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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) of the
SECURITIES AND EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported) : July 7, 1995
GENENTECH, INC.
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(Exact name of registrant as specified in charter)
Delaware
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(State or other jurisdiction of incorporation)
1-9813 94-2347624
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(Commission File No.) (IRS employer
identification no.)
460 Point San Bruno Boulevard, South San Francisco, California 94080
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (415) 225-1000
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This Form 8-K consists of ______
sequentially numbered pages
Exhibit Index Appears on page _____.
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ITEM 5. OTHER EVENTS.
On July 7, 1995, Genentech, Inc. issued a press release relating to
the resignation of its President and Chief Executive Officer. The contents of
the press release, which is attached as Exhibit 1 hereto, are hereby
incorporated by reference to this Form 8-K.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS.
1. Press Release dated July 7, 1995.
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Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
GENENTECH, INC.
By: /s/ Stephen G. Juelsgaard
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Name: Stephen G. Juelsgaard
Title: Vice President and
General Counsel
Date: July 10, 1995
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EXHIBIT INDEX
Exhibit Sequential
No. Description Page Number
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1. Press Release dated July 7, 1995........
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[GENENTECH LOGO] MEDIA CONTACT: LAURA LEBER (415) 225-5759
INVESTOR CONTACT: LISA BROCK (415) 225-1034
GENENTECH BOARD NAMES LEVINSON PRESIDENT & CEO; ROCHE MERGER AGREEMENT
ENHANCED, STOCKHOLDER SUITS SETTLED
- -- Head of R&D assumes top post after Board accepts resignation of Kirk Raab --
SOUTH SAN FRANCISCO, Calif., July 10, 1995 -- Genentech, Inc. (NYSE: GNE)
today announced the appointment of Arthur D. Levinson, Ph.D. as the company's
new president and chief executive officer. Levinson also was named to the
Board of Directors. The Board of Directors made the appointment July 7, 1995
after requesting and accepting the resignation of G. Kirk Raab from the post
the same day.
Genentech and Roche also announced that they have an agreement
in principle to settle the consolidated class action lawsuits that were filed
against Genentech, Genentech's Directors, and Roche following the announcement
of the proposed transaction between the two companies announced May 1. The
agreement was reached in return for changes in the terms of the proposed
transaction between the companies, including an increase in the call prices by
50 cents per share. The "put" price of $60 per share remains unchanged.
The leadership change for Genentech follows an inquiry by the
Board of Directors. At the June 22 meeting of the Board, it was disclosed that
during the period of negotiations with Roche concerning the proposed
transaction, Mr. Raab, at his request, discussed with Roche a guarantee by
Roche of a $2 million personal bank loan to Mr. Raab. Although no guarantee
was provided, the Board decided to appoint a special committee of four
independent directors to review the terms of the proposed transaction with
Roche, to review Mr. Raab's conduct, and to supervise settlement discussions
with lawyers representing plaintiffs.
Following its extensive review of Mr. Raab's leadership over
the past few years, the special committee recommended that the Board request
and accept Raab's resignation. The Board unanimously followed that
recommendation. The Board did note, however, that Mr. Raab had made
significant contributions to the company during his ten years of service, first
as chief operating officer and president and then as president and CEO. In the
last five years, the company's revenues have almost doubled, earnings have
almost tripled, and twice as many drugs are in Phase III development.
After reviewing the proposed merger transaction again, the
non-Roche directors, having previously received a fairness opinion from Lehman
Brothers and after receiving a
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second fairness opinion from Morgan Stanley, unanimously concluded that the
transaction with Roche is fair, and should continue to be recommended to
Genentech stockholders for their approval.
In announcing Levinson's appointment, Robert A. Swanson,
Chairman of the Board of Directors of Genentech, said: "As one of the very
early members of the Genentech team, Art not only knows Genentech's culture, he
is part of it and a significant driving force of it. Under his leadership, the
product pipeline has become one of the richest in the biotechnology industry.
