SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 11-K
X ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the year ended: December 31, 1994
___ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from ___________ to ___________.
Commission file number: 1-9813
GENENTECH, INC. TAX REDUCTION INVESTMENT PLAN
(Full title of the Plan)
GENENTECH, INC.
(Name of issuer of the securities held pursuant to the Plan)
460 Point San Bruno Boulevard
South San Francisco, California 94080
(address of principal executive office)
Genentech, Inc. Tax Reduction Investment Plan
Index to Financial Statements
Item Page No.
__________________________________________________________ _________
Statement Of Net Assets Available For Benefits With Fund
Information at December 31, 1994 and 1993 3-4
Statement Of Changes in Net Assets Available
For Benefits With Fund Information for Years Ended
December 31, 1994 and 1993 5-8
Notes to Financial Statements 9-13
Report of Ernst & Young LLP, Independent Auditors 14
Page 2
Genentech, Inc. Tax Reduction Investment Plan
Statement Of Net Assets Available For Benefits With Fund Information
December 31, 1994
FIDELITY
FIDELITY GROWTH FIDELITY FIDELITY
GENENTECH MAGELLAN COMPANY GROWTH & INTERMEDIATE
STOCK FUND FUND FUND INCOME FUND BOND FUND
___________ ___________ ___________ __________ ____________
ASSETS:
Investments, at
fair value $ 9,090,200 $18,511,180 $ 4,725,960 $ 9,837,949 $ 1,567,685
Contribution
receivable from
Genentech, Inc. 560,300 1,211,006 433,460 782,252 130,119
___________ ___________ ___________ ___________ ___________
Net assets
available for
benefits $ 9,650,500 $19,722,186 $ 5,159,420 $10,620,201 $ 1,697,804
=========== =========== =========== =========== ===========
FIDELITY FIDELITY FIDELITY
FIDELITY FIDELITY ASSET ASSET ASSET
OVERSEAS BALANCED MANAGER MANAGER: MANAGER:
FUND FUND FUND GROWTH FUND INCOME FUND
___________ ___________ __________ ___________ ___________
ASSETS:
Investments, at
fair value $ 3,079,304 $12,769,920 $ 379,027 $ 479,134 $ 100,471
Contribution
receivable from
Genentech, Inc. 302,190 760,508 31,127 47,757 10,507
___________ ___________ __________ ___________ ___________
Net assets
available for
benefits $ 3,381,494 $13,530,428 $ 410,154 $ 526,891 $ 110,978
=========== =========== ========== =========== ===========
FIDELITY
RETIREMENT FIDELITY
MONEY U.S. EQUITY PARTICIPANT
MARKET FUND INDEX FUND LOANS TOTAL
___________ ___________ ___________ ___________
ASSETS:
Investments, at
fair value $7,476,596 $ 766,488 $ 2,108,168 $70,892,082
Contribution
receivable from
Genentech, Inc. 695,091 72,703 - 5,037,020
___________ ___________ ___________ ___________
Net assets
available for
benefits $8,171,687 $ 839,191 $ 2,108,168 $75,929,102
=========== =========== =========== ===========
<FN>
See accompanying notes.
Page 3
Genentech, Inc. Tax Reduction Investment Plan
Statement Of Net Assets Available For Benefits With Fund Information
December 31, 1993
FIDELITY
FIDELITY GROWTH FIDELITY FIDELITY
GENENTECH MAGELLAN COMPANY GROWTH & INTERMEDIATE
STOCK FUND FUND FUND INCOME FUND BOND FUND
___________ ___________ ___________ ___________ ___________
ASSETS:
Investments, at
fair value $ 7,906,574 $15,970,535 $ 3,536,048 $ 7,659,408 $ 1,505,628
Contribution
receivable from
Genentech, Inc. 490,233 1,168,119 367,222 677,284 130,259
___________ ___________ ___________ ___________ ___________
Net assets
available for
benefits $ 8,396,807 $17,138,654 $ 3,903,270 $ 8,336,692 $ 1,635,887
=========== =========== =========== =========== ===========
FIDELITY FIDELITY FIDELITY
FIDELITY FIDELITY ASSET ASSET ASSET
OVERSEAS BALANCED MANAGER MANAGER: MANAGER:
FUND FUND FUND GROWTH FUND INCOME FUND
___________ ___________ __________ ___________ ___________
ASSETS:
Investments, at
fair value $ 1,298,281 $12,978,484 $ - $ - $ -
Contribution
receivable from
Genentech, Inc. 150,843 820,353 - - -
___________ ___________ __________ ___________ ___________
Net assets
available for
benefits $ 1,449,124 $13,798,837 $ - $ - $ -
=========== =========== ========== =========== ===========
FIDELITY
RETIREMENT FIDELITY
MONEY U.S. EQUITY PARTICIPANT
MARKET FUND INDEX FUND LOANS TOTAL
___________ ___________ ___________ ___________
ASSETS:
Investments, at
fair value $ 6,162,063 $ 577,657 $ 1,932,356 $59,527,034
Contribution
receivable from
Genentech, Inc. 552,308 61,793 - 4,418,414
___________ ___________ ___________ ___________
Net assets
available for
benefits $ 6,714,371 $ 639,450 $ 1,932,356 $63,945,448
=========== =========== =========== ===========
<FN>
See accompanying notes.
