UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 11-K
(Mark One)
(X) Annual report pursuant to Section 15(d) of the Securities Exchange Act of
1934 for the fiscal year ended December 31, 2001
Or
( ) Transition report pursuant to Section 15(d) of the Securities Exchange Act
of 1934 for the transition period from ________ to __________
Commission file number_______________________________
A. Full title of the plan and the address of the plan, if different from
that of the issuer named below:
Burlington Resources Inc. Retirement Savings Plan
B. Name of issuer of the securities held pursuant to the plan and the
address of its principal executive office:
Burlington Resources Inc., 5051 Westheimer, Suite 1400, Houston, Texas 77056
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BURLINGTON RESOURCES INC. RETIREMENT SAVINGS PLAN
REPORT ON AUDITS OF FINANCIAL STATEMENTS
AND SUPPLEMENTAL SCHEDULE
AS OF DECEMBER 31, 2001 AND 2000 AND
FOR THE YEAR ENDED DECEMBER 31, 2001
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BURLINGTON RESOURCES INC. RETIREMENT SAVINGS PLAN
TABLE OF CONTENTS
PAGE
----
Financial Statements
Statement of Net Assets Available for Benefits as
of December 31, 2001 and 2000 2
Statement of Changes in Net Assets Available for
Benefits for the year ended December 31, 2001 3
Notes to Financial Statements 4
Report of Independent Accountants 9
Supplemental Schedule
Schedule H, Item 4i - Schedule of Assets Held for Investment
Purposes as of December 31, 2001 10
Exhibit
23 Consent of Independent Accountants
BURLINGTON RESOURCES INC. RETIREMENT SAVINGS PLAN
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS
DECEMBER 31,
-----------------------------
2001 2000
------------ ------------
Investments
At fair value
Burlington Resources Inc. common stock $ 49,504,267 $ 46,356,730
Registered investment companies 107,857,682 134,590,632
Participants' notes receivable 5,284,896 5,987,605
Cash and cash equivalents 2,624,189 5,888,683
At contract value
Unallocated investment contracts 46,262,893 37,586,122
Synthetic investment contracts 16,448,438 19,860,924
------------ ------------
Total investments 227,982,365 250,270,696
------------ ------------
Contributions receivable
Company 257,831 228,336
Participant 356,829 330,040
------------ ------------
Net assets available for benefits $228,597,025 $250,829,072
============ ============
The accompanying notes are an integral part of these financial statements.
2
BURLINGTON RESOURCES INC. RETIREMENT SAVINGS PLAN
STATEMENT OF CHANGES IN NET ASSETS
AVAILABLE FOR BENEFITS
YEAR ENDED
DECEMBER 31,
2001
-------------
Investment income
Interest income $ 485,180
Dividend income 1,802,138
Net depreciation in the fair value of investments (24,037,787)
-------------
Net investment income (21,750,469)
-------------
Contributions
Company 7,458,724
Participant 10,658,494
-------------
Total contributions 18,117,218
-------------
Total additions (3,633,251)
-------------
Participant withdrawals and distributions (18,495,584)
Administrative expenses (103,212)
-------------
Total deductions (18,598,796)
-------------
Net decrease (22,232,047)
Net assets available for benefits
Beginning of year 250,829,072
-------------
End of year $ 228,597,025
=============
The accompanying notes are an integral part of these financial statements.
3
BURLINGTON RESOURCES INC. RETIREMENT SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
1. PLAN DESCRIPTION
General
The following description of the Burlington Resources Inc. ("BR" or the
"Company") Retirement Savings Plan (the "Plan") provides only general
information. Participants should refer to the Plan Document for a more
complete description of the Plan's provisions.
The Plan is a trusteed, defined contribution plan, administered by a
committee of BR executives, for participants of the employer companies BR
and Burlington Resources Oil & Gas Company LP (formerly known as
Burlington Resources Oil & Gas Company), which is a wholly-owned
subsidiary of BR. The Plan is subject to the provisions of the Employee
Retirement Income Security Act of 1974 ("ERISA"), as amended. The Plan's
assets are held by Charles Schwab Trust Company and individual
participant accounts are maintained by Charles Schwab Retirement Plan
Services.
Investments
A participant may direct his or her contributions and account balances
among the following investment funds.
