TCR_Public/991008.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 7, 1999, Vol. 3, No. 195
                     
                     Headlines

ACDC, INC: Disclosure Statement in Support of Liquidation
ATC GROUP: Gets OK for Amended Disclosure Statement
CENTRAL EUROPEAN: Genesis Asset Managers No Longer Hold Stock
CODED COMMUNICATIONS: Trustee Seeks Substantive Consolidation
CRIIMI MAE: Seeks Authority To Sell Brick Church Property

FILENE'S BASEMENT: Judge Dismisses Attorneys and Advisors
FLORIDA COAST PAPER: Taps Rogers, Towers, Bailey, Jones & Gay
GREATER SOUTHEAST: Hospital Buys Time on Finding Financing  
HIGH POINT: Case Summary & 20 Largest Unsecured Creditors
INTERSCIENCE COMPUTER: Acquires Camino Systems Inc.

MEDPARTNERS: California Medical Association Resolves Impasse
MEDPARTNERS: Committee Objects To Exclusivity Extension
MERCURY AIR: Preference Actions Filed By Western Pacific
MICHAEL PETROLEUM: Restructure Proposal Delivered To Noteholders
NORTHWESTERN STEEL: Proposed Restructuring Of $115 Million Debt

PARAGON TRADE: Appaloosa Management Owns 4.81% Of Common Stock
PHAR-MOR INC: Fiscal Year-End Sales Level, Losses Down
PHILIP SERVICES: Plan Of Reorganization Calls For Indenture Issue
PHILIP SERVICES: Proposes Up To $60 Million In Senior Notes
PHILIP SERVICES: Seeks Extension To File Schedules and Statements

PRICHARD ALA: Files Chapter 9  
SERVICE MERCHANDISE: Increases Borrowing Capacity
STORMEDIA: Taps Special Litigation Counsel
TALK AMERICA: Order Approves Asset Purchase Agreement
WELLCARE MANAGEMENT: Receives Release of Supervision

BOND PRICING FOR WEEK OF October 4, 1999

                     *********

ACDC, INC: Disclosure Statement in Support of Liquidation
---------------------------------------------------------
The debtor, ACDC, Inc. liquidated substantially all of its assets
in May 1999.  Although this case was filed under chapter 11, the
plan proposes the liquidation of all of the debtor's assets and
distribution of proceeds among certain creditors in accordance
with the absolute priority rule.  The overall purposes of the
plan are to settle, compromise, or otherwise dispose of certain
claims against and interests in the debtor on terms that the
debtor believes to be fair and reasonable, and to disburse the
proceeds from the sale of the debtor's assets among all creditors
asserting Allowed Claims against the debtor.

It is anticipated that the plan will pay Allowed Priority Tax
Claims in full, and it is also anticipated that the plan will pay
approximately 17 cents on the dollar to unsecured creditors whose
claims are deemed to be Allowed Claims.  It is estimated that tit
will take approximately six months to one year for ACDC to
consummate the plan upon entry of a Final Confirmation Order.

Treatment of Claims Impaired Under the Plan:

Class 4a: Babcock & Wilcox; Unsecured Claim in the amount of
$951,600.
Pursuant to the Asset Purchase Agreement, the purchaser assumed
and became responsible for any payment to Babcock & Wilcox on
account of such claim.

Class 4(b) - All other unsecured claims that become allowed
claims: After Distributions have been made on account of all
Class 2 and Class 3 claims, holders will receive a pro-rata share
of the trust property.

Class 5(a) - The Gladish Claim and (b) All other subordinated
claims that become allowed claims: Distributions after payment to
Classes 2,3, and 4(b).

Class 6: All equity interests shall terminate - no distribution.


ATC GROUP: Gets OK for Amended Disclosure Statement
---------------------------------------------------
The U.S. Bankruptcy Court in Manhattan has approved ATC Group
Services Inc.'s amended disclosure statement, according to an
Oct. 1 order. In finding that ATC's disclosure statement
contained "adequate information" under terms of the U.S.
Bankruptcy Code, the court overruled all prior objections to the
company's plan. (The Daily Bankruptcy Review and ABI October 7,
1999)


CENTRAL EUROPEAN: Genesis Asset Managers No Longer Hold Stock
-------------------------------------------------------------
Genesis Asset Managers International Limited reports that it no
longer holds any interest in the common stock of Central European
Media Enterprises Ltd.


