SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
(Mark One)
FORM 11-K
X ANNUAL REPORT PURSUANT TO SECTION 15(d) OF
- ---- THE SECURITIES EXCHANGE ACT OF 1934
(FEE REQUIRED)
FOR THE FISCAL YEAR ENDED DECEMBER 31, 1995
or
TRANSITION REPORT PURSUANT TO SECTION 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
(NO FEE REQUIRED)
FOR THE TRANSITION PERIOD FROM
TO
___________________
_______________________________
COMMISSION FILE NUMBER 1-3608
_______________________________
WARNER-LAMBERT SAVINGS AND STOCK PLAN
WARNER-LAMBERT COMPANY
(Name of issuer of securities held pursuant to the plan)
201 Tabor Road
Morris Plains, New Jersey 07950
(Address of issuer's principal executive
offices)
WARNER-LAMBERT
SAVINGS AND STOCK PLAN
FINANCIAL STATEMENTS
DECEMBER 31, 1995 AND
DECEMBER 31, 1994
WARNER-LAMBERT
SAVINGS AND STOCK PLAN
INDEX TO FINANCIAL STATEMENTS
Page(s)
Report of Independent Accountants 1
Statement of Net Assets Available for Plan
Benefits with Fund Information as of
December 31, 1995 2
Statement of Net Assets Available for Plan
Benefits with Fund Information as of
December 31, 1994 3
Statement of Changes in Net Assets Available
for Plan Benefits with Fund Information
for the year ended December 31, 1995 4
Statement of Changes in Net Assets Available
for Plan Benefits with Fund Information
for the year ended December 31, 1994 5
Notes to Financial Statements 6 - 9
Exhibit I - Master Trust Statement of Net Assets
Available for Plan Benefits with Fund
Information as of October 31, 1995 and 1994
Exhibit II - Master Trust Statement of Changes in Net
Assets Available for Plan Benefits with
Fund Information for the years ended
October 31, 1995 and 1994
Exhibit III - Notes to the Master Trust Financial
Statements
Additional Information (Master Trust):
Schedule I - Schedule of Assets Held for Investment
at October 31, 1995 - Master Trust
Schedule II - Schedule of transactions involving an
amount in excess of 5% of the fair value
of plan assets
Consent of Independent Accountants
REPORT OF INDEPENDENT ACCOUNTANTS
May 24, 1996
To the Participants and Administrator of
the Warner-Lambert Savings and Stock Plan
In our opinion, the financial statements listed in the
accompanying index present fairly, in all material respects,
the net assets available for plan benefits of the Warner-
Lambert Savings and Stock Plan at December 31, 1995 and
1994, and the changes in net assets available for plan
benefits for the years then ended in conformity with
generally accepted accounting principles. These financial
statements are the responsibility of the Plan's
administrator; our responsibility is to express an opinion
on these financial statements based on our audits. We
conducted our audits of these statements in accordance with
generally accepted auditing standards which require that we
plan and perform the audit to obtain reasonable assurance
about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the
financial statements, assessing the accounting principles
used and significant estimates made by the administrator,
and evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for
the opinion expressed above.
Our audits were performed for the purpose of forming an
opinion on the basic financial statements taken as a whole.
The additional information included in Schedules I and II of
the Master Trust is presented for purposes of additional
analysis rather than to present the net assets available for
plan benefits and changes in net assets available for plan
benefits of each fund. Schedules I and II of the Master
Trust and the Fund Information have been subjected to the
auditing procedures applied in the audits of the basic
financial statements and, in our opinion, are fairly stated
in all material respects in relation to the basic financial
statements taken as a whole.
WARNER-LAMBERT
SAVINGS AND STOCK PLAN
STATEMENT OF NET ASSETS AVAILABLE
FOR PLAN BENEFITS WITH FUND INFORMATION
AS OF DECEMBER 31, 1995
(Dollars in thousands)
W-L W-L
Company Employee Fixed Small-Cap
Stock Stock S&P 500 Income International Balanced Value Combined
Fund Fund Fund Fund Fund Fund Fund Funds
------- -------- ------- ------ ------------- -------- ------- --------
Assets:
Investments in Warner-
Lambert Master Trust,
at market value
(cost $360,101) $229,849 $ 96,903 $ 87,374 $157,054 $ 25,162 $ 20,955 $28,670 $645,967
Participant loans
receivable 447 2,811 2,516 6,465 0 0 0 12,239
-------- -------- -------- -------- -------- -------- ------- --------
Net assets available
for plan benefits $230,296 $ 99,714 $ 89,890 $163,519 $ 25,162 $20,955 $28,670 $658,206
======== ======== ======== ======== ======== ======== ======= ========
The accompanying notes are an integral part
of the financial statements.