Company Stock Fund - Invested in common stock of BR.
S&P 500 Institutional Index Fund - Invested in a diversified portfolio of
common stock and other equity securities. This fund is managed to achieve
results similar to those of the overall stock market as measured by the
Standard & Poor's 500 Index.
International Equity Fund - Invested primarily in the equity securities
of companies based outside the United States of America.
Balanced Fund - Invested 60% in equity securities, which attempt to
mirror the Willshire 5000 Equity Index and 40% in high-quality bonds,
which attempt to mirror the Lehman Brothers Aggregate Bond Index.
Small-Cap Equity Fund - Invested at least 65% of its total assets in
common stock, or other equity securities including preferred stocks,
rights and warrants of the second 1,000 largest U.S. corporations.
Growth Equity Fund - Invested primarily in common stocks of corporations
that the trust advisor believes are undervalued and capable of generating
strong earnings growth in the near term.
4
Large Capital Value Fund - Invested primarily in common stocks and other
instruments convertible into common stock issued by large corporations.
Global Equity Fund - Invested primarily in equity instruments issued by
corporations from the U.S. and abroad.
Stable Value Fund - Invested primarily in a diversified portfolio of
investment contracts offered by major insurance companies and financial
institutions.
Small Cap Growth Fund - Invested primarily in common stocks of U.S. and
foreign companies within the range of capitalizations of companies
included in the Lipper, Inc. Small Cap category.
Participants' Notes Receivable
The Plan may make loans to actively employed participants of up to 50% of
their account balance (excluding any Individual Retirement Account
balance), subject to a minimum loan of $1,000 and a maximum loan of
$50,000. The $50,000 limit is reduced by the participant's highest
outstanding loan balance during the prior one-year period. Interest on
loans accrues at 1% above the Wall Street Journal published prime rate,
which is determined at the time the loan is taken, and remains fixed for
the term of the loan. The repayment period may be from one to five years.
Repayments are made through payroll deductions and are reinvested in Plan
funds according to the borrowing participant's current investment
elections. Loan balances due from terminated participants may be deemed
distributed to the participants at the time his or her account balance is
liquidated. During 2001, $395,149 of such distributions are included in
participant withdrawals and distributions in the accompanying financial
statements.
Contributions
A participant may elect to make regular semi-monthly pre-tax and/or
after-tax contributions from 1% to 13% of his or her total eligible
compensation. Pre-tax contributions are subject to an IRS limitation of
$10,500. The Company matches up to 6% of total eligible compensation for
a participant with less than 10 years of service and up to 8% of total
eligible compensation for a participant with 10 or more years of service.
In addition, a participant may make an approved rollover contribution
from another qualified employee benefit plan. All regular Company and
participant contributions are paid to the Plan's trustee semi-monthly,
and allocated among the investment options consistent with participant
investment elections.
Vesting
Participant accounts are 100% vested and nonforfeitable at all times.
Participant Withdrawals and Distributions
The Plan provides for several different types of withdrawals by
participants. Participants may take in-service withdrawals of certain
funds depending on their source. Upon the separation
5
from service, a participant's account balance may be distributed in a
lump sum. A participant whose account balance exceeds $5,000 may elect a
deferred distribution or installment payments over a period ending not
later than April 1 of the year following the calendar year in which the
participant attains age 70-1/2.
Termination of the Plan
While the Board of Directors of BR has not expressed any intention to do
so, they may at any time terminate the Plan. Upon termination, the Plan's
assets will be distributed to the participants on the basis of their
account balances existing at the date of termination.
Income Taxes
The Plan has received a determination letter dated June 12, 2000, from
the Internal Revenue Service advising that the Plan constitutes a
qualified plan under Section 401(a) of the Internal Revenue Code and is
therefore exempt from income taxes.
2. ACCOUNTING POLICIES
Principles of Reporting
In accordance with generally accepted accounting principles ("GAAP"), the
accounting records of the Plan are maintained on the accrual basis except
for participant withdrawals and distributions, which are reported when
paid. Amounts for benefit claims that have been processed and approved
for payment prior to December 31, but not paid as of that date are
reported on Form 5500 as withdrawals. No such unpaid claims exist at
December 31, 2001 or 2000. The preparation of the Plan's financial
statements in conformity with GAAP requires certain estimates and
assumptions. Actual results could differ from estimates. Due to the level
of risk associated with certain investment securities and the level of
uncertainty related to changes in their value, it is at least reasonably
possible that changes in the near term could materially affect the
amounts reported in the Statement of Net Assets Available for Benefits.