Page 4
Genentech, Inc. Tax Reduction Investment Plan
Statement Of Changes In Net Assets Available For Benefits With Fund Information
Year Ended December 31, 1994
FIDELITY
FIDELITY GROWTH FIDELITY FIDELITY
GENENTECH MAGELLAN COMPANY GROWTH & INTERMEDIATE
STOCK FUND FUND FUND INCOME FUND BOND FUND
___________ ___________ ___________ ___________ ___________
Investment income:
Interest and
dividends $ - $ 714,604 $ 184,569 $ 685,781 $ 114,297
Realized/unrealized
gain (loss) (866,955) (1,093,888) (291,449) (510,850) (149,764)
___________ ___________ ___________ ___________ ___________
Total investment
income (loss) (866,955) (379,284) (106,880) 174,931 (35,467)
Contributions:
Basic 1,071,061 2,667,629 970,509 1,573,614 290,105
Rollover 210,014 329,653 152,702 133,718 61,131
Match 560,300 1,211,006 433,460 782,252 130,119
___________ ___________ ___________ ___________ ___________
Total contributions 1,841,375 4,208,288 1,556,671 2,489,584 481,355
Distributions (296,105) (1,122,164) (214,079) (462,304) (63,090)
Administrative fees - (263) (138) (488) (213)
Transfers between funds 575,378 (123,045) 20,576 81,786 (320,668)
___________ ___________ ___________ ___________ ___________
Net change
during the year 1,253,693 2,583,532 1,256,150 2,283,509 61,917
Net assets available
for benefits:
Beginning of year 8,396,807 17,138,654 3,903,270 8,336,692 1,635,887
___________ ___________ ___________ ___________ ___________
End of year $9,650,500 $19,722,186 $5,159,420 $10,620,201 $1,697,804
=========== =========== =========== =========== ===========
FIDELITY FIDELITY FIDELITY
FIDELITY FIDELITY ASSET ASSET ASSET
OVERSEAS BALANCED MANAGER MANAGER: MANAGER:
FUND FUND FUND GROWTH FUND INCOME FUND
___________ ____________ ___________ ___________ ___________
Investment income:
Interest and dividends $ 51,194 $ 415,428 $ 6,639 $ 11,389 $ 2,387
Realized/unrealized
gain (loss) (89,011) (1,161,346) (17,164) (27,207) (3,234)
___________ ____________ ___________ ___________ __________
Total investment
income (loss) (37,817) (745,918) (10,525) (15,818) (847)
Contributions:
Basic 558,867 1,710,194 35,174 46,145 7,013
Rollover 115,244 129,549 17,876 26,360 15,792
Match 302,190 760,508 31,127 47,757 10,507
___________ ____________ ___________ ___________ __________
Total contributions 976,301 2,600,251 84,177 120,262 33,312
Distributions (95,208) (426,289) (11) (222) -
Administrative fees - (1,075) - - -
Transfers between funds 1,089,094 (1,695,378) 336,513 422,669 78,513
___________ ____________ ___________ ___________ __________
Net change during the year 1,932,370 (268,409) 410,154 526,891 110,978
Net assets available
for benefits:
Beginning of year 1,449,124 13,798,837 - - -
___________ ____________ ___________ ___________ __________
End of year $3,381,494 $13,530,428 $ 410,154 $ 526,891 $ 110,978
=========== ============ =========== =========== ==========
Page 5
Genentech, Inc. Tax Reduction Investment Plan
Statement Of Changes In Net Assets Available For Benefits With Fund Information
Year Ended December 31, 1994
FIDELITY
RETIREMENT FIDELITY
MONEY U.S. EQUITY PARTICIPANT
MARKET FUND INDEX FUND LOANS TOTAL
___________ ___________ ___________ ___________
Investment income:
Interest and dividends $ 284,770 $ 22,532 $ 164,622 $2,658,212
Realized/unrealized
gain (loss) - (19,448) - (4,230,316)
___________ ___________ ___________ ___________
Total investment
income (loss) 284,770 3,084 164,622 (1,572,104)
Contributions:
Basic 1,064,080 169,751 - 10,164,142
Rollover 105,180 59,664 - 1,356,883
Match 695,091 72,703 - 5,037,020
___________ ___________ ___________ ___________
Total contributions 1,864,351 302,118 - 16,558,045
Distributions (265,257) (15,510) (37,377) (2,997,616)
Administrative fees (2,369) (125) - (4,671)
Transfers between funds (424,179) (89,826) 48,567 -
___________ ___________ ___________ ___________
Net change during the year 1,457,316 199,741 175,812 11,983,654
Net assets available
for benefits:
Beginning of year 6,714,371 639,450 1,932,356 63,945,448
___________ ___________ ___________ ___________
End of year $ 8,171,687 $ 839,191 $ 2,108,168 $75,929,102
=========== =========== =========== ===========
<FN>
See accompanying notes.