CODED COMMUNICATIONS: Trustee Seeks Substantive Consolidation
-------------------------------------------------------------
The Chapter 7 Trustee, Michael B. Joseph seeks substantive
consolidation of the debtors' Chapter 7 estates.  AS a result of
such consolidation all intercompany claims by and among the
debtors would be eliminated, all assets and all proceeds thereof
and all liabilities of the debtors will be combined or treated as
though the debtors were merged; any obligation of any of the
debtors and all guarantees thereof executed by any of the debtors
will be deemed to be one obligation of any of the debtors, and
the same will be true of the treatment of claims.  The trustee
states that substantive consolidation is warranted and
appropriate by applying case law standards.


CRIIMI MAE: Seeks Authority To Sell Brick Church Property
---------------------------------------------------------
The debtors, CRIIMI MAE Inc., et al. seek court authority to take
the necessary actions to implement the sale of the Brick Church
Property.  The property is a commercial lot, motel building and
associate personal property in Nashville, Tennessee. Brick Church
(a subsidiary) signed a contract for the sale and purchase of the
property at a price of $4.3 million to Buyers, Himanshu Patel,
Manisha Patel, Prakash N. Shah and Ketki P. Shah. This sale price
is the highest amount that Brick Church has been offered for the
property since it began its efforts to sell the property in
October of 1998.


FILENE'S BASEMENT: Judge Dismisses Attorneys and Advisors
---------------------------------------------------------
In the Filene's Basement bankruptcy case, Judge Hillman issued a
ruling that disqualified the Company's professionals Hale and
Dorr and PricewaterhouseCoopers.  The court dismissed Filene's
Basement Corp.'s legal team and financial advisors because they
failed to disclose ties with a rival retailer, Reuters reported.
Boston-based Hale & Door LLP and financial consultant  
PricewaterhouseCoopers failed to "fully disclose" their
connections with TAC Group Inc., the parent company of Frugal
Fannie's Fashion Warehouse, Hillman said. In his statement,
Hillman wrote that he would not tolerate "coy or incomplete
disclosures which leave the court to ferret out pertinent
information." He ordered Hale & Dorr to return a $435,000
retainer fee to the  retailer, which filed for chapter 11
protection on Aug. 23.

Sam Gerson, Chairman and CEO of the Company, said in response to
this ruling "while we are very disappointed in the outcome, the
Company and its management team wishes to reassure our employees,
creditors, and business partners that we will move forward
expeditiously to continue the progress we have made in
reorganizing Filene's Basement.  We have nothing but laudatory
compliments with regard to the services provided by Hale and Dorr
and PricewaterhouseCoopers.

We have selected Mintz, Levin, Cohn, Ferris, Glovsky and Popeo,
P.C. as our bankruptcy counsel, pending approval of the judge and
we are in the process of choosing financial advisors. The
strategies and action plans that our professionals have set in
motion will ensure that the transition to our new attorneys and
financial advisors will occur quickly and effectively. We thank
Hale and Dorr and PricewaterhouseCoopers for their dedication,
commitment and professionalism and their help in making possible
the significant progress we have achieved in this Chapter 11
case."


FLORIDA COAST PAPER: Taps Rogers, Towers, Bailey, Jones & Gay
-------------------------------------------------------------
The debtors , Florida Coast Paper Holding Company LLC and its
debtor affiliates seek authority to employ Rogers, Towers,
Bailey, Jones & Gay as special employee benefits counsel and
special property tax counsel to the debtors.  The firm would
provide services with regard to ad valorem property tax issues
for the debtors.

The professionals working on these cases charge hourly rates
ranging from $175 to $200 per hour.


