TCR_Public/981023.MBX T R O U B L E D   C O M P A N Y   R E P O R T E R
  Friday, October 22, 1998, Vol. 2, No. 208


AMERICAN TELECOM: Reorganization Plan Filed
BROTHERS GOURMET: Notice Establishes Bar Dates
BRUNO'S: Fixing of Bar Date
CARIBBEAN CIGAR: Annual Meeting of Shareholders
COLONIAL DOWNS: Considers Bankruptcy

CONSUMER PORTFOLIO: Reports 1998 Third Quarter Results       
COVENTRY HEALTH: Files Annual Report With SEC
CRIIMI MAE: Sues Three of Its Largest Creditors
CRIIMI MAE: Wants Seized Bonds Back

ERD WASTE: Seek To Hire Banking Investment Firm
EA. SHOSHONE: Zero Assets; $1 Million Debt
ERLY INDUSTRIES: Trustee Names Creditor Panel
FORMAN PETROLEUM: Approves Engagement of CIBC Oppenheimer
FORMAN PETROLEUM: Files Suit Against Financial Advisor

KIA MOTORS: Banks Expected To Ok Deal
MARVEL ENTERTAINMENT: Files Stockholder Agreement With SEC
PERK DEVELOPMENT: Committee Objects to Deloitte & Touche
PITTSBURGH PENGUINS: Creditors Committee Appointed

REGENCY HOMES: Four Creditors Take Back 300 Lots STAR
NEWCO: Seeks DIP Financing
STORM TECHNOLOGY: Files Chapter 11
SUN TV: Final Okay For Reduced $60M DIP Pact
SUN TV: Money Situation Worsens


AMERICAN TELECOM: Reorganization Plan Filed
Phoenix International Industries Inc., West Palm Beach,
Fla., announced yesterday that the reorganization plan for
American Telecommunications Enterprises Inc. was filed in
bankruptcy court in Utica, N.Y., according to a newswire
report. The terms of the plan call for American Telecom to
emerge from chapter 11 as a wholly owned subsidiary of
Phoenix. (ABI 22-Oct-98)

BROTHERS GOURMET: Notice Establishes Bar Dates
On October 13, 1998, Brothers Gourmet Coffees, Inc. and its
debtor affiliates filed a motion seeking to establish Bar
Dates for filing proofs of claim.  A hearing will be held
on October 27, 1998.  The debtors request that the court
establish December 15, 1998 as the general bar date by
which any entity holding a prepetition claim against one or
more of the debtors must file a proof of claim.

BRUNO'S: Fixing of Bar Date
On October 13, 1998, the court entered an order
establishing December 1, 1998 at 5:00 pm central time as
the last date and time for the filing of proofs of claim
against PWS Holding Corporation, Bruno's, Inc. and their
ten affiliates.

CARIBBEAN CIGAR: Annual Meeting of Shareholders
The 1998 Annual Meeting of Shareholders of Caribbean Cigar
Company, a Florida corporation will be held at in the Sun
Sentinel Auditorium which is located at 200 East Las Olas
Boulevard, Fort Lauderdale, Florida 33301, on November 9,
1998, at 10:30 am local time, for the purpose of
considering and acting upon the following matters:

(1) To elect directors to serve until the 1999 Annual
Meeting of Shareholders and until their successors shall be
elected and qualified;

(2) To approve the possible issuance of in excess of 19.99%
of the presently issued and outstanding Common Stock of the
Company upon the conversion of the Company's Series A
Convertible Preferred Stock;

(3)To consider and act upon a proposal to amend the
Company's Articles of Incorporation to increase the number
of authorized shares of Common Stock from 1,250,000 to

(4)To approve Ahearn, Jasco + Company, P.A. as the
Company's independent certified public accountants for the
fiscal year ending March 31, 1999; and

The board of directors of the Company has fixed the close
business on September 15, 1998 as the record date for the
determination of shareholders entitled to notice of, and to
vote, at the Annual Meeting. As of the record date, there
were 842,994 shares of the Company's common stock, par
value $.001 per share, and 42,128 shares of the Company's
Series A Convertible Preferred Stock, $.001 par value,
issued and outstanding and entitled to vote at the Annual
Meeting giving effect to the Company's 8 to 1 reverse stock
split effective September 1, 1998.

