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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
ANNUAL REPORT PURSUANT TO SECTION 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
[X] 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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ATOFINA CAPITAL ACCUMULATION PLAN
15710 JFK BOULEVARD
HOUSTON, TEXAS 77032
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TOTAL S.A.
2 PLACE DE LA COUPOLE
LA DEFENSE 92078
PARIS FRANCE
INDEPENDENT AUDITORS' REPORT
The Administrative Committee
ATOFINA Capital Accumulation Plan:
We have audited the accompanying statements of net assets available for plan
benefits of the ATOFINA Capital Accumulation 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 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 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. This 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 27, 2003
ATOFINA CAPITAL ACCUMULATION PLAN
Statements of Net Assets Available for Plan Benefits
December 31, 2002 and 2001
2002 2001
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Investments, at fair value $198,825,216 202,005,938
Employer contributions receivable 9,601 7,899
Due from Trustee for securities sold 3,922,072 823,735
Accrued interest receivable 22,106 14,431
Accrued dividends receivable 209,384 190,000
------------ ------------
Plan assets 202,988,379 203,042,003
Administrative expenses payable 38,682 95,930
Due to Trustee for pending trades 2,772,020 --
------------ ------------
Net assets available for plan benefits $200,177,677 202,946,073
============ ============
See accompanying notes to financial statements.
2
ATOFINA CAPITAL ACCUMULATION PLAN
Statement of Changes in Net Assets Available for Plan Benefits
Year ended December 31, 2002
Contributions:
Employee $ 9,160,799
Employer 5,464,216
Rollovers 511,422
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Total contributions 15,136,437
Investment income (loss):
Interest 798,766
Dividends 2,930,416
Net appreciation in fair value of American Depositary Shares and Warrants 5,296,724
Net depreciation in fair value of mutual funds (5,399,759)
Net depreciation in fair value of common collective trust funds (4,002,440)
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Total investment loss (376,293)
Payments to participants (17,234,972)
Administrative expenses (293,568)
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Net decrease in net assets available for plan benefits (2,768,396)
Net assets available for plan benefits:
Beginning of year 202,946,073
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End of year $ 200,177,677
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See accompanying notes to financial statements.
3
ATOFINA CAPITAL ACCUMULATION PLAN
Notes to Financial Statements
December 31, 2002 and 2001
(1) DESCRIPTION OF THE PLAN
(a) GENERAL
The ATOFINA Capital Accumulation Plan (the Plan) operates for the
benefit of certain employees of Total Fina Elf S.A. (the Company),
a French company that is publicly traded on the New York Stock
Exchange, and an indirectly wholly owned subsidiary, American
Petrofina Holding Company (APHC), hereafter referred to as the
"employing companies."
The Plan is a defined contribution plan and is subject to the
provisions of the Employee Retirement Income Security Act of 1974,
as amended (ERISA). The following description of the Plan is
provided for general purposes only. Participants should refer to
the Plan document as amended for more complete information.
The Plan is administered by an administrative committee (the
Committee) appointed by and acting on behalf of the board of
directors of the Company. Pursuant to the Plan's trust agreement,
an independent trustee (the Trustee) maintains custody of the
Plan's assets. Boston Safe Deposit and Trust Company serves as the
Trustee, and Hewitt & Associates serves as the independent record
keeper.
(b) ELIGIBILITY
An employee is eligible to participate in the Plan immediately
upon employment. However, no employee may become a participant if
the employee is a member of a collective bargaining unit, the
recognized representative of which has not agreed to participation
in the Plan by members of such unit. Participants are eligible for
Company matching contributions after one year of employment.
(c) CONTRIBUTIONS
Participants may elect to contribute up to 15% on a pretax basis,
up to 6% on an after-tax basis or a combination of pretax and
after-tax contributions not exceeding 15% of their basic
compensation. Eligible employees are automatically deemed to have
made a pretax election of 6% unless the employee has affirmatively
elected to make no pretax contributions or elected to make pretax
contributions in a different amount. 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
Internal Revenue Code of 1986, as amended (the Code) ($1,000 per
participant in 2002). Eligible participants may also elect to
rollover qualified distributions as defined in the Plan document.
For each participant, the employing company will contribute an
amount up to 6% of the participant's basic compensation for the
pay period (Matching Contribution). Participants must contribute a
minimum of 3% pretax contributions before the Company will match
after-tax contributions. The Company does not match employee
catch-up contributions. Matching Contributions are reduced by
participants' forfeitures.
Employee contributions are paid to the Trustee in cash, and
Matching Contributions are paid to the Trustee in cash or Total
Fina Elf S.A. American Depositary Shares (ADS).
(Continued)
4
ATOFINA CAPITAL ACCUMULATION PLAN
Notes to Financial Statements
December 31, 2002 and 2001
(d) VESTING PROVISIONS
Participants are vested immediately in their contributions plus
actual earnings thereon. Effective January 1, 2001, active
participants are 100% vested in Matching Contributions at all
times.
