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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 11-K
ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
[X] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
FOR THE FISCAL YEAR ENDED DECEMBER 31, 2002
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
FOR THE TRANSITION PERIOD FROM ______ TO ______
COMMISSION FILE NUMBER 1-10888
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TOTAL FINA ELF FINANCE USA, INC. EMPLOYEE SAVINGS PLAN
800 GESSNER, SUITE 700
HOUSTON, TEXAS 77024
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TOTAL S.A.
2 PLACE DE LA COUPOLE
LA DEFENSE 92078
PARIS FRANCE
INDEPENDENT AUDITORS' REPORT
The Administrative Committee
Total Fina Elf Finance USA, Inc. Employee Savings Plan:
We have audited the accompanying statements of net assets available for plan
benefits of the Total Fina Elf Finance USA, Inc. Employee Savings Plan (the
Plan) as of December 31, 2002 and 2001 and the related statement of changes in
net assets available for plan benefits for the year ended December 31, 2002.
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 auditing standards generally accepted
in the United States of America. 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 audit provides 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 plan benefits of the Plan as
of December 31, 2002 and 2001 and the changes in net assets available for plan
benefits for the year ended December 31, 2002 in conformity with accounting
principles generally accepted in the United States of America.
Our audits were performed for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedule H, line 4i -
schedule of assets (held at end of year) as of December 31, 2002 is presented
for purposes of additional analysis and is not a required part of the basic
financial statements but is supplementary information required by the Department
of Labor's Rules and Regulations for Reporting and Disclosure under the Employee
Retirement Income Security Act of 1974. The supplemental schedule is the
responsibility of the Plan's management. The supplemental schedule has been
subjected to the auditing procedures applied in the audit of the basic financial
statements, and, in our opinion, is fairly stated, in all material respects, in
relation to the basic financial statements taken as a whole.
/s/ KPMG LLP
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Houston,Texas
June 19, 2003
TOTAL FINA ELF FINANCE USA, INC. EMPLOYEE SAVINGS PLAN
Statements of Net Assets Available for Plan Benefits
December 31, 2002 and 2001
2002 2001
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Assets:
Investments, at fair value $ 55,617,550 59,618,491
Receivables:
Employee contributions 99,102 173,413
Company contributions 61,652 114,904
Pending sales 15,637 --
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Total receivables 176,391 288,317
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Net assets available for plan benefits $ 55,793,941 59,906,808
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See accompanying notes to financial statements.
TOTAL FINA ELF FINANCE USA, INC. EMPLOYEE SAVINGS PLAN
Statement of Changes in Net Assets Available for Plan Benefits
Year ended December 31, 2002
Contributions:
Employee $ 2,439,586
Company 1,542,990
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Total contributions 3,982,576
Investment income (loss):
Interest 804,549
Dividends 522,261
Net depreciation in fair value of mutual funds (6,506,035)
Net appreciation in fair value of American Depositary Shares and Warrants 434,277
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Total investment loss (4,744,948)
Payment to participants (3,340,267)
Administrative expenses (10,228)
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Net decrease in net assets (4,112,867)
Net assets available for plan benefits, beginning of year 59,906,808
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Net assets available for plan benefits, end of year $ 55,793,941
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See accompanying notes to financial statements.
TOTAL FINA ELF FINANCE USA, INC. EMPLOYEE SAVINGS PLAN
Notes to Financial Statements
December 31, 2002 and 2001
(1) DESCRIPTION OF THE PLAN
The following description of the Total Fina Elf Finance USA, Inc.
Employee Savings Plan (the Plan), provides only general information.
Participants should refer to the Plan document as amended for a more
complete description of the Plan's provisions.
(a) GENERAL
The Plan is a defined contribution plan in which all employees
of Total Fina Elf Finance USA, Inc. (the Company) and certain
of its affiliates are eligible to participate.
Regular, full-time employees are eligible to participate in
the Plan on their date of hire unless they are covered under a
collective bargaining agreement which does not provide for
participation in the Plan or on expatriate service status with
an affiliate that does not participate in the Plan. Temporary
and part-time employees are eligible to participate in the
Plan upon the completion of 1,000 hours of service in the
first 12-month period of employment or any calendar year
following their date of employment.
The Plan is subject to the provisions of the Employee
Retirement Income Security Act of 1974, as amended (ERISA).