WARNER-LAMBERT
SAVINGS AND STOCK PLAN
STATEMENT OF NET ASSETS AVAILABLE
FOR PLAN BENEFITS WITH FUND INFORMATION
AS OF DECEMBER 31, 1994
(Dollars in thousands)
W-L W-L
Company Employee Fixed Small-Cap
Stock Stock S&P 500 Income International Balanced Value Combined
Fund Fund Fund Fund Fund Fund Fund Funds
------- -------- ------- ------ ------------- -------- --------- --------
Assets:
Investments in Warner-
Lambert Master Trust,
at market value
(cost $402,769) $186,647 $ 72,571 $ 60,936 $153,736 $ 20,708 $ 14,245 $ 17,203 $526,046
Participant loans
receivable 379 2,445 2,233 5,657 0 0 0 10,714
-------- -------- -------- -------- -------- -------- -------- --------
Net assets available
for plan benefits $187,026 $ 75,016 $ 63,169 $159,393 $ 20,708 $ 14,245 $17,203 $536,760
======== ======== ======== ======== ======== ======== ======= ========
The accompanying notes are an integral part
of the financial statements.
WARNER-LAMBERT
SAVINGS AND STOCK PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE
FOR PLAN BENEFITS WITH FUND INFORMATION
FOR THE YEAR ENDED DECEMBER 31, 1995
(Dollars in thousands)
W-L W-L
Company Employee Fixed Small-Cap
Stock Stock S&P 500 Income International Balanced Value Combined
Fund Fund Fund Fund Fund Fund Fund Funds
------- -------- ------- ------ ------------- -------- --------- --------
Additions to net assets
attributable to:
Interest in increase in
net assets from investment
activities in the Warner-
Lambert Master Trust,
including $291 of interest
income on participant
loans $53,929 $ 22,140 $23,181 $ 9,888 $ 2,539 $ 3,862 $ 5,751 $121,290
Contributions:
Participant - 9,575 6,313 9,260 3,568 2,607 3,463 34,786
Company 7,544 - - - - - - 7,544
------- -------- ------- -------- ----------- ------- ------- -------
Total contributions 7,544 9,575 6,313 9,260 3,568 2,607 3,463 42,330
------- -------- ------- -------- ----------- ------- ------- -------
Total additions 61,473 31,715 29,494 19,148 6,107 6,469 9,214 163,620
------- -------- ------- -------- ----------- ------- ------- -------
Deductions from net assets
attributable to:
Distributions to
participants (12,669) (5,474) (4,675) (15,316) (963) (1,356) (1,052) (41,505)
Administrative expenses (11) (198) (113) (249) (35) (29) (34) (669)
Interfund transfers (5,523) (1,345) 2,015 543 (655) 1,626 3,339 0
------- -------- ------- -------- ---------- ------- ------- --------
Total deductions (18,203) (7,017) (2,773) (15,022) (1,653) 241 2,253 (42,174)
------- -------- ------- -------- ---------- ------- ------- --------
Increase in net assets
during the year 43,270 24,698 26,721 4,126 4,454 6,710 11,467 121,446
Net assets available for
plan benefits:
Beginning of period 187,026 75,016 63,169 159,393 20,708 14,245 17,203 536,760
-------- ------- ------- -------- ----------- ------- ------- --------
End of period $230,296 $ 99,714 $89,890 $163,519 $ 25,162 $20,955 $28,670 $658,206
======== ======== ======= ======== =========== ======= ======= ========
The accompanying notes are an integral part of the financial statements.
