TCR_Public/980603.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, June 3, 1998, Vol. 2, No. 108

                  Headlines

2CONNECT EXPRESS: Judge Denies Conversion
ALLIANCE ENTERTAINMENT: Hearing on Disclosure Statement
ARROW TRANSPORTATION: Court Approves Disclosure Statement
BARNEY'S: Seeks Time to Assume or Reject Leases
BARRY'S JEWELERS: Seeks Assumption of 12 Leases

BOSTON CHICKEN: Chairman and CEO Purchases 100,000 Shares
BOSTON CHICKEN: Stock Goes Way Down
BOYDS WHEELS: Total Liquidation - 3 Day Auction
BRUNO'S: Creditor Objects to Extension of Exclusivity
D&L VENTURE CORP: Hearing Set for June 30, 1998

HAGERSTOWN FIBER: Builder and Panel Spar Over Arbitration
HOMEPLACE: Seeks Okay For CFO Employment Pact
K.G. MARX: May Be Forced into Bankruptcy
KIA: Ford Plans Takeover
LA VIDA LLENA: Consensual Reorganization Plan

LONG JOHN SILVER: Case Summary & 20 Largest Creditors
LOT$OFF: $6.9 Million Loss on Net Sales of $48.5 Million
MICROLYTICS: SantiGroup to Report to SEC
NAMCO CYBERTAINMENT: Seeks Extension of Exclusivity
RICKEL HOME CENTERS: Rejects 4 Leases

ROSS TECHNOLOGY: Announces Shutdown of Operations
TELECOMMUNICATIONS SERVICE: Files For Bankruptcy Protection
VOC Analytical Laboratories: Meeting of Creditors
VOXEL: Files Chapter 11 Bankruptcy Petition
WIZ INC: Order Fixes Bar Date

                *********

2CONNECT EXPRESS: Judge Denies Conversion
-----------------------------------------
Judge Raymond B. Ray denied the Creditors' Committee's
Motion to convert the Chapter 11 case of 2Connect Express,
Inc. to a Chapter 7 Case.


ALLIANCE ENTERTAINMENT: Hearing on Disclosure Statement
-------------------------------------------------------
Judge Burton R. Lifland, entered an order setting June 23,
1998 as the hearing date to consider whether the Disclosure
Statement of Alliance Entertainment Corp et al. contains
"adequate information."


ARROW TRANSPORTATION: Court Approves Disclosure Statement
---------------------------------------------------------
The court entered an order in the case of Arrow
Transportation co. of Delaware approving the disclosure
statement dated April 15, 1998.  The last date for filing
written ballots accepting or rejecting the plan is July 23,
1998.  The hearing on confirmation of the plan will be held
on July 30, 1998.

The plan provides that following confirmation of the plan,
a Trustee will continue to liquidate Arrow's remaining
assets, collect accounts receivable, pursue causes of
action and distribute the net proceeds thereof, as well as
the remaining proceeds from the sale of assets to Matlack,
Inc. to creditors.


BARNEY'S: Seeks Time to Assume or Reject Leases
-----------------------------------------------
Barney's Inc. et al., debtors, seek an order extending the
debtors' time to assume or reject certain unexpired leases
of nonresidential real property.  The subject leases are in
connection with the properties owned by the Northwestern
JLM, and Fifth Avenue.  The debtors seek an extension of
120 days through and including October 20, 1998.  The
debtors contend that they should have the ability to defer
making any decision with respect to the leases until such
time as the ultimate structure of the reorganized debtors
can be determined.


BARRY'S JEWELERS: Seeks Assumption of 12 Leases
-----------------------------------------------
Barry's Jewelers, Inc. and its affiliates seek assumption
of the following leases:

Eastridge Mall
San Jose, CA

Oakridge Mall
San Jose, CA

Sunnyvale Town Center
Sunnyvale, CA

Valley Fair Mall
Santa Clara CA

Sun Valley Mall
Concord, CA

Parmatown Mall
Parma, Ohio

Parks at Arlington,
Arlington, TX

Town East Mall
Mesquite, Texas

Silver Lake Mall
Coeur D'Alene ID

Fashion Place Mall,
Murray, UT

Serramonte Shopping Center
Daly City, CA

Southland Mall
Hayward, CA

The stores that the debtor operates under the leases are
profitable locations.  Failure to retain the leases, and
the consequent loss of the stores, would cause a
substantial drop in both revenues and profit, and would
have a significant adverse impact on the debtor's
operations and prospects for reorganization.  