Page 6
Genentech, Inc. Tax Reduction Investment Plan
Statement Of Changes In Net Assets Available For Benefits With Fund Information
Year Ended December 31, 1993
FIDELITY
FIDELITY GROWTH FIDELITY FIDELITY
GENENTECH MAGELLAN COMPANY GROWTH & INTERMEDIATE
STOCK FUND FUND FUND INCOME FUND BOND FUND
___________ ___________ ___________ ___________ ___________
Investment income:
Interest and
dividends $ - $ 1,443,725 $ 318,451 $ 417,782 $ 110,909
Realized/unrealized
gain (loss) 2,101,951 1,437,269 94,725 720,966 44,894
___________ ___________ ___________ ___________ ___________
Total investment
income (loss) 2,101,951 2,880,994 413,176 1,138,748 155,803
Contributions:
Basic 999,575 2,235,134 683,575 1,360,576 269,116
Rollover 32,428 165,756 60,128 102,202 28,921
Match 490,233 1,168,119 367,222 677,284 130,259
___________ ___________ ___________ ___________ ___________
Total contributions 1,522,236 3,569,009 1,110,925 2,140,062 428,296
Distributions (276,300) (749,327) (89,426) (503,419) (173,785)
Administrative fees - - - - -
Transfers between funds (548,703) (198,861) 719,956 522,703 (172,398)
___________ ___________ ___________ ___________ ___________
Net change
during the year 2,799,184 5,501,815 2,154,631 3,298,094 237,916
Net assets available
for benefits:
Beginning of year 5,597,623 11,636,839 1,748,639 5,038,598 1,397,971
___________ ___________ ___________ ___________ ___________
End of year $ 8,396,807 $17,138,654 $3,903,270 $8,336,692 $1,635,887
=========== =========== =========== =========== ===========
FIDELITY FIDELITY FIDELITY
FIDELITY FIDELITY ASSET ASSET ASSET
OVERSEAS BALANCED MANAGER MANAGER: MANAGER:
FUND FUND FUND GROWTH FUND INCOME FUND
___________ ___________ ___________ ___________ ___________
Investment income:
Interest and dividends $ 18,557 $ 1,098,241 $ - $ - $ -
Realized/unrealized
gain (loss) 192,698 829,887 - - -
___________ ___________ ___________ ___________ ___________
Total investment
income (loss) 211,255 1,928,128 - - -
Contributions:
Basic 177,706 1,726,754 - - -
Rollover 53,001 132,984 - - -
Match 150,843 820,353 - - -
___________ ___________ ___________ ___________ ___________
Total contributions 381,550 2,680,091 - - -
Distributions (64,465) (563,198) - - -
Administrative fees - - - - -
Transfers between funds 511,417 171,516 - - -
___________ ___________ ___________ ___________ ___________
Net change during the year 1,039,757 4,216,537 - - -
Net assets available
for benefits:
Beginning of year 409,367 9,582,300 - - -
___________ ___________ ___________ ___________ ___________
End of year $ 1,449,124 $13,798,837 $ - $ - $ -
=========== =========== =========== =========== ===========
Page 7
Genentech, Inc. Tax Reduction Investment Plan
Statement Of Changes In Net Assets Available For Benefits With Fund Information
Year Ended December 31, 1993
FIDELITY
RETIREMENT FIDELITY
MONEY U.S. EQUITY PARTICIPANT
MARKET FUND INDEX FUND LOANS TOTAL
___________ ___________ ___________ ___________
Investment income:
Interest and dividends $ 198,008 $ 22,614 $ 131,638 $ 3,759,925
Realized/unrealized
gain (loss) - 28,243 - 5,450,633
___________ ___________ ___________ ___________
Total investment
income (loss) 198,008 50,857 131,638 9,210,558
Contributions:
Basic 1,195,261 151,249 - 8,798,946
Rollover 34,166 42,877 - 652,463
Match 552,308 61,793 - 4,418,414
___________ ___________ ___________ ___________
Total contributions 1,781,735 255,919 - 13,869,823
Distributions (308,243) (56,928) (28,516) (2,813,607)
Administrative fees - - - -
Transfers between funds (1,496,740) (60,513) 551,623 -
___________ ___________ ___________ ___________
Net change during the year 174,760 189,335 654,745 20,266,774
Net assets available
for benefits:
Beginning of year 6,539,611 450,115 1,277,611 43,678,674
___________ ___________ ___________ ___________
End of year $6,714,371 $ 639,450 $1,932,356 $63,945,448
