICATIONS: Court Ok's Benefit Contracts
BN1 TELECOMMUNICATIONS: Court Extends Exclusivity
CONSOLIDATED STAINLESS: Applies to Employ Realty Appraiser
D&L VENTURE: Motion to Extend Time on Leases
DOW CORNING: Settlement Resolves 10,000 Canadian Claims

GIBSON'S HOLDING: Bar Date Set
HERMAN'S SPORTING: Asks to Continue With Grant Thornton
NETS INC: James Manzi Seeks Expense Claim
OLD AMERICA: Court Approves Rejection of 16 Leases
OMAK WOOD PRODUCTS: May Close

PAN AM: Court Authorizes Use of Cash Collateral
PARAGON TRADE: Court Ok's Counsel for Creditors' Committee
PHELPS TECHNOLOGIES: Seeks OK on Contract Assumption
PHOENIX INFORMATION: Seeks Extension of Exclusivity
RELIANCE ACCEPTANCE: Committee Seeks to Employ Co-Counsel

RICKEL HOME: PBGC seeks Time to File Claims
RIVER OAKS: Court Oks Counsel for Committee
SMITH TECHNOLOGY: Seeks to Reject Equipment Leases
SMITH TECHNOLOGY: Sale of Property in Porter, Indiana
STREAMLOGIC: Plan of Reorganization Effective

ULTRAFEM: Files for Chapter 11 Protection
VITALE ENTERPRISES: Court Authorizes Appraisers

                   *********

BN1 TELECOMMUNICATIONS: Court Ok's Benefit Contracts
-------------------------------------------------------
The court entered an order in the case of BN1
Telecommunications, Inc., authorizing the debtor to assume
the executory contracts with Medical Mutual of Ohio, Paul
Revere Insurance Group, Ameritas Life Insurance Corp., and
Medical Life Insurance Co.


BN1 TELECOMMUNICATIONS: Court Extends Exclusivity
-------------------------------------------------
The court entered an order whereby the exclusive period
within which the debtor, BN1 Telecommunications, Inc. may
file its plan of reorganization is extended through July
29, 1998 and the time within which it must gain acceptance
of such plan is extended through September 27, 1998.


CONSOLIDATED STAINLESS: Applies to Employ Realty Appraiser
----------------------------------------------------------
Consolidated Stainless, Inc., debtor filed a n application
seeking authorization to employ Realty Valuation
Associates, Inc. as the debtor's real estate appraiser.

The debtor seeks the services of the appraiser to perform
an appraisal of the debtor's manufacturing facilities in
Florida and warehouse property in Georgia.

Realty's fee will be $10,000.  Court preparation and
testimony will be billed at $150 per hour.


D&L VENTURE: Motion to Extend Time on Leases
--------------------------------------------
D&L Venture Corp., et al., debtor is asking for an
extension of time for the assumption or rejection of non-
residential real property leases.  The current deadline is
April 6, 1998.

The debtors are parties to 57 leases wherein the debtors'
current operations are conducted.  The debtors have
already reduced the number of stores from a high of over
100 stores as of a year ago, to 55.

The debtors are asking the court to extend the Assumption
Deadline until July 6, 1998.  The debtors need such time
to formulate and propose a reorganization plan.


DOW CORNING: Settlement Resolves 10,000 Canadian Claims
-------------------------------------------------------
The Wall Street Journal reported on April 3, 1998 that Dow
Corning Corp. and Dow Corning Canada settled silicone
breast-implant lawsuits in Ontario and Quebec for $35
million.

If approved by the court, the proposed settlement resolves
about 10,000 claims in Canada.  


GIBSON'S HOLDING: Bar Date Set
------------------------------
On March 23, 1998 the court entered an order establishing
May 15, 1998 as the last date and time for filing proofs
of claim against the debtors, Gibson's Holding Company,
Gibson's Discount Centers, Inc. and Gibson Franchise Corp.