(e) INVESTMENTS
Each participant's account is credited with his or her
contribution, the Matching Contribution, and an allocation of plan
earnings or losses and administrative expenses. Allocations are
based on the proportion that each participant's account balance
bears to the total of all participant account balances. The
benefit to which a participant is entitled is the vested portion
of the benefit that can be provided from the participant's
account.
(f) INVESTMENT OPTIONS
Participants may direct the investment of their pretax and
after-tax contributions into three mutual funds, three common
collective trusts, or Total Fina Elf S.A. ADS. Prior to January 1,
2002, the Matching Contributions were invested in Total Fina Elf
S.A. ADS. Effective January 1, 2002, participants were provided
the opportunity to direct the investment of their Matching
Contributions. Total Fina Elf S.A. Warrants (Warrants) may
continue to be held by the participant but are not available for
future investment.
(g) PARTICIPANT LOANS
A participant may borrow from his or her account an amount which,
when added to the greater of the total outstanding balance of all
other loans to such participant from the Plan or the highest
outstanding balance of all such loans for the one-year period
ending the day before the date of the loan, does not exceed the
lesser of $50,000 or 50% of the participant's vested account
balance. Any such loan made to a participant shall be evidenced by
a promissory note payable to the Plan, shall bear a reasonable
rate of interest, shall be secured by the borrowing participant's
vested interest under the Plan and shall be repayable within five
years; provided, however, that if such loan is to be used to
acquire or construct any dwelling unit which within a reasonable
time is to be used as a principal residence of the participant,
the Committee may direct the Trustees to make such loan repayable
over such period greater than five years. No withdrawal pursuant
to any of the withdrawal provisions of the Plan may be made by a
participant to whom a loan is outstanding from the Plan unless the
Committee is satisfied that such loan will remain nontaxable and
fully secured by the withdrawing participant's vested interest
under the Plan following such withdrawal.
(h) DISTRIBUTIONS AND FORFEITURES
Upon termination of service for any reason, a participant may
receive a lump-sum amount equal to the value of the participant's
vested interest in his or her account. An active participant may
withdraw after-tax contributions and Matching Contributions made
before 1984 and earnings thereon. At any time, a participant age
59-1/2 or older may withdraw his or her total account.
Participants had requested distributions in the amount of $8,244
and $558,757 at December 31, 2002 and 2001, respectively, that had
not yet been paid by the Trustee.
5
(Continued)
ATOFINA CAPITAL ACCUMULATION PLAN
Notes to Financial Statements
December 31, 2002 and 2001
Prior to January 1, 2001, a participant's nonvested percentage of
the participant's Matching Contribution account became a
forfeiture upon a participant's termination of employment for
reasons other than retirement, death, or permanent disability.
Forfeitures are used to reduce future Matching Contributions.
(i) PLAN TERMINATION
Although they have not expressed any intent to do so, the
employing companies have the right under the Plan to discontinue
their contributions at any time and to terminate the Plan subject
to the provisions of ERISA.
(j) EXPENSES OF ADMINISTERING THE PLAN
All external costs and expenses incurred in administering the
Plan, including the fees and expenses of the Trustee, the fees of
its counsel, accounting fees, and record keeper fees, are the
responsibility of the Plan.
(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
Investments are reported at fair market value. The Total Fina Elf
S.A. ADS, Warrants, and mutual funds are valued based upon quoted
market prices. The common collective trust funds are stated at
fair value, as determined by the assets' trustee, by reference to
published market data, if available, of the underlying assets.
Participant loans are valued at cost, which approximates fair
value. Security transactions are recorded on a trade date basis.
Interest is recorded as earned, and dividends are recorded on the
ex-dividend date.
Net appreciation (depreciation) in the fair value of investments
includes realized gains (losses) on the sale of investments and
unrealized appreciation (depreciation) in fair value of
investments.
(c) USE OF ESTIMATES
The preparation of financial statements in conformity with
accounting principles generally accepted in the United States
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)
ATOFINA CAPITAL ACCUMULATION 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 as follows:
2002:
Total Fina Elf S.A. ADS $112,813,945
New Perspective Fund 11,161,339
Equity Index Fund H 15,486,304
Pooled Employee Funds Daily Liquidity Fund 23,919,889
2001:
Total Fina Elf S.A. ADS* $130,926,306
New Perspective Fund 12,116,052
Equity Index Fund H 16,084,452
* Nonparticipant-directed in 2001.
(4) TOTAL FINA ELF S.A. ADS AND WARRANTS
Each participant is entitled to exercise voting rights attributable to
the Total Fina Elf S.A. ADS 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 Total Fina Elf S.A. ADS, the Trustee will vote the Total
Fina Elf S.A. ADS 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. Participants who held shares of Fina, Inc. stock in
the 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 S.A., all
outstanding PetroFina warrants were exchanged for Total S.A. warrants.