=========== =========== =========== ===========
<FN>
See accompanying notes.
Page 8
Genentech, Inc. Tax Reduction Investment Plan
Notes to Financial Statements
Description of the Plan:
The following description of the Genentech, Inc. Tax Reduction Investment
Plan ("Plan") provides only general information. Participants should refer to
the Plan document for a more complete description of the Plan's provisions.
The Plan was established, effective January 1, 1985, by Genentech, Inc.
("Company") for the benefit of eligible employees of the Company in order to
provide them with a means of supplementing their retirement income on a tax-
favored basis, an incentive to continue and increase their efforts to
contribute to the success of the Company, and an opportunity to acquire an
equity interest in the Company. The Plan accomplishes this through a savings
program which is based on systematic salary reductions. The employee's salary
is reduced by the amount elected to be saved on a pre-tax basis. The
"deferred" part of the employee's salary is then invested in the Plan. An
individual employee's account is credited with earnings or losses on a pro
rata basis as the actual investment funds report their earnings performance.
Individuals eligible to participate under the Plan must be employees of the
Company or employees of an affiliate of the Company that adopts the Plan with
the approval of the Board of Directors. However, the following employees or
classes of employees are not eligible to participate: (i) any employee who is
classified as temporary by the Company; (ii) any part-time employee normally
scheduled to work less than 20 hours per week, unless such employee has
completed at least 1,000 hours of service in a 12-month period; (iii) any
employee who is a member of a collective bargaining unit and who is covered by
a collective bargaining agreement where retirement benefits were the subject
of good faith bargaining; (iv) any individual employed by any corporation or
other business entity that is merged or liquidated into the Company, unless
the Company designates such employees as eligible employees; (v) any employee
paid from a non-U.S. payroll; or (vi) any leased employee as defined under the
Internal Revenue Code of 1986, as amended ("Code").
The Board of Directors of the Company has the right under the Plan to alter,
amend or terminate the Plan, or any part thereof, in such a manner as it may
determine. If the Plan is terminated, the interests of all Plan members
remain fully (100%) vested and nonforfeitable. The balances credited to their
accounts shall remain with the plan trustee until they become distributable in
accordance with the Plan.
The Company matches a portion of employee contributions, up to a maximum of
4% of a participant's eligible compensation ("Match"). The Match is effective
December 31st of each year ("Effective Date") and contributions under the
Match are fully vested at that time. The Match is funded in the first quarter
of the subsequent year. In the first quarter of 1995 and 1994, the Company
contributed approximately $5.0 million and $4.4 million, respectively, to the
Plan in accordance with the terms of the Match.
The plan trustee ("Plan Trustee") is Fidelity Management Trust Company. All
amounts contributed to the Plan are deposited in a trust account with the Plan
Trustee. The Plan Trustee's fees and expenses that are related to the
accounts of active employees are paid by the Company and are not charged to
the Plan. Effective January 1, 1994, Trustee's fees associated with accounts
of terminated employees are charged to such employee accounts. The Plan
Trustee has blanket bond insurance covering the full market value of the
securities and investments of which it has custody.