GREATER SOUTHEAST: Hospital Buys Time on Finding Financing  
----------------------------------------------------------
U.S. Bankruptcy Judge S. Martin Teel Jr. has agreed to provide
Greater Southeast Community Hospital officials additional time to
locate financing to prevent the hospital's liquidation, The
Washington Post reported. Judge Teel has scheduled a hearing for
Oct. 13 to review any proposals from new business partners. A $24
million offer from Doctors Community Healthcare Corp.,
Scottsdale, Ariz., is pending, but hospital officials argue that
Doctors Community's finance are too weak. D.C. Mayor Anthony A.
Williams has said that the city will not provide further funding.
(ABI 07-Oct-99)


HIGH POINT: Case Summary & 20 Largest Unsecured Creditors
---------------------------------------------------------
Debtor: High Point Homes Sales, Inc.
        158 Clapham Road
        Frederics, DE 19946

Court: United States Bankruptcy Court Delaware

Case No: 99-3519  Case

Filed:October 1, 1999

Attorney For Debtor:
David T. Pryor
Hudson, Jones, Jaywork & Fisher
225 South State Street
Dover, Delaware 19901

List of 20 Largest Unsecured Creditors:

Name                                   Amount
----                                   ------         
PNC Bank of Delaware                 $224,143
Allen E. Starke, Sr.                   70,000
Homette Corporation                    56,761
PNC Bank NA                            50,000
Suntrust Credit                        48,000
Allan E. Starke, Jr.                   16,800
Prickett, Jones, Elliott & Kristol      3,027
Michael B. Mobley                       1,730
Shore Stop Company, LLC                 1,597
Browning Ferris IND                     1,549
Delmarva Transporters, Inc.             1,381
Masten Lumber & Building                1,223
Blevins, Inc.                           1,223
Wyoming Concrete Industries, Inc.       1,068
Delmarva Online                         1,002
Lowes Business Account                    952
Window Son & Dashiell, PA                 860
Preston R. Smith                          850
Harold D. Shockley                        480
Carlson Pest Control, Inc.                475


INTERSCIENCE COMPUTER: Acquires Camino Systems Inc.
---------------------------------------------------
On September 17, 1999, Interscience Computer Corporation acquired
the assets of Camino Systems Inc. for 468,000 shares of the
company's common stock and assumption of certain liabilities of
Camino. The Camino assets consisted of certain business contracts
and intangible personal property. The consideration for the
Camino assets was determined through negotiations
between the management of Camino and Interscience.

Designed for the LAN, WAN, Internet and Intranet marketplace,
Camino's Highway Server HSM software provides unlimited storage
on multiple platforms by utilizing cost-effective optical
jukeboxes as repositories for the vast amount of data accumulated
on a network.

Camino Highway Server provides transparent, multi-stage migration
to optical storage from a variety of network platforms, including
Novell NetWare, NT, Mac and Unix. It can accommodate virtually
unlimited volumes of information, including database, image,
audio/video, video conferencing and medical images.


MEDPARTNERS: California Medical Association Resolves Impasse
------------------------------------------------------------
The California Medical Association announced yesterday that it
has worked with the Davis Administration to push resolution of a
key impasse in the MedPartners bankruptcy settlement
negotiations, and that as a result, MedPartners will pay
thousands of California physicians more than $50 million owed to
them for patient care, according to a newswire report. Payments
have been stopped since Aug. 2 because of MedPartners' and the
health plans' mutual legal liability in the bankruptcy case. This
week MedPartners will mail a physician release form to 6,000
California doctors; those who sign and return the release will
formally become part of the MedPartners Final Agreement and be
eligible to receive payment for unpaid claims. They also
will waive their right to pursue a lawsuit against MedPartners
Inc. of Alabama and the health plans that contracted with
MedPartners. (ABI 07-Oct-99)


MEDPARTNERS: Committee Objects To Exclusivity Extension
-------------------------------------------------------
The Official Committee of Unsecured Creditors of Medpartners
Provider Network, Inc. filed an objection to the debtor's motion
seeking an extension of exclusivity.  The Committee states that
the debtor provides no evidence to justify this extension, and
that the debtor "hides behind the still inchoate Global
Agreement..."  The Committee asserts that tit is prepared to
draft and file a plan which comports with the Global Agreement.  
The Committee also states that the debtors fail to justify the
thirteen week delay in implementing the Global Agreement.