WARNER-LAMBERT
SAVINGS AND STOCK PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE
FOR PLAN BENEFITS WITH FUND INFORMATION
FOR THE YEAR ENDED DECEMBER 31, 1994
(Dollars in thousands)
W-L W-L
Company Employee Fixed Small-Cap
Stock Stock S&P 500 Income International Balanced Value Combined
Fund Fund Fund Fund Fund Fund Fund Funds
------- -------- ------- ------ ------------- -------- ------- --------
Additions in net assets
attributable to:
Interest in increase/
(decrease) in net assets
from investmentactivities
in the Warner-Lambert Master
Trust,including $582 of
interest income on
participant loans $ 29,247 $ 11,385 $ 879 $ 9,258 $ (292) $ (184) $ (227) $ 50,066
Contributions:
Participant - 11,098 6,293 10,019 3,331 2,198 2,812 35,751
Company 7,696 - - - - - - 7,696
------- ------- ------- ------- ---------- ------- ------- --------
Total contributions 7,696 11,098 6,293 10,019 3,331 2,198 2,812 43,447
------- ------- ------- ------- ---------- ------- ------- --------
Total additions 36,943 22,483 7,172 19,277 3,039 2,014 2,585 93,513
------- ------- ------- ------- ---------- ------- ------- --------
Deductions from net
assets attributable to:
Distributions to
participants (11,659) (5,086) (4,424) (14,738) (571) (598) (383) (37,459)
Administrative expenses (9) (217) (116) (276) (28) (20) (23) (689)
Interfund transfers (10,751) (13,090) (4,298) 7,538 8,845 5,343 6,413 0
------- -------- ------- ------- ---------- ------- ------- --------
Total deductions (22,419) (18,393) (8,838) (7,476) 8,246 4,725 6,007 38,148
------- -------- ------- ------- ---------- ------- ------- --------
Increase/(decrease) in net
assets during the year 14,524 4,090 (1,666) 11,801 11,285 6,739 8,592 55,365
Net assets available for
plan benefits:
Beginning of period 172,502 70,926 64,835 147,592 9,423 7,506 8,611 481,395
-------- -------- ------- ------- ---------- ------- ------- --------
End of period $187,026 $ 75,016 $63,169 $159,393 $ 20,708 $14,245 $17,203 $536,760
======== ======== ======= ======= ========== ======= ======= ========
The accompanying notes are an integral part of the financial statements.
WARNER-LAMBERT
SAVINGS AND STOCK PLAN
NOTES TO FINANCIAL STATEMENTS
(Dollars in thousands)
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
The financial statements of the Warner-Lambert Savings and
Stock Plan (the "Plan") are prepared on the accrual basis of
accounting.
Master Trust Arrangement
The assets of the Plan are maintained in the Warner-Lambert
Company Master Trust (the "Master Trust") on a commingled
basis with the assets of the Puerto Rico Plan. These assets
have been commingled for investment purposes. Employer
contributions and benefit payments are identified with each
participating plan whereas earnings and expenses were
allocated proportionately to the plans by the trustee on a
basis equivalent to the proportionate units of
participation. The Master Trust has an October 31 year end.
Valuation of Investments
Investments are presented on a current value basis, with the
exception of group annuity and investment contracts. These
contracts are fully benefit-responsive and are valued at
contract value representing contributions made under the
contracts, plus interest at the contract rate, less funds
withdrawn. Investments in securities traded on a national
exchange are valued based upon the last published quotations
for the last business day of the year.
Investment Income
Dividend and interest income is recorded by the trustee as
earned. Realized gains and losses from the sale of
securities are accounted for as of the trade date. In
calculating such amounts, the cost of investments sold was
determined on the basis of the moving average acquisition
cost by the trustee.
Expenses
All expenses incurred in the administration of the Plan,
including audit fees, recordkeeping expenses and all other
costs incurred in the administration of the Plan and Master
Trust are borne by the Plan. In addition, administrative
expenses of the trustee, brokerage commissions, transfer
taxes and all other charges incurred in connection with the
purchase and sale of securities are also absorbed by the
Plan.
NOTE 2 - DESCRIPTION OF THE PLAN:
The Plan is a defined contribution profit-sharing-savings
plan covering employees of the Company and its domestic
affiliates and subsidiary companies who meet certain
eligibility and participation requirements. The following
brief description of the Plan is provided for general
information purposes only. Participants should refer to the
Plan agreement for more complete information. The Plan is
comprised of seven investment funds as follows:
WARNER-LAMBERT COMPANY STOCK FUND - Employer contributions
are invested in Warner-Lambert Common Stock.
WARNER-LAMBERT EMPLOYEE STOCK FUND - Employee contributions
are invested in Warner-Lambert Common Stock.
S&P 500 FUND - Employee contributions may be invested in
substantially all stocks comprising the Standard & Poor's
500 Stock Index.
FIXED INCOME FUND - Employee contributions may be invested
in investments such as contracts with insurance companies,
bonds, preferred stocks, or certificates of deposit.