The Plan qualifies under the provisions of Section 401(a) of
the Internal Revenue Code of 1986, as amended (the Code). The
Plan is administered by the Company and advised by a committee
whose members are appointed by the Company's board of
directors (the Administrative Committee). The assets of the
Plan are held and invested by Fidelity Management Trust
Company (Fidelity or Trustee) who also serves as the Plan's
trustee.
(b) CONTRIBUTIONS AND VESTING
Employees electing to participate may contribute from 1% to
75% of their base salary to the Plan on a pretax basis, an
after-tax basis, or combination thereof. The Company will make
a matching contribution of up to 6% of the employee's base
salary. The Company's contributions vest 20% for each year of
service. Participants who are age 50 or older before the close
of the plan year may elect to make a catch-up contribution,
subject to certain limitations under the IRC ($1,000 per
participant in 2002). The Company does not match employee
catch-up contributions.
Employee and Company contributions, as described, are subject
to various limitations imposed by the Code. Under the terms of
the Plan, employee pretax contributions are limited to amounts
provided under Sections 402 (g) of the Code.
Eligible participants may also elect to rollover distributions
from a former employer's qualified retirement plan.
(c) PARTICIPANT ACCOUNTS
Each participant's account is credited with the participant's
contributions, the Company matching contributions, and an
allocation of Plan earnings, net of administrative expenses.
Allocations are based on participant account balances, as
defined. The benefit to which a participant is entitled is the
benefit that can be provided from the participant's vested
account.
4 (Continued)
TOTAL FINA ELF FINANCE USA, INC. EMPLOYEE SAVINGS PLAN
Notes to Financial Statements
December 31, 2002 and 2001
(d) PAYMENT OF BENEFITS AND FORFEITURES
Distributions are made in a lump sum or for balances greater
than $5,000 in installment payments as elected by the
participant after termination of employment. Distributions
from the participant's account invested in the Total Fina Elf
S.A., American Depositary Shares (American Depositary Shares),
and Total Fina Elf S.A., Warrants (Warrants) are made in cash,
unless the participant elects to receive the distribution
in-kind with the value of fractional shares paid in cash.
Distributions from other funds are made in cash.
While employed, a participant may make withdrawals from his or
her Company or employee contribution accounts (as allowed
under Internal Revenue Service (IRS) regulations) subject to
certain restrictions as described in the Plan. Certain
restrictions associated with withdrawals may be waived in the
event a participant demonstrates financial hardship.
When a participant terminates employment, he or she is
entitled to withdraw his or her total vested account balance.
A participant's nonvested percentage of the Company's matching
contribution shall become a forfeiture upon a participant's
termination of employment for reasons other than retirement,
death, or permanent disability. Forfeitures are used to reduce
the Company's matching contributions for the Plan year.
Forfeitures available to offset future Company contributions
were $93,735 and $68,913 at December 31, 2002 and 2001,
respectively.
(e) PARTICIPANT LOANS
A participant may obtain loans from the Plan secured by the
pledge of the participant's account balance. Loans are to be
greater than $1,000 and may not exceed the lesser of $50,000,
less the participant's highest outstanding loan balance during
the preceding 12 months or 50% of the participant's vested
account balance in the Plan. Loans bear interest at two
percentage points above the five-year U.S. treasury note rate
or the standard lending rate for twenty-year, fixed-rate home
mortgage loans if the loan is to acquire the principal
residence of the participant (home loans). Home loans can be
repaid at terms up to twenty years; other loans have terms of
five years.
(f) INVESTMENT OPTIONS
Participants may allocate their contributions (in multiples of
1%) and those of the Company among eight mutual funds, a
common/collective trust fund, and American Depositary Shares.
Warrants received as a result of the transfer of participant
accounts from a prior plan may continue to be held by the
participant, but are not available for future investment.
Employees may change their contribution allocation between
investment options for future contributions and transfer prior
contributions and associated earnings between investment
options subject to certain restrictions set forth in the Plan.
(g) PLAN TERMINATION
Upon termination of the Plan, each participant would
immediately become fully vested in his or her contributions,
and the total amount in each participant's account would be
distributed to such participant. The rights of affected
participants to their accounts as of the date of termination
shall be nonforfeitable.