HERMAN'S SPORTING: Asks to Continue With Grant Thornton
--------------------------------------------------------
The debtor, Herman's Sporting Goods, in Liquidation, Inc.
applies for the entry of an order authorizing the debtor
to continue to employ Grant Thornton LLP as special tax
accountants and consultants.

Due to the loss of the debtor's accounting personnel, the
debtor requires the services of a tax accountant and
consultant to prepare the debtor's federal and various
state income and franchise tax returns for its fiscal
years ended January 31, 1997 and January 31, 1998, and
subsequent years, as necessary, until final distributions
to creditors are made under the plan, and to assist the
debtor with respect to other tax matter relating to the
debtor's liquidation and dissolution pursuant to the plan.


INTERNATIONAL HERITAGE: Shareholders File Lawsuit
-------------------------------------------------
A class-action shareholders lawsuit was filed in U.S.
District Court against International Heritage of Raleigh on
March 25.

The suit is the second against the network marketing
company this month. In mid-March, the Securities and
Exchange Commission sued IHI, claiming it was an  
elaborate pyramid scheme that defrauded representatives of
more than $150 million.

The lawsuit was filed in the U.S. District Court for the
Eastern District of  North Carolina by law firms Abbey
Gardy & Squitieri and Schiffrin Craig &  Barroway. The
attorneys are seeking damages on behalf of all
purchasers of the  company's stock from March 6 to March
13, the date the SEC suspended trading.  The suit alleges
IHI issued "false and misleading statements" regarding its  
financial condition and source of revenues.  (Raleigh/Durham
Bus. Journal; 03/27/98)


NETS INC: James Manzi Seeks Expense Claim
-----------------------------------------
James Manzi advanced a loan in excess of $1.5 million to
the debtor, Nets, Inc. in May 1997.  The court approved
the stipulation between the debtor and Manzi pursuant to
which Manzi agreed to provide the debtor with post-
petition financing of $100,000.

Manzi is now seeking a court order allowing Manzi an
administrative expense claim in the amount of $13,231 for
legal fees, and , among other things, to the extent
ultimately allowed, establishing that the Secured Claim
shall include attorneys' fees in the amount of $34,583 and
directing the Committee to segregate an additional
$750,000 to pay Manzi's future interest and attorneys'
fees related to the defense of the Adversary Proceeding.


OLD AMERICA: Court Approves Rejection of 16 Leases
--------------------------------------------------
Upon the application of Old America Stores, Inc., debtor,
the court authorized the rejection of 16 leases for
nonresidential real property with respect to the stores
the debtor is no longer operating.

These stores were chosen by the debtor as unprofitable
and/or underperforming.


OMAK WOOD PRODUCTS: May Close
-----------------------------
The largest private employer in Okanogan County has told  
workers that it will likely close this June.  Omak Wood
Products, which filed for a Chapter 11 bankruptcy
reorganization last March, could not recover because of
poor lumber market conditions, company  president Jim Aher
said.

"Frankly, it is a miracle we're still operating," Aher said
Tuesday. "I'll consider our efforts successful if we can
maintain 250 to 300 jobs or more by selling the company.
The community deserves it, and the employees deserve it."
He said all 465 employees are likely to lose their jobs, at
least temporarily. There have already been 140 layoffs.

Aher said he expects the company will be sold, and that
lumber or sawmill manufacturing will continue at the
current location, where a lumber facility has existed since
1921.  Omak Wood Products took over operation in 1988, he
said.  "We have an offer on the table, and we're hoping to
get others," Aher said.  "I think there will be some kind
of manufacturing business here in the future. Whether it's
sawmill or lumber, I don't know," he said.

While the facility shutdown is not definite, the company
mailed official notices to employees and others Tuesday.
(Columbian; 04/01/98)


PAN AM: Court Authorizes Use of Cash Collateral
-----------------------------------------------
Judge A. Jay Cristol entered an interim order authorizing
the debtors, Pan American Airways Corp. and Pan American
World Airways, Inc. to use cash collateral in accordance
with the Budget approved by the court.