Investments
The Plan's investments, except for its investment contracts, are stated
at fair value. Investment contracts, which are fully benefit responsive,
are stated at contract value. Fair value for investments other than
participants' notes receivable is determined by quoted market prices.
Participants' notes receivable are carried at original loan principal
balance, less principal repayments which approximates fair value.
Net appreciation (depreciation) in the fair value of the Plan
investments, which consists of net realized and unrealized appreciation
(depreciation), is presented in the Statement of Changes in Net Assets
Available for Benefits. This appreciation (depreciation) is allocated to
participants based upon their proportionate share of assets in each
investment fund.
6
Cash and Cash Equivalents
All short-term investments purchased with a maturity of three months or
less are considered cash equivalents. Cash equivalents are stated at fair
value.
Dividend and Interest Income
Dividend and interest income from investments are recorded as earned and
allocated to participants based upon their proportionate share of assets
in each investment fund.
Administrative Expenses
Certain administrative expenses and professional fees incurred by the
Plan are paid by BR, including record keeping and trust fees.
3. NET DEPRECIATION IN THE FAIR VALUE OF INVESTMENTS
Following is a summary of the components of the net depreciation in the
fair value of investments.
Year Ended
December 31,
2001
-------------
BR common stock $ (9,139,361)
Registered investment companies (14,898,426)
-------------
Total net depreciation $ (24,037,787)
=============
4. INVESTMENTS
Investments that comprised 5% or more of the net assets available for
benefits follow.
December 31,
-----------------------------
2001 2000
------------ ------------
BR common stock $ 49,504,267 $ 46,356,730
Janus Worldwide Fund $ 18,365,059 $ 29,553,641
Vanguard Institutional Index Fund $ 43,591,919 $ 52,444,999
Schwab Small-Cap Index Fund $ 16,822,336 $ 17,681,087
Vanguard Balanced Index Fund * $ 13,581,882
* Item does not meet 5% threshold as of December 31, 2001.
7
5. INVESTMENT CONTRACTS
The fair value of investment contracts as of December 31, 2001 and 2000
was approximately $64,500,000 and $58,100,000, respectively. Fair value
was determined using a discounted cash flow analysis assuming market
rates for similar contracts. The average yield for these investment
contracts during 2001 and 2000 was 5.82% and 6.50%, respectively. The
crediting interest rates ranged from 2.44% to 8.75% and 5.13% to 7.50% at
December 31, 2001 and 2000, respectively.
8
REPORT OF INDEPENDENT ACCOUNTANTS
To the Participants and Administrator of
Burlington Resources Inc. Retirement Savings Plan
In our opinion, the accompanying statement of net assets available for benefits
and the related statement of changes in net assets available for benefits
present fairly, in all material respects, the net assets available for benefits
of Burlington Resources Inc. Retirement Savings Plan (the "Plan") at December
31, 2001 and 2000, and the changes in its net assets available for benefits for
the year ended December 31, 2001 in conformity with accounting principles
generally accepted in the United States of America. 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 auditing standards
generally accepted in the United States of America 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 our opinion.
Our audits were conducted for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedule listed in the
accompanying table of contents on Page 1 is presented for the purpose 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 audits 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/ PricewaterhouseCoopers LLP
Houston, Texas
June 20, 2002
9
SUPPLEMENTAL SCHEDULE
BURLINGTON RESOURCES INC. RETIREMENT SAVINGS PLAN
SCHEDULE H, ITEM 4I - SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
DECEMBER 31, 2001
(e)
CURRENT
VALUE/
(a) (b)(c) FAIR VALUE
-------------
Unallocated Investment Contracts
John Hancock Mutual Life Insurance Company
#7216, 5.24%, matures 6/20/02 $ 289,665
#7354-1, 3.87%, matures 8/1/02 2,514,663
#7474, 8.18%, no maturity date 5,343,992
Continental Assurance Company
#630-05573, 5.61%, matures 12/17/12 1,664,377
#25708-101, 5.97%, no maturity date 4,088,586
J.P. Morgan Chase Bank
#401725-G, 5.85%, no maturity date 3,828,559
Bank of America NT & SA
#99-043, 5.87%, no maturity date 2,627,546
BMA
#1335, 5.75%, matures 11/17/03 1,785,909
State Street Bank & Trust
#99007, 5.21%, matures 12/17/12 4,710,086
Monumental Life Ins. Co.