Page 9
Genentech, Inc. Tax Reduction Investment Plan
Notes to Financial Statements
In 1994, each participant in the Plan could elect to defer up to the lower
of $9,240 or 15% of his or her eligible compensation, and, in 1993, $8,994 or
15% of his or her eligible compensation, except that in 1994 highly
compensated employees were limited to the lower of $9,240 or 9% of eligible
compensation and, in 1993, $8,994 or 9% of eligible compensation in accordance
with the Code. For plan year 1994, each participant directs the investment of
his or her contributions in any of the following twelve investment funds of
the Plan (or any combination thereof):
Genentech Stock Fund
This fund invests only in the Redeemable Common Stock of the Company, which
is purchased at full market price. The Redeemable Common Stock of the Company
does not currently pay dividends; therefore the return on this fund is
dependent solely on the performance of the stock.
Fidelity Magellan Fund
The Fidelity Magellan Fund is a mutual fund managed by Fidelity Management
and Research Company ("FMR"). The fund invests primarily in the stocks of
domestic and foreign growth companies.
Fidelity Growth Company Fund
The Fidelity Growth Company Fund is a mutual fund managed by FMR. It
invests primarily in common stock and securities convertible into common stock
of companies which it believes have above-average growth characteristics.
Fidelity Growth & Income Fund
The Fidelity Growth & Income Fund is a mutual fund managed by FMR, which
invests primarily in securities of companies that offer growth of earnings
potential while paying current dividends.
Fidelity Intermediate Bond Fund
The Fidelity Intermediate Bond Fund is a mutual fund managed by FMR. The
Fidelity Intermediate Bond Fund invests in high and upper-medium grade
corporate debt obligations with intermediate maturities, as well as
obligations of the U.S. government and its agencies and U.S. banks.
Fidelity Overseas Fund
The Fidelity Overseas Fund is a mutual fund managed by FMR. The fund
invests in foreign securities including common stock, securities convertible
to common stock and debt instruments of foreign businesses and governments.
Fidelity Balanced Fund
The Fidelity Balanced Fund is a mutual fund managed by FMR that invests in
high-quality bonds and high-yielding stocks. It is a growth and income fund
that seeks a high level of income while preserving capital.
Fidelity Asset Manager Fund
The Fidelity Asset Manager Fund is a mutual fund managed by FMR. The Asset
Manager Fund allocates its assets among domestic and foreign equities, bonds
and short-term instruments, attempting to achieve a high total return with
reduced risk over the long-term.
Fidelity Asset Manager: Growth Fund
The Fidelity Asset Manager: Growth mutual fund, managed by FMR, invests in
domestic and foreign stocks, bonds and short-term instruments, seeking to
maximize its total long-term return.
Page 10
Genentech, Inc. Tax Reduction Investment Plan
Notes to Financial Statements
Fidelity Asset Manager: Income Fund
The Fidelity Asset Manager: Income Fund is a mutual fund managed by FMR
which invests in income-producing domestic and foreign stocks, bonds and
short-term instruments, with the goal of achieving a high level of current
income.
Fidelity Retirement Money Market Fund
The Fidelity Retirement Money Market Fund is a mutual fund managed by FMR.
It invests in high-quality United States dollar-denominated money market
instruments of U.S. and foreign issuers, including short-term corporate
obligations, U.S. government obligations and certificates of deposit.
Fidelity U.S. Equity Index Fund
The Fidelity U.S. Equity Index Fund, a mutual fund managed by FMR, invests
mostly in the common stocks of the 500 companies that make up the Standard &
Poor's 500 Index.
Participant Loans
Loans are made only to Plan participants at fixed interest rates 2% above
the then current bank prime interest rate subject to certain restrictions,
principally related to a participant's account balance, permissible loan
amount, and repayment through payroll withholding. Loans are repaid through
monthly payroll deductions over three or five years.
Conditions of Withdrawal
Distributions under the Plan will be made upon a participant's death,
disability, retirement or other termination of employment with the Company,
attainment of age 70-1/2, or authorized exercise of his or her withdrawal
rights under the Plan (subject in all cases to regulation under the Code
requiring the participant's consent to distribution unless he or she has
attained age 62 or the balance credited to his or her account under the Plan
does not exceed $3,500). Distributions are made upon receipt by the Plan
administrator of the participant's or beneficiary's election directing the
method of distribution.