COLONIAL DOWNS: Considers Bankruptcy
Colonial Downs Holding Inc., parent company of  
Virginia's first and only track since the Civil War, on
Thursday said it may file for protection under U.S.
bankruptcy laws.  The company said it probably will post a
loss of $4-6 million for the third quarter of 1998.  
Thursday afternoon the company's stock dropped 41 cents to
72 cents, near the year low of 69 cents. The company had
traded as high as $7.25 per share within the year.

The fledgling track, opened only two years ago, would face
further trouble if the state's law compelling the track to
increase its live racing season by 2002 from its current 72
to 150 days were not amended, Jeffery Jacobs, the  
company's chief operating officer, said in a statement.
The track currently loses money on live thoroughbred racing
operations, Herb Jones, the company's director of
investment relations, told Reuters. The company had
anticipated receipts from six offtrack betting sites would  
offset the live racing losses. So far, three of the four
offtrack betting facilities up and running are making
money, and one is breaking even, Jones said.

Colonial Downs, which went public March 1997, had expected
to take up to 10 years to build a fan base that would flock
to the track, Jones said.  Jacobs said the company may take
up to 60 days to decide whether to file to reorganize under
Chapter 11 bankruptcy protection laws. He said the company  
will not seek a referendum for additional offtrack

CONSUMER PORTFOLIO: Reports 1998 Third Quarter Results       
According to a business wire report, Consumer Portfolio  
Services, Inc. (Nasdaq: CPSS) Thursday announced financial
results for its third quarter, ended September 30, 1998.

For the third quarter, total revenues increased 76% to
$37.4 million, compared with $21.3 million for the same
period in the prior year. The Company's net earnings
increased 29.5% to $6.2 million, or $.38 per share, on 16.9
million diluted shares outstanding, compared with $4.8
million, or $.30 per share, on 16.5 million diluted shares
outstanding for the same period in the prior year.

For the nine months ended September 30, 1998, total
revenues increased 83.2% to $102.0 million, compared with
$55.7 million for the same period in the prior year. Net
earnings increased 33.1% to $17.8 million, or $1.08 per
share on 16.7 million diluted shares, compared with $13.3
million, or $.85 per share on 15.9  million diluted shares
for the same period in the prior year.

Purchases of contracts from automobile dealers increased
74.5% in the third quarter to $303.0 million, compared with
$173.6 million for the same period in 1997. Contracts sold
during the third quarter in the form of asset-backed  
securities increased 60.2% to $240.3 million compared with
$150.0 million for the same period in the prior year. The
aggregate outstanding balance of contracts serviced by the
Company at September 30, 1998, increased by 87.9% to  
$1,489.4 million, compared with $792.7 million at September
30, 1997.

Balances of accounts past due over 30 days represented 4.7%
of the servicing portfolio at September 30, 1998, compared
with 6.1% at September 30, 1997. The annualized net charge
off rate for the three month period ended September 30,  
1998, was 6.5%, compared to 6.2% for the three month period
ended September 30, 1997. The Company's non-discounted
allowance for credit losses equaled $131.7 million, or
11.2% of the contracts sold that it serviced as of
September 30, 1998. The on-balance sheet allowance for
credit losses was $14.1 million, or 4.6% of contracts held
for sale at September 30, 1998.

Charles E. Bradley, Jr., President and Chief Executive
Officer said, "The credit quality of our servicing
portfolio continues to improve. Annualized net charge offs
were 6.5%, approximately equal to second quarter 1998, and
in line with our expectations. Delinquent accounts
represented only 4.7% of the servicing portfolio,
continuing a trend of lower delinquencies in 1998 compared
to 1997. As of September 30, 1998, our inventory of
repossessed vehicles declined to 1.9% of the servicing
portfolio, compared to 2.2% for June 1998.

COVENTRY HEALTH: Files Annual Report With SEC
Coventry Health Care Inc. filed a Form 11K Annual Report
with the SEC for the fiscal year ended December 31, 1997.