BOSTON CHICKEN: Chairman and CEO Purchases 100,000 Shares
---------------------------------------------------------   
Boston Chicken, Inc. said that J. Michael Jenkins,
Chairman, CEO and President, today purchased 100,000 shares
of Boston Chicken stock as evidence of his belief in  
the company and the potential of the Boston Market brand.

Jenkins said, "As we announced last week, we have hired
Morgan Stanley to help us evaluate the sale of some or all
of our approximately 52% share in Einstein/Noah Bagel
Corp."  Boston Chicken also reiterated again today that it
has no plans to file for bankruptcy protection, adding that
speculation on the subject by both the media and other
third-party sources is totally erroneous.  The company also
stated that, contrary to speculation by uninformed sources,
the company has not retained outside advisors to provide
assistance in preparing any such filings.


BOSTON CHICKEN: Stock Goes Way Down
------------------------------------
Boston Chicken Inc. shares lost more than a third of their
value Friday after Arthur Andersen LLP expressed doubt the
operator of Boston Market restaurants can continue as a
going concern.  

Boston Chicken fell 13/16, or 37 percent, to 21/32 in
trading of 13 million shares, ranking it the third most-
active U.S. issue. The shares, which are down  88 percent
the past year, earlier fell to a record low of 111/16.
The stock peaked at 41 in December 1996.

The company had earlier said sales at its Boston Market
restaurants are falling and it would write off hundreds of
millions of dollars in loans to franchisees. In the fiscal
first quarter, Boston Chicken reported a loss of $312.6
million, or $4.38 a diluted share.(Gazette-05/30/98)


BOYDS WHEELS: Total Liquidation - 3 Day Auction
-----------------------------------------------
A liquidation of substantially all of the physical assets
of Boyds Wheels, Inc. will take place during a public  
auction June 3, 4, and 5 at 10:00 a.m. held on-site at 8380
Cerritos Avenue in  Stanton.  This sale comes by order of
the U.S. Bankruptcy Court.

The auction is unprecedented in the wheel and related
industries according to Adam Reich, senior vice president
and partner of Hackman Capital Partners LLC an asset
recovery firm and one of the entities managing the auction.
The auction is expected to attract a world-wide audience
for both its magnitude, and its timing following the ever-
popular Indianapolis 500 race.

All Boyds Wheels assets including billet and other wheel
rim inventory, machinery, custom Harley Davidson and Boyds'
Speedster motorcycles, Boyds sportswear and office
equipment are among the items for sale.  "The purpose of
the auction is to drastically restructure the company by  
eliminating a substantial portion of its fixed assets,"
says Jeffrey Golden of  Albert, Weiland & Golden, LLP,
bankruptcy counsel to Boyds.

Boyds Wheels, Inc. posted substantial losses last year when
its sales plummeted to $16 million from its highest year in
sales of $27.9 million in 1996. The downfall is blamed on a
slump that hit the market after Boyds spent millions on
expanding its manufacturing facilities.  After an intensive
review of the environment and the company's operations, its
Board of Directors determined that a major reorganization
and Chapter 11 filing was necessary.


BRUNO'S: Creditor Objects to Extension of Exclusivity
-----------------------------------------------------
W.R. Huff Asset Management Co., LLC (Huff) and its
affiliates file an objection to the motion of the debtors
for an order extending the exclusive periods during which
the debtor may file a plan of reorganization and solicit
acceptances thereof.  Huff owns approximately half of the
original principal amount of the debtors' 10,.5 % senior
subordinated notes due 2005 and is the debtors' single
largest creditor.

