TCR_Public/990617.MBX T R O U B L E D   C O M P A N Y   R E P O R T E R=20
     Thursday, June 17, 1999, Vol. 3, No. 115                            =


FACTORY CARD: Appointment of Official Committee of Equity Holders
FACTORY CARD: Committee Supports Extension Regarding Leases
FACTORY CARD: Seeks To Set Bar Date For August 2
FIRST JERSEY: Fee Before Filing Ruled Preferential Transfer
FIRST MERCHANTS: Establishes Long-Term Equity Incentive Plan

FIRSTPLUS FINANCIAL: Joint Motion To Compromise Controversy
FIRSTPLUS FINANCIAL: Sale of Loans To Conti Mortgage Corp
FLORIDA COAST PAPER: Time Extended To File Schedules
GEOTEK: Comments Due on Plan
HARNISCHFEGER: Court Approves Professionals

HARNISCHFEGER: Extension of Time To File Schedules
HEALTHSPHERE: Files For Bankruptcy
HOMEPLACE: Back Bay Capital and BankBoston Announce Loans
HOMEPLACE: Plan Becomes Effective; Merger Completed
LOEHMANN'S: Seeks To Reject Certain Unexpired Leases

NUCENTRIX: Equity Plan For Key Players
NU-KOTE: Objections To Disclosure Statements
OKURA & CO: Seeks Approval of Stipulation
ORANGE COUNTY: Settlement With Standard & Poor's
PARAGON TRADE: Kimberly-Clark Seeks Protective Order

PCG CORP: Seeks Substantive Consolidation
PHILIP SERVICES: Extends Lock-Up Agreement with Lenders
PHP HEALTHCARE: Seeks To Assume and Assign CSC License Agreement
PREMIS CORP: Company To Cease All Operations/Liquidation Pending
PREMIS CORP: Stockholders To Vote On Sale Of Subsidiary

RECYCLING INDUSTRIES: Seeks Approval of Sale of Assets
SCOOP INC: Disclosure Statement in Support of Plan
SCOOP INC: Hearing Regarding Disclosure Statement
SOURCEONE WIRELESS: Seeks Extension To Assume or Reject Leases
TEXFI INDUSTRIES: Troublesome Events Continue To Vex Company
THORN APPLE: Creditors give Debtor Until July For Plan or Sale


FACTORY CARD: Appointment of Official Committee of Equity Holders
Ronald L. Chez and Allstate Insurance Company, together with=20
certain related entities, who in the aggregate own approximately=20
25% of the outstanding common stock of Factory Card Outlet Corp.=20
fiel a motion for appointment of an Official Committee of Equity=20
Holders.  The movants allege that there are compelling reasons=20
for the appointment of an Equity Committee in this case.  They=20
say that the debtor's status as a public company, the size and=20
complexity of the case and the solvency of the debtor weigh=20
strongly in favor of the appointment of an Equity Committee.

The movants also claim that the participation of equity in=20
determining the case's direction and the terms of its=20
reorganization plan are most critical at this juncture. "The=20
timing is exactly right for existing equity to be represented in=20
these negotiations.  The existing equity shareholders should=20
directly participate in the pending decisions on whether the=20
company should seek a stand-alone plan, as opposed to a sale, and=20
what portion, if any, of existing equity should be provided to=20
the debtor's shareholders."

FACTORY CARD: Committee Supports Extension Regarding Leases
The Official Committee of Unsecured Creditors of the debtors,=20
Factory Card Outlet Corp, and Factory Card Outlet of America Ltd.=20
believes that the debtors have not had an adequate opportunity to=20
make informed lease determinations  and that ample cause exists=20
to grant the requested extension for determination of assumption=20
or rejection of the debtors' 210 leases.  The debtors seek an=20
extension of time through July 31, 1999 to make determinations=20
with respect to their closed store leases and through November=20
24, 1999 to make decisions with respect to their remaining=20
operating store leases.

FACTORY CARD: Seeks To Set Bar Date For August 2
The debtors, Factory Card Outlet Corp, and Factory Card Outlet of=20
America Ltd. request entry of an order fixing August 2, 1999 at=20
5:00 PM, Pacific Time as the last date for filing proofs of claim=20
against the debtors. =20

FIRST JERSEY: Fee Before Filing Ruled Preferential Transfer
A Third Circuit Court of Appeals has ruled that Robinson St. John=20
& Wayne, a New Jersey law firm, must return $450,000 it was paid=20
in shares of stock just before its client, First Jersey
Securities Inc., filed chapter 11, according to The Legal=20
Intelligencer. The court ruled that the transfer was a=20
preferential payment and that the shares of stock in=20
International Thoroughbred Breeders Inc. that were paid to the=20
firm one day prior to the chapter 11 filing gave it an interest
adverse to the debtor's estate. It is not clear what the impact=20
of the ruling will be, because the firm has now split into two.=20

Walter J. Greenhalgh, who was lead counsel to First Jersey, is=20
now with the Newark office of Duane Morris & Heckscher. The=20
appeals court reversed the bankruptcy court and the district=20
court, which both held that the payment to the firm was proper,
even though it occurred during the 90-day preference period,=20
because it was not made in order to satisfy a past due debt, and=20
that even if it had been a voidable preference, it qualified for=20
an exception as a payment made in the "ordinary course of=20
business." U.S. District Judge Murray M. Schwartz (D. Del.) said=20
that the bankruptcy court's reasoning that a "debt is not owed=20
until payment is past due is not found in the preference statute"=20
and that "this is the type of payment Congress intended the=20
preference section to reach." Judge Schwartz also said that the=20
stock transfer "resulted in a large diminution of the value of=20
the debtor's estate, and a serious depletion of assets of the=20
estate available to other creditors. Similarly situated creditors=20
were not treated equally." (ABI 16-June-99)

FIRST MERCHANTS: Establishes Long-Term Equity Incentive Plan
First Merchants Corporation, an Indiana corporation, has=20
established a Long-Term Equity Incentive Plan effective as of=20
April 14, 1999, subject to the approval of the plan at the=20
company's 1999 annual meeting of shareholders.  Initial stock to=20
be registered for participation in the plan is 600,000 shares of=20
the company's common stock.