A full-text copy of the filing is available via the
Internet at:

CRIIMI MAE: Sues Three of Its Largest Creditors
Criimi Mae Inc., Rockville, Md., has sued affiliates of
Morgan Stanley & Co., Merrill Lynch & Co. and Citigroup
Inc., three of its largest creditors, alleging that they
have "wrongfully seized" millions of the firm's cash and
securities that were put up as collateral on loans, The
Washington Post reported. The firm filed for chapter 11
protection two weeks ago and is now citing conflicts
of interest by the big Wall Street firms that dominate the
commercial mortgage finance market. According to industry
analysts, the lawsuits could be the beginning of a legal
battle that may determine the future of commercial real
estate finance. Criimi Mae is the first firm in the
business to ever file bankruptcy; thus there are no legal
precedents. (ABI 22-Oct-98)

CRIIMI MAE: Wants Seized Bonds Back
According to an article on October 22, 1998 in the
Washington Times Criimi Mae Inc. asked a bankruptcy court
to order the return of  bonds with a face value of $286.8
million that were seized by one of its creditors.

The Rockville-based company, which filed for bankruptcy
protection after the demand for its commercial mortgage-
backed securities (CMBS) collapsed, asked the U.S.
Bankruptcy Court in Greenbelt to compel Morgan Stanley Dean
Witter & Co. to return the seized bonds.

Criimi Mae said it holds an equity stake of $54.5 million
in the bonds, which are commercial mortgage-backed
securities assembled from a pool of commercial mortgages.
Morgan Stanley, a securities firm, incorrectly valued the
bonds at just $237,127 when it seized them, Criimi Mae

New York-based Morgan Stanley "is using the current
temporary market turmoil to pay an absurdly low price for
performing mortgage assets that are generating  as much
cash flow as they did three months ago," Criimi Mae
Chairman William B.  Dockser said in a written statement.

Criimi Mae's suit "is without merit and we will defend
ourselves vigorously," said Jeanmarie McFadden, a Morgan
Stanley spokeswoman, who denied Criimi Mae's charges but
refused to comment on specifics of the suit.  It was the
second time since Criimi filed for bankruptcy that the
company has moved to fend off a creditor from taking its
assets. Last week, it won a bankruptcy court order
preventing Citicorp Securities Inc. from seizing similar  

Criimi called Morgan Stanley's action a "willful violation
of the automatic stay" imposed on creditors when the
company filed for protection from creditors.  What's more,
Criimi Mae said yesterday, Morgan Stanley said in an Oct.
16 letter to Criimi that it might sell the seized assets.
If sold now, the assets would fetch far less than they're
worth because the CMBS market is depressed, Criimi said in
the statement. That would harm both Criimi and the CMBS
market overall, it said.  For the past year, Criimi Mae has
been the nation's most aggressive buyer of CMBS, a market
that reached $47 billion by late August but has become
inactive in the wake of the growing world economic crisis
that began in Asia last year.

Criimi Mae blames its bankruptcy on creditors who demanded
extra collateral when recent global financial troubles
slashed the value of its CMBS, which are  backed by
offices, hotels and shopping centers. However,
Criimi officials say borrowers are continuing to repay
their loans as much as before.

"These are very strong assets that have been caught in a
financial squeeze," said company spokesman Jim Pastore.
The company is "stabilizing its current business, putting
together the  reorganization plan and continuing to
negotiate with creditors and with potential sources of
capital," he said.  With two creditors trying to seize
Criimi's assets, Mr. Pastore said the major question of how
to value the CMBS assets has not been resolved.

The CMBS market will survive in the long run no matter what
happens to Criimi Mae, said an analyst who asked not to be
identified. But Morgan Stanley may have a strong case for
holding on to the assets, which didn't exist the  
last time Congress amended the bankruptcy code, he said.

ERD WASTE:  Seek To Hire Banking Investment Firm
The debtors, ERD Waste Corp., et al., are in the process of
finalizing a Chapter 11 plan of reorganization.  A key
component of the plan is the obtaining of additional
working capital either in the form of a new equity infusion
and/or a line of credit.

The debtors wish to engage the banking investment firm of
ITS, LLC to assist them in obtaining the additional working
capital required to enable the debtors to emerge from
Chapter 11.  ITS has considerable experience in rendering
consulting services to businesses with respect to capital
raising and related matters.  The debtors believe that ITS
can provide substantial assistance to them in locating
potential investors and or lenders to make available to the
debtors the working capital required to complete the
debtors' plan.  The debtors would be responsible only for
ITS' out-of-pocket expenses to a maximum of $14,000.

