ITEM 1. BUSINESS
Total Containment, Inc. (the "Company") was incorporated in the State of Pennsylvania. The Company is a leading manufacturer and distributor of underground systems and products for the conveyance and containment of petroleum and alcohol based motor vehicle fuels from underground storage tanks to aboveground fuel dispensers. The Company's systems and products are used in connection with the installation of new and the retrofitting of existing underground fuel containment and distribution systems ("Fuel Containment Systems") worldwide. The principal end users of the Company's products are major oil companies and convenience stores. End users also include government bodies, utilities and other fleet vehicle operators.
During the third quarter of 1996, the Company acquired American Containment, Inc. ("ACI"). ACI is principally engaged in the manufacture and installation of fiberglass tank and dispenser sumps used in underground piping systems. The Company acquired ACI to have a supply of quality fiberglass components in addition to an increased presence in the Western United States. The Company intends to transfer this business from ACI to the Company. During 1997, the Company caused ACI to redirect its focus solely on the custom part service business, as well as on becoming the field technical arm of the Company. The Company believes that this action will complement the Company's parts business, enhance its field level expertise and provide an additional resource to its customers.
PRINCIPAL PRODUCTS
The principal products of the Company and their primary features are summarized in the following table:
Enviroflex A flexible double-wall - Double-wall construc- pipe for the conveyance tion provides primary and secondary contain- pipe protection and ment of motor vehicle secondary containment fuels from underground storage tanks to - Flexible product dispensers - No joints
- UL-approved for gaso- line and gasohol
- Primary pipe can be retracted for repair or replacement
- Ease of installation
- Thermoplastic construction
- Certain features protected by patent
Sump/risers Liquid-resistent access - Secondary containment chambers made from fiberglass or polyethy- - Mounted on all types of lene for submersible underground storage pumps and other fit- tanks tings attached to underground storage - Provides easy above- tanks ground access to pumps and fittings
- Sumps and risers can be stacked and trimmed to achieve required burial depth
Dispenser Liquid-resistant - Secondary containment sumps secondary containment chambers made from - UL-approved mounting fiberglass or poly- frames, brackets and ethylene for above stabilizer bars ground fuel dispensers - Provides aboveground access to dispenser valves, joints and connectors
- Polyethylene and fiberglass construction
- Certain features protected by patent
Bulkhead Specially designed fit- - Ease of installation fittings tings used to seal pipe/ and sump connections - Thermoplastic reducers construction
- Certain features protected by patent
Tank A polyethylene jacket - Secondary containment Jacket that provides secondary containment and corro- - UL-approved secondary sion protection for containment and corro- steel underground sion protection jacket storage tanks - UL-approved for gasoline and gasohol
- Less expensive than fiberglass tanks
- Ease of transportation
- Polyethylene construction
- Certain features protected by patent
Pipe A telescoping poly- - Secondary containment Jacket ethylene pipe that provides liquid con- - Polyethylene construc- veyance and corro- tion sion protection for rigid fiberglass or - Certain features pro- steel underground tected by patent piping systems
SALES ACTIVITIES
General
The sales of the Company's principal products and the sales of each product as a percentage of total sales in 1995, 1996 and 1997 are set forth in the following table:
Sales and Percentages of Total Sales
Year Ended December 31, ------------------------------------------------------ 1995 1996 1997 ---------------- ---------------- ---------------- (Dollars in thousands) Enviroflex and other piping... $ 18,466 47.3% $ 16,912 44.8% $ 19,550 42.8% Sump/risers and bulkhead fit- tings and reducers....... 7,696 19.7 8,374 22.2 10,168 22.3 Dispenser sumps.. 4,732 12.1 4,876 12.9 5,060 11.1 Tank Jacket..... 5,983 15.3 6,008 15.9 6,109 13.4 Pipe Jacket...... 774 2.0 624 1.7 485 1.1 Installation..... -- -- -- -- 1,977 4.3 Applicator equip- ment and other. 1,418 3.6 936 2.5 2,300 5.0 -------- ---- ------- ----- ------- ----- Totals........... $ 39,069 100.0% $37,730 100.0% $45,649 100.0% ======== ===== ======= ===== ======= =====
Geographic Markets
In addition to the United States, the Company's geographic market for its products includes Canada, Mexico, Central and South America, Europe (including the EEC, Hungary and Poland), Australia, New Zealand, Southeast Asia (including Singapore, Thailand, Taiwan and Hong Kong), and the Middle East (including
Turkey and Israel). The Company's net sales to customers outside the United States in 1997, 1996 and 1995 were $12.5 million, $12.7 million and $12.3 million, respectively. The Company's principal foreign end users are the major oil companies.