The plan is designed to promote the interests of the company, its=20
subsidiaries, and its shareholders by providing stock-based=20
incentives to selected employees, non-employee directors,=20
subsidiary directors and advisory directors who are expected to=20
contribute  materially to the success of the company and its=20
subsidiaries.  The purpose of the plan is to provide a means of=20
rewarding performance and to provide an opportunity to increase=20
the personal ownership interest of the above in the continued=20
success of the company.  The company believes that the plan will =20
assist its  efforts to attract and retain quality personnel,=20
directors and advisors.

For a complete text of the plan access
bin/srch-edgar?0000712534-99-000020 on the Internet, free of=20

FIRSTPLUS FINANCIAL: Joint Motion To Compromise Controversy
The debtors, FirstPlus Financial Inc. and FirstPlus Special=20
Funding Corp. and German American Capital Corporation ("GACC")=20
filed a joint motion to compromise a controversy with GACC and=20
related entities.

The settlement provides:
Financial will receive $6 million in cash from a certain escrow=20
agreement.  At the same time, GACC will receive the remaining=20
$3.3 million from the escrow to pay down GACC secured debt.  The=20
balance of the GACC secured debtor will be paid in full over a=20
four year term.  GACC will pay all recording and other loan=20
clean-up expenses relating to the loan sale dated October 8,=20
1998.  The debtors claim this will save between $2.5 million and=20
$4 million. The debtors request that the court approve the=20
compromise. The debtors say that their probability of success in=20
litigation against GACC is uncertain and that litigation would be=20
complex, expensive and would foster delay. =20

FIRSTPLUS FINANCIAL: Sale of Loans To Conti Mortgage Corp
FirstPlus Financial, Inc. intends to sell certain loans to Conti=20
Mortgage Corporation for the sum of $1,481,705 pursuant to a=20
certain Mortgage Loan Sale Agreement.

The proceeds of the sale will be applied against existing=20
indebtedness to Comerica Bank pursuant to court order.

FLORIDA COAST PAPER: Time Extended To File Schedules
The US Bankruptcy Court for the District of Delaware entered an=20
order extending the time within which the debtor Florida Coast=20
Paper Holding Company LLC and its affiliates must file =20
schedules, lists and statement of financial affairs through June=20
15, 1999.

GEOTEK: Comments Due on Plan
The FCC said comments are due June 28 on bankrupt Geotek's plan=20
to transfer its MHz SMR license to creditors Hughes Electronics=20
and Wilmington Trust, which plan to sell them to a Nextel
subsidiary, according to Mobile Communications Report. The FCC=20
may review the two steps separately. Oppositions are due July 8=20
and replies are due July 15.=20

HARNISCHFEGER: Court Approves Professionals
The Debtors obtained authority to employ Kirkland & Ellis as=20
their attorneys. =20

James H.M. Sprayregen, Esq., leads the engagement, assisted by=20
Anne Marrs Huber, Esq. Mr. Sprayregen advises the Court and=20
parties-in-interest that Kirkland was retained in contemplation=20
of these chapter 11 cases in April 1999.  Within the year prior=20
to the Petition Date, Kirkland received approximately $876,409=20
for pre-petition services.  Kirkland received a $100,000 retainer=20
in connection with these chapter 11 cases. =20
The Debtors agree, subject to Court approval, to pay Kirkland the=20
customary hourly rates billed by the Firm's professionals, and=20
reimburse all expenses.  Kirkland does not relate its customary=20
billing rates to the Court or parties-in-interest.=20

The Debtors seek to employ PricewaterhouseCoopers, LLP, as their=20
accountants and auditors in these chapter 11 cases. =20
PwC will bill the Debtors at its customary hourly rates:

Partners              $350-550
Directors/Principals  $240-490
Associates            $140-290=20
Paraprofessionals/Administrative Support    $60-100

The Debtors ask to employ PricewaterhouseCoopers Securities, a=20
wholly-owned subsidiary of PricewaterhouseCoopers, as their=20
financial advisors.  Specifically, PwC Securities will:=20

The Debtors agree to pay PwC Securities a $150,000 monthly=20
advisory fee. PwC Securites discloses that it received $100,000=20
for services performed prior to the Petition Date.=20

The Debtors obtained the Court's authority to employ the law firm=20
of Mayer, Brown and Platt as special arbitration and litigation=20
counsel.  Mayer Brown is currently assisting the Debtors in=20
litigating several claims on behalf of the Beloit subsidiaries. =20

There are pending litigation matters for which Mayer Brown has=20
been the lead counsel for the Debtors. These matters include the=20
APP Singapore Arbitration, the Norscan Icc Arbitration, the=20
Potlatch Idaho State Court Litigation, and the ALPAC AND=20
Ingersoll Rand Canadian Litigation.  The Debtors tell the Court=20
that Mayer Brown has been involved in these cases and has the=20
necessary familiarity and expertise necessary to represent the=20
Debtors in the cases.