MERCURY AIR: Preference Actions Filed By Western Pacific
--------------------------------------------------------
Mercury Air Group, Inc. (Amex: MAX; PCX) announced today that it
has been served with a lawsuit in the United States Bankruptcy
Court of the District of Colorado by the Trustee for Western
Pacific Airlines, Inc. ("WPAI") (OTC Bulletin Board: WPACQ).  The
complaint seeks to recover alleged preferential payments of
approximately $11.4 million.  This amount represents cash
received for payment of fuel during the 90 days prior to WPAI's
initial bankruptcy filing on October 5, 1997.  Mercury believes
this claim is without merit and the entire amount is defensible
based on the transaction: (1) having been a substantially
contemporaneous exchange for value; (2) being made in the
ordinary course of business; and (3) involving an exchange for
new value.

Mercury has also received notice that in the same action Compass
Bank of Texas, Inc. ("Compass") has been sued for an alleged
preference in the amount of approximately $1.1 million.  Mercury
entered into an agreement to indemnify and defend Compass as part
of a $6 million note arrangement for WPAI in April of 1997.  
While Mercury has not yet finished its review of this second
matter, it does believe that the payments in question were made
in the ordinary course of business and are also defensible.
Mercury Air Group, Inc. is a worldwide provider of aviation
petroleum products, cargo services, aviation information
technology and support services to international and domestic
commercial airlines, general aviation and U.S. government
aircraft.  Founded in 1956 by three members of the American
Volunteer Group in China, better known as the AVG Flying Tigers,
Mercury reported fiscal year 1999 profits of over $5.9 million on
revenues of over $224 million.


MICHAEL PETROLEUM: Restructure Proposal Delivered To Noteholders
-----------------------------------------------------------------
On September 30, 1999, representatives of Michael Petroleum
Corporation delivered a revised debt restructuring proposal to
holders of the company's 11 1/2% Senior Notes due 2005 and to the
financial advisor for the unofficial committee of noteholders.  
The proposal contemplates issuing common stock of the company in
exchange for 50% of the outstanding indebtedness evidenced by the
Senior Notes, and New Senior Notes in exchange for the remaining
50% amount.  The common stock to be issued in exchange for the
Senior Notes would represent 50% of the outstanding common stock
of the restructured company, before giving effect
to potential dilution for certain Warrants to be issued.

The revised proposal contemplates that the terms of the New
Senior Notes would retain the same interest rate and maturity as
the Senior Notes, and that certain covenants would be
renegotiated.  The revised proposal also contemplates the
issuance of Warrants to the existing shareholders of the
company, containing exercise provisions so that, if exercised,
the existing shareholders of the company would own in excess of a
majority (up to 90%) of the shares of outstanding common stock.  
The proposal contemplates that trade creditors of the company
would be paid in full or otherwise remain unimpaired, and the
company's outstanding $23 million indebtedness under
its current bank facility would be refinanced from the proceeds
of a new credit facility to be obtained.  The restructuring could
be implemented outside of insolvency proceedings or in connection
with court-supervised bankruptcy proceedings, depending on the
degree of noteholder support for the alternative chosen.

The proposal described is preliminary in nature and no
predictions are made by company management as to the degree of
success the company may achieve in its negotiations with
noteholders, whether a restructuring or refinancing of its Senior
Note and senior bank indebtedness will be accomplished on the
terms described, whether such a restructuring can be
effected outside of bankruptcy, if at all, or if accomplished,
whether the company will be able to achieve its business plan
objectives following such a restructuring.

Michael Petroleum Corporation also reported it would not make, on
October 1, 1999, the approximately $7.8 million interest payment
then due on its Senior Notes.  The Indenture under which the
Senior Notes were issued provides for a 30-day grace period
before an Event of Default will occur due to the nonpayment of
interest.  If the interest payment is not made within the 30-day
grace period, the Indenture provides that the entire indebtedness
under the Senior Notes may be declared due and payable.