Prior to termination of employment with the Company, the Plan administrator
may grant a participant's request for a withdrawal if either (i) the Plan
administrator makes a determination that such withdrawal is necessary in light
of the immediate and heavy financial needs of the participant and is in
accordance with the requirements of the Code and regulations promulgated
thereunder; or (ii) the participant is over age 59-1/2 at the time of
withdrawal.
(1) Summary of Significant Accounting Policies:
Investment Valuation
Investments are stated at market value at year end. Market values are
determined as follows: The Genentech Stock Fund, Fidelity Magellan Fund,
Fidelity Growth Company Fund, Fidelity Growth & Income Fund, Fidelity
Intermediate Bond Fund, Fidelity Overseas Fund, Fidelity Balanced Fund,
Fidelity Asset Manager Fund, Fidelity Asset Manager: Growth Fund, Fidelity
Asset Manager: Income Fund, and Fidelity U.S. Equity Index Fund securities are
valued at the last reported sales price on the last business day of the year,
which represent the net asset values of shares held by the Plan at year end;
the Fidelity Retirement Money Market Fund portfolio instruments are valued on
the basis of historical cost which approximates fair value; and the
Participant Loans are valued on the basis of cost, which approximates fair
value.
Page 11
Genentech, Inc. Tax Reduction Investment Plan
Notes to Financial Statements
Contributions
Basic contributions are accrued and vested when deducted from employee pay;
the Match is accrued and vested on the Effective Date; and qualified rollover
contributions are vested when received by the Plan Trustee. Contributions are
invested pursuant to participants' directions to the Plan Trustee after
receipt of contributions by the Plan Trustee. Participants may change the
amount of contributions (as a percentage reduction of pre-tax eligible
compensation) on a quarterly basis. Transfers between funds and changes in
investment allocations can be made up to ten times per year on a daily basis
effective upon request by the participant to Plan Trustee, except that
transfers in and out of the Genentech Stock Fund are effected on a monthly
cycle.
Distributions
Distributions are recorded when paid.
Other
All security transactions are recorded on the trade date. Gains and losses
on the disposals of investments are determined based on the average cost of
all securities. Dividend income is recorded on the effective date of a
declared dividend. Income from other investments is recorded as earned on an
accrual basis. All administrative costs of the Plan incurred by the Company
are paid by the Company and are not charged to the Plan.
(2) Income Tax Status:
The Internal Revenue Service ruled on April 29, 1988 that the December 21,
1984 Plan, as amended, qualified in form under Section 401(a) of the Code and
the underlying trust is, therefore, exempt from federal income taxes under
Section 501(a) of the Code. The Plan is required to operate in conformity
with the Code to maintain its qualification. The Plan has been subsequently
audited and accepted by the Internal Revenue Service with no change through
December 31, 1990.
In December, 1990, an amended and restated Plan, effective as of January 1,
1991, was adopted by the Board of Directors of the Company. Effective as of
June 30, 1991 and October 7, 1993 the first and second amendments to the
amended and restated Plan were adopted. In January 1994, the second
restatement of the Plan was adopted effective January 1, 1994. In July 1994,
the Plan administrator filed for a favorable determination letter from the
Internal Revenue Service seeking to substantiate that the current restated
Plan and related trust meet the requirements of Section 401(a) of the Internal
Revenue Code, as amended, and, as such, are exempt from federal income tax. A
response regarding the filing for a determination letter has not yet been
received.
The Company is not aware of any events which would cause the Plan to become
disqualified in operation.
(3) Related Party Transactions:
Certain of the investment funds are managed by Fidelity Management Research
Company (FMR), an affiliate of the Plan Trustee. Because of this
relationship, transactions involving these funds qualify as party-in-interest
transactions.
