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, 1996
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
FOR COLLEAGUES IN PUERTO RICO
-----------------------------
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
FOR COLLEAGUES IN PUERTO RICO
FINANCIAL STATEMENTS
DECEMBER 31, 1996
and DECEMBER 31, 199
WARNER-LAMBERT
SAVINGS AND STOCK PLAN
FOR COLLEAGUES IN PUERTO RICO
INDEX TO FINANCIAL STATEMENTS
Page(s)
Report of Independent Accountants 1
Statement of Net Assets Available for Benefits
with Fund Information as of December 31, 1996 2
Statement of Net Assets Available for Benefits
with Fund Information as of December 31, 1995 3
Statement of Changes in Net Assets Available
for Benefits with Fund Information for the
year ended December 31, 1996 4
Statement of Changes in Net Assets Available 5
for Benefits with Fund Information for the
year ended December 31, 1995
Notes to Financial Statements 6 - 9
Exhibit I - Master Trust Statement of Net Assets
Available for Benefits with Fund
Information as of October 31, 1996 and 1995
Exhibit II - Master Trust Statement of Changes in Net
Assets Available for Benefits with Fund
Information for the years ended October 31,
1996 and 1995
Exhibit III - Notes to the Master Trust Financial
Statements
* Additional Information (Master Trust):
Schedule I - Schedule of Assets Held for Investment
Purposes at October 31, 1996 - Master Trust
Schedule II - Schedule of Reportable Transactions
Consent of Independent Accountants
* Other schedules required by Section 2520.103-10 of the
Department of Labor Rules and Regulations for Reporting and
Disclosure under ERISA have been omitted because they are not
applicable
REPORT OF INDEPENDENT ACCOUNTANTS
May 30, 1997
To the Participants and Administrator of
the Warner-Lambert Savings and Stock Plan
for Colleagues in Puerto Rico
In our opinion, the accompanying statements of net assets available
for benefits and the related statements of changes in net assets
available for benefits present fairly, in all material respects, the
net assets available for benefits of the Warner-Lambert Savings and
Stock Plan for Colleagues in Puerto Rico at December 31, 1996 and
1995, and the changes in net assets available for benefits for the
years then ended, in conformity with generally accepted accounting
principles. 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 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 management, 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 and is not a required
part of the basic financial statements but is additional information
required by ERISA. The Fund Information in the statement of net
assets available for benefits and the statements of changes in net
assets available for benefits 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 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
<TABLE>
WARNER-LAMBERT
SAVINGS AND STOCK PLAN
FOR COLLEAGUES IN PUERTO RICO
STATEMENT OF NET ASSETS AVAILABLE
FOR BENEFITS WITH FUND INFORMATION
AS OF DECEMBER 31, 1996
(Dollars in thousands)
W-L W-L
Company Colleague Fixed Small-Cap
Stock Stock S&P 500 Income International Balanced Value
Fund Fund Fund Fund Fund Fund Fund Total
------- --------- ------- ------ ------------- -------- ------- --------
Assets:
Investment in Warner-
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Lambert Master Trust $ 3,573 $ 4,289 $ 1,313 $ 2,590 $ 144 $ 125 $ 120 $ 12,154
Participant loans
receivable 34 102 42 132 4 - 4 318
-------- -------- ------- -------- ------------- -------- ------- --------
Net assets available for
<S> <C> <C> <C> <C> <C> <C> <C> <C>
benefits $ 3,607 $ 4,391 $ 1,355 $ 2,722 $ 148 $ 125 $ 124 $ 12,472
======== ======== ======= ======== ============= ======== ======= ========
The accompanying notes are an integral part of the financial statements.
</TABLE>
<TABLE>
WARNER-LAMBERT
SAVINGS AND STOCK PLAN
FOR COLLEAGUES IN PUERTO RICO
STATEMENT OF NET ASSETS AVAILABLE
FOR BENEFITS WITH FUND INFORMATION
AS OF DECEMBER 31, 1995
(Dollars in thousands)
W-L W-L
Company Colleague Fixed Small-Cap
Stock Stock S&P 500 Income International Balanced Value
Fund Fund Fund Fund Fund Fund Fund Total
------- -------- ------- ------ ------------- -------- ------- --------
Assets:
Investment in Warner-
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Lambert Master Trust $ 2,328 $ 2,427 $ 1,093 $ 2,591 $ 90 $ 61 $ 29 $ 8,619
Participant loans
receivable 21 104 42 126 2 5 - 300
-------- -------- ------- -------- ------------- -------- ------- -------
Net assets available for
<S> <C> <C> <C> <C> <C> <C> <C> <C>
benefits $ 2,349 $ 2,531 $ 1,135 $ 2,717 $ 92 $ 66 $ 29 $ 8,919
======== ======== ======= ======== ============= ======== ======= =======
The accompanying notes are an integral part of the financial statements.
