TCR_Public/990107.MBX T R O U B L E D   C O M P A N Y   R E P O R T E R
     
  Thursday, January 7, 1999, Vol. 3, No. 4

                 Headlines

2CONNECT EXPRESS: Completes Merger With Bobby Allison
AHERF: Bankruptcy Trustee Asks AUH-West to Drop Appeal
AHERF: Looking To Sell Solvent Hospitals
ARCADE TEXTILES: Files Bankruptcy - Out of Business
CHEMTRACK: Applies To Employ Financial Advisor

COMMERCIAL FINANCIAL: To Downsize By Week's End   
FIDELITY BANCORP: Annual Report For Fiscal Year Ended 9/30
MERCHANTS: Files Current Report With SEC
MOBILEMEDIA: Seeks To sell Equity Interests To Abacus
FULCRUM DIRECT: DIP Financing Extended To Jan. 30

GALILEO CORP: Stock Ownership Reported
HAYES CORP: Staff Gets No Severance
INTERNATIONAL HERITAGE: Chief Executive Is Big Creditor
INTERNATIONAL WIRELESS: Seeks Extension of Exclusivity
INTERSCIENCE COMPUTER: Annual Report For Year Ended 9/30

JOTAN: Court Authorizes Special Counsel
LONG JOHN SILVER'S: Seeks Extension of Exclusivity
NATIONAL ENERGY: Files Motion To Dismiss Petition
NEXAR TECHNOLOGIES: Continued Operation In Air
NORDICTRACK: Parent Chapter 11 Case Moved To Mass.

PHP HEALTHCARE: Seeks Authority To Fire Mazur
PRECISION AUTO: Receives Credit Waiver
SABACOL INC: Meeting of Creditors
SYNCRONYS SOFTCORP: Files Monthly Statement With SEC
SYQUEST: Drives Now Supported by Inter-Manufacturing Inc.
   
                  *********

2CONNECT EXPRESS: Completes Merger With Bobby Allison
-----------------------------------------------------
2Connect Express, Inc. announced the completion of its
merger with Bobby Allison Cellular Systems of Florida,
Inc., effective at 11:59 p.m. EST, December 31, 1998. On
May 1, 1998, 2Connect entered into a definitive merger
agreement, as amended October 26, 1998, with Bobby Allison,
which provided for Bobby Allison to merge with and into
2Connect Acquisition Corp., a wholly owned subsidiary of
2Connect formed for the purpose of facilitating the merger.

Pursuant to the terms of the merger agreement, the
following occurred: (i) 2Connect Acquisition Corp. survives
the merger, remains a wholly owned subsidiary of 2Connect
and has changed its name to "Bobby Allison Wireless,  
Inc.;" (ii) the holders of all of the common stock of Bobby
Allison, Robert L. McGinnis and James L. Ralph, each
received (A) 175, 000 shares of the common stock of
2Connect ("Common Stock") or, in the aggregate, 350,000
shares representing approximately 73% of the 480,000 shares
of Common Stock outstanding after the merger and (B)
$125,000 debenture (or $250,000 in the aggregate) bearing
interest at 7.5% per annum amortized over three (3) years;  
(iii) the holders of preferred stock in Bobby Allison
received equivalent preferred stock in 2Connect, which
preferred stock is convertible into 270,790 shares of
Common Stock, of which Robert L. McGinnis and James L.
Ralph own preferred stock convertible into 24,996 shares of
Common Stock; (iv) Craig R. Heyward and F. Eugene Woodham
resigned from the Board of Directors of 2Connect  
and Robert L. McGinnis and James L. Ralph were elected to
fill such vacancies and (v) James S. Holbrook, Jr., former
Chairman and CEO, and F. Eugene Woodham, former Secretary
and Treasurer, resigned as Officers Of 2Connect and Robert
L. McGinnis was appointed to serve as Chairman, CEO and
Treasurer and James L. Ralph was appointed to serve as
President and Secretary.

2Connect filed a voluntary petition for relief under
Chapter 11 of the U.S.  Bankruptcy Code on January 12,
1998, and subsequently closed all of its stores except the
store at Coral Square Mall in Coral Springs, Florida.
2Connect liquidated most of its assets and reduced its
overhead to skeleton levels. The Coral Square store
operated from June 16, 1998 until the effective date of the  
merger under a Management Agreement with Bobby Allison
whereby Bobby Allison  was responsible for all expenses
related to that store and is entitled to any  profits or
losses that it generated. The Management Agreement
automatically terminated upon the merger.

