|
The holder of the Series A Bonds elected, under the terms of the
extension agreement, to convert the bonds from United States dollar denominated
bonds to Japanese Yen denominated bonds. The conversion of the Bonds from $10.0
million U.S. Dollars to 1,354,733,330 Japanese Yen was made effective on
September 30, 1998. This Yen denominated obligation currently remains unhedged
and any gains or losses resulting from fluctuations in exchange rates are
recorded in income. As of March 31, 1999, the Company recorded an unrealized
loss of approximately $1.4 million.
During fiscal year 1999, the Company did not make the required interest
payments of $125,000 due in October 1998 and $125,000 due in April 1999 on the
Series A Bonds. As a result, the bondholder has the right to declare the Series
A Bonds in default and accelerate the entire outstanding balance of $11.4
million plus accrued interest of $0.7 million. As a result, the Series A Bonds
have been classified as a current liability. On March 26, 1999, CT Sports
entered into a restructuring agreement with the bondholder which is contingent,
among other things, Marker entering into a definitive purchase agreement with CT
Sports (see Note 1). There can be no assurance that the bondholder will not
declare the Series A Bonds in default and accelerate the outstanding balance.
|