The following table sets forth, for the periods indicated, the net sales of the Company's products by geographic market area.
NET SALES BY GEOGRAPHIC MARKET AREA
Information relating to foreign operating income and foreign assets is set forth in Note 13 of Notes to Consolidated Financial Statements included elsewhere herein.
PRODUCT DEVELOPMENT
The Company is committed to a program of continuous product evaluation and continuous improvement in order to maintain the technological competitiveness of its product line. In addition, the Company is actively engaged in developing new products for traditional markets in addition to expanding into non- traditional markets.
NEW MANUFACTURING LINE
In the fourth quarter of 1997, the Company completed the installation of a new primary pipe manufacturing line at its Oaks, Pennsylvania facility. Prior to such completion, the Company, since its inception, had purchased its primary pipe from Dayco Products, Inc., a subsidiary of Mark IV Industries. See "Notes to Consolidated Financial Statements -- Warranty Reserve" and "Item 3. Legal Proceedings." With this equipment, the Company was able to redesign and significantly improve certain important features of the Enviroflex and Omniflex primary pipes. This primary pipe carries the approval of Underwriters' Laboratories.
Also, the Company finalized the design and began producing a new pipe for use in remote fill applications. This pipe is a 4 inch corrugated composite extrusion with field attachable
fittings. The Company expects that this pipe will be sold principally overseas.
END USERS
The principal domestic end users of the Company's products are major oil companies and convenience store chains which purchase the Company's products in connection with the installation of new and the retrofitting of existing Fuel Containment Systems. The Company's other domestic customers are primarily state and local government bodies, utilities and other fleet vehicle operators.
Substantially all of the Company's sales relating to oil company and convenience store chain end users are performed pursuant to purchase orders or non-exclusive contracts, neither of which provide for any minimum purchase requirements. During 1995 and 1996 the two previous fiscal years, the Company's backlog of orders averaged less than $770,000. In 1997, the backlog averaged $1.7 million. The Company typically ships incoming orders within approximately seven days and, therefore, does not have a significant backlog.
COMPETITION
The industry in which the Company operates is highly competitive and dominated by a few companies. The companies compete on several factors including product performance, service, and pricing.
The Company's principal competitors in the market for underground piping systems (including sump risers and dispenser sumps) are divisions or subsidiaries of A. O. Smith Corporation and Ameron, Inc. both fiberglass manufacturers, as well as Environ Products, Inc., a manufacturer of flexible piping systems, and a new competitor of the Company, OPW Fueling Components ("OPW"), a division of Dover Resources, Inc. (See "Item 3 - Legal Proceedings"). Many of these companies have greater financial resources than the Company.
The Company's primary competition for Tank Jacket are manufacturers of fiberglass, fiberglass clad, and steel tanks. Of these competing manufacturers, Fluid Containment, Inc. and Xerxes Corporation, are both fiberglass tank manufacturers.
MANUFACTURERS AND SUPPLIERS
During the fourth quarter of 1997, the Company began manufacturing the primary pipe component of its Enviroflex and Omniflex flexible piping systems. Prior thereto, the Company purchased its primary pipe from Dayco Products, Inc., a subsidiary of Mark IV Industries (See Item 3 - "Legal Proceedings"). The Company also manufacturers its Tank Jacket
product, as well as molded bulkhead fittings and other seals, and fiberglass tanks and dispenser sumps.
Ten suppliers provide the Company approximately 75% of its purchases. During 1997, the Company has entered into a written supply contract with Cleveland Tubing, Inc. (which manufactures various extruded pipes for the Company, including the Enviroflex secondary pipe). The Company does not have any written supply contracts with any other principal suppliers.
PATENTS AND TRADEMARKS, LICENSING AGREEMENTS
The Company derives revenues from the sale of Enviroflex and Omniflex piping systems and its Tank Jacket product, certain features of which are covered by patent owned by, assigned to, or licensed to the Company. The Company relies on its intellectual property rights to protect its interest in these design features.
The Company has the right to practice certain claims with respect to piping used in the Enviroflex and Omniflex system pursuant to an exclusive worldwide license (the "license") covered under patents owned by OPW Fueling Components Division of Dover Industries, Inc. ("OPW"), which also possesses the right to practice these claims. Under the license, the Company is obligated to pay a royalty of three percent of net sales of the Company attributable to products covered by the patents to OPW, payable quarterly, with a minimum payment of $75,000 per calendar quarter.