INTERNATIONAL STOCK FUND - Employee contributions are
invested in the common stocks of large, established non-U.S.
companies outside of the United States.
BALANCED FUND - Employee contributions are invested in a
diversified mix of approximately 60% stocks and 40% bonds.
SMALL-CAP VALUE FUND - Employee contributions are invested
in primarily common stocks of small companies which are
believed to be undervalued at the time of purchase and to
have potential for capital appreciation.
Participants may elect to contribute into the Plan from a
minimum of 1% up to a maximum of 15% of their basic earnings
(as defined by the Plan) each year. Participants have the
option of contributing on a before-tax basis, an after-tax
basis, or a combination of both methods. The Company
contributes for each participant an amount equal to 35% and
25% of such participant's pre-tax and after-tax
contributions, respectively, limited to those participant
contributions less than or equal to 6% of the participant's
basic earnings. Based upon the vesting requirements of the
Plan, additional lump-sum matching contributions are
recorded each year of 25% to 65% of such participants'
contributions, up to 6% of base earnings, based upon growth
in the Company's earnings-per-share versus the prior year.
All Company contributions are invested in the Warner-
Lambert Company Stock Fund. Forfeitures of the plan are
netted against the Company's contributions. Forfeitures for
the plan years 1995 and 1994 were $161,540 and $142,531,
respectively. Participants can elect to have their
contributions invested in any of the funds noted above with
the exception of the Warner-Lambert Company Stock Fund. At
age fifty-five, participants can transfer assets out of the
Company Stock Fund to other investment funds.
Changes in the participants' allocations relating to their
contributions and the allocation of past contributions and
earnings can be requested at any time. A participant may
also suspend contributions or withdraw from the Plan at any
time, subject to certain restrictions and penalties.
Generally, participating employees become fully vested in
Company contributions made on their behalf to the Plan after
completing three years of Plan membership or five years of
service. Forfeitures reduce contributions otherwise due
from the Company and have not been significant.
Loans may not exceed the lesser of (1) fifty thousand
dollars or (2) 50% of the participant's before-tax balance.
Each loan must be for a minimum of one thousand dollars.
Any loan will be repaid with interest at a rate that is
equal to the prime rate effective at the close of business
on the first business day ofthe quarter in which the loan is
taken. Such rate remains in effect for the life of the
loan. The term of the loan shall not exceed 48 months.
Only one loan may be taken per year and only two loans will
be permitted to be outstanding for a participant at any
time. Participants may borrow from both the before-tax
account balance and the vested account balance in the
Company Stock Fund.
In the event of termination of the Plan, or if there is a
complete discontinuance of contributions under the Plan, all
rights of participants in accumulated investments credited
to them become fully vested. If the Plan is terminated by
resolution of the Company Board of Directors, the balance in
accumulated investments credited to each participant shall
be distributed to the participant.
NOTE 3 - FEDERAL INCOME TAX STATUS:
The Internal Revenue Service ("IRS") issued a favorable
determination letter to the Plan, dated 9/20/95, indicating
that the Plan documentation as reviewed by the IRS satisfied
the requirements of Section 401(a) of the Internal Revenue
Code. Accordingly, the earnings of the Plan are exempt from
taxation and no provision has been made for federal income
taxes.
NOTE 4 - PLAN ADMINISTRATION:
The Retirement and Savings Plan Committee of the Warner-
Lambert Company Board of Directors (the "Committee")
monitors and reports on the selection and termination of
trustees and investment managers and on the investment
activity and performance. The Committee also implements the
overall asset allocation guidelines as established by the
Board of Directors and decides on benefit appeals. The
Investment Committee, established by the Warner-Lambert
Company Board of Directors, is responsible for the daily
administration of the Plan, including oversight of plan
investments, plan trustees and investment managers.
NOTE 5 - MASTER TRUST FINANCIAL INFORMATION:
At December 31, 1995, the Plan has a 98.6% interest in the
Master Trust. The financial statements for the Master Trust
are prepared on the modified cash basis. The financial
statements for the year ended October 31, 1995 follow.
The Plan's financial statements have been adjusted for
November and December activity. All adjustments necessary
to reflect the Plan's financial statements on an accrual
basis have been recorded.
SIGNATURES
Pursuant to the requirements of the Securities Exchange
Act of 1934, the Warner-Lambert Investment Committee has
duly caused this annual report to be signed by the
undersigned thereunto duly authorized.