5 (Continued)
TOTAL FINA ELF FINANCE USA, INC. EMPLOYEE SAVINGS PLAN
Notes to Financial Statements
December 31, 2002 and 2001
(2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(a) BASIS OF ACCOUNTING
The accompanying financial statements have been prepared on
the accrual basis of accounting in accordance with accounting
principles generally accepted in the United States of America.
(b) VALUATION OF INVESTMENTS
Quoted market prices are used to determine the fair value of
the investments in mutual funds, American Depositary Shares,
and Warrants. The common/collective trust fund is valued at
fair value based upon the quoted market values of the
underlying assets. Participant loans are valued at cost which
approximates fair value. Securities transactions are recorded
on the trade date. Interest and dividends are recorded on the
accrual basis.
The common/collective trust fund invests primarily in
guaranteed investment contracts (GICs) and synthetic GICs. The
GICs and synthetic GICs are fully benefit-responsive and are
recorded at contract value, which approximates fair value.
Contract value is determined based on invested principal plus
interest earned thereon. The effective yield of the
common/collective trust fund was 4.95% for the year ended
December 31, 2002.
Net appreciation (depreciation) from mutual funds includes
realized gains (losses) on the sale of investments, and
unrealized appreciation (depreciation) in fair value of
investments. Net appreciation in fair value of American
Depositary Shares and Warrants includes realized gains
(losses) on the sale of American Depositary Shares and
Warrants and unrealized appreciation (depreciation) in fair
value of American Depositary Shares and Warrants.
(c) USE OF ESTIMATES
The preparation of financial statements in conformity with
accounting principles generally accepted in the United States
of America requires management to make estimates and
assumptions that affect the reported amounts of net assets
available for plan benefits and changes therein. Actual
results could differ from those estimates.
6 (Continued)
TOTAL FINA ELF FINANCE USA, INC. EMPLOYEE SAVINGS PLAN
Notes to Financial Statements
December 31, 2002 and 2001
(3) INVESTMENTS
The fair market values of individual assets that represent 5% or more
of the Plan's net assets at December 31, 2002 and 2001 are separately
identified as follows:
2002:
Fidelity Growth & Income Fund $ 9,478,425
Fidelity Magellan Fund 4,308,645
Fidelity Managed Income Portfolio 14,463,542
Spartan U.S. Equity Index Fund 3,031,131
Total Fina Elf S.A. American Depositary Shares 12,642,459
Fidelity Retirement Money Market Portfolio 2,849,875
2001:
Fidelity Growth & Income Fund $ 11,251,803
Fidelity Magellan Fund 5,696,772
Fidelity Managed Income Portfolio 12,440,049
Spartan U.S. Equity Index Fund 4,082,286
Total Fina Elf S.A. American Depositary Shares 13,656,184
(4) TOTAL FINA ELF S.A. AMERICAN DEPOSITARY SHARES AND WARRANTS
Each participant is entitled to exercise voting rights attributable to
the American Depositary Shares allocated to his or her account and is
notified by the Trustee prior to the time that such rights are to be
exercised. If the participant does not direct the Trustee as to the
voting of the American Depositary Shares, the Trustee will vote the
American Depositary Shares in the same proportion as the votes received
by the Trustee.
The Warrants are the result of the PetroFina S.A. and Fina, Inc. merger
on August 5, 1998, and participants who held shares of Fina, Inc. stock
in the prior plan at that time received the PetroFina warrants as part
of the proceeds for each share of Fina, Inc. stock in their accounts.
In connection with a tender offer made on May 6, 1999 by Total Fina
S.A., all outstanding PetroFina warrants were exchanged for Total Fina
S.A. warrants. Following a consolidation of Total Fina Elf S.A., all
Total Fina S.A. warrants have been exchanged for Total Fina Elf S.A.
warrants. Each warrant entitles the participant to acquire one American
Depositary Share at a price of $46.94. The Warrants expire on August 5,
2003.
(5) CONCENTRATION OF INVESTMENTS
The Plan's investment in American Depositary Shares and Warrants
represents 23% of total investments as of December 31, 2002 and 2001.
Total Fina Elf S.A. is an international integrated oil and gas and
specialty chemical company which engages in all areas of the petroleum
industry, from exploration and production to refining and shipping.