The debtors may use the cash collateral for quarterly
fees, bankruptcy court fees and court approved fee to
professionals, not to exceed $100,000.

A hearing on the debtor's use of cash collateral on a
permanent basis will be held on April 8, 1998.


PARAGON TRADE: Court Oks Counsel for Creditors' Committee
---------------------------------------------------------
The Official Committee of Unsecured Creditors filed
applications to employ O'Melveny & Myers LLP and Parker,
Hudson, Rainer & Dobbs LLP as co-counsel to the Committee.

The Creditors' Committee was directed by the court to
supplement the applications to describe how the legal
tasks will be apportioned to avoid duplication of
services. The Committee provided information that the
Parker, Hudson firm will serve as local counsel, and the
O'Melveny firm will serve as lead counsel.

Both applications were approved by the court on March 30,
1998.


PHELPS TECHNOLOGIES: Seeks OK on Contract Assumption
----------------------------------------------------
Phelps Technologies, Inc., and Phelps Tool and Die
Houston, Inc., debtors, are seeking an order authorizing
assumption and assignment of executory contracts and
unexpired leases.

The debtor previously sought approval of the sale of
substantially all of the debtors' assets to Foxconn
Corporation.  The debtor now requests authority to assume
and assign to Purchaser any or all of its executory
contracts and unexpired leases, and to reject certain
executory contracts and unexpired leases at the sole
discretion of the purchaser.


PHOENIX INFORMATION: Seeks Extension of Exclusivity
---------------------------------------------------
Phoenix Information Systems Corp., Phoenix Systems Ltd.
and Phoenix Systems Group, Inc., debtors, applied for an
order granting an extension of the debtors' exclusive
periods.

The debtors are seeking to extend the periods of
reorganization and solicitation of acceptances for ninety
days, from April 2, 1998 and June 1, 1998 respectively, up
to and including July 1, 1998 and August 30, 1998.

The debtors state that they have almost completed their
reorganization process, yet they need more time to
effectuate the final phase of such process, namely the
formulation and filing of their plan of reorganization.  
The debtors believe that the extension of exclusivity
would permit them to complete plan-related discussions
begun with S-C Phoenix Partners and other interested
parties and, thus., enable them to file a successful plan
within such extended period.

The debtors state that the most significant of the
debtors' accomplishments to date is their execution of the
Sale of substantially all of the debtor's assets to S-C
Phoenix Partners.  The debtors claim that it is through
the proceeds of the combined Sale and DIP transactions
with S-C Phoenix that the debtors have been able to
maximize value for their respective estates, and it is
with these proceeds that the debtors will be able to fund
their plan of reorganization.

The debtors also complain that the Equity Committee from
the very beginning of the case has delayed the debtors'
progress toward completion of their Chapter 11 plan with
its consistent objections to motions filed by the debtors.  
Also, the Equity Committee's extensive discovery and
repeated requests for extensions of the Sale deadline
further delayed the debtors' progress.


RELIANCE ACCEPTANCE: Committee Seeks to Employ Co-Counsel
---------------------------------------------------------
The Official Committee of Unsecured Creditors' of Reliance
Acceptance, Group Inc., et al., filed an application to
employ Pepper Hamilton LLP  as co-counsel
to the Committee.  Pepper also represents the Official
Committee of Unsecured Creditors in the First Merchants
Acceptance Corporation case.


RICKEL HOME: PBGC seeks Time to File Claims
-------------------------------------------
Creditor Pension Benefit Guaranty Corporation, in the case
of Rickel Home Centers, Inc., debtor, seeks an order
providing approval of a stipulation and agreed order
enlarging the time for the PBGC to file claims.

In this case, the PBGC learned that the Local 478
employees were not participants in the Retirement Plan,
but were in a separate pension plan, which the PBGC
determined was underfunded by $2 million.