Huff states that the length of the extension of the
exlusive period requested by the debtor is excessive.  Huff
states that there is simply no basis for granting an
extension of the exclusive period to file a plan through
January, 1999 at this juncture.  Huff requests that the
court limit any extension of the exclusive periods to 120
days.


D&L VENTURE CORP: Hearing Set for June 30, 1998
-----------------------------------------------
At a hearing scheduled by the court for june 30, 1998, D&L
Venture Corp. will present motions for authority to enter
into an employee retention program and to assume key-man
executory contracts; an application to employ Sp[ecial
counsel Richard D. O'Connor and the firm of Siegel,
O'Connor, Schiff & Zangari, PC and an application by the
debtor to employ accountant Frank R. Miller under monthly
retainer.


HAGERSTOWN FIBER: Builder and Panel Spar Over Arbitration
---------------------------------------------------------
The latest battle in Hagerstown Fiber L.P.'s case pits the
builder of the partnership's waste paper pulping
and de-inking facility, who is seeking to lift the
automatic stay to permit pending arbitration proceedings to
go forward, against the unofficial committee of
bondholders.  The arbitration of claims arising under a
Sept. 30, 1994, construction contract were "already in an
advanced stage" before the partnership filed for chapter 11
protection, SBCCS Constructors Joint Venture asserted.
SBCCS argued that resumption of the arbitration proceedings
would therefore provide an efficient and less expensive
method for resolving the contract disputes. The arbitrators
were "merely days away from having sufficient information
for them to make dispositive rulings on the issues in
arbitration when the Debtor filed its bankruptcy
petition." The bondholders' panel, on the other hand,
asserted that resumption of arbitration would result in
duplicate litigation, prejudice creditors and waste the
partnership's resources. (Courtesy of The Daily
Bankruptcy Review Copyright c June 2, 1998-ABI 02-June-98)


HOMEPLACE: Seeks Okay For CFO Employment Pact
---------------------------------------------
HomePlace Stores Inc. asked the court to approve its
employment agreement with new Chief Financial Officer
Patrick Fodale. The agreement provides the CFO with a
$175,000 yearly salary. The retailer noted that Fodale, who
was hired on March 16 after the company fired former CFO
Thomas Murasky, has extensive experience in the retail
industry and, in particular, with retailers operating as
debtors-in-possession, such as Color Tile Inc. In addition
to the salary, the employment contract between Fodale and
HomePlace provides the CFO with a 50 percent base salary
bonus ($87,500) if the company exceeds target profit goals
as well as reimburses Fodale up to $25,000 for relocation
expenses. (Courtesy of The Daily Bankruptcy Review
Copyright c June 2, 1998 - ABI 02-June-98)


K.G. MARX: May Be Forced into Bankruptcy
----------------------------------------
K.G. Marx Inc. may be forced into bankruptcy by a group of
its creditors, putting the company's future in question.
The Westerville-based party supply retailer has been in
receivership since July 1996, but three of its creditors on
May 14 petitioned U.S. Bankruptcy Court in Columbus to
involuntarily force the company into Chapter 7 bankruptcy.

Enesco Corp., an Illinois-based giftware company, Leanin'
Tree Inc. of Boulder, Colo., and United Steel & Wire Co. of
Battle Creek, Mich., are seeking payment of $115,785 from
the company. Enesco is K.G. Marx's largest creditor,
accounting for $114,157 of the debt.  In their petition,
the creditors said the "significant lease obligations of  
(K.G. Marx) and inability of (the company) to formulate a
plan of distribution to unsecured creditors" justified the
action.

K.G. Marx attorney A.C. Strip said that the company has
been profitable over the past two years and is free of any
bank debt or tax obligations. Still, the company could not
come out of receivership nor could it pay Enesco because of
a lawsuit filed last spring by four K.G. Marx investors
over a 1995 stock and debt offering that raised $884,248. A
planned secondary offering was abandoned in July last year.
(Business First Columbus - 05/29/98)


KIA: Ford Plans Takeover
------------------------
US auto giant Ford Motor Co. intends to take over
South Korea's ailing Kia Motors Corp. through the
acquisition of a controlling stake in the firm, Kia's top
manager said Tuesday.  The plan was unveiled as 14,000
striking workers of the debt-ridden firm prepared to
demonstrate in front of its headquarters here in protest
against unpaid wages.