On August 27, 1998, 2Connect entered into an agreement with
Sterne, Agee & Leach, Inc., whereby Sterne Agee acquired
out of bankruptcy 100% of the equity interests of 2Connect
and 2Connect would retain the Coral Square store
lease  and certain store fixtures. In consideration for
such acquisition, Sterne Agee made a new value contribution
to the bankruptcy estate for the benefit of 2Connect's
creditors in the amount of $175,000. To effect this
transaction, the  Plan of Reorganization, as amended,
provided that, upon the effective date of  the Plan of
Reorganization, all of the existing Common Stock
of 2Connect was  forever extinguished and canceled and
2Connect issued 30,000 new shares of  Common Stock to
Sterne Agee which constituted 100% of the issued
and  outstanding shares at such time. The existing
shareholders of the Common Stock of 2Connect did not retain
any interest in the post-bankruptcy estate and their  
interests were extinguished and canceled. On October 27,
1998, the U.S.  Bankruptcy Court confirmed 2Connect's Plan
of Reorganization and 2Connect emerged from bankruptcy as a
wholly owned subsidiary of Sterne Agee. A related entity of
Sterne Agee acquired an additional 100,000 shares of Common
Stock  prior to the merger.

As a consequence of the merger, 2Connect will, through its
wholly owned subsidiary Bobby Allison Wireless, Inc., own
and operate 24 mall-based specialty retail locations and
one direct marketing location in the state of Florida
offering cellular and pager service under the names "Bobby
Allison Wireless" and "Bobby Allison Cellular." 2Connect is
now the largest authorized dealer of AT&T Wireless services
in the state of Florida and is being operated  
by the former management of Bobby Allison.  


AHERF: Bankruptcy Trustee Asks AUH-West to Drop Appeal
------------------------------------------------------
Allegheny Health, Education & Research Foundation (AHERF)
bankruptcy trustee William J. Scharffenberger has asked
Allegheny University Hospitals-West to drop an appeal in
federal court designed to prevent the hospitals from being
pulled into AHERF's chapter 11 case, The Pittsburgh Post-
Gazette reported. Scharffenberger said in a letter to the
chairman of Allegheny Generals Hospital's board of
directors that if the hospitals do not drop the appeal, he
would be "constrained to pursue the other options available
to me," but he did not elaborate on those options. AGH,
Forbes Health System, Allegheny Valley Hospital and
Canonsburg Hospital were not included in AHERF's July 1998
chapter 11 filing and are collectively known as AUH-West. A
spokesman for the state attorney general is reportedly
disappointed by the trustee's request, stating that he is
asking the hospitals to drop their support for an appeal
filed by the attorney general. He said the attorney general
is trying to protect the hospitals. Scharffenberger said he
asked AUH-West to drop the appeal to avoid a legal fight
and that it is not his intent to bring AUH-West into
bankruptcy.


AHERF: Looking To Sell Solvent Hospitals
----------------------------------------
Allegheny Health, Education and Research Foundation is
looking to sell all of its still-solvent western
Pennsylvania hospitals. A spokesman for the foundation said
yesterday that it's a package deal, all or nothing.  
Proposals are being sought by Jan. 15th for the possible
sale. Allegheny Health sold off its Philadelphia area
holdings late last year after filing for bankruptcy. That
sale raised $345-million. The foundation has debts of
roughly  $1-billion, according to the Tribune-Review.


ARCADE TEXTILES: Files Bankruptcy - Out of Business
---------------------------------------------------
The owners of Arcade Textiles made it official Wednesday:
They're out of business.

The Twaddell family moved its operations to the Gaston
County, N.C., town of Bessemer City after a November 1997
fire destroyed the company's plant on Blackwell Street near
downtown Rock Hill.

The Twaddells' textile operations, now known as Custom
Textiles, closed earlier this month, putting 50 out of
work. On Dec. 11, Custom Textiles filed for Chapter 11
bankruptcy, which would have allowed the company to live
again.

But Wednesday, attorney David Badger filed papers to change
to a Chapter 7  bankruptcy, in which Custom Textiles will
liquidate its assets, pay off creditors and go out of
business. Badger described the chances of the Twaddells
returning to the business as "slim to none."
   
Custom Textiles listed $6.5 million of assets and $11.5
million worth of liabilities in its filing. It owes FMRA, a
related company that holds the lease on its Bessemer City
mill, $5.04 million. Custom Textiles owes NationsBank  
$4.73 million, about $488,000 of which is unsecured by any
collateral.

Badger said the Twaddells created Custom Textiles as a new
company for the Bessemer City operations. "The only
relation (to Arcade) is similar ownership."

The Twaddells continue to wait for an insurance payment for
the Rock Hill fire. A case in U.S. District Court in
Columbia is attempting to sort out how to divide the money
among the Twaddells' companies, their lenders and
customers  that had products destroyed in the blaze.

Custom Textiles owes nearly $169,000 to the city of
Bessemer for water, sewer and natural gas service,
according to the filing.