</TABLE>
<TABLE>
WARNER-LAMBERT
SAVINGS AND STOCK PLAN
FOR COLLEAGUES IN PUERTO RICO
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE
FOR BENEFITS WITH FUND INFORMATION
FOR THE YEAR ENDED DECEMBER 31, 1996
(Dollars in thousands)
W-L W-L
Company Colleague Fixed Small-Cap
Stock Stock S&P 500 Income International Balanced Value
Fund Fund Fund Fund Fund Fund Fund Total
------- -------- ------- ------ ------------- -------- ------- -------
Additions to net assets attributable to:
Investment Income from the
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Warner-Lambert Master Trust $ 1,313 $ 1,484 $ 248 $ 157 $ 19 $ 14 $ 17 $ 3,252
Investment Income on
Participant Loans 3 9 4 7 - - - 23
Contributions:
Participant - 527 203 526 71 70 54 1,451
Company 254 - - - - - - 254
------- -------- ------- ------ ------------- -------- ------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Total additions 1,570 2,020 455 690 90 84 71 4,980
------- -------- ------- ------ ------------- -------- ------- --------
Distributions from net assets attributable to:
Distribution to participants (302) (306) (152) (553) (20) (13) (5) (1,351)
Administrative expenses (10) (28) (7) (26) (2) (2) (1) (76)
Interfund transfers - 175 (75) (106) (12) (6) 24 0
------- -------- ------- ------ ------------- -------- ------- --------
Net deductions (312) (159) (234) (685) (34) (21) 18 (1,427)
------- -------- ------- ------ ------------- -------- ------- --------
Increase in net
<S> <C> <C> <C> <C> <C> <C> <C> <C>
assets during the year 1,258 1,861 221 5 56 63 89 3,553
Net assets available for benefits:
Beginning of period 2,349 2,531 1,135 2,717 92 66 29 8,919
------- -------- ------- ------ ------------- -------- ------- --------
End of period $ 3,607 $ 4,392 $ 1,356 $2,722 $ 148 $ 129 $ 118 $ 12,472
======= ======== ======= ====== ============= ======== ======= ========
The accompanying notes are an integral part of the financial statements
</TABLE>
<TABLE>
WARNER-LAMBERT
SAVINGS AND STOCK PLAN
FOR COLLEAGUES IN PUERTO RICO
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE
FOR BENEFITS WITH FUND INFORMATION
FOR THE YEAR ENDED DECEMBER 31, 1995
(Dollars in thousands)
W-L W-L
Company Colleague Fixed Small-Cap
Stock Stock S&P 500 Income International Balanced Value
Fund Fund Fund Fund Fund Fund Fund Total
------- -------- ------- ------ ------------- -------- ------- --------
Additions to net assets attributable to:
Investment Income from the
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Warner-Lambert Master Trust $ 533 $ 551 $ 261 $ 152 $ 10 $ 9 $ 3 $ 1,519
Investment Income on
Participant Loans 2 7 4 6 1 - - 20
Contributions:
Participant - 413 233 674 40 37 19 1,416
Company 224 - - - - - - 224
------- -------- ------- ------ ------------- -------- ------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Total additions 759 971 498 832 51 46 22 3,179
------- -------- ------- ------ ------------- -------- ------- --------
Deductions from net assets attributable to:
Distribution to participants (286) (342) (95) (641) (7) (8) (2) (1,381)
Administrative expenses (11) (25) (7) (29) (1) (1) - (74)
Interfund transfers - (13) 59 5 (49) (2) - 0
------- -------- ------- ------ ------------- -------- ------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Total deductions (297) (380) (43) (665) (57) (11) (2) (1,455)
------- -------- ------- ------ ------------- -------- ------- --------
Increase in net
assets during the year 462 591 455 167 (6) 35 20 1,724
Net assets available for benefits:
Beginning of period 1,887 1,940 680 2,550 98 31 9 7,195
------- -------- ------- ------ ------------- -------- ------- --------
End of period $ 2,349 $ 2,531 $ 1,135 $2,717 $ 92 $ 66 $ 29 $ 8,919
======= ======== ======= ====== ============= ======== ======= ========
The accompanying notes are an integral part of the financial statements
</TABLE>
WARNER-LAMBERT
SAVINGS AND STOCK PLAN
FOR COLLEAGUES IN PUERTO RICO
NOTES TO FINANCIAL STATEMENTS
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
The financial statements of the Warner-Lambert Savings and Stock
Plan for Colleagues in Puerto Rico (the "Plan") are prepared on the
accrual basis of accounting.