7 (Continued)
TOTAL FINA ELF FINANCE USA, INC. EMPLOYEE SAVINGS PLAN
Notes to Financial Statements
December 31, 2002 and 2001
(6) PARTY-IN-INTEREST TRANSACTIONS
The Plan engages in investment transactions with funds managed by
Fidelity, the Trustee, a party in interest with respect to the Plan. In
addition, the Plan holds American Depositary Shares and Warrants. The
transactions are covered by an exemption from the "prohibited
transaction" provisions of ERISA and the Code.
(7) INCOME TAX STATUS
The Plan obtained its latest determination letter on January 9, 1998,
in which the Internal Revenue Service stated that the Plan, as then
designed, was in compliance with the applicable requirements of the
Code. The Company believes that the amended and restated Plan is
currently designed and being operated in compliance with the applicable
requirements of the Code. Therefore, it believes that the Plan is
qualified, and the related trust is tax-exempt as of December 31, 2002
and 2001.
(8) RISKS AND UNCERTAINTIES
The Plan provides for investments in mutual funds, a common/collective
trust fund, American Depositary Shares and Warrants. Investment
securities, in general, are exposed to various risks, such as interest
rate, credit, and overall market volatility risk. Due to the level of
risk associated with certain investment securities, it is reasonably
possible that significant changes in the values of investment
securities will occur in the near term.
(9) SUBSEQUENT EVENTS
Effective January 1, 2003, the Plan definition of eligible compensation
was amended to include overtime hours.
Effective May 6, 2003, Total Fina Elf S.A. changed its name to TOTAL
S.A. In conjunction with the name change, Total Fina Elf S.A. American
Depositary Shares and Warrants have become TOTAL S.A. American
Depositary Shares and Warrants.
Effective May 16, 2003, Total Fina Elf Finance USA, Inc. changed its
name to TOTAL Finance USA, Inc.
8
SCHEDULE
TOTAL FINA ELF FINANCE USA, INC. EMPLOYEE SAVINGS PLAN
Schedule H, Line 4i - Schedule of Assets (Held at End of Year)
December 31, 2002
CURRENT
IDENTITY OF ISSUE DESCRIPTION OF INVESTMENT VALUE
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Dreyfus Funds Dreyfus Founders Balanced Fund $ 1,186,454
Fidelity Investments* Fidelity Cash Reserves 40,442
Fidelity Investments* Fidelity Institutional Short-Intermediate Government Fund 2,766,460
Fidelity Investments* Fidelity Aggressive Growth Fund 1,749,159
Fidelity Investments* Fidelity Growth & Income Fund 9,478,425
Fidelity Investments* Fidelity Magellan Fund 4,308,645
Fidelity Investments* Fidelity Managed Income Portfolio 14,463,542
Fidelity Investments* Fidelity Overseas Fund 1,979,091
Fidelity Investments* Fidelity Retirement Money Market Portfolio 2,849,875
Fidelity Investments* Spartan U.S. Equity Index Fund 3,031,131
Total Fina Elf S.A.* Total Fina Elf S.A. American Depositary Shares 12,642,459
Total Fina Elf S.A.* Total Fina Elf S.A. Warrants 256,412
Participant loans* Interest rates ranging from 4.6% to 10.5% 865,455
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$ 55,617,550
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* Indicates a party in interest.
See accompanying independent auditors' report.
SIGNATURE
The Plan. Pursuant to the requirements of the Securities Exchange Act of 1934,
the Administrative Committee has duly caused this annual report to be signed on
its behalf by the undersigned thereunto duly authorized.
DATE: JUNE 26, 2003 TOTAL FINA ELF FINANCE USA, INC. EMPLOYEE SAVINGS PLAN
BY: /s/ OTTO TAKKEN
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EXECUTIVE VICE PRESIDENT
CHIEF OPERATING OFFICER,
CHIEF FINANCIAL OFFICER, AND
ADMINISTRATIVE COMMITTEE MEMBER
INDEX TO EXHIBIT
Exhibit Number Description
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23.1 Independent Auditors' Consent
99.1 Certification of Chief Executive Officer pursuant to 18
U.S.C. Section 1350, as adopted pursuant to Section 906 of
the Sarbanes-Oxley Act of 2002.
99.2 Certification of Chief Financial Officer pursuant to 18
U.S.C. Section 1350, as adopted pursuant to Section 906 of
the Sarbanes-Oxley Act of 2002.