The Board of Directors is confident that with his new leadership as CEO, and
with the full support of Genentech's very strong management team, the company
will fully capitalize on the promise of that pipeline."
Levinson, 45, joined Genentech in 1980 as a senior scientist
and became a vice president in 1989. He was named a Sr. Vice President in
1993. Levinson has a doctorate in biochemistry from Princeton and his
undergraduate degree from the University of Washington.
"The opportunity to lead Genentech is most exciting," said
Levinson. "I bring a passion for our science and a strong commitment to the
highest business standards. Working with a very strong management team, I look
forward to helping Genentech realize its maximum growth potential."
The proposed transaction announced May 1st gives Roche the
right to cause the redemption of Genentech stock at a predetermined price that
increases quarterly through the quarter beginning April 1, 1999. The same
transaction gives Genentech stockholders the right to "put" (cause Genentech to
redeem) some or all of their stock at $60/share within a 30-day period
commencing July 1, 1999.
In settlement of lawsuits filed, Genentech and Roche agreed to
increase the redemption price for Genentech's stock as outlined in the initial
transaction by 50 cents per share. The put price of the new proposed
transaction remains as in the original transaction at $60/share.
Initially, the transaction provided that the price at which
Roche could cause Genentech's stock to be redeemed be $61.25 per share
beginning in the third quarter of 1995 and increasing by $1.25 per share per
quarter for the next seven quarters and $1.50 per share per quarter for the
next eight quarters with a final redemption price of $82.00 per share in the
second quarter of 1999. The new redemption prices begins at $61.75 per share
and increases at the same rate noted above with a final redemption price of
$82.50. A table of the previous and new redemption prices is attached.
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The increase in the call prices and the overall settlement are
subject to the approval of the Delaware Chancery Court. Absent final court
approval, the call prices will remain unchanged. In addition, the parties
extended the September 30, 1995 cut off date for stockholder approval of the
proposed transaction to October 31, 1995. The proposed transaction must be
approved by a majority of non-Roche stockholders.
The Company is in the process of responding to SEC comments on
its preliminary proxy statement. When the SEC review process is completed, the
proxy will be mailed to shareholders as promptly as possible and a vote
scheduled, probably in early September.
Genentech, Inc. is a leading biotechnology company that
discovers, develops, manufactures and markets human pharmaceuticals for
significant medical needs. Ten of the currently marketed biotechnology
products stem from Genentech research, five of which are marketed directly by
Genentech. The company has six products in Phase III development. Genentech
is headquartered in South San Francisco, California, and is traded on the New
York and Pacific Stock Exchanges under the symbol GNE.
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GENENTECH, INC.
CALL AND PUT PRICES
<TABLE>
<CAPTION>
CALL PERIOD OLD PRICE NEW PRICE
- ----------- --------- ---------
<S> <C> <C>
July 1, 1995 to September 30, 1995 $61.25 $61.75
October 1, 1995 to December 31, 1995 $62.50 $63.00
January 1, 1996 to March 31, 1996 $63.75 $64.25
April 1, 1996 to June 30, 1996 $65.00 $65.50
July 1, 1996 to September 30, 1996 $66.25 $66.75
October 1, 1996 to December 31, 1996 $67.50 $68.00
January 1, 1997 to March 31, 1997 $63.75 $64.25
April 1, 1997 to June 30, 1997 $65.00 $65.50
July 1, 1997 to September 30, 1997 $66.25 $66.75
October 1, 1997 to December 31, 1997 $67.50 $68.00
January 1, 1998 to March 31, 1998 $68.75 $69.25
April 1, 1998 to June 30, 1998 $70.00 $70.50
July 1, 1998 to September 30, 1998 $71.50 $72.00
October 1, 1998 to December 31, 1998 $73.00 $73.50
January 1, 1999 to March 31, 1999 $74.50 $75.00
April 1, 1999 to June 30, 1999 $82.00 $82.50
PUT PERIOD
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30 business days after June 30, 1999 $60.00 $60.00
(unchanged)
</TABLE>