Michael Petroleum is continuing to negotiate with the holders of
the Senior Notes and its senior bank lender in an effort to
restructure the company's indebtedness.


NORTHWESTERN STEEL: Proposed Restructuring Of $115 Million Debt
---------------------------------------------------------------
Northwestern Steel and Wire Company announces that as part of its
strategic plan to build a new structural rolling mill in
Sterling, Illinois, it has reached an agreement in principle with
the steering committee of its 9 1/2% Senior Notes to restructure
the $115 million of outstanding debt represented by the notes.
The terms include: a payment of $50 million plus accrued and
unpaid interest to the noteholders out of the company's funds and
from the proceeds of a new revolving credit agreement expected to
become effective in the near future; the issuance to the
noteholders of common stock representing 70% of the outstanding
common shares of the company on a fully diluted basis; and the
noteholders will be given the right to elect 4 of 7 directors.

The agreement in principle has been approved by the Board of
Directors of Northwestern Steel and the steering committee will
recommend its adoption by the noteholders.  The company will also
file an application under the Emergency Steel Loan Guarantee Act
of 1999 to obtain a guarantee of new senior debt to fund the
construction of the new mill.

The agreement in principle with the noteholders is subject to,
among other things (i) 95% acceptance by the noteholders; (ii)
obtaining the federal guarantee of new senior debt; and (iii)
stockholder approval.

Fred Rocchio, Chief Executive Officer of Northwestern Steel and
Wire, stated: "In concluding this agreement with the noteholders,
Northwestern Steel has achieved another critical component of our
strategic plan to build a new structural rolling mill. We have
already reached agreement with the United Steelworkers of America
for a new labor agreement and we have substantially completed the
plans and feasibility studies for the new mill. Now, we need only
secure the federal guarantee under the Emergency Loan Act
for all of the components of our strategic plan to be in place.
We are working closely with our bankers to file a guarantee
application as soon as the regulations governing the guarantees
are adopted, which is expected on or about October 18."

Founded in 1879, the company is a major mini-mill producer of
structural steel components that include wide flange beams,
channels, angles and merchant bars, as well as rod and selected
wire products. The structural products are used in a wide variety
of commercial, industrial and residential construction
applications.


PARAGON TRADE: Appaloosa Management Owns 4.81% Of Common Stock
--------------------------------------------------------------
Appaloosa Management L.P., reports beneficial ownership of
575,000 shares of the common stock of Paragon Trade Brands Inc.,
which represents 4.81% of the outstanding shares of common stock
of the company.  Appaloosa exercises sole voting and dispositive
power over such shares.  David A. Tepper shares ownership in the
575,000 shares of common stock, also exercising sole
voting and dispostive powers.

Appaloosa Management L.P. is the general partner of Appaloosa
Investment Limited Partnership I, the investment advisor to
Palomino Fund Ltd., and the managing member of Tersk LLC, which
are the holders of record of 245,309, 298,825 and 30,866 shares,
respectively.  David A. Tepper is the sole stockholder and
president of Appaloosa Partners Inc.  Appaloosa Partners Inc. is
the general partner of Appaloosa Management L.P. and David
A.Tepper owns a majority of the limited partnership interests of
Appaloosa Management L.P.


PHAR-MOR INC: Fiscal Year-End Sales Level, Losses Down
------------------------------------------------------
Phar-Mor, Inc., a Pennsylvania corporation, operates a chain of
discount retail drugstores devoted to the sale of prescription
and  over-the-counter drugs, health and beauty care products,
baby products, pet supplies, cosmetics, greeting cards,
groceries, beer, wine, tobacco, soft drinks, video rental and
seasonal and other general merchandise.  As of July 3,
1999, the company operated 139 stores in 24 states under the
names of Phar-Mor, Rx Place and Pharmhouse.  Approximately 55% of
the company's stores are located in New York, New Jersey,
Pennsylvania and Ohio, and approximately 22% are located in
Virginia, West Virginia, North Carolina and South Carolina.