The debtors request entry of an order authorizing them to
reain ITS, LLC to render the consulting services as
described in the letter agreement between the parties.

EA. SHOSHONE: Zero Assets; $1 Million Debt
The taxpayer-supported East Shoshone Hospital District is
nearly $1 million in debt, according to U.S. Bankruptcy
Court documents.   The district closed its Silver Valley
Medical Center in September.   Last week it filed for
reorganization under Chapter 9 of the federal  
bankruptcy code.

The taxing district's board of trustees voted Oct. 6 to
file the petition after concluding that it is
"impracticable" to negotiate with its creditors.
The district's bankruptcy attorney is Ford Elsaesser.  
Board chairman Robin Stanley will not comment on the
district's  financial situation.

In the court documents, the hospital district lists zero
assets. Total liabilities are $944,636.The debts fall into
three categories: Secured claims, $435,000.   First
Security Bank of Salt Lake City has a claim of $150,000.
That amount is secured with the property taxes that the
hospital district expects to collect in 1999.   The
Magnuson Trust, a claim of $150,000, is secured with the
deed to the Wallace Clinic.  Source Capital Leasing of
Spokane, a claim of $125,000, is secured with the medical
center's accounts receivable and equipment.   Unsecured
priority claims, $171,591.  Creditors include 33 former
employees who did not get paychecks for work done at the
Silverton hospital between Aug. 30 and Sept. 12. The
district also owes a total of $146,154 to the state and
federal governments for unemployment and withholding taxes,
and workers compensation.   Unsecured nonpriority claims,
$338,045.  There are 121 such claims. Creditors range from
garbage collectors and medical laboratories to restaurants
and a flower shop. They are located from Georgia to
California.(Copyright 1998 Cowles Publishing Company
Spokesman Review; 10/20/98)

ERLY INDUSTRIES: Trustee Names Creditor Panel
The U.S. Trustee has appointed an official committee of
Erly Industries Inc.'s unsecured creditors: Epman Dwyer
Singer & Wohrle, Culver City, Calif.; Seneca Foods
Foundation, Pittsford, N.Y.; Kasco Media Services Inc., c/o
Platzer Swergold Karlin et al., New York, N.Y.; ChaseMellon
Shareholder Services LLC, Ridgefield Park, N.J.; Sandburg
Financial Corp., c/o Marshack Shulman & Hodges, Irvine,
Calif. (The Daily Bankruptcy Review and ABI Copyright c
October 22, 1998)

FORMAN PETROLEUM: Approves Engagement of CIBC Oppenheimer
On October 16, 1998, the Board of Directors of Forman
Petroleum Corporation (the "Company") approved the
engagement by the Company of CIBC Oppenheimer Corp.
("Oppenheimer") as the Company's exclusive financial
advisor in connection with the possible financial
recapitalization of the Company (the "Recapitalization").  

At the present time, the Company is not a party to any
definitive agreement or letter of intent with respect to
any transaction in connection with the Recapitalization.  
In connection with the Oppenheimer engagement, however, the
Company expects to review and conduct investigations from
time to time with respect to such transactions.  It is the
Company's policy, absent unusual circumstances, not to
comment publicly on discussions concerning proposals that
may be considered or transactions that may be pending with
respect to the Recapitalization.  The Company also intends,
absent unusual circumstances, to refrain from making any
further announcements or reports with respect to the
Recapitalization unless and until a definitive agreement
has been executed by the Company with respect to a
transaction in connection with the Recapitalization.  There
can be no assurance that the Company will consummate any
transactions in connection with the Recapitalization.  

Forman Petroleum Corporation is headquartered at 650
Poydras Street, Suite 2200, New Orleans, Louisiana.

FORMAN PETROLEUM: Files Suit Against Financial Advisor
On October 16, 1998, Forman Petroleum Corporation filed a
Complaint against Jefferies & Company, Inc. in the United
States District Court in and for the Eastern District of
Louisiana.  Forman's complaint arises out of conduct of
Jefferies acting as exclusive financial advisor to and
placement agent for Forman in connection with the
recapitalization of Forman through offerings of debt and
equity securities, and Jefferies' unauthorized conduct
following the recapitalization.

By advising Forman to recapitalize through a certain
proposed offering, Forman alleges that Jefferies caused
Forman to enter into an ill-advised offering of high yield
debt and equity securities.