The company also lists six York County companies as
creditors in amounts ranging from $40 to more than $7,000
owed to Econo-Tex Inc. of Clover and Star Paper Tube in
Rock Hill.  (Herald Rock Hill - 12/31/98)


CHEMTRACK: Applies To Employ Financial Advisor
----------------------------------------------
Chemtrak Incorporated, the debtor, requests authority to
employ MedTech Capital, Inc. to provide financial advisory
services to assist the debtor in locating purchasers of the
debtor's business or assets.

MedTech will be paid an initial fee of $5,000 and in the
event the company reaches agreement on a transaction, the
company shall pay a cash success fee at transaction closing
based on the value of each such transaction at the rate of
2 1/2% of the value of the transaction.

The debtor had a sale offer by Clinimetrics Research
Associates, Inc. which did not close, and MedTech has
waived its claim for any fees from that sale since it did
not close.  However the debtor believes that MedTech is the
the most appropriate party to assist the debtor in its
renewed efforts to sell the business, since MedTech
previously made many good contacts with potential
purchasers.


COMMERCIAL FINANCIAL: To Downsize By Week's End   
-----------------------------------------------                 
The Daily Oklahoman reports on January 5, 1999 that                
Tulsa-based Commercial Financial Services will cut its
3,600 work force in half at the end of the week, a company
spokeswoman said Monday.

The troubled company, which collects credit card debt,
announced plans two weeks ago to lay off 1,800 workers but
didn't indicate a timetable for achieving the reductions.

The job cuts are part of a swift restructuring plan to make
the company more attractive to potential buyers. Sixteen
companies have expressed an interest in  a merger,
acquisition or some kind of business affiliation, Price
said.

The company's troubles became public in late October when
debt-rating agencies lowered or suspended ratings on the
company's credit card, debt-backed securities, which
Commercial Financial issued to raise capital to buy more  
delinquent credit card debts from the nation's largest
banks.

Employees were told Monday how layoffs would be
administered and were asked to take home personal
belongings to make the process easier, Price said.  
Retained workers will likely be reshuffled as the company
consolidates offices, she said.  The packets will instruct
retained workers on where to report to work Sunday
or Monday and will provide laid-off workers with
information on benefits.

An official with the Oklahoma Employment Security
Commission will be in the Oklahoma City office Thursday to
show workers how to apply for unemployment, Price said.

Commercial Financial also is conducting job fairs for laid-
off workers Monday and Jan. 12 at Expo Square in Tulsa and
Jan. 14 at the Embassy Suites, 1815 S Meridian, in Oklahoma
City. Companies recruiting at the job fairs must be seeking
at least 10 permanent employees for positions paying
minimum salaries of $20,000.

Six companies have expressed an interest in Commercial
Financial since the company filed its Chapter 11 petition,
Price said.  Ten other companies already have visited
Commercial Financial's Tulsa office. Nine of the 10 have
reconfirmed their interest in submitting a proposal, Price
said, and the 10th is considering it. The company will not
disclose the names of potential bidders, although  
Creditrust Corp., SunAmerica and GE Capital Corp. have been
mentioned as suitors.

In other matters, company President Fred Caruso appointed
Alan Colberg chief operating officer. He had been managing
director of strategic business initiatives.


FIDELITY BANCORP: Annual Report For Fiscal Year Ended 9/30
----------------------------------------------------------
At September 30, 1998, the Company had total assets of
$406.0  million, savings  deposits of $261.7 million and  
stockholders' equity of $29.0 million.
A full-text copy of the filing is available via the
Internet at:
     http://www.sec.gov/Archives/edgar/data/0000914317-98-
000746.txt


FIRST MERCHANTS: Files Current Report With SEC
----------------------------------------------
First Merchants Acceptance Corporation filed a Report dated
December 29, 1998 with the SEC.  The company's plan of
reorganization became effective on March 31, 1998.

Under the terms of the Plan and various Bankruptcy Court
orders, Ugly Duckling Corporation acquired the Company's
property and equipment related to the Company's loan
servicing operations and replaced the Company as the
services of the Owned Contracts and Securitization
Contracts.  UDC has since transferred the loan servicing to
Cygnet Financial Services, an affiliate of UDC.

As a result of the Plan, the reorganized Company is issuing
$44 million of debt with interest accruing at a rate of
5.47% per annum, compounded quarterly, which is being
allocated among the Company's subordinated debt holders
plus all other unsecured and trade creditors, in
satisfaction of their allowed claims.  

The Company will rely upon its portion of the collections
on its remaining interest in various loan portfolios and
net proceeds from certain causes of action to meet Plan
obligations.  There can be no assurance that the New Debt
will be paid in full.  The New Debt shall mature on
February 28, 2003.  