Results of Phar-Mor's fiscal year ended July 3, 1999 show net
sales of $1,206,539 with net loss of 1,592.  For comparison, net
sales in fiscal 1998 were $1,100,851 and net losses amounting to
$8,830.


PHILIP SERVICES: Plan Of Reorganization Calls For Indenture Issue
-----------------------------------------------------------------
On June 25, 1999, Philip Services Corp., an Ontario corporation,
together with its wholly owned subsidiary, Philip Services, Inc.,
a Delaware corporation, and certain of their subsidiaries filed a
voluntary application with the Ontario Superior Court of Justice
in Toronto, Canada, to reorganize under the Companies Creditors
Arrangement Act (Canada) and voluntary petitions with the United
States Bankruptcy Court for the District of Delaware, under
Chapter 11 of the United States Bankruptcy Code.

On June 27, 1999, the company obtained First Day Orders under
Chapter 11 of the United States Bankruptcy Code from the
Bankruptcy Court.  On September 17, 1999 the company filed an
Amended and Restated Plan of Compromise and Arrangement under the
CCAA with the Ontario Superior Court of Justice in Toronto,
Canada, and an Amended Joint Plan of Reorganization and a
Disclosure Statement under Chapter 11 with the Bankruptcy Court.  
On September 21, 1999 the company filed a further Amended and
Restated Plan of Compromise and Arrangement under the CCAA with
the Ontario Superior Court of Justice in Toronto, Canada, and an
Amended Joint Plan of Reorganization, together with the Amended
Canadian Plan and a Disclosure Statement under Chapter 11 with
the Bankruptcy Court.  A confirmation hearing to confirm
the Amended U.S. Plan is scheduled for November 3, 1999 at the
Bankruptcy Court.

The company proposes to issue, as part of the Amended U.S. Plan,
up to $18 million of its 3% Convertible Subordinated notes due
2019.  The notes will be issued to discharge, in part, claims of
certain existing creditors in the bankruptcy proceedings.  
Description of the indenture issue and further information may be
obtained by accessing http://www.sec.gov/cgi-bin/srch-
edgar?0000950135-99-004575 on the Internet, free of charge.


PHILIP SERVICES: Proposes Up To $60 Million In Senior Notes
-----------------------------------------------------------
In connection with the company's amended U.S. Plan the company
proposes to issue up to $60 million of its 6% Senior
Subordinated Notes due 2009.  The notes will be issued to
discharge, in part, claims of certain existing creditors in the
bankruptcy proceedings.

For description of the proposed 6% Senior Subordinated Notes due
2009 issuance, and further information concerning the action
access http://www.sec.gov/cgi-bin/srch-edgar?0000950135-99-004573
free of charge, on the Internet.


PHILIP SERVICES: Seeks Extension To File Schedules and Statements
-----------------------------------------------------------------
The debtors, Philip Services Inc., et al., seek an extension of
time to file schedules and statements. The debtors seek an order
further extending their time for filing the Schedules and
Statements by 70 days, through and until December 17, 1999.  
Additionally, the debtors request that they be permanently
relieved of any obligation to file the Schedules and statements
in the event the court confirms the debtors' proposed plan of
reorganization and such plan becomes effective by December 17,
1999. The debtors' Confirmation Hearing is scheduled to commence
on November 3, 1999 at 9:30 AM.


PRICHARD ALA: Files Chapter 9  
------------------------------
Prichard, Ala., has filed for chapter 9 protection after
searching for several weeks for an alternative solution,
according to a newswire report. Prichard is the largest city in
the state to ever file for bankruptcy protection. The City
Council had tried to borrow to buy its way out of debt, but the
chapter 9 filing was considered the only viable option. (ABI 07-
Oct-99)


SERVICE MERCHANDISE: Increases Borrowing Capacity
-------------------------------------------------
Service Merchandise Company, Inc. (NYSE:SME) announced that its
lenders have approved an amendment to its $ 750 million debtor-
in-possession (DIP) financing agreement that provides for the
release of the $ 50 million borrowing base reserve which had been
in effect pending negotiation of financial covenants.