As a result of the ill-advised offerings, Forman's
financial obligations increased from $45 million to $80
million and additional financing options were foreclosed by
the security interests provided as collateral for the
notes.  After the paymentof trade payables and after
offering fees and expenses, the offering generated only
$500,000 of working capital available for its exploration
and development activities -- the generation of which
was a primary reason for pursuing the offering in the first
place. At the same time, Jefferies demanded and was paid
$5.5 million in fees for the transaction.  In addition, the
issuance of the preferred stock required that Forman
convert from "S-Corporation" status to "C-Corporation"
status, thereby depriving Forman of the substantial tax
benefits associated with its them existing $10 million net
operating loss carry forward.  But for the acts of
Jefferies with regard to its financial advice to Forman on
proposed restructuring, Forman would be in a far better
financial position today.

Hayes Corporation reports to the SEC that on October 9,
1998, the Hayes Corporation and its affiliates filed a
petition in the U.S. Bankruptcy Court for the District of
Delaware (Case No. 98-2278 (MFW)) for relief under Chapter
11 of the U.S. Bankruptcy Code due to its inability to pay
its debts on a current basis.

KIA MOTORS: Banks Expected To Ok Deal
Creditor banks are expected to approve Hyundai Motors Co.'s
takeover of bankrupt Kia Motors Corp., a top government
official said Thursday.  The comment by Chairman Lee Hun-
jai of the Financial Supervisory Commission appeared to be
a tacit government endorsement of Hyundai's bid to acquire

Hyundai was named the winning bidder for Kia in an auction
Monday, but its offer still must be approved by Kia's
creditor banks, most of which are controlled by the
government.  Hyundai bid was chosen over those of Ford
Motor Co. of the United States and two domestic
competitors, Daewoo Motors Co. and Samsung Motors Inc.  
There has been speculation that the banks might reject
Hyundai's bid, which included a demand that they write off
$7.3 billion of Kia's $8.4 billion debt.

Lee said Hyundai's takeover of Kia would spur a
reorganization of South Korea's shaky auto industry,
plagued by over-supply problems.  With a combined capacity
of 3.5 million vehicles a year, South Korea is the world's
fifth largest car producer.

MARVEL ENTERTAINMENT: Files Stockholder Agreement With SEC
In a Schedule 13D filed with the SEC, Marvel Enterprises
Inc. reports that the Chase Manhattan Corporation, and The
Chase Manhattan Bank are the beneficial owners of  
33,002,326 shares of common stock representing 71% of the
classs. A certain stockholders' agreement dated October 1,
is included in the filing.  A full-text copy of the filing
is available via the Internet at:

PERK DEVELOPMENT: Committee Objects to Deloitte & Touche
The Official Joint Committee of Unsecured Creditors objects
to the application by the debtors for approval of
employment of Deloitte & Touche as independent auditors.
The Committee complains that there was no engagement letter  
that the debtors were to supply to the court and the
Committee. "The Committee is disappointed, frustrated, and
distressed by the manner in which the debtors have dealt
with the appointment of auditors.  The Committee is
especially concerned because it believes that the debtors'
actions with repsect to the appointment of auditors
demonstrate and underscore a pervasive, cavalier and
laissez faire attitude that appears to infect the overall

The Committee also complains that the October 7 engagement
letter appears to be for the sole benefit of Travel Ports
and to provide no benefit to the estate whatsoever.

PITTSBURGH PENGUINS: Creditors Committee Appointed
Mario Lemieux and Civic Arena landlord SMG Pittsburgh were
appointed to lead a creditors' committee in the Pittsburgh
Penguins chapter 11 case; Lemieux is the largest creditor,
owed $28.7 million, according to the team, the Associated
Press reported. Others on the committee include Fox Sports
Pittsburgh, former Penguins' employee William Craig, the
law firm of Cohen and Grisby, architects with John R. Kosko
Associates, and Carriage Limousines, which shuttled  
players. Also yesterday Bankruptcy Judge Bernard Markovitz
ruled that attorneys for Pittsburgh, Allegheny County and
SMG Pittsburgh could continue gathering evidence in their
lawsuit against team owner Roger Marino. They allege that
he has continued efforts to move the team to another city.
Judge Markovitz said he would decide within 30 days whether
the lawsuit could go forward in Allegheny County Common
Pleas Court, were it was filed. Judge Markovitz
also scheduled a hearing for Tuesday at the National Hockey
League's request on granting an extension of a grace
period. Under the NHL's constitution, it has 10 days to
decide whether to take over a franchise that files for
bankruptcy protection. The 10-day period lapses today, but
the league wants the extension to keep its options open.
(ABI 22-Oct-98)