On April 1, 1994 the Company paid an advance of $1.5 million against the royalties. The Company used the last of the prepaid royalties during the fourth quarter of 1997. For information relating to litigation with OPW, see "Item 3. Legal Proceedings." See also "Competition."
The Company also relies on unpatented proprietary information to maintain and promote its commercial position.
EMPLOYEES
As of December 31, 1997, the Company employed 257 persons, of which 17 were engaged in marketing and sales; 4 were engaged in research and development; 138 were engaged in manufacturing and assembly; 54 were engaged in field service installations; and 40 were engaged in finance, administration and management. Of the total number of employees, 4 were located outside the United States. None of the Company's employees are covered by a collective bargaining agreement.
ITEM 2.
ITEM 2. PROPERTIES
The Company operates in a 125,000 square foot leased facility located in Oaks, Pennsylvania. The Company believes that the facility will accommodate its administrative and manufacturing needs for the foreseeable future.
Rene Morin, Inc. operates from a 12,000 square foot leased facility located in Plainfield, Connecticut.
American Containment, Inc. operates from several leased buildings, totaling approximately 10,000 square feet, located in Bakersfield, California.
TCI Environment operates from an office located in Antwerp, Belgium. In addition, TCI Environment has warehouse space in Antwerp, Belgium.
ITEM 3.
ITEM 3. LEGAL PROCEEDINGS
In January, 1998 the Company settled and terminated litigation with two competitors who claimed that they possessed licenses to manufacture and sell underground systems with retractability and other features covered by patents licensed to the Company. The purported licensees acknowledged that whatever license rights they had were terminated and the Company paid $1.6 million to them.
During 1997, the Company was a party in litigation involving the owner of the patents referred to above and a third party to whom the owner of such patents proposed to transfer his business, including patent rights with respect to the retractability feature of the underground containment systems sold by the Company.
In April, 1997 a court held that the owner of the patents was entitled to transfer his business, including his patent rights. The Company did not appeal the Court's decision.
During 1997, the Company initiated a legal action against Dayco Products, Inc., a subsidiary of Mark IV Industries, in the United States District Court for the Eastern District of Pennsylvania seeking, among other things, a judicial determination that Dayco breached the provisions of two Supply Agreements, entered into in 1990 and 1993 for the sale of primary pipe. The Complaint alleges that Dayco supplied pipe that was defective because it was susceptible to microbial fungus.
In its suit, the Company requests that the Court award damages, to cover, among other things, the cost of inspecting and replacing defective pipe and related costs in an amount to be determined at trial and for further appropriate relief. The Company, in consultation with its legal counsel, believes that it is more likely than not that the Company will prevail with
respect to its material claims. (See "Significant Accounting Policies - Warranty Reserve.")
A legal action was filed in the Fifth Circuit Court of the State of Hawaii on September 16, 1997 by JJR Inc., James Jasper Enterprises, Inc., and others with interests in a retail shopping center on the Island of Kauai, Hawaii, against Company, Dayco, and Senter Petroleum, Inc. for damages allegedly resulting from the failure of Company's Enviroflex piping system on or about August 12, 1996 at The Little Gas Shack (the "Shack"), a retail gasoline service facility supplied by Senter adjacent to the shopping center. The Complaint alleges that more than 1,800 gallons of gasoline were released onto the property occupied by the Shack and the adjacent businesses and into a nearby stream and the harbor where the shopping center was located. Although the amount sought by the plaintiffs is not specified in the Compliant, the attorney retained by the Company's insurance carrier has ascertained that plaintiffs are seeking approximately $23 million in damages. The Company has and maintains insurance with policy limits at the time of this claim of $3 million which may respond to this claim, however, the amount claimed exceeds the liability limits. Under the Dayco Supply Agreement, Dayco is required to indemnify and hold the Company harmless from all claims and suits by third parties based upon the manufacture of Enviroflex primary pipe or the performance by Dayco of its obligations under the Agreement. Dayco, has not, as yet, agreed to honor this obligation. The Company has commenced litigation to enforce its rights against Dayco. Based upon the Company's investigation to date, the Company believes that the Enviroflex secondary containment system functioned properly to contain the overflow and was not responsible for the release, and that any loss was caused by the failure of equipment manufactured and supplied by third parties. The Company believes that plaintiff's claims are grossly excessive and intends to vigorously defend its position. The Company believes that it has no material uninsured liability in connection with this matter and that if it does, it is covered by Dayco's contractual indemnity.