"Ford is showing its interest in taking over Kia," Yoo
Chong-Yul, designated  by creditors as Kia's receiver, told
a press conference. Ford and its Japanese  affiliate Mazda
Motor Corp. hold a 16.9 percent stake in Kia.  The US firm
has proposed to increase its stake to between 49 and 51
percent by forming an international consortium, Yoo said.
Yoo, who took over Kia's management last month on behalf of
creditors, said that two major South Korean auto makers --
Hyundai Motor and Daewoo Motor --did not show their
interest in taking over Kia.  But reports said Kia's
creditors were preparing to set public bid guidelines
this month for the beleaguered company and that Ford and a
consortium of  Hyundai and Daewoo had shown interest in the
tender. (Agence FrancePresse -06/02/98)


LA VIDA LLENA: Consensual Reorganization Plan
---------------------------------------------
La Vida Llena LifeCare Retirement Community Monday
announced that it has signed an Agreement in  
Principle with the holders of a majority of its outstanding
bonds to refinance existing tax-exempt bond obligations.

The refinancing is to be accomplished through a pre-
negotiated consensual reorganization plan under Chapter 11
of the United States Bankruptcy Code.

The consensual bond refinancing will reduce overall bond
indebtedness, debt service and interest rates.  The bonds
are not an obligation of the City of Albuquerque, and will
not be paid from City funds. Approval by the City Council
will be necessary for issuance of the new bonds, but is
expected.  La Vida Llena's outstanding bond debt consists
of approximately $50 million principal amount comprising
three-tiered series of bonds, referred to as Series 1993 A,
B, and C bonds.  While La Vida Llena has operated smoothly,
the board realized that eventually the debt would not be
retired through the organization's normal level of revenues
and that a restructuring is necessary.

La Vida Llena LifeCare Retirement Community is a retirement
community in Albuquerque.  Founded in 1983 by four
Albuquerque churches -- La Vida Llena is an independent,
nonprofit New Mexico corporation, with about 190 employees
and serving nearly 400 residents.


LONG JOHN SILVER: Case Summary & 20 Largest Creditors
--------------------------------------------------
Debtor:  Long John Silver's Inc.
         300 West Vine Street
         P.O. Box 11988
         Lexington, KY 40579  
Type of business: Seafood Restaurant Chain

Court: District of Delaware

Case No.: 98-1164   Filed: 06/01/98    Chapter: 11

Debtor's Counsel: Young Conaway Stargatt & Taylor, LLP
                  Laura Davis Jones
                  Robert S. Brady
                  Pauline K. Morgan
                  Brendan Linehan Shannon
                  11th floor, Rodney Square North
                  P.O. Box 391
                  Wilmington Delaware
                      and
                  Sherman & Sterling
                  Ronald DeKoven
                  Mark J. Shapiro
                  599 Lexington Avenue
                  New York, NY 10022
                  (212) 848-4000

Total Assets:              $329,100,000
Total Liabilities:         $457,300,000
                                                   No. of
                                         Amount    Holders
                                         ------    -------
Fixed, liquidated secured debt     $241,300,000          15          
Contingent secured debt              $2,700,000          15
Disputed secured debt                        $0           0
Unliquidated secured debt                    $0           0

Fixed, liquidated unsecured debt   $210,200,000  over 1,000
Contingent unliquidated unsecured debt      undetermined
Contingent liquidated unsecured debt        undetermined

Disputed  unsecured claims          $3,100,000 undetermined

No. of shares of common stock               100          1`
20 Largest Unsecured Creditors:

