<PAGE> 1
FORM 8-K
QUARTERLY REPORT UNDER SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report: August 11, 1998
GOLF TRAINING SYSTEMS, INC.
---------------------------
(Exact name of registrant as specified in its charter)
<TABLE>
<S> <C> <C>
GEORGIA 58-1963120
------------------- --------------- ----------------------
(State or other jurisdiction of (Commission (I.R.S. Employer
incorporation or organization) File Number) Identification No.)
3400 CORPORATE WAY
SUITE G
DULUTH, GA 30096
- ------------------------------------------------------------------------------
(Address of principal (Zip Code)
executive offices)
</TABLE>
Registrant's telephone number, including area code (404) 673-6400
--------------
<PAGE> 2
Item 3. BANKRUPTCY OR RECEIVERSHIP
On August 11, 1998, Golf Training Systems, Inc., a Georgia corporation (the
"Company"), filed a voluntary Petition for Relief under the provisions of
Chapter 11 of the U.S. Bankruptcy Code in the U.S. Bankruptcy Court for the
Northern District of Georgia, Atlanta Division (Bankruptcy Case No.
98-75390-SWC).
Chapter 11 allows the Company to remain as debtor-in-possession of its
assets and business while being subject to the supervision and orders of the
Bankruptcy Court for certain transactions or actions.
The Company is negotiating an agreement with Meadowcroft Golf Associates,
Inc., the lender under the Company's existing working capital credit facility
for use of such collateral to fund on-going operations. This agreement will be
limited in duration.
Pursuant to Sections 1107 to 1108 of the Bankruptcy Code, Debtors, as
debtors and debtors-in-possession, will continue to manage and operate their
assets and businesses in the ordinary course of business, pending the
confirmation of a plan of reorganization and subject to the supervision and
orders of the Court. No trustee, examiner or similar officer has been appointed
by the Court.
Item 7. FINANCIAL STATEMENTS AND EXHIBITS
99.1 Press release issued by Golf Training Systems, Inc. on August 11,
1998.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
Date: August 11, 1998
GOLF TRAINING SYSTEMS, INC.
By: /s/ Wayne McDonald
___________________________
Wayne McDonald
Chairman and
Chief Executive Officer
<PAGE> 1
EXHIBIT 99.1
FOR IMMEDIATE RELEASE
Contact:
Wayne McDonald
Chairman
Golf Training Systems, Inc.
(770)623-6400
GOLF TRAINING SYSTEMS FILE FOR CHAPTER 11 RELIEF
GOLF TRAINING SYSTEMS, INC. ATLANTA, GA (GTS) September 11, 1998. (Nasdaq:
GTSX) announced today that it has filed for bankruptcy and intends to
reorganize under chapter 11 of the Bankruptcy Code.
In early July, GTS announced that it was in default on a $1 million Senior
Secured Note which matured on June 30, 1998. Since that time it has been in
continuing negotiations with its Senior Secured Lender, Meadowcroft Golf
Associates, Inc., of Westport, CT, the assignee of Mr. John H. Laeri, Jr.,
under the loan agreement between GTS and Mr. Laeri dated December 31, 1997. The
loan is secured by substantially all of the Company's operating assets.
Early this week, while the Laeri discussions were continuing, GTS received
notice from Mr. David Leadbetter that it is also in default under the terms of
a five year contract that terminates on December 31, 2002 which obligates GTS
to pay Mr. Leadbetter about $144,000 a year in minimum guaranteed royalties in
return for giving GTS exclusive worldwide distribution rights to golf training
aids endorsed by Mr. Leadbetter. Mr. Leadbetter states he is owed $48,000.
According to Wayne McDonald, Chairman of GTS "By filing for bankruptcy, we hope
to get the time we need to restructure our financial affairs and reorganize our
business We appreciate the role our Secured Creditor has played and the
relationship we have enjoyed with Mr. Leadbetter since 1991. We will continue to
work closely with both Mr. Laeri and Mr. Leadbetter, as well as our suppliers
and other parties-in-interest, to try to get a plan of reorganization confirmed
as soon as possible."
GTS has been a leader in the development and marketing of golf improvement,
learning and performance enhancement products. Its primary product has been
sold under the "Leadbetter Collection" brand. These products have been offered
primarily in the United States.
Forward-looking statements in the news release are made pursuant to the "safe
harbor" provisions of the federal securities laws. Investors are cautioned that
actual results may differ substantially from such forward-looking statements
involve risks and uncertainties including, but not limited to, seasonality of
sales, level of customer demand, competitive pressure and other risks detailed
in the Company's periodic report filings with the Securities and Exchange
Commission.