The Company is also involved in various other legal actions incidental to the conduct of its business. Management is contesting these cases vigorously and believes it has meritorious defenses in each matter. Management does not believe the ultimate outcome of these various legal actions will have a material effect on the Company's financial condition, results of operations or working capital requirements.
ITEM 4.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None.
ITEM 4A. EXECUTIVE OFFICERS OF THE REGISTRANT
The executive officers of the Company and their ages and positions with the Company are as follows:
Name Age Position - ---------------------------- ----------------------------------
Pierre Desjardins...... 56 President and Chief Executive Officer Jeffrey A. Boehmer..... 32 Vice President Finance Randolph B. Braun...... 40 Vice President Sales and Marketing David L. Gilbert....... 48 Vice President Engineering Homer N. Holden........ 61 Vice President - Research and Product Development John R. Wright, Jr..... 37 Vice President Operations
The principal occupation and business experience during the last five years of the executive officers of the Company are as follows:
Pierre Desjardins joined the Company in September 1996 as President and Chief Executive Officer. From 1990 to 1994, he was President and Chief Executive Officer of Domtar, Inc., a publicly held Canadian pulp and paper corporation. He is currently a director for Discreet Logic, a publicly held Canadian company that develops, assembles, markets, and supports systems for creating, editing and compositing imagery and special effects for film and video, as well as Canam Manac Group, Inc., a publicly owned Canadian industrial corporation engaged in the manufacture of construction steel components and trailers in Canada, the United States, France and Mexico.
Jeffrey A. Boehmer joined the Company as an accountant in 1987. From 1990 until 1996, Mr. Boehmer served as Operations Manager, Vice President Operations from January 1996 until June 1997, and presently Vice President Finance. Mr. Boehmer has also served as Secretary of the Company since 1994.
Randolph B. Braun joined the Company as Director of Marketing in April 1995 and became Vice President of Sales and Marketing in January 1996. Prior to joining the Company, from 1992 to 1995, Mr. Braun was a Sales and Marketing Account Executive for Mark IV Automotive, concentrating on customers in the Pacific Rim and the Japanese auto manufacturers transplanted in the United States.
David L. Gilbert joined the Company in March of 1996 as Vice President Engineering. Prior to joining the Company, from 1992 to 1996, Mr. Gilbert was Manager of Program Development with Mark IV automotive. In this position he was responsible for establishing new manufacturing plants in Europe.
Homer N. Holden joined the Company as Director of Research in 1990 and became Vice President - Research and Product
Development in 1992. Prior to joining the Company, from 1988 to 1990, Mr. Holden managed the Plastic Products Development Laboratory at Dayco.
John R. Wright, Jr. joined the company in June 1997 as Vice President Operations. Prior to joining the Company, from 1982 to 1997, Mr. Wright was Director of Materials Management for Lukens, a specialty steel manufacturer. Prior responsibilities at Lukens included Corporate planning, manager, and various sales positions.
PART II
ITEM 5.
ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTER
The Company's Common Stock (the "Common Stock") commenced trading on the Nasdaq Stock Market National Market System ("Nasdaq NMS") under the symbol TCIX on February 25, 1994, the date on which the Company completed its initial public offering (the "Offering"). Prior to the Offering there was no public market for the Common Stock. As of February 27, 1998, the Company had 17 shareholders of record and approximately 459 beneficial owners of the Common Stock. The Company has been advised by Nasdaq NMS that the Company's net tangible assets do not meet NASDAQ's criteria for continued listing on the Nasdaq NMS. On March 13, 1998, the Company's principal shareholder purchased from the Company 400 shares of authorized perpetual preferred stock at $10,000, cash, per share or $4 million in the aggregate. This $4 million equity infusion is expected to cause the Company to meet NASDAQ's listing requirements and should permit the Company to maintain its NASDAQ NMS listing over the foreseeable future.
The following table sets forth the quarterly ranges of high and low sale prices, and the closing sale price, for shares of the Common Stock for the periods indicated. Such prices represent quotations between dealers and do not include mark-ups, mark-downs or commissions, and may not necessarily represent actual transactions.