Page 12
Genentech, Inc. Tax Reduction Investment Plan
Notes to Financial Statements
(4) Assets held for investment at December 31, 1994 were as follows:
Number of
Name of Issuer Shares or Fair
and Title of Principal Amount Cost Value
__________________________________________ ___________ ____________ ___________
GENENTECH STOCK FUND
Genentech, Inc. -
Redeemable Common Stock............... 199,237 $ 7,085,865 $ 9,090,200
FIDELITY MAGELLAN FUND
Fidelity Magellan Fund.................. 277,113 18,587,898 18,511,180
FIDELITY GROWTH COMPANY FUND
Fidelity Growth Company Fund ........... 173,366 4,896,991 4,725,960
FIDELITY GROWTH & INCOME FUND
Fidelity Growth & Income Fund .......... 466,475 9,800,926 9,837,949
FIDELITY INTERMEDIATE BOND FUND
Fidelity Intermediate Bond Fund......... 159,480 1,670,265 1,567,685
FIDELITY OVERSEAS FUND
Fidelity Overseas Fund ................. 112,795 3,069,389 3,079,304
FIDELITY BALANCED FUND
Fidelity Balanced Fund ................. 1,039,050 13,130,786 12,769,920
FIDELITY ASSET MANAGER FUND
Fidelity Asset Manager Fund ............ 27,406 396,164 379,027
FIDELITY ASSET MANAGER: GROWTH FUND
Fidelity Asset Manager: Growth Fund .... 37,316 506,365 479,134
FIDELITY ASSET MANAGER: INCOME FUND
Fidelity Asset Manager: Income Fund ... 9,642 103,692 100,471
FIDELITY RETIREMENT MONEY MARKET FUND
Retirement Money Market Fund............ 7,476,596 7,476,596 7,476,596
FIDELITY U.S. EQUITY INDEX FUND
Fidelity U.S. Equity Index Fund ........ 45,328 750,136 766,488
PARTICIPANT LOANS
Loans receivable from participants ..... $2,108,168 2,108,168 2,108,168
___________ ___________
TOTAL INVESTMENTS ........................ $69,583,241 $70,892,082
=========== ===========
Page 13
Report of Ernst & Young LLP, Independent Auditors
To the Participants and Plan Administration Committee of the
Genentech, Inc. Tax Reduction Investment Plan
We have audited the accompanying statements of net assets available for
benefits with fund information of the Genentech, Inc. Tax Reduction Investment
Plan as of December 31, 1994 and 1993, and the related statements of changes
in net assets available for benefits with fund information for the years then
ended. These financial statements are the responsibility of the Plan's
management. Our responsibility is to express an opinion on these financial
statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards 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. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the net assets available for benefits of the Genentech,
Inc. Tax Reduction Investment Plan at December 31, 1994 and 1993, and the
changes in its net assets available for benefits for the years then ended in
conformity with generally accepted accounting principles.
Our audits were made for the purpose of forming an opinion on the basic
financial statements taken as a whole. The accompanying supplemental
schedules of assets held for investment purposes as of December 31, 1994 and
of reportable transactions for the year then ended are presented for purposes
of complying with the Department of Labor's Rules and Regulations for
Reporting and Disclosure under the Employee Retirement Income Security Act of
1974, and are not a required part of the basic financial statements. The Fund
Information in the statement of net assets available for benefits and the
statement of changes in net assets available for benefits is presented for
purposes of additional analysis rather than to present the net assets
available for benefits and changes in net assets available for benefits of
each fund. The supplemental schedules and Fund Information have been
subjected to the auditing procedures applied in our audit of the 1994
financial statements and, in our opinion, are fairly stated in all material
respects in relation to the 1994 basic financial statements taken as a whole.
ERNST & YOUNG LLP
San Jose, California
May 10, 1995
Page 14
Signatures
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Plan administrator has duly caused this annual report to be signed by the
undersigned hereunto duly authorized.
Genentech, Inc. Tax Reduction Investment Plan
by Genentech, Inc., Plan Administrator
By: /S/ MARTY GLICK Date: June 29, 1995
___________________________________
Marty Glick
Vice President and Treasurer
and Plan Administration Committee
Member for Genentech, Inc.
Tax Reduction Investment Plan
By: /S/ LOUIS J. LAVIGNE, JR. Date: June 29, 1995
___________________________________
Louis J. Lavigne, Jr.
Senior Vice President and
Chief Financial Officer
and Plan Administration Committee
Member for Genentech, Inc.
Tax Reduction Investment Plan
By: /S/ LARRY SETREN Date: June 29, 1995
___________________________________
Larry Setren
Vice President-Human Resources
and Plan Administration Committee
Member for Genentech, Inc.