Under the Plan, the New Debt will receive payment after
certain secured and administrative expense obligations have
been satisfied.  Likewise, the Company is not entitled to
receive cash flow from its residual interests in various
securitizations until the senior certificates for the
applicable securitization have been satisfied.  The
information attached hereto outlines the various sources of
cash and senior debt at the securitization level and
Company level which need to be satisfied in order for
payments on the New Debt to begin.

UDC agreed to provide up to $21.5 million of "debtor-in
possession" financing (the "DIP Facility").  The interest
rate on borrowings outstanding under the DIP Facility is
10% per annum from and after the effective date of the plan
with a maturity date of December 31, 2000.

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

     http://www.sec.gov/Archives/edgar/data/0000950124-98-
007769.txt


FULCRUM DIRECT: DIP Financing Extended To Jan. 30
--------------------------------------------------
The court has approved a fourth amendment to Fulcrum Direct
Inc.'s interim debtor-in-possession financing agreement
with IBJ Schroder Business Credit Corp. that extends the
maturity date through Jan. 30 and increases it to $2.9
million. Fulcrum got its first extension in the end of
September, extending the DIP facility to Oct. 30 and
increasing the amount to $2.2 million. The second extension
raised the ceiling to $2.7 million and pushed the deadline
to Nov. 28. The third extension, which maintained the same
sum, gave Fulcrum and IBJ until Dec. 31 to negotiate a
permanent facility. The company owed a total of
approximately $18.9 million under its $22.5 million
prepetition credit agreement with IBJ at the end of July.
The $2.9 million DIP agreement essentially leaves
intact the terms of the prepetition agreement, and excludes
the amount of prepetition debt.(The Daily Bankruptcy Review
and ABI Copyright c January 6, 1999)


GALILEO CORP: Stock Ownership Reported
--------------------------------------
Schedule 13D is filed with the SEC by (1)  Andlinger  
Capital XIII LLC,  a  limited  liability  company  
organized  under  the laws of the State of
Connecticut (2)  Gerhard R.  Andlinger,  (3) Stephen A.
Magida, (4) Charles E. Ball and (5) John P. Kehoe.  

Andlinger Capital XIII LLC reports beneficial ownership of
4 million shares of common stock of Galileo Corp.,
representing 33.1% of the class.

Galileo Corp.  and   Andlinger   Capital  have  entered  
into  a Securities  Purchase  Agreement,  dated as of
December 22, 1998, and certain related agreements. The
Purchase Agreement, among other things,  provides  for the  
purchase by  Andlinger  Capital,  subject to certain
conditions,  of  2,000,000  shares of  Common  Stock and  
warrants  to  purchase 2,000,000  shares of Common Stock  
(subject to  anti-dilution  adjustment) at an
exercise price of $1.50 per share,  exercisable at any time
prior to 7-1/2 years after their date of issuance,  for the
aggregate  consideration of  $6,000,000.  

It is anticipated that prior to closing each member of
Andlinger  Capital will make an initial cash contribution
to Andlinger Capital in an amount proportionate to his
interest  in  Andlinger   Capital  and  that  the  amount  
and  source  of  such contributions  will be, (1) in the
case of Mr.  Andlinger,  $5,550,000  from his
personal funds, (2) in the case of Mr. Magida, $75,000 from
a loan to be made by Mr.  Andlinger  from his personal  
funds prior to the closing under the Purchase Agreement at
an interest  rate of 10% per annum,  (3) in the case of Mr.  
Kehoe, $75,000 from a loan to be made by Mr. Andlinger from
his personal funds prior to the closing  under the Purchase  
Agreement at an interest rate of 10% per annum;
and  (4) in the  case  of Mr.  Ball,  $300,000  from a loan  
to be  made  by Mr. Andlinger  from his  personal  funds  
prior to the  closing  under the  Purchase Agreement at an
interest rate of 10% per annum.


HAYES CORP: Staff Gets No Severance
-----------------------------------
The Atlanta Journal/Constitution reports on January 5, 1999
that Hayes Corp. on Monday laid off all but a handful of
employees, after running out of cash when bankers slammed
the door on financing for anything but a liquidation of the
once-proud company.

Once the leading maker of analog modems, Hayes sent about
250 employees home without severance packages, apparently
giving up the ghost after months of struggle through
sagging sales, feuding executives and a stock price
crashing toward zero.

Yet even as the end loomed, officials were still
negotiating with potential "white knights" who might have
purchased Hayes, said Ron Howard, Hayes' chief  
executive officer. "As late as this weekend, we had
significant interest in the sale of the company as a going
concern, but the bank wouldn't fund that."

Talks ended Monday, and the company moved to close down.

Howard declined to name potential suitors. But Hayes had
been in talks with Kaifa Technology of Taiwan and another
unnamed company that would have put the Hayes name on
modems it manufactured. Even as its debts grew steeper,
Hayes officials had hoped such a deal to outsource
production would offer a way to keep the company alive.