Master Trust Arrangement
The assets of the Plan have been commingled with the assets of the
Warner-Lambert Savings and Stock Plan (collectively referred to as
"the Plans"), for investment and administrative purposes in the
Warner-Lambert Company Master Trust (the "Master Trust"). The
Plans do not own specific Master Trust assets but rather maintain
an undivided beneficial interest in such assets. Each Plans'
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 Plans' beneficial interest
in the net assets of the Master Trust.
Expenses
All expenses incurred are borne by the Plan.
NOTE 2 - DESCRIPTION OF THE PLAN:
The Plan is a defined contribution profit-sharing savings plan
covering employees of the Company in Puerto Rico 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.
Contributions
Participants may elect to contribute into the Plan from a minimum
of 1% up to a maximum of 15% of their basic earnings each year.
Participants have the option of contributing on a before-tax basis
and/or an after-tax basis. 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.
Investment Options
Participants can elect to have their contributions invested in any
of the funds noted below, 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. A
description of all of these funds are as follows:
WARNER-LAMBERT COMPANY STOCK FUND - This fund invests employer
contributions in Warner-Lambert Company common stock.
WARNER-LAMBERT COLLEAGUE STOCK FUND - This fund invests in Warner-
Lambert common stock, to provide an additional opportunity to
participate in the performance of Warner-Lambert Company common
stock.
S&P 500 FUND - This fund invests in substantially all common stocks
that make up the S&P 500 to match, as closely as possible, the
performance of the S&P 500 Composite Stock Index.
FIXED INCOME FUND - This fund invests in marketable fixed income
securities, as well as a diversified mix of guaranteed investment
contracts, bank investment contracts, structured investment
contracts, and separate account contracts issued by high-quality
companies, to provide stability of principal value, minimal credit
risk and current income.
INTERNATIONAL STOCK FUND - This fund invests primarily in stocks of
established growth companies outside the U.S., predominantly in
Europe, the Far East, Australia, Canada, as well as other areas, to
provide diversification of an international fund, as well as the
opportunity for long-term capital growth.
BALANCED FUND - This fund invests in a balanced mix of
approximately 60% stocks and 40% bonds, to provide long-term growth
of capital from stocks and current income from bonds.
SMALL-CAP VALUE FUND - This funds invests in stocks of small
companies believed to be undervalued at the time of purchase and
have potential for capital growth, to provide long-term capital
growth.
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.
Vesting
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.
Forfeitures for the plan years 1996 and 1995 were $9,504 and
$3,849, respectively.
Participant Loans
Loans may not exceed the lesser of (1) fifty thousand dollars or
(2) 50% of the participant's before-tax account balance and the
vested account balance in the Company Stock Fund. Each loan must
be for a minimum of five hundred dollars. All loans will be repaid
with interest at a rate that is equal to the prime rate effective
at the close of business on the last business day of the month
before 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. A
participant may take only one loan per calendar year and only two
loans will be permitted to be outstanding at any time.
Plan Termination
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
Warner-Lambert Company Board of Directors, the balance in
accumulated investments credited to each participant shall be
distributed to the participant.
NOTE 3 - PUERTO RICO AND TAX STATUS OF THE PLAN:
The Bureau of Income Tax of the Department of the Treasury of the
Commonwealth of Puerto Rico has ruled that the Plan qualifies under
section 165(a) of the Income Tax Act of 1954 ("The Act") and is,
therefore, not subject to tax under present income tax law. The
Plan, being exempt under Section 165(a) of the Act is subject to
the provision of Section 404, which requires the trust to file an
annual return stating income, receipts, disbursements, and other
pertinent information. Further, the Plan has received a
determination letter advising that the original plan and subsequent
amendments through October 1, 1993 are qualified under Section
165(a) of the Puerto Rico Income Tax Act of 1954, as amended, and
will be treated for purposes of Section 501(a) of the Internal
Revenue Code as an organization described in Section 401(a) of the
Internal Revenue Code by reason of Section 1022(i)(1) of the
Employee Retirement Income Security Act of 1974 ("ERISA"), as
amended. The Company believes that the Plan is designed and is
currently being operated with the applicable requirements of the
IRC. Therefore no provision for income taxes has been taken.