Tax Reduction Investment Plan
Page 15
Index of Supplemental Schedules Filed with Form 11-K
For the Year Ended December 31, 1994
Sequential
Schedule Description Page Numbers
________ ___________________________________ ____________
I Assets Held for Investment Purposes 17
II Schedule of Reportable Transactions 18
Page 16
SCHEDULE I
Genentech, Inc. Tax Reduction Investment Plan
Item 27a
Schedule of Assets Held For Investment Purposes
December 31, 1994
Description Current
Identity of Issue of Investment Cost Value
________________________________________ _________________ ____________ ___________
* GENENTECH STOCK FUND
Genentech, Inc. - Common stock -
Redeemable Common Stock ............. 199,237 shares $ 7,085,865 $ 9,090,200
* FIDELITY MAGELLAN FUND
Mutual fund -
Fidelity Magellan Fund ............... 277,113 shares 18,587,898 18,511,180
* FIDELITY GROWTH COMPANY FUND
Mutual fund -
Fidelity Growth Company Fund ......... 173,366 shares 4,896,991 4,725,960
* FIDELITY GROWTH & INCOME FUND
Mutual fund -
Fidelity Growth & Income Portfolio ... 466,475 shares 9,800,926 9,837,949
* FIDELITY INTERMEDIATE BOND FUND
Mutual fund -
Fidelity Intermediate Bond Fund ...... 159,480 shares 1,670,265 1,567,685
* FIDELITY OVERSEAS FUND
Mutual fund -
Fidelity Overseas Fund ............... 112,795 shares 3,069,389 3,079,304
* FIDELITY BALANCED FUND
Mutual fund -
Fidelity Balanced Fund ............... 1,039,050 shares 13,130,786 12,769,920
* FIDELITY ASSET MANAGER FUND
Mutual fund -
Fidelity Asset Manager Fund .......... 27,406 shares 396,164 379,027
* FIDELITY ASSET MANAGER: GROWTH FUND
Mutual fund -
Fidelity Asset Manager: Growth Fund .. 37,316 shares 506,365 479,134
* FIDELITY ASSET MANAGER: INCOME FUND
Mutual fund -
Fidelity Asset Manager: Income Fund .. 9,642 shares 103,692 100,471
* FIDELITY RETIREMENT MONEY MARKET FUND
Mutual fund -
Retirement Money Market Fund ......... 7,476,596 shares 7,476,596 7,476,596
* FIDELITY U.S. EQUITY INDEX FUND
Mutual fund -
Fidelity U.S. Equity Index Portfolio . 45,328 shares 750,136 766,488
* PARTICIPANT LOANS
Loans receivable from participants ... (1) 2,108,168 2,108,168
___________ ___________
TOTAL INVESTMENTS ...................... $69,583,241 $70,892,082
=========== ===========
<FN>
(1) Maturing at various dates through 1999 at interest rates ranging from 7.25% to 13.5%.
* Party-in-interest.
Page 17
SCHEDULE II
Genentech, Inc. Tax Reduction Investment Plan
Line 27d
Schedule of Reportable Transactions
For the Year ended December 31, 1994
Purchases Sales
_________________________ _________________________________________________
Number of Dollar Number of Purchase Selling Realized
Description Transactions Value Transactions Price Price Gain/Loss
of Asset
____________________________ __________ ____________ __________ __________ _________
Genentech Stock 78 $2,967,986 38 $ 638,610 $ 917,405 $ 278,795
Fidelity
Magellan Fund 184 6,165,473 122 2,491,836 2,530,940 39,104
Fidelity Growth
Company Fund 145 2,337,954 75 854,846 856,593 1,747
Fidelity Growth
& Income Fund 161 3,989,202 99 1,233,770 1,299,810 66,040
Fidelity
Balanced Fund 166 3,537,876 133 2,571,594 2,585,095 13,501
Fidelity Retirement
Money Market Fund 149 3,447,310 121 2,132,777 2,132,777 -
<FN>
Reportable transactions include any series of transactions that in the aggregate exceed five
percent of the fair market value of Plan assets at the beginning of the year. The transactions
can occur on a daily basis. These transactions represent Category (iii) reportable
transactions in accordance with Department of Labor regulations. There were no other
reportable transactions during 1994.
Page 18
Genentech, Inc. Tax Reduction Investment Plan
Index of Exhibits Filed with Form 11-K
For the Year Ended December 31, 1994
Sequential
Exhibit Number Description Page Numbers
________________ ______________________________________________ ____________
1 Consent of Ernst & Young LLP, Independent Auditors,
filed with this document 20
Page 19
EXHIBIT 1
Consent of Ernst & Young LLP, Independent Auditors
We consent to the incorporation by reference in the Registration Statement on
Form S-8 pertaining to the Genentech, Inc. Tax Reduction Investment Plan of
our report dated May 10, 1995, with respect to the financial statements and
supplemental schedules of the Genentech, Inc. Tax Reduction Investment Plan
included in this Annual Report (Form 11-K) for the year ended December 31,
1994.
ERNST & YOUNG LLP
San Jose, California
June 29, 1995
Page 20