Following the consolidation of Total Fina Elf S.A., all Total S.A.
warrants have been exchanged for Total Fina Elf S.A. Warrants. Each
Warrant entitles the participant to acquire one Total Fina Elf S.A. ADS
at a price of $46.94. Warrants expire on August 5, 2003.
(5) CONCENTRATION OF INVESTMENTS
The Plan's investment in Total Fina Elf S.A. ADS and Warrants represents
59% and 68% of total investments as of December 31, 2002 and 2001,
respectively. The Company 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)
ATOFINA CAPITAL ACCUMULATION PLAN
Notes to Financial Statements
December 31, 2002 and 2001
(6) NONPARTICIPANT-DIRECTED INVESTMENTS
The Total Fina Elf S.A. ADS fund contains both participant and
nonparticipant-directed investments as of December 31, 2001. The relative
amounts could not be separated, and as such, information about the net
assets relating to the entire fund is as follows:
2001
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Net assets:
Cash equivalents $ 1,107,981
Total Fina Elf S.A. ADS 130,926,306
Employer contributions receivable 7,899
Securities receivables 799,628
Accrued interest receivable 3,599
Accrued dividends receivable 190,000
Administrative expenses payable (16,369)
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$ 133,019,044
=============
Effective January 1, 2002, the entire Total Fina Elf S.A. ADS Fund is
participant-directed (see note 1).
(7) FEDERAL INCOME TAXES
The Plan has obtained from the Internal Revenue Service a determination
letter dated October 30, 2002 indicating that the Plan qualifies under
the provision of Section 401(a) of the Code and, accordingly, is exempt
from federal income taxes under Section 501(a) of the Code. The Plan has
been amended since receiving the letter; however, the Company believes
that the Plan is designed and continues to operate in accordance with the
applicable provisions of the Code.
(8) RECONCILIATION TO FORM 5500
The following is a reconciliation of net assets available for plan
benefits per the financial statements to the Form 5500:
2002 2001
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Net assets available for plan benefits per the financial
statements $ 200,177,677 202,946,073
Amounts allocated to withdrawing participants (8,244) (558,757)
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Net assets available for plan benefits per the Form 5500 $ 200,169,433 202,387,316
============= =============
8
(Continued)
ATOFINA CAPITAL ACCUMULATION PLAN
Notes to Financial Statements
December 31, 2002 and 2001
The following is a reconciliation of withdrawals per the financial
statements to the Form 5500:
YEAR ENDED
DECEMBER 31,
2002
------------
Payments to participants per the financial statements $ 17,234,972
Add amounts allocated to withdrawing participants at December 31, 2002 8,244
Less amounts allocated to withdrawing participants at December 31, 2001 (558,757)
------------
Payments to participants per the Form 5500 $ 16,684,459
============
Amounts allocated to withdrawing participants are recorded on the Form
5500 for withdrawals that have been processed and approved for payment
prior to December 31, but not yet paid as of that date.
(9) RISKS AND UNCERTAINTIES
The Plan provides for investments in Total Fina Elf S.A. ADS and
Warrants, mutual funds, and common collective trust funds. 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.
(10) PARTY-IN-INTEREST TRANSACTIONS
The Plan engages in investment transactions with funds managed by The
Boston Company, Inc., an affiliate of the Trustee, a party in interest
with respect to the Plan. In addition, the Plan invests in Total Fina
Elf, S.A. ADS and Warrants, which are shares and units of Company
securities. The Company is the parent of the sponsor of the Plan;
therefore, these transactions qualify as party-in-interest transactions.
These transactions are covered by an exemption from the "prohibited
transaction" provisions of ERISA and the Code.
(11) SUBSEQUENT EVENTS
Effective January 1, 2003, a participant may elect to change his or her
election under the Plan on a weekly basis.
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.
9
ATOFINA CAPITAL ACCUMULATION PLAN
Schedule H, Line 4i - Schedule of Assets (Held at End of Year)
December 31, 2002
CURRENT
IDENTITY OF ISSUE DESCRIPTION OF INVESTMENT VALUE
----------------------------------------- --------------------------------------------------------- ------------
Total Fina Elf S.A.* American Depositary Shares $112,813,945
Total Fina Elf S.A.* Warrants 4,078,056
American Funds, Inc. Balanced Fund 9,859,620
American Funds, Inc. New Perspective Fund 11,161,339
Dreyfus Funds Growth and Value Fund 7,323,825
Barclays Global Investors Equity Index Fund H 15,486,304
Barclays Global Investors U.S. Debt Market Index Fund 7,490,797
The Boston Company, Inc.* Pooled Employee Funds Daily Liquidity Fund 23,919,889
Barclays Global Investors Cash 268
Participant Loans* Interest rates ranging from 5.25% to 11% 6,691,173
------------
$198,825,216
============
* Indicates a party in interest.
See accompanying independent auditors' report.
10
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.
ATOFINA CAPITAL ACCUMULATION PLAN
Date: June 27, 2003 /s/ Carolyn Sanders
-------------------------------------
Vice President and Chairman,
Benefits Administration Committee
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.