NationsCredit, which had funded the limping company after
its fall into bankruptcy protection Oct. 9, put officials
on notice two weeks ago that it would not fund efforts to
find a suitor or to keep the company in business.  
When Hayes failed to find alternate sources of revenue ---
a buyer or a big contract --- it had no choice but to shut
down.

Through years of turmoil, the Hayes work force had been
shaved from more than 1,200 to fewer than 500 in November,
when the company shut down its manufacturing unit. Those
who stayed until the end now must get into queue with
other creditors, hoping a liquidation will leave them a few
scraps of severance.

Dennis Hayes has been alternately cursed and hailed for his
role in founding the company and steering it from upstart
to dominance --- and then into trouble. Yet in bankruptcy
court, Hayes had made an impassioned plea that he be  
permitted to reject takeover bids that ranged up to $140
million. As the prime shareholder, he would have been the
prime recipient of those offers, but he wanted the company
to remain independent and in Georgia.

To convince the judge, Hayes accepted investment that
diluted his control, hired a chief executive officer and
gave up day-to-day control of operations. But the CEO
stayed less than two years. After the merger with Access
Beyond, Howard became CEO --- and the two men did not get
along. In the fall, Hayes agreed to resign as chairman of
the board. Monday, he declined to comment on the company's
fate or on his own plans.

Hayes Corp. owes creditors about $42 million. The company
has several hundred creditors, although the bulk of the
debt is owed to NationsCredit and a few large suppliers
like Lucent Technologies, which says it is owed $4.8  
million, and another chip maker, Rockwell Semiconductor
Systems, which alleges  a debt of $2.8 million.

Charles Campbell, attorney for the committee representing
creditors, said the company is not formally being
liquidated. "In order to have a liquidation you'd have to
sell all the assets, employ an auctioneer and so on,
and that would require a court order."

The next court session is set for Jan. 19, Campbell said.

Howard said that while formal sale of assets has not begun,
the company is no longer in business. "The company is being
liquidated. The company is no longer being operated as a
going concern." Howard said he will remain chairman of the
board but is no longer an employee.


INTERNATIONAL HERITAGE: Chief Executive Is Big Creditor
-------------------------------------------------------
It was reported in the News Observer, Raleigh NC on January
5, 1999 that Stan Van Etten, the chief executive of
International Heritage Inc., is the bankrupt Raleigh
company's largest creditor -- and his claim could  put him
at the front of the line when it comes to divvying up the
company's  assets.

Van Etten plans to file secured claims for $6 million from
the network marketing company. A secured claim has the
highest priority in Chapter 7 bankruptcy cases.

IHI filed for Chapter 7 bankruptcy, which leads to
liquidation of a company's assets, on the day before
Thanksgiving.  Van Etten said he put up $5 million of his
own money for a court-ordered bond that grew out of a civil
complaint by the Securities and Exchange Commission. In
March, the SEC accused IHI of being a massive pyramid
scheme.  IHI claims the litigation effectively put the
company out of business.

About $3.7 million of the bond money, including $200,000 in
fees, went to the surety company that supplied the bond.
The remaining amount went to IHI for its operations.

Van Etten said he loaned IHI an additional $1 million
through Mayflower Capital, an investment brokerage he owns.
And he is seeking some unpaid wages and legal fees.

As with most creditors, Van Etten probably won't collect
the amount he is claiming.   "Seeking and recovering the
money are different things," said Brent Wood, an
attorney with Wood & Francis, which represents Van Etten
and IHI.

Paying all creditors in full "would be a rare thing ... in
a bankruptcy case," said Holmes Harden, the bankruptcy
trustee.

In addition, the $5 million bond that Van Etten funded
could be used to pay off any court judgments won by the
SEC, which is still pursuing its civil case.  Any money the
SEC succeeds in prying from IHI would be distributed
to the  company's former independent sales representatives
who are seeking refunds.

Harden said it remains to be seen whether Van Etten's claim
meets the legal requirements for a secured claim.
"These are all things I need to look at," he said. "We are
going to do our dead-level best to generate money for
unsecured creditors. One of the ways to do that is to look
at {money} transfers like this and see if there are
grounds to challenge it."

Unsecured creditors are those who are owed money by IHI but
whose transactions with the company were not backed by
collateral.  Harden held a hearing last week so that he and
creditors could question Van Etten regarding IHI's assets.
Only a handful of attorneys representing creditors were
present. Creditors have until March 8 to file claims.

Harden, from the Raleigh law firm of Maupin Taylor & Ellis,
is trying to determine the value of the company's assets.
About 195,000 creditors, including Van Etten, are seeking
more than $12 million in claims, according to court  
documents. The company's liabilities are listed as totaling
$12.9 million, and  its assets are listed at $5.4 million.