APP SINGAPORE ARBITRATION.  The Singapore arbitration matters=20
relate to two fine-paper machines that Asia Pulp & Paper, Co.,=20
agreed to purchase, including manufacture and services, from two=20
indirect subsidiaries of Beloit Corporation for over 300,000,000.

THE NORSCAN ICC ARBITRATION.  Norscan-Tech Limited is a Hong Kong=20
Corporation.  It filed for arbitration against Beloit before the=20
International Chamber of Commerce in February 1999.  The=20
arbitration arises from a contract for the design, fabrication=20
and delivery of paper manufacturing equipment for erection in=20
Changshu, China.  Norscan alleges breach of contract and=20
misrepresentation by Beloit and seeks $4,711,000. The Beloit=20
subsidiaries are filed a counterclaim alleging misrepresentation.=20

complaint against Beloit, in an Idaho state court, for breach of=20
contract and breach of warranty, for seven large pulp washers. =20
In June 1997, an Idaho jury awarded Potlatch $95,000,000 in=20
damages.  The fees, costs, and interests for the case now total=20
$116,000,000.  The case was appealed and after reversal by the=20
Idaho Supreme Court, a new jury trial will be conducted.

Ingersoll Rand litigation was brought by ALPAC against Ingersoll=20
Rand and Beloit in September 1997.  ALPAC alleges that it was=20
sold a defective drum debarker and asserts that Beloit is liable=20
because Beloit purchased certain assets of Ingersoll Rand. =20
Ingersoll wants Beloit to indemnify it against ALPAC's=20
claims and Beloit denies any obligation.

The hourly rates for the attorneys primarily handling these=20
matters are:

          Hugh R. Mccombs              $400
          James E. Tancula             $375
          Bettina Getz                 $350
          Michael J. Gill              $350
          Frank A. Perrone             $275
          Theresa A. Canady            $215
          Ronald P. Gould              $215
          Timothy J. Tyler             $215

Judge Walsh granted the Debtors request to employ Kekst and=20
Company as their Public Relations Consultants. =20
Kekst's customary hourly billing rates are:=20

     Senior Partners       $495 to $700
     Partners              $460 to $495
     Senior Associates     $335 to $360
     Associates            $275 to $300

The court also approved Poorman-Douglas Corporation, a=20
subsidiary of Fleet National Bank, as their notice agent and=20
claims agent. (Harnischfeger Bankruptcy News Issue No.2 June 16,=20
1999; Bankruptcy Creditors' Service, Inc.)

HARNISCHFEGER: Extension of Time To File Schedules
The court allowed the Debtors an additional 40 days from the=20
Petition Date, to and including August 2, 1999, to file their=20
schedules of assets and liabilities, list of equity security=20
holders, schedules of executory contracts and unexpired leases=20
and statements of financial affairs. =20

The Debtors say they have more than 21,000 creditors, including=20
employees, and that given the size and complexity of their=20
business and the fact that certain pre-petition invoices have not=20
yet been received or entered into the Debtors' financial=20
accounting systems, they have not had the opportunity to gather=20
the necessary information to prepare and file the Statements and=20
Schedules. (Harnischfeger Bankruptcy News Issue No.2 June 16,=20
1999; Bankruptcy Creditors' Service, Inc.)

HEALTHSPHERE: Files For Bankruptcy
Two Memphis-based home health care firms and six subsidiaries=20
have filed for chapter 11 protection, according to The Commercial=20
Appeal. HealthSphere of America Inc. and its subsidiary Home-
Bound Medical Systems Inc. filed, along with six other Home-Bound=20
entities in Tennessee, Arkansas and Missouri. The corporations=20
have until June 25 to disclose their financial situations and=20
list their creditors. John L. Ryder of Apperson, Crump, Duzane &
Maxwell in Memphis is representing the eight firms. (ABI 16-June-

HOMEPLACE: Back Bay Capital and BankBoston Announce Loans
Back Bay Capital LLC announced on June 16, 1999 that it has
provided a $15 million junior secured term loan to the newly-
created HomePlace of America, Inc. Funds will be used primarily=20
to facilitate HomePlace Holdings' emergence from Chapter 11=20
bankruptcy proceedings and its merger with Waccamaw Corporation,=20
a retailer of home decor and furnishings, to form HomePlace of=20
America. Headquartered in Myrtle Beach, S.C., HomePlace of=20
America, Inc. is a retailer of home fashion textiles, home=20
furnishings and housewares. "We are pleased to assist
HomePlace and Waccamaw in this exciting new phase of growth,"=20
said Ward K. Mooney, chief operating officer of Back Bay Capital.=20
"We are confident that this facility will enable them to=20
accomplish their strategic objectives." "Back Bay Capital=20
provided us with the additional liquidity we needed to complete=20
this complex transaction," said Greg Johnson, president
and chief executive officer of HomePlace of America. The new=20
company will form the third-largest national chain of fashion=20
home furnishings, high-quality linens for bed and bath,=20
housewares and home decor products. It will operate 117=20
superstores in 27 states. Back Bay Capital is a high-yield
finance group that provides Tranche B, junior secured loans to=20
companies seeking growth financings, bridge and acquisition=20
facilities and turnaround capital. Headquartered in Boston, Back=20
Bay Capital has offices in Chicago and Los Angeles.=20

