The auditor Ernst & Young quit, according an 8-k filed today.
I've pasted the entire filing below. Squest wrote it so that it is
hard to read, so look at the second part of item (e) to see exactly
what happened.
===================================================================
Form 8-K for SYQUEST TECHNOLOGY INC filed on Jan 30 1997
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 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) January 23, 1997
SYQUEST TECHNOLOGY, INC.
(Exact name of registrant as specified in its charter)
Delaware
(State or other jurisdiction of incorporation)
0-19674 94-2793941
(Commission File Number) (IRS Employer Identification No.)
47071 Bayside Parkway, Fremont, California 94538
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (510) 226-4000
Not Applicable
(Former name or former address, if changed since last report.)
INFORMATION TO BE INCLUDED IN THE REPORT
Item 4. Changes in Certifying Accountant.
(a) During Registrant's two most recent fiscal years,
Registrant engaged the accounting firm of Ernst & Young LLP ("E&Y")
as the independent accountants to audit Registrant's financial
statements. At a meeting on January 23, 1997, Registrant indicated
that it was changing its independent accountants. E&Y confirmed
its discontinuation of services to Registrant by letter dated
January 24, 1997, and received by Registrant on January 27, 1997.
On January 30, 1997, Registrant engaged (subject to final approval
by Price Waterhouse LLP) the firm of Price Waterhouse LLP to act as
its independent accountants for the 1997 fiscal year.
(b) Registrant's decision to engage Price Waterhouse LLP
as Registrant's independent accountants was concurred with by
Registrant's Audit Committee and approved by its Board of
Directors.
(c) E&Y's reports on Registrant's financial statements
for the past two fiscal years did not contain an adverse opinion or
a disclaimer of opinion nor were they qualified or modified as to
uncertainty, audit scope or accounting principles.
(d) During the two fiscal years ended September 30,
1996, and subsequent interim periods prior to January 23, 1997,
there were no disagreements, as that term is used in paragraph
(a)(1)(iv) of Item 304 ("Item 304") of Regulation S-K promulgated
by the Securities and Exchange Commission (the "SEC"), between
Registrant and E&Y, which, if not resolved to the satisfaction of
E&Y, would have caused E&Y to refer thereto in their reports on
Registrant's financial statements for such periods.
(e) There has not occurred, during the two fiscal years
ended September 30, 1996, or any subsequent interim period prior to
January 23, 1997, any reportable events, as defined in paragraph
(a)(1)(v) of Item 304, with respect to E&Y, except as set forth in
a letter from E&Y to Registrant's Audit Committee, dated December
11, 1996, which Registrant received on January 29, 1997, noting a
material weakness in Registrant's internal control structure
relative to the preparation of accurate financial statements in a
timely fashion for Registrant's fiscal year ended September 30,
1996.
(f) During the two fiscal years ended September 30,
1996, and the subsequent interim periods prior to January 23, 1997,
Registrant did not consult Price Waterhouse LLP regarding the
the type of audit opinion that might be rendered on Registrant's
financial statements or regarding any matter that was either
subject to a disagreement or a reportable event, as those terms are
used in paragraphs (a)(1)(iv) and (a)(1)(v), respectively, of Item
304.
(g) Registrant is filing the letter dated January 30,
1997, from E&Y addressed to the SEC, stating that it agrees with
the statements herein.
Item 5. Other Events
Registrant Files Lawsuit Against Nomai, S.A.
On January 27, 1997, Registrant announced (in a press
release erroneously dated January 27, 1996) that it has filed suit
against Nomai, S.A. of Avranches, France, in Federal District Court
in San Francisco, California, for patent, copyright, and trademark
infringement as well as breach of contract and unfair competition.
The lawsuit is also described in the press release attached hereto
as Exhibit 99.1.
Item 7. Financial Statements, Pro Forma Financial Information and
Exhibits.
Exhibit No. Description
16.1 Letter dated January 30, 1997,
from E&Y to the SEC regarding
change in certifying accountant.
99.1 Registrant's Press Release
released January 27, 1997.
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 hereunto duly authorized.
SYQUEST TECHNOLOGY, INC.
(Registrant)
Date: January 30, 1997 By /s/ Edwin L. Harper
Edwin L. Harper
President and Chief
Exhibit 16.1
January 30, 1997
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549
Gentlemen:
We have read Item 4 of Form 8-K dated January 30, 1997 of SyQuest
Technology, Inc. and we are in agreement with the statements
contained in the first and third sentence of paragraph (a),
paragraphs (c), (d) and (e) therein. We have no basis to agree or
disagree with the Registrant's statements in the second and fourth
sentences of paragraph (a) or as to when they received our client-
auditor relationship termination letter, and paragraphs (b), (f)
and (g).
Regarding the registrant's statement concerning the lack of
internal control to prepare financial statements, included in the
fifth paragraph of Item 4 therein, we had considered such matter in
determining the nature, timing and extent of procedures performed
in our audit of the registrant's 1996 financial statements.
Very truly yours,
Exhibit 99.1
Contacts:
Richard Cline Henry Montgomery
Miller/Shandwick Technologies Chief Financial Officer
415/962-9550 SyQuest Technology, Inc.
rcline@miller.shandwick.com 510/226-4000
For Immediate Release:
SYQUEST FILES LAWSUIT AGAINST NOMAI, S.A.
Alleges that French Firm Sold
or Distributed Proprietary Cartridges
FREMONT, Calif., Jan. 27, 1996 -- SyQuest Technology, Inc.
(NASDAQ:SYQT) today announced that it has filed suit against Nomai,
S.A. of Avranches, France, in Federal District Court in San
Francisco for patent, copyright, and trademark infringement as well
as breach of contract and unfair competition. Also named
defendants with respect to the infringement and unfair competition
claims were Electronique d2, a French distributor of Nomai
products, and its U.S. affiliate, LaCie Ltd.
The suit alleges that Nomai attempted to capitalize on
SyQuest's innovation and technological leadership through the
unauthorized sale and/or distribution in the United States of
proprietary 3-1/2 inch and 5-1/4 inch replacement cartridges for
SyQuest removable disk drives.
In November 1996, SyQuest abandoned previously announced plans
to acquire Nomai when the majority shareholders of the French firm
attempted to radically alter the terms of the acquisition as set
forth in a letter of intent that they had signed five days before.
The lawsuit includes a claim for damages of at least $2 million for
breach of contract arising from alleged breaches of the letter of
intent.
"SyQuest has established itself as a leader in the removable
cartridge hard drive industry, with an installed base of over three
million drives and 18 million cartridges," said Ed Marinaro,
chairman. "In so doing, our Company has invested substantial
amounts of time and money in R&D and in establishing its
intellectual property portfolio. We will take all steps necessary
to protect SyQuest's investments, and those of our shareholders,
from companies that would infringe our intellectual property
rights."
About SyQuest
SyQuest Technology, Inc. is headquartered in Fremont,
and Penang, Malaysia, with additional facilities in Colorado,
California, Europe and Asia. The company offers removable
cartridge hard drives for Apple, Windows, MS-DOS, PC-DOS, UNIX, SGI
and Sun OS platforms. SyQuest (SYQT) is publicly traded on
NASDAQ's National Market System. See SyQuest on the World Wide Web
at syquest.com.
This news release contains forward-looking statements that involve
risks and uncertainties, including competition in the marketplace
for the Company's products and other risks detailed from time to
time in the reports filed by SyQuest with the SEC, including the
reports an Forms 10-Q and 10-K.
SyQuest and the SyQuest logo are registered trademarks of SyQuest
Technology, Inc. All other brands or tradenames are the property
of their respective companies. |