WARNER-LAMBERT SAVINGS
AND STOCK PLAN
Date: June 27, 1996 By: /s/ Ernest J. Larini
Ernest J. Larini
Chairman
Warner-Lambert Investment
Committee
EXHIBIT I
1 of 2
WARNER-LAMBERT COMPANY
MASTER TRUST
SAVINGS AND STOCK PLAN
STATEMENT OF NET ASSETS AVAILABLE
FOR PLAN BENEFITS WITH FUND INFORMATION
AS OF OCTOBER 31, 1995
(Dollars in thousands)
W-L W-L
Company Employee Fixed Small-Cap
Stock Stock S&P 500 Income International Balanced Value Combined
Fund Fund Fund Fund Fund Fund Fund Funds
-------- -------- ------- -------- ------------- -------- --------- ---------
Assets:
Investments in Warner-
Lambert Common Stock,
3,397,281 shares
(cost $148,446,531) $202,849 $ 86,363 $ - $ - $ - $ - $ - $ 289,212
Beneficial interest in group
annuity contracts (cost
equals market) - - - 64,614 - - - 64,614
Beneficial interest in
investment contracts (cost
equals market) - - - 89,056 - - - 89,056
Equity Funds
(cost $128,821,120) - - 82,082 - 23,490 19,666 26,270 151,508
Short-term investments (cost
equals market) - - - 4,084 - - - 4,084
-------- -------- ------- -------- ------------- -------- --------- ---------
Total Investments 202,849 86,363 82,082 157,754 23,490 19,666 26,270 598,474
Assets available for plan
benefits 202,849 86,363 82,082 157,754 23,490 19,666 26,270 598,474
Liabilities:
Accrued Administrative Expenses - (4) (4) (7) (1) (1) (1) (18)
-------- -------- ------- -------- ------------- -------- --------- ---------
Net assets available for
plan benefits $202,849 $ 86,359 $82,078 $157,747 $ 23,489 $ 19,665 $ 26,269 $ 598,456
======== ======== ======= ======== ============= ======== ========= =========
The accompanying notes are an integral part
of the financial statements.
EXHIBIT I
2 of 2
WARNER-LAMBERT COMPANY
MASTER TRUST
SAVINGS AND STOCK PLAN
STATEMENT OF NET ASSETS AVAILABLE
FOR PLAN BENEFITS WITH FUND INFORMATION
AS OF OCTOBER 31, 1994
(Dollars in thousands)
W-L W-L
Company Employee Fixed Small-Cap
Stock Stock S&P 500 Income International Balanced Value Combined
Fund Fund Fund Fund Fund Fund Fund Funds
--------- -------- --------- -------- ------------- -------- --------- ---------
Assets:
Investments in Warner-
Lambert Common Stock,
3,389,439 shares
(cost $132,615) $ 186,218 $ 72,233 $ - $ - $ - $ - $ - $ 258,451
Beneficial interest in group
annuity contracts (cost
equals market) - - - 60,821 - - - 60,821
Beneficial interest in
investment contracts (cost
equals market) - - - 83,983 - - - 83,983
Equity Funds (cost $111,083) - - 62,754 - 21,235 14,314 17,138 115,441
Short-term investments (cost
equals market) - - - 10,377 - - - 10,377
--------- -------- --------- -------- ------------- -------- --------- ---------
Total Investments 186,218 72,233 62,754 155,181 21,235 14,314 17,138 529,073
Assets available for plan
benefits 186,218 72,233 62,754 155,181 21,235 14,314 17,138 529,073
Liabilities:
Accrued Administrative Expenses - (6) (5) (12) (2) (1) (1) (27)
--------- -------- --------- -------- ------------- -------- --------- ---------
Net assets available for
plan benefits $ 186,218 $ 72,227 $ 62,749 $155,169 $ 21,233 $ 14,313 $ 17,137 $ 529,046
========= ======== ========= ======== ============= ======== ========= =========
The accompanying notes are an integral part
of the financial statements.