"Just because there are more liabilities than assets, that
doesn't mean there are no equity or assets to collect,"
Harden said. One asset could be a used $65,000 Ferrari that
was given to a sales representative at a 1998 convention in
New Orleans. The trustee also wants to sell IHI's
trademark, computers and its list of sales reps to other
network marketing companies.   Van Etten said a list broker
may pay $1 for each of the 195,000 names.


INTERNATIONAL WIRELESS: Seeks Extension of Exclusivity
------------------------------------------------------
Out of an abundance of caution, International Wireless
Communications Holdings, Inc. and its affiliated debtors
seek an extension of the debtors' exclusive periods in
which to file a Chapter 11 plan and to solicit acceptances
thereof.  The hearing to consider confirmation of the plan
is scheduled to commence on January 27, 1999.  The debtor
seeks an extension of the filing period through and until
such time as the court enters an order regarding
confirmation of the plan and an extension of the
solicitation period through the later of the current
deadline of March 2, 1999 or the date the court enters an
order confirming the plan or any amendment thereto.

The debtors state that the plan confirmation process is
well underway and that the debtors remain in the best
position to propose and confirm a consensual chapter 11
plan.


INTERSCIENCE COMPUTER: Annual Report For Year Ended 9/30
--------------------------------------------------------
INTERSCIENCE COMPUTER CORPORATION filed its annual report
for the fiscal year ended September 30, 1998 with the SEC.

On April 1, 1998 a hearing was held in the Bankruptcy Court
to consider confirmation of the Company's First Amended
Plan of Reorganization.  The Plan was confirmed on April
20, 1998. As a result, the Company has been revested with
all of its assets. The Plan terms control all claims and
equity interests which existed as of March 6, 1997, the
date when the Company filed its Chapter 11 reorganization
case. The Company can now conduct business as usual without
the requirement of obtaining Bankruptcy Court approval.

As of December 1, 1998, the Company leases one warehouse in
Los Angeles pursuant to a three-year lease expiring
February 2001 at a rent of $4,700 per month, and one office
facility in Agoura Hills, California for the Company's
executive offices pursuant to a one-year lease extension
expiring January 2000 at a rental of $2,780 per month. The
warehouse in Los Angeles has 10,500 square feet and the
office in Agoura Hills has 2,362 square feet.

Sales for the fiscal year ended September 30, 1998
decreased by approximately 5, 046,000 or 55% from sales in
the prior year.

The Company posted net income during 1998 of approximately
$2,789,000 in contrast with a loss of $11,597,000 in fiscal
year 1997. The profit in fiscal year 1998 included net
income on continuing operations of $1,006,781, which
includes an income tax benefit of $652,471 and deferred
income tax of 250,000.Also included in the overall net
income of the Company was a gain of $332,471from the sale
of Interscience PLC in April 1998 and the sale and
discontinuance of Laser Support & Engineering, Inc. in
December 1997. The final component of net income for the
current fiscal year was a gain of approximately $1,450,000
on creditor settlements that were compromised during the
reorganization.


JOTAN: Court Authorizes Special Counsel
---------------------------------------
The Court entered an order on December 28, 1998 authorizing
the debtors, Jotan, Inc. and Southland Container Packaging
Corp., to retain Ridge & Lantinberg, PA as special counsel
to the debtors in a certain adversary proceeding with Jeff
Barnett, Alton E. Thompson, Bob McCririe, John Holcomb,
Nikki Holcomb and Eastern Seaboard Packaging, Inc.

Subject to court approval, compensation on a contingent
basis is to be paid based on 30% of any recovery obtained
before trial or during trial and 35% of any recovery on or
after appeal.


LONG JOHN SILVER'S: Seeks Extension of Exclusivity
--------------------------------------------------
The debtors, Long John Silver's Restaurants, Inc., et al.,
seek court authority to extend exclusive periods in which
to file a plan of reorganization and solicit acceptances
thereto.  A hearing to consider the motion will be held on
January 14, 1999 at 2:30 PM before the Honorable Mary F.
Walrath, US Bankruptcy Court, District of Delaware.

The debtors state that they have made great strides toward
stabilizing their business operations and have made
substantial progress in their efforts toward effectuating
their ultimate reorganization.  The debtor s obtained
approval of a $65 million post-petition secured financing
facility.  The debtors have rejected 73 leases to sites
where the debtors no longer operate restaurants.  The
debtors have sold a total of eleven owned sites yielding
approximately $3.3 million in net proceeds for the debtors'
estates.  The debtors are currently marketing forty-eight
additional properties for sale.  The debtors have obtained
approval of a global reclamation claim program and the
debtors are requesting the extension of the exclusive
periods to complete the task of resolving reclamation
claims.  The debtors are still determining whether to sell
the remaining viable stores or to work on a "stand-alone"
business plan which would form the basis for a chapter 11
plan.