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, 1996 and 1995, the Plan has a 1.5% and 1.4%
interest, respectively, in the Master Trust. The financial
statements for the Master Trust are prepared on the modified cash
basis. The financial statements for the years ended October 31,
1996 and 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 FOR COLLEAGUES
IN PUERTO RICO
Date: June 11, 1997 By: /s/ Ernest J. Larini
--------------------
Ernest J. Larini
Chairman
Warner-Lambert Investment
Committee
<TABLE>
EXHIBIT I
1 of 2
WARNER-LAMBERT COMPANY
MASTER TRUST
STATEMENT OF NET ASSETS AVAILABLE
FOR BENEFITS WITH FUND INFORMATION
AS OF OCTOBER 31, 1996
(Dollars in thousands)
W-L W-L
Company Colleague Fixed Combined Combined
Stock Stock S&P 500 Income Combined One-Step Income
Fund Fund Fund Fund Growth Funds Mix Funds Funds Total
------- -------- ------- ------ ------------- --------- -------- ---------
Assets:
Investments at fair value:
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Warner-Lambert Common Stock $298,471 $146,070 $ - $ - $ - $ - $ - $ 444,541
Equity Funds - - 101,544 - 76,773 25,806 218 204,341
Short-term investments - - - 3,477 - - - 3,477
Investments at contract value:
Group annuity contracts - - - 49,462 - - - 49,462
Investment contracts - - - 94,647 - - - 94,647
-------- -------- ------- ------- ---------- ------- ------- ---------
Net assets available for
<S> <C> <C> <C> <C> <C> <C> <C> <C>
benefits $298,471 $146,070 $101,544 $147,586 $ 76,773 $25,806 $ 218 $ 796,468
======== ======== ======== ======== ========== ======= ======== =========
The accompanying notes are an integral part of the financial statements.
</TABLE>
<TABLE>
EXHIBIT I
2 of 2
WARNER-LAMBERT COMPANY
MASTER TRUST
STATEMENT OF NET ASSETS AVAILABLE
FOR BENEFITS WITH FUND INFORMATION
AS OF OCTOBER 31, 1995
(Dollars in thousands)
W-L W-L
Company Colleague Fixed Small-Cap
Stock Stock S&P 500 Income International Balanced Value
Fund Fund Fund Fund Fund Fund Fund Total
------- --------- ------- ------ ------------- -------- --------- ---------
Assets:
Investments at fair value:
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Warner-Lambert Common Stock $202,849 $ 86,363 $ - $ - $ - $ - $ - $ 289,212
Equity Funds - - 82,082 - 23,490 19,666 26,270 151,508
Short-term investments - - - 4,084 - - - 4,084
Investments at contract value:
Group annuity contracts - - - 64,614 - - - 64,614
Investment contracts - - - 89,056 - - - 89,056
-------- -------- ------- ------- ---------- ------- -------- ---------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Total Assets 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
<S> <C> <C> <C> <C> <C> <C> <C> <C>
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.