BankBoston Retail Finance Inc. today announced that it has=20
provided a $200 million revolving line of credit to HomePlace of=20
America, Inc., formerly HomePlace Holdings and Waccamaw=20
Corporation. Headquartered in Myrtle Beach, SC, HomePlace of=20
America, Inc. is a retailer of home fashion textiles, home=20
furnishings and housewares. The funds provided by
BankBoston Retail Finance will help in two areas: provide the=20
working capital necessary to facilitate HomePlace Holdings'=20
emergence from Chapter 11 bankruptcy proceedings; and enable it=20
to merge with Waccamaw Corporation, a retailer of home decor and=20
furnishings. "HomePlace and Waccamaw are both clients of=20
BankBoston Retail Finance," said Edward J. Siskin, chief=20
operating officer of BankBoston Retail Finance Inc. "It is very
exciting to see an existing client emerge from bankruptcy and=20
merge with another BankBoston client to become a new, stronger=20
organization." "Once the merger is completed, our new company=20
will be able to offer a broad merchandise selection at, or below,=20
department store sale prices," said Greg Johnson, president and=20
chief executive officer of Waccamaw Corporation.  The new company=20
will form the third-largest national chain of fashion home
furnishings, high-quality linens for bed and bath, housewares and=20
home d=82cor products. It will operate 117 superstores in 27=20
states. BancBoston Robertson Stephens, the Section 20 subsidiary=20
of BankBoston, acted as the syndicating agent in this tax-free=20

HOMEPLACE: Plan Becomes Effective; Merger Completed
HomePlace Stores, Inc. announced on June 15, 1999 that its First=20
Amended Joint Plan of Reorganization became effective, bringing=20
about its simultaneous emergence from Chapter 11 and the=20
completion of its merger with The Waccamaw Corporation.  The=20
stores will operate under the HomePlace name.  Waccamaw CEO Greg=20
Johnson will serve as President and CEO of the new combined=20
chain, and the corporate offices of the new company will be=20
consolidated into Waccamaw's Myrtle Beach headquarters and=20
HomePlace's existing corporate offices in suburban Cleveland will=20
be closed.

The merger creates a new combined entity, HomePlace of America=20
Inc., one of the nation's largest home furnishings retailers with=20
117 stores in 27 states and annual sales exceeding $600 million.

LOEHMANN'S: Seeks To Reject Certain Unexpired Leases
The debtor, Loehmann's Inc., seeks entry of an order authorizing=20
the debtor to reject certain unexpired leases of nonresidential=20
real property.  The stores covered by the leases are located in=20
West Long Branch, NJ and Philadelphia, PA.

The two premises covered by the leases are former sites for=20
Loehmann's stores that are closed.  The Philadelphia store has=20
been closed since January, 1999 and the West Long Branch store=20
has been closed since May, 1998.  As such stores are not required=20
by the debtor in its operations, the rejection of the leases will=20
eliminate the debtor's obligations of approximately $31,000 per=20

NUCENTRIX: Equity Plan For Key Players
The Nucentrix Broadband Networks, Inc. has registered 900,000=20
shares of common stock of the company in furtherance of it's 1999=20
Share Incentive Plan.  The plan is intended to provide incentives=20
which will attract, retain and motivate highly competent persons=20
as non-employee directors, officers, and key employees of, and=20
consultants to, Nucentrix Broadband Networks, Inc. and its=20
subsidiaries and affiliates, by providing them opportunities to=20
acquire shares of the common stock of the company or to=20
receive monetary payments based on the value of such shares. =20
Additionally, the plan is intended to assist in further aligning=20
the interests of the company's directors, officers, key employees=20
and consultants to those of its other stockholders.

The plan will be effective as of April 1, 1999, the date on which=20
the plan was adopted by the committee, provided that the plan is=20
approved by the stockholders of the company at an annual meeting=20
or any special meeting of stockholders of the company within 12=20
months of the effective date, and such approval of stockholders=20
shall be a condition to the right of each participant to receive=20
any benefits.

Interested parties may read the text of the proposal by accessing=20 the=20
internet at no charge.

NU-KOTE: Objections To Disclosure Statements
Hewlett-Packard Company objects to approval of the Creditors'=20
Disclosure Statement.  The company says that it objects to those=20
portions of the Disclosure Statement that either mischaracterize=20
or inadequately describe the pending litigation between Nu-kote=20
International, Inc., and Hewlett-Packard.

Hewlett-Packard Company also objects to Nu-Kote's Disclosure=20
Statement.  The company states that Nu-Kote also mischaracterizes=20
and inadequately describes the pending litigation.

Canon Computer Systems, Inc. and Canon USA and Canon Inc. object=20
to both the Creditors' Disclosure Statement and the debtor's=20
Disclosure Statements.  Canon states that both the Creditors' and=20
the Debtors' Disclosure Statements fail to provide adequate=20
information and clarification regarding post-confirmation=20
procedures to be employed, pursuant to the Creditors' Joint Plan,=20
to resolve the Canon Litigation; treatment of set-off and=20
recoupment issues likely to arise regarding the various=20
litigation with Canon, Hewlett Packard, and Seiko Epson; and=20
whether the proponents of the Creditors' Joint Plan seek to use=20
the post-confirmation injunctive power of this court to inhibit=20
creditors such as Canon from protecting their intellectual=20
property rights.

OKURA & CO: Seeks Approval of Stipulation
The debtor, Okura & Co. (America) Inc. seeks approval of a=20
proposed stipulation and order among Okura, the Official=20
Committee of Unsecured Creditors and The Bank of Tokyo-
Mitsubishi, Ltd.("BTM")  =20

Upon approval of the Stipulation, BTM will have an allowed claim=20
against Okura in the amount of $15,862,767.  40% will be paid in=20
cash, and 60% will be allowed as a general unsecured claim. =20
Releases will be granted among the parties and the previous=20
adversary proceeding will be dismissed.  The debtor states that=20
the Stipulation is beneficial to the debtor as it will reduce the=20
amount of BTM's puportedly secured claim against Okura which will=20
result in a greater recovery for general unsecured creditors.