The debtors are seeking an extension of the exclusive
period within which the debtors may file a plan or plans of
reorganization through and including May 29, 1999.  The
debtors are seeking an extension of the exclusive period
within which the debtors may solicit acceptances of any
such plan(s) through and including July 28, 1999.


MOBILEMEDIA: Seeks To sell Equity Interests To Abacus
---------------------------------------------------------
The debtors, Mobilemedia Communications, Inc. et al. seek
to sell certain equity interests to Abacus Exchange Inc.

The debtors seek court authority to sell to Exchange
debtors' 33.33% limited partnership interest in Abacus and
the debtors' 33.33% membership interest in a related
entity, Abacus Communications, LLC for $1.4 million in cash
and to amend a dispatch agreement with Abacus.


NATIONAL ENERGY: Files Motion To Dismiss Petition
-------------------------------------------------
The Daily Oklahoman reports on January 5, 1999                  
Dallas-based National Energy Group Inc. has filed a motion
to dismiss an involuntary bankruptcy petition filed against
it a month ago in a Dallas federal court.

Shortly before the bankruptcy petition, Miles Bender was
replaced as National chairman, president and chief
executive by Bob G. Alexander, former chairman and
president of Oklahoma City-based Alexander Energy Corp.
Alexander has been a National board member since Alexander
Energy was acquired by National in 1996 through a deal
valued at more than $100 million.

National failed to make an $8.9 million interest payment
due Nov. 2 and had until Dec. 1 before the nonpayment
triggered default under an indenture. On Dec. 4, some of
National's 10 3/4 senior note bondholders filed the
involuntary  bankruptcy petition seeking a reorganization
of the company's finances.

National's motion to dismiss the bankruptcy says the
company is meeting obligations and generally paying debts
unless disputed. The motion also says National arranged to
borrow funds to pay accrued interest of about $9 million  
on the 10 3/4 percent senior notes, conditioned upon
dismissal of the involuntary petition.


NEXAR TECHNOLOGIES: Continued Operation In Air
----------------------------------------------
The Worcester Telegram & Gazette reports on January 5, 1999
that U.S. Bankruptcy Court Judge James F. Queenan has
continued  until tomorrow a hearing to determine whether
Nexar Technologies Inc. of Southboro will be allowed to
borrow enough money to continue operating.

If the court approves Nexar's request, ATEC Group Inc. of
Hauppauge, N.Y., will provide Nexar with a $750,000 credit
line to finance its operations during bankruptcy
proceedings. Otherwise, Nexar could be forced into Chapter
7liquidation.

Nexar filed for bankruptcy protection against its creditors
Dec. 17. In its filing the company reported liabilities of
$5.4 million against assets of $4.3 million. ATEC, to which
Nexar owes $715,000, is the company's only secured
creditor. Nexar also owes money to 180 unsecured creditors.

In continuing the hearing on Nexar's request for approval
of its financing agreement, Queenan encouraged Nexar to
return to court tomorrow with an agreement with ATEC or
another company for the sale of some or all of Nexar's
assets. Failing such an agreement, Queenan said, he would
be tempted to deny the company's financing request.

Noting that Nexar is losing between $100,000 and $250,000 a
month, Queenan said it makes little sense to let the
company borrow money without solid evidence that it could
turn itself around.  "Why should I permit this continued
run-up of losses?" said Queenan "Why should I not close
this business down right now?"

Anthony A. Froio, lawyer for Robins, Kaplan, Miller and
Ciresi LLP of Boston, said if nothing else the successful
conclusion of the financing agreement would improve Nexar's
chances of collecting more than $3 million owed
to it by customers.

Froio said he was also hopeful that an agreement could be
reached either between Nexar and ATEC or Nexar and one of
several other parties the company has talked with about the
sale of its assets.

"I'm cautiously optimistic something can be worked out,"
Froio said.  In opposing Nexar's financing request, Whitton
E. Noris III, of Davis, Malm & D'Agostine P.C. of Boston,
argued that Nexar has no realistic prospect of  
stemming its losses. Norris, who represents Nexar's
unsecured creditors, pointed out that in recent months
Nexar has cut its work force from 70 to 21, has closed its
California manufacturing plant and is producing computers
only sporadically under an arrangement with ATEC.

Even so, said Norris, Nexar maintains "opulent" offices,
carries an average monthly payroll of $130,000 and proposes
to continue making lease payments on automobiles that the
company provides its top executives, including a 1997  
Jaguar XJ8, a 1997 Infiniti 530 and a 1997 BMW 528i.