Sale Prices ------------------ Closing High Low Sale Price --------- -------- ---------- - ---- First Quarter... $ 3 $ 2 3/8 $ 3 Second Quarter.. 3 2 1/4 2 5/8 Third Quarter... 2 15/16 2 1/4 2 5/8 Fourth Quarter.. 2 7/8 2 3/16 2 3/4
- ---- First Quarter... $ 5 $ 3 1/4 $ 3 5/8 Second Quarter.. 3 3/4 2 1/4 3 1/2 Third Quarter... 4 1/4 1 27/32 3 1/4 Fourth Quarter.. 3 1/2 2 1/4 3 3/8
The Company has not paid any cash dividends on the Common Stock in the past and does not anticipate that any cash dividends will be declared or paid in the foreseeable future. The Company's current line of credit facility prohibits the payment of any dividends by the Company without the lender's prior written consent.
ITEM 6.
ITEM 6. SELECTED FINANCIAL DATA
Information required by this Item is included on Page 3 of the Annual Report.
ITEM 7.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Information required by this Item is included on Pages 4 through 7 of the Annual Report.
ITEM 8.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
The audited Consolidated Financial Statements of the Company at December 31, 1996 and 1997 and for the three years ended December 31, 1997 required by this Item are included on Pages 9 through 21 of the Annual Report. No supplementary financial data is required to be included herein.
ITEM 9.
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
On January 12, 1998, the Company engaged Grant Thornton LLP as the Company's principal accountant to audit the Company's financial statements. The Company did not consult with Grant Thornton LLP regarding any accounting matter during the two most recent fiscal years or any subsequent interim period prior to engaging Grant Thornton LLP.
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 $20.4 million operating loss due in large measure to an $18 million warranty charge and certain other charges of $2.4 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 stated the Company should record a substantial valuation allowance because, 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 LLP, which occurred prior to the commencement of the 1997 year-end audit process, was not resolved at the time of Price Waterhouse LLP's resignation.
The Company has evaluated whether a valuation allowance is appropriate under all the facts and circumstances existing at December 31, 1997, in connection with the 1997 audit process and concluded that a valuation allowance of $275,465 is required to cover
various state net operating loss carryforwards with relatively short carryforward periods. Grant Thornton LLP concurs with the Company's determination that no additional valuation allowance is required.
The Company is unable to quantify the amount of the required valuation allowance. A substantial valuation allowance would have reduced the Company's consolidated assets, net worth, and net income by the amount of the increase in the valuation allowance.
(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 Grant Thornton LLP, 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)).
PART III
ITEM 10.
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
Incorporated by reference herein is the information appearing in the Proxy Statement relating to the Company's Annual Meeting of Stockholders to be held on April 17, 1998 (the "Proxy Statement") under the heading "Election of Directors - --Continuing Directors and Nominees for Election as Director" and under the heading "Report of the Compensation Committee on Executive Compensation -- Additional Information Regarding Directors and Officers."
Information regarding executive officers of the Company is presented in Part I, Item 4A of this Form 10-K.
ITEM 11.
ITEM 11. EXECUTIVE COMPENSATION
Incorporated by reference herein is the information appearing in the Proxy Statement under the heading "Report of the Compensation Committee on Executive Compensation."
ITEM 12.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
Incorporated by reference herein is the information appearing in the Proxy Statement under the headings "General --Principal Stockholders" and "Election of Directors -- Security Ownership of Management."
ITEM 13.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
None.
PART IV
ITEM 14.
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K
(a) The following documents are filed as part of this report:
1. AUDITED FINANCIAL STATEMENTS
The financial statements of the Company listed on the index set forth below are filed as part of this Annual Report on Form 10-K. PAGE OF THE ANNUAL REPORT -------------
Reports of Independent Accountants............... 8-9 Consolidated Balance Sheets as of December 31, 1996 and 1997.................................. 10 Consolidated Statements of Operations for the years ended December 31, 1995, 1996 and 1997... 11 Consolidated Statements of Changes in Stockholders' Equity for the years ended December 31, 1995, 1996 and 1997............... 12 Consolidated Statements of Cash Flows for the years ended December 31, 1995, 1996 and 1997... 13 Notes to Consolidated Financial Statements....... 14
2. FINANCIAL STATEMENT SCHEDULES.
A schedule setting forth the warranty reserves of the Company as of December 31, 1995, 1996 and 1997 is attached as an Appendix to this Annual Report on Form 10-K.
3. EXHIBITS.
The following is a list of the Exhibits required by Item 601 of Regulation S-K and incorporated by reference herein or attached as Exhibits to this Annual Report on Form 10-K.