ORANGE COUNTY: Settlement With Standard & Poor's
Standard & Poor's has agreed to pay $140,000 to settle a lawsuit=20
in which Orange County accused the rating agency of failing to=20
warn against issuing bonds just before the county declared=20
bankruptcy in 1994.

The settlement, announced Tuesday, must be approved by a judge.=20
The county's $2 billion suit against S&P was the last one pending=20
among the county's more than two dozen lawsuits against finance=20
and securities firms, and former financial advisers and lawyers.

If approved, the $140,000 would mean that the county has=20
recovered $860.7 million, or more than half of the $1.64 billion=20
it lost in the nation's largest municipal bankruptcy.

"The settlement with Standard & Poor's represents the final step=20
necessary to put the litigation surrounding Orange County's=20
bankruptcy to a conclusion," Thomas Hayes, the federal bankruptcy=20
court-appointed overseer, said in a statement.

Final court approval was anticipated in about four months.

The county had argued that S&P gave its highest ratings to one-
year notes and multiyear bonds that the county issued in 1994,=20
just before it declared bankruptcy and that S&P should have=20
warned county officials against issuing the bonds.

Standard & Poor's countered that its liability should be=20
determined under federal rather than state law. Federal law=20
limits a defendant's damages to its fair share of the blame,=20
while state law allows individual lawsuits for such =20
claims. The company also said its ratings were protected by the=20
First Amendment.

In May, the 9th U.S. Circuit Court of Appeals ruled the county=20
would have to show S&P acted with "actual malice." All of the=20
county's other suits related to its bankruptcy have been=20
settled  out-of-court including in December 1998 when U.S.=20
District Judge Gary Taylor  approved a total of $703 million in=20
settlements, the largest being $447.7 million from Merrill Lynch=20
& Co.

The county filed for bankruptcy protection in December 1994 after=20
it was revealed that risky investments by Treasurer Robert L.=20
Citron on behalf of cities, schools and special districts had=20
lost $1.64 billion.

The county emerged from bankruptcy in 1996, but still has $1.3=20
million in debt stemming from the investment losses, Orange=20
County Chief Financial Officer Gary Burton said earlier this=20

PARAGON TRADE: Kimberly-Clark Seeks Protective Order
Kimberly-Clark asserts that the Equity Committee has sought=20
extensive discovery to try to prove that certain patents are=20
invalid. In negotiating with the debtor, Kimberly-Clark stated=20
that if the debtor operated within certain "safe harbors" it=20
would not sue the debtor for infringement of these patents.=20
Kimberly-Clark states that the discovery is enormously burdensome=20
and intrusive.  The Equity Committee has failed to follow proper=20
procedure for securing deposition testimony and the company=20
requests that the court quash The Equity Committee's second=20
request for production to Kimberly-Clark relating to the Kimberly=20
Clark settlement.

The Equity Committee is trying to establish that the patents are=20
invalid so that the debtor may ignore them. Kimberly-Clark argues=20
that if the patents are valid, the debtor benefits from having a=20
clear path to market that does not risk the accrual of patent=20
infringement damages; and the "safe harbor" provides a clear=20
benefit to the debtor.  Kimberly-Clark says that the "safe=20
harbor" provides no downside for the debtor.  In the worst case -
where the patents are invalid and the debtor's safe harbor is of=20
little value - there would be no reason to disapprove the=20
Settlement Agreement as a consequence, because the safe harbor=20
imposes no harm or cost to the debtor. =20

PCG CORP: Seeks Substantive Consolidation
The debtors, PCG Corp I. Et al., seek substantive consolidation=20
of the debtors' chapter 11 cases.  The plan of reorganization in=20
these cases is a joint plan by and among each of the debtors. =20
Consolidation will enable the debtors to pool their respective=20
assets and liabilities, and utilize all available cash to=20
effectuate the payments required by the plan.  Moreover,=20
consolidation will eliminate any claims that are based upon=20
guarantees or are otherwise duplicative of another claim. =20

The debtors say that consolidation will not adversely affect any=20
creditors based upon the de minimus distribution to be made to=20
general unsecured creditors.  Apart from the fact that=20
substantive consolidation will not adversely affect the rights of=20
creditors, there is good reason to grant the relief. Despite the=20
fact that the debtors are nine separate corporations, they argue=20
that they have functioned essentially as a single business=20
operation, with virtually identical officers and directors.  The=20
debtors have maintained a centralized cash management system in=20
order to provide the most efficient management and use of cash by=20
its operating generally without regard to corporate separateness. =20

The effect of consolidation will be that for the purposes of the=20
plan, all assets and liabilities of the debtors will be pooled or=20
treated as though they were pooled, and any obligation of any of=20
the debtors will be deemed to be one obligation of the=20
consolidated debtors.  Any claims filed against any of the=20
debtors will be deemed one claim filed against the consolidated=20
debtors in the consolidated case.

PHILIP SERVICES: Extends Lock-Up Agreement with Lenders
Philip Services Corp. (TSE/ME: PHV) announced that Philip and its=20
lending syndicate have agreed to extend the date to file Philip's=20
pre-packaged plan of reorganization to June 30, 1999. Philip will=20
file its plan under Chapter 11 of the Bankruptcy Code in the=20
United States and the Companies Creditors Arrangement
Act in Canada.