"All that is being done could be done for $25,000 a month,"
Norris said.  In continuing the hearing, Judge Queenan
suggested that Froio talk to Nexar Chief Executive Officer
and President Albert J. Agbay about terminating the car  
leases and taking an immediate cut in his monthly salary of
$14,583.  "Management must give serious consideration to
salary reductions," Queenan said. "These car leasing
arrangements are out. I'm not authorizing one cent for
them."


NORDICTRACK: Parent Chapter 11 Case Moved To Mass.
--------------------------------------------------
The U.S. Trustee won its bid to transfer venue of CML Group
Inc.'s chapter 11 case from Wilmington, Del., to Worcester,
Mass., where unit NordicTrack Inc. sought bankruptcy
protection in November. The U.S. Trustee 's office in
Worcester, which filed a Dec. 18 emergency motion seeking
the venue change, pointed to CML's relationship to
NordicTrack, including a shared address, as reason for the
transfer. The motion estimates CML's debt at about $85
million, asserting that the companies are linked and that
each is affected by the actions of the other. Acton, Mass.-
based NordicTrack Inc., an exercise equipment manufacturer,
and retail subsidiary NordicTrack Advantage Inc. filed for
Chapter 11 in Worcester Nov. 5. Holding company CML
followed suit about six weeks later. (The Daily Bankruptcy
Review and ABI Copyright c January 6, 1999)


PHP HEALTHCARE: Seeks Authority To Fire Mazur
---------------------------------------------
The debtor, PHP Healthcare Corporation seeks court
authority  to reject the employment agreement with Jack M.
Mazur.  Mazur was CEO of PHP and was paid a base salary of
$675,000 per year, with an executive benefit plan and an
employee benefit plan and other fringe benefits.  He is no
longer providing any services to PHP.

PHP's board of directors received a report from a special
committee of the Board finding that Mazur engaged in
conduct which constituted 'cause' for termination under the
employment agreement.  There is a scheduled hearing with
the Board on January 20, 1999.


PRECISION AUTO: Receives Credit Waiver
--------------------------------------
Precision Auto Care Inc., Leesburg, Va., announced that it
has received a waiver of its  bank credit default but that
it does not expect to be in compliance with the current
terms  of the credit line by March 31, according to
Reuters. The company, which franchises auto
care centers, expects to post a second quarter loss
exceeding the $717,000 it lost in its first fiscal quarter.
In November the company announced it was having liquidity
problems and that it needed additional financing for
operations. It plans to sell some of its non-strategic car
wash operations this month and expects unspecified
financing transactions by the end of March, but based on
anticipated operating results, Precision Auto does not
expect it will be in compliance with current financial
agreement as of March 31. (ABI 06-Jan-99)


SABACOL INC: Meeting of Creditors
---------------------------------
A Chapter 11 bankruptcy case concerning Sabacol Inc. was
filed on December 11, 1998.  The meeting of creditors is
set for February 4, 1999, 9:00 AM, 128 East Carrillo
Street, Santa Barbara, CA 93101.  The debtor
s attorney is Jay L. Michaelson, 7 West Figueroa Street,
2nd Floor, Santa Barbara, California 93101-31918.


SYNCRONYS SOFTCORP: Files Monthly Statement With SEC
----------------------------------------------------
On December 15, 1998 Syncronys Softcorp filed its fifth
Monthly Interim Statement and Debtor in Possession
Operating Report for the period:  November
1, 1998 through November 30, 1998.

The filing is available via the Internet at:
http://www.sec.gov/Archives/edgar/data/0000798077-98-
000017.txt


SYQUEST: Drives Now Supported by Inter-Manufacturing Inc.
---------------------------------------------------------           
Inter-Manufacturing Inc. (IMI), a contract manufacturing
services company located in Santa Clara announced, since
Dec. 1, 1998, it has voluntarily assumed the roles formerly  
performed by SyQuest's (SYQT) customer support and services
departments for the SyQuest disk drives and cartridge
products.  The action taken by IMI is a result of SyQuest's
inability to respond to customer's urgent needs. Since Nov.
15, 1998, SyQuest customers have contacted IMI for their
repairs. IMI was able to give owners of SyQuest product
limited support of "in warranty" and "out of warranty"
products.

"IMI services include refurbishing, cleaning, updating and
testing of drives and cartridges. The company even performs
data recovery. This announcement allows previous Syquest
customers to obtain the services previously unavailable
to them when SyQuest filed for bankruptcy. We are pleased
to provide IMI's  expertise to PC owners," stated Johan
Willems, IMI's President and CEO.  

Since Nov. 17, 1998, negotiations with SyQuest Technology
concerning the official transfer of customer support and
services from SyQuest to IMI were held. IMI's technical
expertise includes a history of manufacturing services for  
Syquest Technology since May 1997. IMI is a private company
founded to provoke manufacturing for high technology
companies. The company's World Wide Web Site  
is at http://www.intermfg.com.

                 *********

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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-
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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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