SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 8-K
Current Report Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) December 3, 1997
TOTAL CONTAINMENT, INC.
(Exact name of registrant as specified in its charter)
Pennsylvania 0-23454 23-2394872
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Ident. No.)
422 Business Center, A130 North Dr., Oaks, PA 19456
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (610) 666-7777
N/A
(Former name or former address, if changed since last report.)
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Item 4. Change's in Registrant's Certifying Accountant.
The following information is set forth in accordance
with the relevant provisions of Item 304 of Regulation S-K:
Item 304(a)(1)--
(i) On December 3, 1997, Price Waterhouse LLP resigned
as the independent accountants of the Registrant.
(ii) The reports of Price Waterhouse LLP on the
financial statements for the past two fiscal years
contained no adverse opinion or disclaimer of
opinion and were not qualified or modified as to
uncertainty, audit scope or accounting principle.
(iii) Not applicable.
(iv) In connection with its audits for the two most
recent fiscal years and through December 3, 1997,
there have been no disagreements with Price
Waterhouse LLP on any matter of accounting
principles or practices, financial statement
disclosure, or auditing scope or procedure, which
disagreements, if not resolved to the satisfaction
of Price Waterhouse LLP, would have caused them to
make reference thereto in their report on the
financial statements for such years, except as
described in (A) below:
(A) During the third quarter of 1997, the Company
sustained a $20 million operating loss due in
large measure to an $18 million warranty
charge and certain other charges of $2.6
million. Based on its review of all evidence
and other information available to it at
September 30, 1997, the Company recorded a
$6.8 million tax benefit represented by
deferred tax assets which management believes
are fully realizable, based on the Company's
historical results of operation, management's
forecast of future taxable income, and other
factors. Based on procedures performed in
connection with its review of the Company's
unaudited financial information for the
quarter ended September 30, 1997, Price
Waterhouse LLP has stated the Company should
record a substantial valuation allowance
since in its view the objective evidence
indicated it is more likely than not that
such deferred assets will not be fully
realized. This matter was discussed by the
Company's Audit Committee with
representatives of Price Waterhouse LLP.
This disagreement between the Company and
Price Waterhouse, which occurred prior to the
commencement of the 1997 year-end audit
process, was not resolved at the time of
Price Waterhouse's resignation. The Company
will evaluate whether a valuation allowance
is appropriate and, if so, the amount thereof
under all the facts and circumstances
existing at December 31, 1997, in connection
with the 1997 audit process, and review such
allowance at the end of each fiscal quarter
thereafter.
(B) The Audit Committee of the Registrant's Board
of Directors discussed the subject matter of
the disagreement referenced above with Price
Waterhouse LLP.
(C) The Registrant has authorized Price
Waterhouse LLP to respond fully to the
inquiries of any successor accountant, when
retained, concerning the subject matter of
the disagreement referenced above.
(v) During the two most recent fiscal years and
through December 3, 1997, there have been no
reportable events (as defined in Item 304(a)(1)(v)
of Regulation S-K)).
Item 304(a)(3)--
The Registrant has requested Price Waterhouse LLP to
furnish it with a letter addressed to the Securities and
Exchange Commission stating whether or not it agrees with
the above statements. A copy of such letter will be filed
by amendment.
Item 7. Financial Statements and Exhibits.
(a) Financial Statements: NONE
(b) Exhibit:
*16 Accountants' letter received by the Registrant
pursuant to Item 304(a)(3) of Regulation S-K.
* To be filed by amendment.
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SIGNATURE
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.
TOTAL CONTAINMENT, INC.
Dated: December 10, 1997 /s/ Pierre Desjardins
Pierre Desjardins
President and Chief Executive
Officer
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EXHIBIT INDEX
Exhibit Number Description
*16 Accountants' letter received by the
Registrant pursuant to Item 304(a)(3) of
Regulation S-K.
* To be filed by amendment.