   Name                              Nature         Amount
   ----                              ------         ------
Goldman Sachs & Co.        12% and 18% Notes      6,276,485
Cerberus                   12% and 18% Notes      6,232,500
DK Acquisition Partners    12% and 18% Notes      6,232,500
Western International Media         TV Media      6,012,027
Tyson Foods                     Chicken/Fish      3,181,517
Strottman International                 Toys      3,076,899
ProSource                  Food Distribution      2,445,734
Lamb Weston                     French Fries      1,021,759
Pilgrims Pride                       Chicken        762,635
Jordan McGrath Case & Taylor   TV Production        705,676
Foodservice Purchasing Coop   Produce, paper        649,558
New Mexico Taxation & Revenue          Taxes        592,895
Northern Victor                         Fish        520,527
Griffith Laboratories                 Batter        519,545
IBM                      Computer Consulting        442,651
Portion Pac                        Dressings        406,071
Edge Network                     Print Media        405,427
Burrows-Corroc Paper             Paper Goods        389,612
T. Marzetti                           Sauces        383,577
AC Humko                          Shortening       379, 817


LOT$OFF: $6.9 Million Loss on Net Sales of $48.5 Million
--------------------------------------------------------
Preliminary results indicate that LOT$OFF experienced a  
$6.9 million net loss on net sales of $48.5 million for the
fiscal year ended Jan. 30, 1998, the company announced.
That compares to a net loss of $43.6 million on net sales
of $106.2 million for fiscal year ended Jan. 31, 1997.  
During fiscal 1998, the company operated a weighted average
of 42.1 stores, nearly half the number it operated in
fiscal 1997.

The company's total merchandise sales were up 0.6% (from
$3,414,058 to $3,436,205) for the four weeks ended May 29,
1998, while comparable store merchandise sales were down
1.4% (from $3,212,263 to $3,166,813) for such period.
LOT$OFF also announced its total and comparable  
store merchandise sales figures for the seventeen weeks
ended May 29, 1998: total merchandise sales were up 5.1%
(from $14,786,952 to $15,547,517); and comparable store
merchandise sales were up 3.2% (from $13,868,370 to  
$14,309,565).

The Company's Annual Meeting of Stockholders will be held
July 14, 1998 in San Antonio, Texas. The record date for
the Annual Meeting was May 28, 1998. At May 28, 1998, there
were 4,159,210 shares of Common Stock outstanding,  
1,596,420 shares of which are held in an escrow account at
Continental Stock Transfer & Trust Company for the benefit
of holders of allowed general unsecured claims pending
distribution upon the filing and/or resolution of  
claims objections under the Company's confirmed Plan of
Reorganization, as Amended and Modified. Such escrowed
shares are not entitled to vote at the Annual Meeting.


MICROLYTICS: SanTiGroup to Report to SEC
----------------------------------------
SanTi Group, Inc. formerly known as Microlytics, Inc.
announced that it intends to file a Form 10 with the
Securities and Exchange Commission during the second
quarter of 1998. The filing of the Form 10 will  
provide current information about the company, including
audited financial statements of the merged company, and
will thereafter require the company to file current,
quarterly and annual reports with the SEC as a reporting
company.

Microlytics suspended its filings with the SEC in 1996 and
has provided information solely through its Chapter 11
bankruptcy process since that time.   Microlytics and a
privately held company, SanTi Group, Inc., merged
effective  May 13, 1998, with Microlytics surviving the
merger and changing its name to  SanTi Group, Inc.  SanTi
Group's common stock has not traded on the over-the  
counter bulletin board since the effective date of the
merger.


NAMCO CYBERTAINMENT: Seeks Extension of Exclusivity
---------------------------------------------------
The debtor, Namco Cybertainment Inc., seeks an extension of
the debtor's exclusive periods in which to file a plan of
reorganization and solicit acceptances thereof.
The debtors seek a 60-day extension, from May 29, 1998
through and including July 28, 1998, of the period during
which the debtors will maintain the exclusive right to file
a plan resolving this case; as well as a 60-day extension
from July 28, 1998 through and including September 28,
1998, of the period during which the debtor will have the
exclusive right to solicit acceptances to such plan.

The debtor seeks this relief solely out of an abundance of
caution to maintain the exclusive periods throughout the
schedule contemplated for plan confirmation.

The debtor anticipates filing an amended plan by May 29,
1998 and confirming the amended plan by August 10, 1998.  
The extension is warranted to allow the debtor additional
time to complete negotiations and the prosecution of its
Chapter 11 plan.