</TABLE>
<TABLE>
EXHIBIT II
1 of 2
WARNER-LAMBERT COMPANY
MASTER TRUST
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE
FOR BENEFITS WITH FUND INFORMATION
FOR THE YEAR ENDED OCTOBER 31, 1996
(Dollars in thousands)
W-L W-L
Company Colleague Fixed Combined Combined
Stock Stock S&P 500 Income Combined One-Step Income
Fund Fund Fund Fund Growth Funds Mix Funds Funds Total
-------- --------- ------- ------ ------------- --------- ------- --------
Additions to net assets attributable to:
Investment Income:
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Interest income $ 40 $ 342 $ 167 $ 254 $ 139 $ 52 $ - $ 994
Dividend income 6,430 2,886 - 9,449 2,069 1,037 - 21,871
Net realized gain on
securities sold 12,386 4,922 4,691 - 2,100 685 - 24,784
Changes in unrealized
appreciation 86,927 40,195 15,572 - 5,801 1,574 - 150,069
-------- ------- ------- ------ ----------- ------- ------- -------
105,783 48,345 20,430 9,703 10,109 3,348 - 197,718
Contributions:
Participant 287 13,405 8,652 10,543 9,105 3,372 1 45,365
Company 8,042 - - - - - - 8,042
-------- ------- ------- ------ ----------- ------- ------- -------
8,329 13,405 8,652 10,543 9,105 3,372 1 53,407
-------- ------- ------- ------ ----------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Total additions 114,112 61,750 29,082 20,246 19,214 6,720 1 251,125
-------- ------- ------- ------ ----------- ------- ------- -------
Deductions from net assets attributable to:
Distributions to participants (14,276) (8,290) (6,979) (17,564) (3,627) (1,690) - (52,426)
Administrative expenses (19) (219) (116) (225) (74) (34) - (687)
Interfund transfers (4,195) 6,470 (2,521) (12,618) 11,502 1,145 217 0
-------- ------- ------- ------- ----------- ------- ------- -------
Total deductions (18,490) (2,039) (9,616) (30,407) 7,801 (579) 217 (53,113)
-------- ------- ------- ------- ----------- ------- ------- -------
Increase/(decrease) in net
assets during the year 95,622 59,711 19,466 (10,161) 27,015 6,141 218 198,012
Net assets available for benefits:
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Beginning of period 202,849 86,359 82,078 157,747 49,758 19,665 0 598,456
-------- -------- -------- -------- ----------- -------- ------- --------
End of period $298,471 $146,070 $101,544 $147,586 $ 76,773 $25,806 $ 218 $796,468
======== ======== ======== ======== =========== ======== ======= ========
The accompanying notes are an integral part of the financial statements
</TABLE>
<TABLE>
EXHIBIT II
2 of 2
WARNER-LAMBERT COMPANY
MASTER TRUST
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE
FOR BENEFITS WITH FUND INFORMATION
FOR THE YEAR ENDED OCTOBER 31, 1995
(Dollars in thousands)
W-L W-L
Company Colleague Fixed Small-Cap
Stock Stock S&P 500 Income International Balanced Value
Fund Fund Fund Fund Fund Fund Fund Total
-------- -------- ------- ------ ------------- -------- -------- --------
Additions to net assets attributable to:
Investment Income:
<S> <C> <C> <C> <C> <C> <C> <C> <C>
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 - (162) 74 126 16,261
Changes in unrealized
appreciation(depreciation) 9,847 5,070 15,355 - (949) 1,638 2,350 33,311
-------- ------- ------- ------- ----------- ------- ------- -------
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
-------- ------- ------- ------- ----------- ------- ------- -------
7,953 11,894 7,355 11,797 4,220 2,939 3,799 49,957
-------- ------- ------- ------- ----------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
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 benefits:
<S> <C> <C> <C> <C> <C> <C> <C> <C>
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.
</TABLE>
Exhibit III
WARNER-LAMBERT COMPANY
MASTER TRUST
NOTES TO THE FINANCIAL STATEMENTS
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 (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.
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. Shares of equity funds are valued at
cost which is equal to market value. 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. Contract value is equal to fair value. The average
annual yield and average annual crediting interest rate of these
investments for the year ended 12/31/96 was 6.13% and 6.43%,
respectively, and for the year ended 12/31/95 was 6.69%.
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.
Expenses
All expenses incurred are borne by the Plans.