The adoption of the covenant package provides the Company an
additional $ 50 million in availability under the DIP facility,
as the borrowing base reserve is eliminated. The covenants
require the Company to maintain either a minimum EBITDA (earnings
before interest, taxes, depreciation, and amortization)
performance OR minimum availability under the facility.

Under the DIP agreement, the Company's senior lenders, led by
Citibank as administrative agent and BankBoston as documentation
agent and collateral monitoring agent, provided $ 750 million in
post-petition financing to fund the Company's operations during
its restructuring.

"The two-pronged nature of this covenant and its reasonable
EBITDA thresholds signify the strong support and confidence of
our lenders. We believe that the flexibility of the covenants,
coupled with the release of the $ 50 million reserve, will
further increase our merchandise vendors' confidence in
our liquidity and will maintain the momentum of their return to
normalized payment terms," said Chief Executive Officer Sam
Cusano.

Under the terms of the amendment, a maximum annual capital
expenditure covenant is set at $ 50 million. Additional
flexibility is provided to carry over 50 percent of unused
capital expenditures from a prior year and to earn
additional capital expenditure capacity as EBITDA rises.

"This additional boost to our liquidity raises the Company's
availability to approximately $ 185 million as of October 5,
1999," said Thomas Garrett, Chief Financial Officer. "This
development further demonstrates the confidence shown
by our lenders."

Service Merchandise and its subsidiaries filed voluntary
petitions for reorganization under Chapter 11 in the U.S.
Bankruptcy Court for the Middle District of Tennessee in
Nashville on March 27, 1999.

Known as "America's Leading Jeweler," Service Merchandise is a
specialty retailer focusing on fine jewelry, home and gift
products.


STORMEDIA: Taps Special Litigation Counsel
------------------------------------------
Stormedia Incorporated, debtor and Stormedia International Ltd
seek authority to employ Hennigan, Mercer & Bennett as special
litigation counsel to represent the debtors in two cases with
Maxtor Corp.  The firm will handle the matters on a contingency
basis. Postpetition fees to the firm were in the amount of
$765,640 and $167,432 as expenses.


TALK AMERICA: Order Approves Asset Purchase Agreement
-----------------------------------------------------
The US Bankruptcy Court, District of Maine entered an order on
September 30, 1999 approving that certain asset purchase
agreement between the debtor Talk America, Inc. and DanMark, Inc.


WELLCARE MANAGEMENT: Receives Release of Supervision
----------------------------------------------------
The WellCare Management Group, Inc., parent company of WellCare
of New York, Inc. and WellCare of Connecticut, Inc., held its
Annual Meeting of Shareholders Meeting on September 30,
1999. At the meeting, Kiran C. Patel, M.D., Mark D. Dean, D.D.S.,
Rupesh Shah, Pradip C. Patel and Mary Lee Campbell-Wisley, all
current WellCare Board members, were elected to serve on the
Board until WellCare's next annual meeting. Additionally, the
shareholders adopted an Amendment to WellCare's Restated
Certificate of Incorporation, as amended, to increase the number
of Common Stock authorized for issuance from 20 million shares to
75 million shares. The Amendment was adopted to allow for future
stock dividends, acquisitions (no acquisition is currently
pending), general corporate purposes and to provide the Board
adequate flexibility to accomplish stock splits and other
corporate transactions as may arise from time to time. The
increase in the authorized shares of Common Stock was also
required to provide sufficient Common Stock to be issued pursuant
to the recently completed transactions with Dr. Patel and The
1818 Fund II, L.P. in June 1999. Finally, the Shareholders
ratified the Board's selection of Deloitte & Touche, LLP as
independent auditors of WellCare for the year ending December 31,
1999.  