REGENCY HOMES: Four Creditors Take Back 300 Lots
A bankruptcy judge has allowed four major creditors to take
back approximately 300 building lots in Maryland and
Virginia from the Chapter 7 liquidation of Regency Homes
Inc. and its affiliates, a move that gets  homebuyers a
step closer to a resolution in one of the largest
homebuilder  debacles ever in Maryland.

Judge S. Martin Teel Jr. signed off on a motion of sale
Friday from Zvi Guttman, trustee for the estate, that
allows Provident Bank of Maryland, Sterling, Va.-based Bank
United, First Union National Bank and Ohio Savings Bank of
Cleveland to take back their lots in exchange for $21
million in secured claims against the estate.

However, Bankers Trust Co. of New York, which has more than
$20 million in secured and unsecured debt with Regency, has
yet to come to any agreement, according to Guttman, who
added that negotiations would continue. Bankers Trust
holds rights to 90 to 100 "spec" homes that are nearly
complete.  The four banks also included in their agreement
$550,000 to go toward satisfying administrative expenses as
well as employee, trade and consumer claims against
Regency.  The deal with the four banks also effectively
kills a proposal made in August by Washington Homes Inc. of
Landover to purchase the assets of Regency for $25.5
million. Guttman said the banks balked at the Washington
Homes proposal for not being more lucrative, saying their
portion of the purchase would total $16 million, but the
principal value was $21 million.

Guttman expects to close the agreement with the four banks
next week and at "that point each bank will have to have a
story of what they are going to do"  in terms of dealing
with buyers who may have contracts to build homes. Guttman  
said his office has a list of which banks own which lots.
Christopher Spendley, chief financial officer for
Washington Homes, said that his company -- despite not
acquiring all the assets -- remains in  negotiation with
several of banks.

Provident issued a statement saying the court order "allows
us to take control of our collateral. We are talking to
various third parties about the disposition of that

Regency, once the largest private homebuilder in Maryland,
filed for bankruptcy in July after an agreement for
Atlanta-based Beazer Homes USA to buy the company for $41
million fell through after creditor objections. In
a  release of creditor schedules Monday, Guttman said the
company showed a total  of $46.5 million in secured claims,
$1.6 million in priority claims (employee  payroll and
consumer deposits) and another $14.8 million in
unsecured claims.  The largest unsecured claim was by
Bankers Trust at $7 million, according to Guttman.  Also
waiting for a resolution is Thomas P. Raimondi, associate
deputy  commissioner for the Maryland Insurance
Administration.  Raimondi said his office has "a couple of
hundred" claims from Regency depositors against a $500,000
surety bond that was taken out by the company last spring.
"We hopefully are going to make distribution once this is
all resolved," he said. (BaltimoreSun-10/21/98)

STAR NEWCO: Seeks DIP Financing
The debtor, Star Newco, Inc. is seeking authorization to
obtain secured post-petition financing.  The motion will be  
heard on October 30, 1998 at 9:30 am at the U.S. Bankruptcy
Court, 824 Market Street, Wilmington, Delaware.

The debtor seeks authority to obtain the DIP Financing
under the terms set fort in the post-petition loan
agreement.  The maximum amount of the facility is $8
million subject to the terms of the loan.  The monthly term
loan amortization is $50,000 per month payable at the end
of the month.

The ability of the debtor to finance its operations, and
the availability of sufficient working capital and
liquidity through the occurrence of new indebtedness for
borrowed money is essential to the debtor's ability to
continue to operate in the short term.  In the absence of
such financing, the continued operation of the debtor's
business would not be possible and serious and irreparable
harm to the debtor and its estate would occur. In
particular the debtor states that it will have difficulty
in dealing with its customers and suppliers without the
availability of the DIP financing.