EXHIBIT II
1 of 2
WARNER-LAMBERT COMPANY
MASTER TRUST
SAVINGS AND STOCK PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE
FOR PLAN BENEFITS WITH FUND INFORMATION
FOR THE YEAR ENDED OCTOBER 31, 1995
(Dollars in thousands)
W-L W-L
Company Employee Fixed Small-Cap
Stock Stock S&P 500 Income International Balanced Value Combined
Fund Fund Fund Fund Fund Fund Fund Funds
-------- -------- --------- -------- ------------- -------- --------- --------
Additions to net assets
attributable to:
Income from investments:
Interest income $ 31 $ 248 $ 120 $ 227 $ 66 $ 42 $ 52 $ 786
Dividend income 6,196 2,460 - 9,739 1,273 1,009 1,259 21,936
Net realized gain on
securities sold 11,589 3,331 1,303 0 (162) 74 126 16,261
Changes in unrealized
appreciation(depreciation) 9,847 5,070 15,355 0 (949) 1,638 2,350 33,311
-------- -------- --------- -------- ------------- -------- --------- --------
Total income from investments 27,663 11,109 16,778 9,966 228 2,763 3,787 72,294
Contributions:
Participant 202 11,894 7,355 11,797 4,220 2,939 3,799 42,206
Company 7,751 - - - - - - 7,751
-------- -------- --------- -------- ------------- -------- --------- --------
Total contributions 7,953 11,894 7,355 11,797 4,220 2,939 3,799 49,957
-------- -------- --------- -------- ------------- -------- --------- --------
Total additions 35,616 23,003 24,133 21,763 4,448 5,702 7,586 122,251
-------- -------- --------- -------- ------------- -------- --------- --------
Deductions from net assets
attributable to:
Distributions to
participants (13,645) (8,184) (6,174) (19,565) (1,448) (1,685) (1,392) (52,093)
Administrative expenses (22) (226) (119) (284) (35) (29) (33) (748)
Interfund transfers (5,318) (461) 1,489 664 (709) 1,364 2,971 0
-------- -------- --------- -------- ------------- -------- --------- --------
Total deductions (18,985) (8,871) (4,804) (19,185) (2,192) (350) 1,546 (52,841)
-------- -------- --------- -------- ------------- -------- --------- --------
Increase in net assets
during the year 16,631 14,132 19,329 2,578 2,256 5,352 9,132 69,410
Net assets available for
plan benefits:
Beginning of period 186,218 72,227 62,749 155,169 21,233 14,313 17,137 529,046
-------- -------- --------- -------- ------------- -------- --------- --------
End of period $202,849 $ 86,359 $ 82,078 $157,747 $ 23,489 $ 19,665 $ 26,269 $598,456
======== ======== ========= ======== ============= ======== ========= ========
The accompanying notes are an integral part of the financial statements.
EXHIBIT II
2 of 2
WARNER-LAMBERT COMPANY
MASTER TRUST
SAVINGS AND STOCK PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE
FOR PLAN BENEFITS WITH FUND INFORMATION
FOR THE YEAR ENDED OCTOBER 31, 1994
(Dollars in thousands)
W-L W-L
Company Employee Fixed Small-Cap
Stock Stock S&P 500 Income International Balanced Value Combined
Fund Fund Fund Fund Fund Fund Fund Funds
-------- -------- -------- -------- ------------- --------- --------- ---------
Additions to net assets
attributable to:
Income from investments:
Interest income $ 13 $ 215 $ 79 $ 152 $ 40 $ 25 $ 29 $ 553
Dividend income 6,121 2,449 0 9,160 198 408 223 18,559
Net realized gain on
securities sold 16,598 5,214 286 0 77 (40) 2 22,137
Changes in unrealized
appreciation(depreciation) (341) 888 1,997 0 1,221 (195) 325 3,895
-------- -------- -------- -------- ------------- --------- --------- ---------
Total income from investments 22,391 8,766 2,362 9,312 1,536 198 579 45,144
Contributions:
Participant 74 16,470 7,837 13,075 3,212 2,181 2,702 45,551
Company 8,718 - - - - - - 8,718
-------- -------- -------- -------- ------------- --------- --------- ---------
Total contributions 8,792 16,470 7,837 13,075 3,212 2,181 2,702 54,269
-------- -------- -------- -------- ------------- --------- --------- ---------
Total additions 31,183 25,236 10,199 22,387 4,748 2,379 3,281 99,413
-------- -------- -------- -------- ------------- --------- --------- ---------
Deductions from net assets
attributable to:
Distributions to participants (12,672) (8,429) (5,991) (18,254) (883) (777) (639) (47,645)
Administrative expenses (21) (271) (125) (321) (27) (19) (22) (806)
Interfund transfers (15,539) (19,407) (12,187) 2,491 17,395 12,730 14,517 0
-------- -------- -------- -------- ------------- --------- --------- ---------
Total deductions (28,232) (28,107) (18,303) (16,084) 16,485 11,934 13,856 (48,451)
-------- -------- -------- -------- ------------- --------- --------- ---------
Increase/(decrease) in net
assets during the year 2,951 (2,871) (8,104) 6,303 21,233 14,313 17,137 50,962
Net assets available for
plan benefits:
Beginning of period 183,267 75,098 70,853 148,866 0 0 0 478,084
-------- -------- -------- -------- ------------- --------- --------- ---------
End of period $186,218 $ 72,227 $ 62,749 $155,169 $ 21,233 $ 14,313 $ 17,137 $ 529,046
======== ======== ======== ======== ============= ========= ========= =========
The accompanying notes are an integral part of the financial statements.