#00214FR, 6.98%, matures 10/30/03 1,623,197
UBS AG
#5002, 2.44%, no maturity date 2,738,388
Prudential - Cap MAC Inc.
#10041-211, 6.61%, matures 6/14/02 1,765,398
Prudential - Cap MAC Insd
#10041-212, 5.97%, 1/18/05 1,163,450
Sun America Life Ins. Co.
#4887, 7.44%, matures 1/2/04 482,777
Aetna Life Insurance & Annuity Company
#14680, 5.46%, matures 12/25/12 4,979,660
Caisse des Depots (CDC)
#1810-01, 4.19%, no maturity date 4,036,584
GE Life & Annuity Asr Co.
#3528, 5.50%, 3/29/04 1,042,692
Metropolitan Life Insurance
#25811, 6.02%, 2/17/04 1,577,364
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Total unallocated investment contracts $ 46,262,893
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10
BURLINGTON RESOURCES INC. RETIREMENT SAVINGS PLAN
SCHEDULE H, ITEM 4I - SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
DECEMBER 31, 2001
(e)
CURRENT
VALUE/
(a) (b)(c) FAIR VALUE
-------------
Synthetic investment contracts
Monumental Life Ins. Co. #00085TR
Citibank Credit Card MT $ 2,112,502
Citibank Credit Card MT 1,047,166
Federal Home Loan Mortgage Co., 5.75%, matures 4/08 2,292,706
Federal National Mortgage Co., 5.13%, matures 2/04
United States Treasury, 5.875%, matures 11/04 2,132,430
United States Treasury, 6.625% matures 5/07 1,661,222
Monumental Life Ins. Co. Wrapper (341,742)
Chase Manhattan Bank, #401725-T
Fannie Mae Whole Loan, 7.00%, matures 7/05 2,016,725
Ford Auto Owners Trust 1,569,225
Fannie Mae Whole Loan, 6.625%, matures 9/09 543,816
Fannie Mae Whole Loan, 5.125%, matures 2/04 526,712
United States Dollars 12,513
Chase Manhattan Bank Wrapper (78,288)
UBS AG, #5040
Fannie Mae Whole Loan, 7.0%, matures 7/05 1,120,403
Federal Home Loan Mtg. Co. 1,008,272
Fannie Mae Whole Loan 958,841
United States Dollars 53,460
UBS AG Wrapper (187,525)
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Total synthetic investment contracts 16,448,438
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Total investment contracts $ 62,711,331
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11
BURLINGTON RESOURCES INC. RETIREMENT SAVINGS PLAN
SCHEDULE H, ITEM 4I - SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
DECEMBER 31, 2001
(e)
CURRENT
VALUE/
(a) (b)(c) FAIR VALUE
-------------
Registered investment companies
Janus Worldwide Fund $ 18,365,059
MFS Massachusetts Investors A Trust 2,152,259
Vanguard Balanced Index Fund 9,557,933
Waddell & Reed Small Cap Growth Fund 1,589,668
Montag and Caldwell Growth Fund 8,635,343
* Schwab Small-Cap Index Fund 16,822,336
Vanguard Institutional Index Fund 43,591,919
Vanguard International Growth Fund 7,143,165
-------------
Total investment companies 107,857,682
Cash and cash equivalents 2,624,189
* Burlington Resources Inc. common stock 49,504,267
Participants' notes receivable, 5.38% to 8.75% 5,284,896
-------------
Total investments $ 227,982,365
=============
* Denotes investment issued by a party-in-interest to the Plan.
12
The Retirement Savings Plan. Pursuant to the requirements of the Securities
Exchange Act of 1934, the person who administers the employee benefit plan has
duly caused this annual report to be signed on its behalf by the undersigned
hereunto duly authorized.
Retirement Savings Plan
------------------------------------
Date June 28, 2002 /s/ William Usher
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William Usher
Vice President
Human Resources & Administration
EXHIBIT INDEX
23 Consent of Independent Accountants