RICKEL HOME CENTERS: Rejects 4 Leases
-------------------------------------
In the case of Rickel Home Centers, Inc., debtor, the court
entered an order authorizing the debtor to reject the
following four nonresidential real property leases:
Flemington, New Jersey; Middletown, New York,
Pleasantville, New Jersey and Pottstown, Pennsylvania.


ROSS TECHNOLOGY: Announces Shutdown of Operations
-------------------------------------------------
Ross Technology Inc., Austin, Texas, announced that its  
Board of Directors has voted to commence an orderly
shutdown of the company & operations while it continues
efforts to facilitate a sale of the remaining, smaller
business. Under the plan approved by the board, the company
expects to continue operations at a scaled-down level
through the end of the year and to continue seeking a
buyer for the company for all or part of its assets,
including its intellectual property.  While Ross is
actively discussing a sale with several parties, there is
no confirmed buyer at this point so it will move ahead with
its plans to maximize asset value for creditors. (ABI 02-
June-98)


TELECOMMUNICATIONS SERVICE: Files For Bankruptcy Protection
-----------------------------------------------------------
Telecommunications Service Center, a Tampa-based long
distance telephone service reseller, has filed for
protection from creditors in bankruptcy court.  The Chapter
11 filing is aimed at giving TSC breathing room to repair
shaken finances, which were dealt a blow recently when
Georgia marketing outfit One Bill Plan sold the company a
bogus block of "thousands of" new out-of-state customers,
said TSC President Hal Shankland.

These customers turned out to have been gained allegedly
through the illegal practice of slamming, or switching a
client's long distance carrier without consent. "They sent
us thousands of people that were not legally picked,"  
Shankland said.  He added that TSC was unable to charge
those customers for service and had to eat the costs. "We
just weren't able to charge them," Shankland said. "It  
put us in a financial bind. But it wasn't like it was bad
planning on our part."

TSC listed $5 million in assets and a little more than $5
million in debt.  The reorganization comes on the heels of
an aborted acquisition deal in which Bridgeport
Communications Inc., a Fort Lauderdale-based  
telecommunications marketing concern, sought to buy TSC.
That deal fell apart because "Bridgeport came back to the
table with an entirely different proposal than they first
did," Shankland said.

He said that in spite of TSC's recent troubles, the company
is on track for nearly $30 million in revenues this year.
Besides offering switch-based long distance telephone
service, TSC peddles prepaid telephone cards. (Tampa Bay
Business - 05/29/98)


VOC Analytical Laboratories: Meeting of Creditors
-------------------------------------------------
The debtor, VOC Analytical Laboratories, Inc. filed a
Notice of Commencement of Case under Chapter 11.  The date
of the meeting of creditors is June 17, 1998.  The deadline
for filing claims with the court is September 15, 1998.


VOXEL: Files Chapter 11 Bankruptcy Petition
-------------------------------------------
Voxel announced that it has filed a voluntary Chapter 11
petition. The filing was precipitated by a recent
arbitration award of $1.9 million in favor of General
Scanning Inc. and by the subsequent failure of the
parties to reach an agreement as to a payment schedule.

Voxel intends to operate under the protection afforded by
the Bankruptcy Code so that it may complete the development
of the Voxcam(R) imager unhampered by continuing collection
efforts by GSI. The filing will also facilitate efforts by
Voxel to maximize the value of its assets for the benefit
of creditors, and to maintain the going concern value of
the company for shareholders and other investors.

Voxel is engaged in the development and marketing of
Digital Holography, a proprietary system that produces
"three-dimensional X-rays" of the internal structure of the
body.  


WIZ INC: Order Fixes Bar Date
-----------------------------
By order entered May 26, 1998, Judge Cornelius Blackshear
set the date by which all claims must be filed, except
those specifically excluded in the order. All claims
against The Wiz, Inc. et al., debtors, must be filed before
June 19, 1998. The company is currently known as NYEC, Inc.

                  *********

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in the TCR each Tuesday.  Submissions via e-mail to
conferences@bankrupt.com are encouraged.  

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