Exhibit III
WARNER-LAMBERT COMPANY
MASTER TRUST
NOTES TO THE FINANCIAL STATEMENTS
(Dollars in thousands)
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
Basis of Financial Statement Presentation
The financial statements of the Warner-Lambert Company
Master Trust (the "Master Trust") include the assets of
the Warner-Lambert Savings and Stock Plan and the Warner-
Lambert Savings and Stock Plan for Colleagues in Puerto
Rico ("Puerto Rico Plan") (collectively the "Plans") and
are prepared on a modified cash basis of accounting. The
Plans are defined contribution profit-sharing-savings plans,
subject to the provisions of the Employee Retirement Income
Security Act of 1974 ("ERISA"), as amended.
The assets of the Plans have been commingled for investment
and administrative purposes in the Master Trust.
Accordingly, the Plans do not own specific Master Trust
assets but rather maintain an undivided beneficial interest
in such assets. Each Plan's interest in the Trust is
credited or charged for contributions, transfers and
distributions. Realized gains and losses and changes in net
unrealized appreciation or depreciation on investments were
allocated to the Plans based upon each Plan's beneficial
interest in the net assets of the Master Trust.
During 1993, T. Rowe Price Associates, Inc. replaced State
Street Bank and Trust Company of Boston as the trustee.
Effective with the change in trustee, realized gains and
losses and changes in net unrealized appreciation or
depreciation on investments are now recorded directly to the
participant accounts rather than on an allocation basis.
Valuation of Investments
Investments in securities traded on a national exchange are
valued based upon the last published quotations for the last
business day of the year. Other government securities and
short-term investments are valued at market value. The
fully benefit-responsive group annuity and investment
contracts, the principal and interest of which are
guaranteed, are valued at contract value representing
contributions made under the contracts, plus interest at the
contract rate, less funds withdrawn. The average annual
yield and average annual crediting interest rate of these
investments for the years ended 12/31/95 and 12/31/94 is
6.69% and 6.51%, respectively. Mutual shares of pooled
investment funds are valued at cost which is equal to
market value.
Investment Income
Dividend and interest income are recorded by the trustee as
earned. Realized gains and losses from the sale of
securities are accounted for as of the trade date. In
calculating such amounts, the cost of investments sold is
determined on a basis of the moving average acquisition
cost.
ERISA requires the Company to report investment transactions
on a current value basis of accounting versus a historical
basis of moving average cost which is utilized for the
financial statements under generally accepted accounting
principles.
Expenses
All expenses incurred in the administration of the Master
Trust and the related Plans, including audit fees,
recordkeeping expenses, administrative expenses of the
Trustee, brokerage commissions, transfer taxes and other
charges incurred in connection with the purchase and sale of
securities are borne by the Master Trust and are paid out of
the fund to which such charges relate.
NOTE 2 - FEDERAL INCOME TAX STATUS:
Participating plans in the Master Trust are intended to be
qualified plans under Section 401(a) of the Internal Revenue
Code, and the Master Trust established thereunder is
entitled to exemption from federal income tax under the
provisions of Section 501(a) of the Code. Accordingly, no
provision for federal income tax has been made.