NOTE 2 - TAX STATUS OF THE MASTER TRUST:
The 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 Purposes
October 31, 1996
(Dollars in thousands)
Cost Fair Value
------ ----------
Warner-Lambert Company Common Stock $176,560 $444,541
S&P 500 Fund 67,707 101,544
T. Rowe Price Balance Fund 21,257 24,273
T. Rowe Price Capital Opportunity Fund 197 193
T. Rowe Price Emerging Markets Stock Fund 573 556
T. Rowe Price Equity Income Fund 2,161 2,175
T. Rowe Price European Stock Fund 357 358
T. Rowe Price Health Sciences Fund 610 591
T. Rowe Price High Yield Fund 188 187
T. Rowe Price International Stock Fund 26,000 28,683
T. Rowe Price Mid-Cap Growth Fund 2,920 2,874
T. Rowe Price New America Growth Fund 495 490
T. Rowe Price New Horizons Fund 2,926 2,845
T. Rowe Price New Income Fund 30 31
T. Rowe Price OTC Fund 1,375 1,347
T. Rowe Price Personal Strategy Growth Fund 330 331
T. Rowe Price Personal Strategy Income Fund 290 293
T. Rowe Price Science & Technology Fund 979 967
T. Rowe Price Small-Cap Value Fund 27,399 33,667
T. Rowe Price Spectrum Growth Fund 672 668
T. Rowe Price Spectrum Income Fund 240 241
T. Rowe Price Value Fund 2,024 2,027
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 $4,102 $4,102
Life Insurance Company of Georgia
annuity contract GA-351-GIC (7.23%
minimum annual effective rate)
guaranteed through 5/10/00 6,661 6,661
Life Insurance Company of Georgia
annuity contract GA-356-GIC (6.23%
minimum annual effective rate)
guaranteed through 6/12/00 1,990 1,990
Life Insurance Company of Virginia
annuity contract GS-2755 (5.6% minimum
annual effective rate) guaranteed
through 12/17/98 4,652 4,652
Life Insurance Company of Virginia
annuity contract GS-2868 (6.84% minimum
annual effective rate) guaranteed
through 9/18/00 4,405 4,405
Lincoln National Pension Co. annuity
contract GA-9672 (7.35% minimum annual
effective rate) guaranteed through
5/27/99 2,937 2,937
New York Life Insurance Co. annuity
contract GA-06948-001 (7.3% minimum
annual effective rate) guaranteed
through 8/17/98 11,895 11,895
New York Life Insurance Co. annuity
contract GA-06948-002 (7.41% minimum
annual effective rate) guaranteed
through 9/17/99 2,940 2,940
Peoples Security annuity contract
BDA00461FR (7.73% minimum annual effective
rate) guaranteed through 5/17/99 2,330 2,330
Security Life of Denver Insurance Co.
annuity contract FA-0272, principal and
interest (5.7% minimum annual effective
rate) guaranteed through 6/16/00 3,450 3,450
Sun Life Insurance Company of America
annuity contract 4376 (6.8% minimum
annual effective rate) guaranteed
through 6/17/97 4,100 4,100
Beneficial Interest in Investment Contracts:
Bankers Trust Co. investment contract
93-644, principal and interest (4.8%
annual effective rate at 10/31/96)
maturing on 9/30/98 $ 28,978 $ 28,978
Deutsche Bank investment contract WAR-1
(7.25% annual effective rate at 10/31/96)
maturing on 3/31/00 29,614 29,614
State Street Bank investment contract
96028 (6.50% annual effective interest
rate at 10/31/96) 36,055 36,055
Short-Term Investments
State Street Bank Money Fund $ 3,454 $ 3,454
State Street Bank Short-Term Interest 23 23
TOTAL INVESTMENTS $482,876 $796,468
======== ========
<TABLE>
Schedule II
WARNER-LAMBERT
SAVINGS AND STOCK PLAN
SCHEDULE OF REPORTABLE TRANSACTIONS* FOR THE
TWELVE MONTHS ENDED OCTOBER 31, 1996
(Dollars in thousands)
Expense Current
Incurred Value on
Party Description Purchase Selling Lease with Cost Transaction Net Gain
Involved of Asset Price Price Rental Transaction of Asset Date (loss)
- -------- ----------- ----------- ---------- ------ ----------- ----------- ------------ ----------
<S> <C> <C> <C> <C> <C> <C> <C>
T.Rowe Warner-Lambert $23,434,506 $ 8,854,678 -- -- $28,987,774 $32,289,184 $3,301,410
Price Common Stock
T. Rowe Peoples Security 1,996,321 35,862,253 -- -- 37,858,574 37,858,574 --
Price GIC
T. Rowe Provident Life 1,593,450 29,213,412 -- -- 30,806,862 30,806,862 --
Price GIC
<S> <C> <C> <C> <C> <C> <C> <C>
T. Rowe State Street Bank 36,054,463 -- -- -- 36,054,463 36,054,463 --
Price GIC
* Transactions or series of transactions in excess of 5% of the current value of the Plans assets as of October 31, 1996, as
defined in Section 2520.103-6 of the Department of Labor Rules and Regulations for Reporting and Disclosure under ERISA
</TABLE>
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 30, 1997 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 11, 1997