RIVER OAKS: Court Oks Counsel for Committee
-------------------------------------------
The court in the matter of River Oaks Furniture, Inc.
approved the employment of Derek A. Henderson, Esq and J.
Michael Booe as counsel for the Unsecured Creditors'
Committee.


SMITH TECHNOLOGY: Seeks to Reject Equipment Leases
--------------------------------------------------
Smith Technology Corporation, et al, debtor seeks to
reject equipment leases with American Business Credit
Corporation (fax machines), American Business Credit
Corporation (copying machines), IKON Capital (fax and
copying machines).

The leases are burdensome to the debtors, and it is in the
debtors' business judgment to reject the leases.


SMITH TECHNOLOGY: Sale of Property in Porter, Indiana
-----------------------------------------------------
Smith Technology Corporation, et al., debtor is seeking
entry of an order authorizing the sale of certain real and
personal property located in Porter, Indiana.

The debtors seek authority to sell to Eagle Properties,
LLC the real property, and office equipment located in
Porter, Indiana  for $1.2 million payable in cash at
closing.  The Buyer's obligations are conditioned on the
Buyer's obtaining zoning approval for its intended use.  
The debtors will advertise the property and the sale price
in local newspapers and solicit higher and better bids for
the property.


STREAMLOGIC: Plan of Reorganization Effective
---------------------------------------------
StreamLogic Corporation announced that StreamLogic's First  
Amended Plan of Reorganization, which was confirmed by the
U.S. Bankruptcy Court for the Northern District of
California on March 3, 1998, became  effective on March 31,
1998 (the "Effective Date").

All shares of StreamLogic's stock existing immediately
before the  Effective Date have been canceled. Because the
Company's liabilities significantly exceeded its assets,
former StreamLogic shareholders did not receive any equity
or other interest in the reorganized entity in exchange for  
cancellation of their shares.


ULTRAFEM: Files for Chapter 11 Protection
-----------------------------------------
Ultrafem, Inc. announced that it has filed a Chapter 11
bankruptcy petition.  They also announced a lay off of 45
employees in their Montana and New York facilities,
shutting down business operations in the two locations,
while maintaining personnel  necessary to administer the
bankruptcy proceedings.  In addition, Charles D. Peebler,
Jr. resigned from the Board of Directors on March 2, 1998,
according to Joy V. Jones, chairperson.

The Company also announced that two purported class action
lawsuits have been filed against the Company, certain of
its officers, directors, and former directors.  The Company
believes the allegations in these complaints are without
merit.  These actions will be stayed as a result of the
Chapter 11 filing.

Reeling from sexual harassment charges involving former top
executives, the company said it was leaving enough  
staff to administer the bankruptcy proceedings. It had
fired another 44 in February.

The company, which had previously announced it had put
itself up for sale, remains in talks with potential buyers,
according to Albert Togut, a bankruptcy attorney with
Togut, Segal & Segal of New York, speaking on behalf of the
company.

"Ultrafem is not going out of business," Togut told
Reuters. "Ultrafem has about seven months of inventory we
are still shipping," he said.  He said the current
inventory amounted to about 15 million units. The  
company had revenues of roughly $3.5 million during the
fiscal year ending in September 1997. He said several
employees remained on the payroll to handle distribution.

"What this Chapter 11 filing is all about is selling the
company," Togut said. "We are having serious discussions
with respective purchasers who are talking with us about
buying the company."  Ultrafem stock, which stood above $30
a share last May, plummeted to less than a dollar in
January. It closed at 59 cents, down 25 cents on the day,
in Nasdaq trading Wednesday.  (Reuters: Business - 04/02/98)


VITALE ENTERPRISES: Court Authorizes Appraisers
-----------------------------------------------
Upon the application of Vitale Enterprises, Inc., et al,
debtors, the court authorized the debtors to retain and
employ Caspert Management Co., Inc. as appraisers in
connection with the valuation of certain furniture,
fixtures and equipment.  The debtors are authorized to pay
Caspert $4,500.

                   *********

A listing of meetings, conferences and seminars appears
each Tuesday.   

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

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