Schedule I
Warner-Lambert Company
Master Trust
Schedule of Assets Held for Investment
October 31, 1995
(Dollars in thousands)
Units or Fair Value Fair Value
Face Value Description Amount Cost Percent
3,397,281 Warner-Lambert Company $ 289,212 $148,447 48.3%
10,837,737 T. Rowe Price Equity Funds 151,508 128,821 25.3
Beneficial Interest in Group Annuity Contracts:
Canada Life Assurance Co. annuity
contract P-45881 (7.24% minimum annual
effective rate) guaranteed through
6/21/00 $ 4,140 $ 4,140 0.7%
Life Insurance Company of Georgia
annuity contract GA-351-GIC (7.23%
minimum annual effective rate)
guaranteed through 5/10/00 6,211 6,211 1.0
Life Insurance Company of Georgia
annuity contract GA-356-GIC (6.23%
minimum annual effective rate)
guaranteed through 6/12/00 2,355 2,355 0.4
Life Insurance Company of Virginia
annuity contract GS-2755 (5.6% minimum
annual effective rate) guaranteed
through 12/17/98 4,405 4,405 0.7
Life Insurance Company of Virginia
annuity contract GS-2868 (6.84% minimum
annual effective rate) guaranteed
through 9/18/00 4,123 4,123 0.7
Lincoln National Pension Co. annuity
contract GA-9672 (7.35% minimum annual
effective rate) guaranteed through
5/27/99 2,736 2,736 0.4
Metropolitan Life Insurance Co. annuity
contract GAC-12456-069, principal and
interest (8.03% minimum annual effective
rate) guaranteed through 5/1/96 16,376 16,376 2.7
New York Life Insurance Co. annuity
contract GA-06948-001 (7.3% minimum
annual effective rate) guaranteed
through 8/17/98 11,085 11,085 1.9
New York Life Insurance Co. annuity
contract GA-06948-002 (7.41% minimum
annual effective rate) guaranteed
through 9/17/99 2,737 2,737 0.5
Peoples Security annuity contract
BDA00461FR (7.73% minimum annual effective
rate) guaranteed through 5/17/99 2,163 2,163 0.4
Schedule I
Warner-Lambert Company
Master Trust
Schedule of Assets Held for Investment
October 31, 1995
(Dollars in thousands)
Fair Value Fair Value
Amount Cost Percent
Beneficial Interest in Group Annuity Contracts:
Security Life of Denver Insurance Co.
annuity contract FA-0272, principal and
interest (5.7% minimum annual effective
rate) guaranteed through 6/16/00 4,183 4,183 0.7%
Sun Life Insurance Company of America
annuity contract 4376 (6.8% minimum
annual effective rate) guaranteed
through 6/17/97 4,100 4,100 0.7
---------- --------
TOTAL $ 64,614 $ 64,614
Beneficial Interest in Investment Contracts:
Bankers Trust Co. investment contract
93-644, principal and interest (5.20%
annual effective rate at 10/31/95)
maturing on 3/31/98 $ 27,570 $ 27,570 4.6%
Peoples Security investment contract
BDA00054TR (6.26% annual effective
rate at 10/31/95) 33,866 33,866 5.7
Provident Life and Accident Insurance
Co. investment contract 630-05699
(7.33% annual effective rate at
10/31/95) maturing on 3/31/00 27,620 27,620 4.6
---------- --------
TOTAL $ 89,056 $ 89,056
OTHER $ 4,084 $ 4,084 0.7%
---------- --------
TOTAL INVESTMENT $ 598,474 $435,022
========== ========
Schedule II
-----------
WARNER-LAMBERT
SAVINGS AND STOCK PLAN
SCHEDULE OF TRANSACTIONS INVOLVING AN AMOUNT IN EXCESS OF 5%
OF THE FAIR VALUE OF PLAN ASSETS FOR THE
TWELVE MONTHS ENDED OCTOBER 31, 1995
(Dollars in thousands)
Current
Value on
Party Description Number of Purchase Selling Cost Transaction Net Gain
Involved of Asset Transactions Price Price of Asset Date (loss)
T.Rowe Warner-Lambert 825 27,949,200
Price Common Stock 825 26,819,912 13,491,556 26,819,912 13,328,356
T. Rowe Fixed Income Fund 444 21,547,112
Price 444 18,660,596 18,660,596 18,660,596 0
Consent of Independent Accountants
We hereby consent to the incorporation by reference in the
Prospectus constituting part of the Registration
Statement on Form S-8 ( Registration No. 33-12209) of
Warner-Lambert Company of our report dated May 24, 1996
appearing in the Annual Report of Warner-Lambert Company
Savings and Stock Plan, which is incorporated in this annual
report on Form 11-K.
PRICE WATERHOUSE LLP
4 Headquarters Plaza North
Morristown, New Jersey 07962
June 27, 1996