WellCare also announced the Officers for WellCare, WCNY and WCCT.
Kiran C. Patel, M.D. will serve as Chairman of the Board,
President and Chief Executive Officer of WellCare,
Secretary of WCNY and Chairman of the Board of WCCT; Mary Lee
Campbell-Wisley will serve as Secretary of WellCare, Chairman of
the Board, President and Chief Executive Officer of WCNY and
Secretary, President and Executive Director of WCCT; Hitesh Adhia
will serve as the Interim Acting Chief Financial Officer for
WellCare, WCNY and WCCT and; Sandip I. Patel will serve as the
General Counsel to WellCare, WCNY and WCCT.  The Officers will
serve in their respective capacity until WellCare's next annual
Board meeting.

WellCare also announced that it has received a release of the
order from the State of Connecticut Insurance Department
requiring WCCT to submit to administrative supervision by
the State's Insurance Commissioner. The order was issued on May
26, 1999 to WCCT by the Insurance Department based on the
determination that WCCT was not in compliance with the State of
Connecticut's minimum net worth requirement for a health
maintenance organization. WCCT was released from administrative
supervision based upon its meeting the $ 1 million statutory net
worth requirement. Additionally, Dr. Patel's application for the
acquisition of control of WCCT was approved by the Connecticut
Insurance Department. In furtherance of this approval, WCCT is
required to file balance sheets and income statements with the
Insurance Department on a monthly basis for a period of one
year and file reports of business operations in Connecticut on a
quarterly basis for a period of two years. WCCT must also file
with the Insurance Department (1) a plan for handling insolvency,
(2) a plan to establish and maintain a mechanism to afford its
members an opportunity to participate in matters of policy and
operation and, (3) an amended Insurance Holding Company System
Annual Registration Statement.

Dr. Patel, Chairman and Chief Executive Officer of WellCare,
stated, "I am excited about the implementation of my management
team into the Connecticut operations. Though we face a number of
challenges from the past, I believe that this team can work
closely and in partnership with the physicians, hospitals, payors
and members to eliminate all outstanding issues and progress
forward by providing high quality, affordable healthcare in the
State of Connecticut." WellCare's service area extends from New
York City to the southern Adirondacks, west into the Mohawk River
Valley and Southern Tier counties, and east into Connecticut.  


BOND PRICING FOR WEEK OF October 4, 1999
========================================
DLS Capital Partners, Inc., bond pricing for week of October 4,
1999

Following are indicated prices for selected issues:

Acme Metal 10 7/8 '07                  18 - 20 (f)
Amer Pad & Paper 13 '05                28 - 31
Asia Pulp & Paper 11 3/4 '05           66 - 67
E & S Holdings 10 3/8 '06              38 - 42
Fruit of the Loom 8 7/8 '06            39 - 41
Geneva Steel 11 1/2 '01                18 - 20 (f)
Globalstar 11 1/4 '01                  62 - 64
Hechinger 9.45 '12                      9 - 12 (f)
Integrated Health 9 1/2 '07            11 - 13 (f)
Iridium 14 '05                         12 - 13 (f)
Just for Feet 11 '09                   15 - 18
Loewen 7.20 '03                        48 - 50 (f)
Planet Hollywood 12 '05                26 - 28 (f)
Purina Mills 9 '10                     22 - 26 (f)
Revlon 0 '01                           18 - 20
Service Merchandise 9 ''04             14 - 16 (f)
Sunbeam 0 '18                          16 - 16 1/2
TWA 11 3/8 '06                         58 - 60
United Artists 9 3/4 '08               22 - 26
Vencor 9 7/8 '05                       20 - 22 (f)
Zenith 6 1/4 '11                       17 - 20 (f)


                   
                   *********

The Meetings, Conferences and Seminars column appears
in the TCR each Tuesday.  Submissions via e-mail to
conferences@bankrupt.com are encouraged.  
Bond pricing, appearing in each Friday edition of the TCR, 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

Troubled Company Reporter is a daily newsletter, co- published by
Bankruptcy Creditors' Service, Inc., Princeton, NJ, and Beard
Group, Inc., Washington, DC. Debra Brennan, Yvonne L. Metzler,
Editors.  Copyright 1999. All rights reserved. ISSN 1520-9474.

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

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


       * * * End of Transmission * * *