3.1 Certificate of Incorporation of the Company incorporated herein by reference to Exhibit 3.1 to the Quarterly Report of the Company on Form 10-Q for the quarter ended June 30, 1997.
3.2 Bylaws of the Company incorporated herein by reference to Exhibit 3.2 to the Quarterly Report of the Company on Form 10-Q for the quarter ended June 30, 1997.
3.3 Certificate Representing Shares of Class A Floating Rate Preferred Stock and Related Statement With Respect to Shares - Domestic Business Corporation, with Attachments (Exhibit 1).
4.1 Specimen of Common Stock Certificate of the Company, incorporated herein by reference to Exhibit 4(a) to Registration Statement No. 33- 70456 on Form S-1 of the Company.
10.1 Stock Compensation Plan, dated January 14, 1994, incorporated herein by reference to Exhibit 10(a) to Registration Statement No. 33-70456 on Form S-1 of the Company.*
10.2 Stock Compensation Plan, dated February 27, 1997 incorporated herein by reference to Exhibit 10.2 to the Annual Report of the company on Form 10-K for the fiscal year ended December 31, 1996.*
10.3 Employment Agreement between the Company and Marc Guindon, incorporated by reference to Exhibit 10(b) to Registration Statement No. 33-70456 on Form S-1 of the Company.*
10.4 Employment Agreement between the Company and Pierre Desjardins incorporated herein by reference to Exhibit 10.4 to the Annual Report of the Company on Form 10-K for the fiscal year ended December 31, 1996.*
10.5 Employment Agreement between the Company and Homer N. Holden, incorporated by reference to Exhibit 10(o) to Registration Statement No. 33-70456 on Form S-1 of the Company.*
10.6 Employment Agreement between the Company and Jeffrey A. Boehmer, incorporated by reference to the Quarterly Report of the Company on Form 10-Q for the quarter ended March 31, 1994.*
10.7 Settlement Agreement between the Company Ameron, Inc., Environ Products, Inc., Michael C. Webb, Keith Osborne, Intelpro Corporation, and Buffalo Environmental Products Corporation, dated as of January 26, 1998. (Exhibit 2).
10.8 Secrecy Agreement, dated November 2, 1987, between the Company and Remcon Plastics, Inc., incorporated herein by reference to Exhibit 10(m) to Registration Statement No. 33-70456 on Form S-1 of the Company.
10.9 Settlement Agreement, dated December 16, 1994, between the Company and the Settlement Counterparty, incorporated by reference to Exhibit 10.14 to the Annual Report on Form 10-K of the Company for the fiscal year ended December 31, 1994.
10.10 Release of All Claims/Settlement Agreement, dated March 5, 1996, between the Company and James Lawrence, incorporated by reference to Exhibit 10.11 to the Annual Report of the Company on Form 10-K for the fiscal year ended December 31, 1996.
10.11 Commitment Letter from Commercial Bank dated January 17, 1998 setting forth terms of $10 million line of credit facility.
11 Statement re: Computation of per share earnings.
16 Letter of Price Waterhouse re: Change in Certifying Accountant, incorporated by reference to Exhibit 16 to the Current Report on Form 8-K/A of the Company dated December 15, 1997.
21 Subsidiaries of the Company.
27 Financial Data Schedule (December 31, 1997).
27.2 Financial Data Schedule (December 31, 1996).
27.3 Financial Data Schedule (December 31, 1995). ___________________
* Denotes compensatory plan or arrangement.
(b) Reports on Form 8-K.
The Company filed the following Current Reports on Form 8-K during the fourth quarter of 1997:
(a) The Company's Current Report on Form 8-K, File No. 000-23454, as filed with the Securities and Exchange Commission on December 10, 1997, and any amendments thereto.
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) 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. (Registrant)
/s/ Pierre Desjardins ----------------------------------- Pierre Desjardins, President and Chief Executive Officer
Dated: February 27, 1998
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed by the following persons on behalf of the Registrant and in the capacities and on the dates indicated.
Schedule VIII
TOTAL CONTAINMENT, INC.
RESERVES
DECEMBER 31, 1995, 1996 AND 1997
___________________
(1) Includes pipe warranty of $7,500,000 (See Notes 2 and 10).
(2) Includes Dayco receivable for replacement materials (See Note 10).
(3) Includes pipe warranty of $17,200,000 (See Notes 2 and 10).