Under the terms of the lock-up agreement between Philip and its=20
lending syndicate, the Company's lenders will convert=20
approximately US$1.0 billion of senior secured debt into US$250=20
million of senior secured debt, US$100 million in secured payment=20
in kind notes, and 90 percent of the common shares of the=20
restructured company. Under the proposed plan of reorganization=20
employees, ongoing trade suppliers and clients will
remain financially unimpaired and will be paid in the normal=20
course of business throughout the restructuring. Philip has=20
access to proceeds from the sale of assets of US$64 million and=20
expects to have access to an additional US$100 million in debtor-
in-possession financing upon filing its plan to meet its ongoing=20
working capital requirements.

The extension was required to permit Philip and its lenders to=20
finalize the structural aspects of the restructuring plan and to=20
conclude negotiations with certain unsecured non-trade creditors=20
who would be impaired in the Company's plan of reorganization.=20
The Company will settle these obligations with a combination of=20
unsecured payment in-kind notes and common shares of the=20
restructured company. Common shares issued to settle unsecured=20
creditor claims or class action litigation will reduce the amount=20
of equity available for distribution to existing shareholders.=20
The Company currently anticipates that existing shareholders may=20
retain up to 5% of the shares of the restructured company,=20
although there can be no assurance given in this regard.

Philip Services is an integrated metals recovery and industrial=20
services company with operations throughout the United States,=20
Canada and Europe. Philip provides diversified metals services,=20
together with by-product management and industrial outsourcing=20
services, to all major industry sectors.

PHP HEALTHCARE: Seeks To Assume and Assign CSC License Agreement
The debtor, PHP Healthcare Corporation ("PHP") agreed to the=20
license of the software provided by Vmark Software, Inc. and CSC=20
agreed to provide support and maintenance services related to=20
such software to be used in the operations of PHP's wholly-owned=20
subsidiary, DC Chartered Health Plan, Inc.  DC Chartered has been=20
utilizing the software and related support services since the=20
inception date of the License Agreement.  The software and=20
related support services have not been utilized by PHP directly,=20
and are of no use to PHP in its current operations. PHP seeks=20
entry of an order authorizing the assumption of the License=20
Agreement by PHP and the immediate assignment of the License=20
Agreement to DC Chartered.  A hearing will be held on June 25,=20
1999 at 2:00 PM.

PREMIS CORP: Company To Cease All Operations/Liquidation Pending
In filing its March 31, 1999 financial statements for the year=20
end period Premis Corporation reported 1999 revenues of=20
$5,465,851 with net income of $283,860.  For the year ended March=20
31, 1998 revenue was $5,945,378 with a net loss of $2,426,214.

As reported elsewhere in this issue Premis Corporation has=20
historically developed, marketed and supported a line of=20
enterprise-wide solutions to meet the information needs of multi-
store specialty and general merchandise retailing chains.  On May=20
7, 1999, the Board of Directors of the company adopted the plan=20
of liquidation.  The company is seeking ratification and=20
approval of the Board's action and the affirmative adoption of=20
the plan of liquidation by the stockholders.  The plan of=20
liquidation provides that upon adoption by the stockholders, the=20
company will proceed to liquidate its assets and to dissolve its=20
corporate existence in accordance with Minnesota law.

Assuming the plan of liquidation is approved by the stockholders=20
at the annual meeting, Premis indicates the Board of Directors=20
will proceed in the following manner: The company will file a=20
Notice of Intent to Dissolve with the Minnesota Secretary of=20
State.  The Board will collect monies owed to the company and=20
sell the company's assets in one or more transactions.=20
The company will pay or provide for payment of all debts and=20
liabilities of the company and all expenses of liquidation and=20
dissolution (to the extent of available funds realized upon the=20
sale of the company's assets plus existing cash on hand).  After=20
all assets of the company have been reduced to cash and all=20
creditors' claims have been paid or provided for, and if there=20
then are no pending legal, administrative or arbitration=20
proceedings (or adequate provisions have been made to satisfy any=20
liability arising from such proceedings), the company will=20
distribute all remaining assets (consisting solely of cash) to=20
the stockholders.  Following this distribution, the company will=20
file Articles of Dissolution with the Secretary of State of=20
Minnesota and will take any and all other necessary or=20
appropriate actions to dissolve and to terminate the company's=20

In anticipation of the approval of the plan of liquidation,=20
Premis Corporation restructured its operations, including the=20
closing of its Canadian operations during February and March=20
1999.  Severance agreements have been signed by all Canadian=20
employees, and the company has provided for all anticipated costs=20
of this closing.  Additionally, the company has significantly=20
reduced head count in the United States, and has provided for=20
all related severance agreements.

PREMIS CORP: Stockholders To Vote On Sale Of Subsidiary
Stockholders are being invited to attend the annual meeting of=20
Pemis Corporation to be held at 2:00 p.m., on July 15, 1999, at=20
the Ramada Plaza Hotel, located at 12201 Ridgedale Drive in=20
Minnetonka, Minnesota.

The agenda for this year's meeting includes proposals to sell the
company's ownership of its subsidiary, PREMIS Systems Canada =20
Incorporated and its OpenEnterprise software to ACA Facilitair=20
BV; to adopt a plan of complete liquidation and dissolution of=20
the company; if the transaction is approved and the second=20
payment under the NCR agreement is recieved, to authorize to the=20
Board to retain up to $1 million, in net proceeds of the=20
liquidation for a period of up to 12 months to identify and=20
secure a business combination which may provide shareholders with=20
additional value; to elect five directors; and to appoint=20
PricewaterhouseCoopers LLP as auditors for the fiscal year ending=20
March 31, 2000. If the transaction is not approved, or if the=20
transaction is approved but is not consummated for any reason,=20
management will implement the plan of liquidation (see=20
additional article in this issue). Following the formal business=20
of the meeting, management of the company will respond to=20
questions from shareholders.