STORM TECHNOLOGY: Files Chapter 11
Storm Technology Inc., Mountain View, Calif., has filed for
chapter 11 protection in the Northern District of
California, according to a newswire report. President and
CEO L. William Krause said that the filing is in the best
interest of Storm's customers, employees and creditors,
and that it provides the best opportunity to restore
financial stability. (ABI 22-Oct-98)

SUN TV: Final Okay For Reduced $60M DIP Pact
The court has given final approval to Sun Television &
Appliances Inc.'s $60 million debtor-in-possession credit
agreement with BankBoston Retail Finance Inc. as agent,
reduced from the initial $75 million proposal. The DIP
agreement matures on the earlier of Sept. 15, 2000, notice
of a default, and confirmation of a reorganization plan.
Meanwhile, the consumer electronics chain said vendors are
responding unfavorably to its Chapter 11 filing. "Currently
the company is receiving little or no vendor support or
trade credit, and some vendors have chosen not to sell
product to the company post-petition." (The Daily
Bankruptcy Review and ABI Copyright c 22-Oct-98)

SUN TV: Money Situation Worsens
According to the Columbus Dispatch on October 21, 1998,                         
Sun Television & Appliances has suffered its biggest three-
month loss ever and is warning investors to expect the
worst, say documents filed Monday with the Securities and
Exchange Commission.

The ailing electronics retailer reported a loss of $63.5
million for the quarter ended Aug. 29, the largest
quarterly loss in the company's 49-year history. Sun has
lost more than $153 million in the past 2 1/2 years.

The 59-store chain filed for Chapter 11 bankruptcy
protection Sept. 16 and got court approval a day later to
close 29 stores. The stores - in metropolitan Cleveland,
Cincinnati, Pittsburgh and Buffalo, and in smaller cities
in Kentucky, Pennsylvania, Tennessee and Virginia - were
turned over to a liquidator last week. Going-out- of-
business sales are expected to be
complete  before year-end.

Thirty other stores - including eight in central Ohio - are
to remain open for business. Bankruptcy-court officials are
expected to decide soon whether another Sun store will open
this fall at Easton.

Officials weren't available for comment yesterday, but
their statements in SEC filings don't sugarcoat Sun's
condition.  "It is extremely unlikely that holders of the
company's common stock will receive or retain any property
under a plan of reorganization or otherwise," officials

Sun's stock has traded at less than $1 since the bankruptcy
filing.  Yesterday, Sun's stock closed at 17 cents. A
little more than five years ago, it was $27 a share.  Sun
filed for bankruptcy after poor sales led the chain to
default on loan payments due in August, giving vendors the
jitters. In the SEC filing, officials said some vendors are
refusing to sell merchandise to Sun. Others have required
cash payment when merchandise is delivered rather than
deferring payment until it is sold, the customary retail

"For a stand-alone reorganization plan to be viable, vendor
support and trade credit are critical," Sun said in the
filing. "Currently, the company is receiving little or no
vendor support or trade credit, and some vendors have  
chosen not to sell product to the company."  Meanwhile,
Sun's credit crunch is making it difficult to stock
shelves. The company's line of credit with Banc Boston was
reduced last week to $60 million from $100 million before
the bankruptcy filing.

Sun Chairman Carter Pate and President Dennis May said
unexpectedly poor sales in July and August and thin profit
margins combined to force the bankruptcy petition. In the
securities filing, officials said sales at stores open
longer than a year declined 9.3 percent. Those declines
come in addition to declines in 1997 and 1996, largely as a
result of competition from national chains including Best
Buy and Circuit City.

Pate's strategy was to open stores in smaller towns to
avoid the national competitors, but that hasn't worked.
Some of the stores to close this fall have been open less
than six months. In the securities filing, officials said
the chain experienced "slower-than- expected sales growth
from the new rural-market stores."   Sun's latest quarter
includes a charge of $47.4 million for store inventory  
and real estate related to the planned store closings.
May said last month that Sun is open to selling all or part
of the remaining company, but no one has offered to buy it
since late 1996.

In the past six months, Sun has lost more than $74 million,
or $4.27 per share, on sales of $231.2 million.
In addition to the local stores, Sun intends to operate 22
stores in smaller cities in Ohio, Indiana, West Virginia,
Virginia and Pennsylvania.


The Meetings, Conferences and Seminars column appears in
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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 Lexy Mueller, Editors.   

Copyright 1998.  All rights reserved.  ISSN 1520-9474.  
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