PREMIS Corporation, a Minnesota corporation, develops, markets=20
and supports a line of enterprise-wide solutions to meet the=20
information needs of multi-store specialty and general=20
merchandise retailing chains.  The company's development efforts=20
have focused on developing leading-edge, industry-specific=20
software systems to collect business information, analyze=20
the collected data and provide timely and meaningful reports to=20
individuals within an organization.  The company's information=20
management software systems are designed to assist businesses=20
with the day-to-day management of their operations and long-term=20
strategic planning.  Premis' systems, which remain in=20
development, provide retailers with a variety of integrated=20
functions and benefits, such as: point of sale ("POS") data=20
collection, "real time" sales analysis reporting, enterprise=20
inventory tracking, gross margin improvement, increased inventory=20
productivity, improved loss prevention, and on-line enterprise=20
communications by and between stores and corporate offices.

On April 20, 1999, Premis and ACA Facilitair BV, a corporation=20
organized under the laws of the Netherlands, entered into a stock=20
purchase agreement, an exclusive software license agreement, and=20
an escrow agreement with a bank in Minneapolis, Minnesota.  ACA=20
is a leading supplier of enterprise systems for retailers in the=20
Netherlands.  ACA plans to utilize the OpenEnterprise suite of=20
products developed by PSC as product offerings in North America=20
with later introduction in Europe.

In accordance with the terms of the stock purchase agreement, ACA=20
agrees to purchase and the company agrees to sell all of the=20
company's shares of its wholly-owned subsidiary, Premis Systems=20
Canada Incorporated.  PSC owns the OpenEnterprise software,=20
related customer contracts and maintenance agreements, and rights=20
to the NCR Payment.  Sale of the PSC shares is contingent upon=20
approval by the shareholders of the company at the annual=20
meeting.  Under the terms of the stock purchase agreement, ACA=20
will purchase the PSC shares for $1,000,000 (US) (which has been=20
deposited in escrow pursuant to the escrow agreement in the form=20
of $100,000 cash and a $900,000 irrevocable direct pay letter of=20
credit), plus an amount equal to the after tax proceeds of the=20
NCR Payment.   ACA has operated the business of PSC since April=20
20, 1999 as agreed upon under the terms of the exclusive software=20
license agreement, which was executed simultaneously=20
with the stock purchase agreement.

If the shareholders do not approve the sale of the PSC shares,=20
the funds and letter of credit currently held under the escrow=20
agreement will be released in payment of the one-time license fee=20
under the exclusive software license agreement and the exclusive=20
software license agreement will remain in force and effect in=20
perpetuity, absent an event of default giving rise to a right of=20
termination.  In the event that the sale of the PSC shares is not=20
approved by the shareholders, Premis Corporation will=20
continue to own the PSC shares (unless subsequently sold) and=20
will retain all rights to receipt of the NCR Payment, if any.

RECYCLING INDUSTRIES: Seeks Approval of Sale of Assets
The debtors, Recycling Industries Inc., and affiliated debtors=20
seek court authority to sell all of the machinery, equipment,=20
spare parts, tools, furniture, fixtures and vehicles of Nevada=20
Recycling, Inc. to Silver Dollar Salvage, LLC for a purchase=20
price of $2.5 million.  A break-up fee of $150,000 is included in=20
the agreement.

SCOOP INC: Disclosure Statement in Support of Plan
The purposes of the plan of Scoop, Inc. are twofold; distributing=20
to creditors the cash in the estate as of the Effective Date and=20
providing to the Equity Security Holders Interests in the=20
Reorganized Debtor pursuant to the provision of the InfiniCom=20
Stock Agreement.

The debtor estimates that approximately $3,743,671 in general=20
unsecured claims will be asserted against the estate.  The debtor=20
estimates that it will have approximately $1,558,000 available to=20
it to distribute to creditors.  The debtor estimates about=20
$550,000 in priority claims, most of which the debtor disputes.

The debtor's assets have already been liquidated.  Through the=20
SMS Asset Sale and the SIS Asset Sale, the debtor's assets both=20
tangible and intangible have been converted into cash.  Pursuant=20
to the plan, the debtor's corporate shell is effectively being=20
liquidated in accordance with the terms of the InfiniCom Stock=20

The debtor believes that creditors' recovery on their allowed=20
claims will be maximized through the reorganization of the=20
debtor's financial affairs rather than through any Chapter 7=20
liquidation proceeding.   If the debtor's case were converted to=20
a Chapter 7 liquidation proceeding, InfiniCom would have no=20
interest in acquiring the debtor's stock and would terminate the=20
InfiniCom Stock Agreement, thereby depriving the creditors of up=20
to a $225,000 recovery on their allowed general unsecured claims=20
(estimated to be approximately a 18% recovery.

SCOOP INC: Hearing Regarding Disclosure Statement
The hearing to consider approval of the proposed Disclosure=20
Statement of Scoop, Inc. will be held on July 16, 1999 at 2:30 PM=20
before the Honorable Robert W. Alberts, US Bankruptcy Judge, in=20
Courtroom 6C of the US Bankruptcy Court, located at 411 West=20
Fourth Street, Santa Ana, California.

SOURCEONE WIRELESS: Seeks Extension To Assume or Reject Leases
The debtor, SourceOne Wireless, Inc. seeks an extension of time=20
for assumption or rejection of unexpired leases of nonresidential=20
real property.

The debtor is lessee under approximately 85 Tower Leases and also=20
a lessee under four separate leases of real property. =20

The debtor needs the assurance in the case of both kinds of=20
leases that the leases will remain in effect long enough to allow=20
potential purchasers to conduct due diligence of the debtor,=20
including determining which real estate leases, if any, to assume=20
as part of any sale or sales.  The debtor requests that the court=20
enter an order extending the deadline for assuming or rejecting=20
the leases to August 26, 1999.

TEXFI INDUSTRIES: Troublesome Events Continue To Vex Company
Net sales for the thirteen weeks ended January 29, 1999 decreased=20
to $27,192,000 as compared to net sales of $41,776,000 for the=20
thirteen weeks ended January 30, 1998 for Texfi Industries Inc.=20
Losses were up for the 1999 period to $2,600,000 from $897,000 in=20

Earlier reports in this Reporter cited the violations the company=20
experienced in its credit and loan facility debt service coverage=20
ratio, and minimum capital funds requirement.  A forbearance=20
agreement was secured by Texfi through May 28, 1999.  The company=20
was also delinquent on certain real property taxes and equipment=20
operating leases.

On May 28, 1999, the company negotiated an additional amendment=20
to the forbearance agreement and a third amendment to the loan=20
agreement. The amendment reduced the credit facility from $40.0=20
million to $30.0 million, revised the period end EBITDA financial=20
requirements, limited borrowing base availability on specific in-
house trade accounts receivable customers, and increased=20
applicable interest rate margins.

The amendment extends the initial forbearance period by 120 days=20
through September 28, 1999. The extension period is separated=20
into two sixty day periods, each contingent upon the company=20
raising an additional $1.0 million in subordinated financing. The=20
first extension period runs through July 28, 1999 dependent upon=20
the May 28, 1999 receipt of $1.0 million in cash, representing=20
the net proceeds of a subordinated loan made by MAI. In=20
addition, the amendment required that the net proceeds from this=20
MAI subordinated loan similarly be applied to the revolving=20
credit line and the company is prohibited from payment of=20
interest or principal on either MAI subordinated loan.

Subsequent to year-end, Texfi failed to make the February 1, 1999=20
interest payment due on the 8-3/4% Debentures which approximated=20
$1.5 million, make the April 1, 1999 interest payment due on the=20
Series C Debentures which approximated $153,000, and honor the=20
approximately $1.5 million in Series C Debentures put to the=20
company for redemption at the option of Series C=20
Debenture holders.

In earlier editions we reported that in May 1999 certain=20
executive officers and entities affiliated with those officers=20
sold their combined interest, representing 23% of the common=20
stock of the company, to Whitecross Ltd., a Bahamas holding=20
company.  In conjunction therewith, Mr. Richard L. Kramer=20
resigned as a director and Chairman of the Board of Directors. In=20
addition, Mr. William L. Remley resigned as Chief Executive=20
Officer, director, and Vice Chairman of the Board. The Board=20
named Mr. Andrew J. Parise, Jr. as Chairman of the Board of=20
Directors and Chief Executive Officer in addition to his=20
responsibilities as President and Chief Operating Officer.

THORN APPLE: Creditors give Debtor Until July For Plan or Sale
Thorn Apple Valley Inc. and its official committee of unsecured=20
creditors reached a stipulation regarding a plan of=20
reorganization and sale of its assets. Currently, the meat=20
processor is in an "intense period of negotiation" with potential=20
purchasers and investors, according to an attorney working on the=20
case. The overriding issue in the case is whether Thorn Apple=20
Valley formulates a plan or decides to sell substantially all of=20
its assets. Under the terms of the agreement with the committee,=20
reached late last month, the absence of a plan or sale by June 30=20
constitutes a default on Thorn Apple Valley's loans. In return,=20
the committee withdrew a motion to terminate exclusivity and=20
further agreed not to oppose Thorn Apple Valley's request to=20
extend the exclusive period for 30 days. (The Daily Bankruptcy=20
Review and ABI; June 16, 1999)


The Meetings, Conferences and Seminars column appears=20
in the TCR each Tuesday.  Submissions via e-mail to=20 are encouraged. =20

Bond pricing, appearing in each Friday edition of the TCR,=20
is provided by DLS Capital Partners, Dallas, Texas.

S U B S C R I P T I O N   I N F O R M A T I O N    =20
Troubled Company Reporter is a daily newsletter, co-
published by Bankruptcy Creditors' Service, Inc.,=20
Princeton, NJ, and Beard Group, Inc., Washington, DC. =20
Debra Brennan, Yvonne L. Metzler and Lexy Mueller, Editors.=20
Copyright 1999. All rights reserved.  ISSN 1520-9474. =20

This material is copyrighted and any commercial use, resale=20
or publication in any form (including e-mail forwarding,=20
electronic re-mailing and photocopying) is strictly=20
prohibited without prior written permission of the=20
publishers.  =20

Information contained herein is obtained from sources=20
believed to be reliable, but is not guaranteed.  =20
The TCR subscription rate is $575 for six months delivered=20
via e-mail. Additional e-mail subscriptions for members of=20
the same firm for the term of the initial subscription or=20
balance thereof are $25 each.  For subscription=20
information, contact Christopher Beard at 301/951-6400. =20
          * * *  End of Transmission  * * *