<PAGE>
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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 [FEE REQUIRED]
For the fiscal year ended December 31, 1993
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 33-42696
COASTAL ARUBA REFINING COMPANY N.V.
THRIFT PLAN
(Full title of the plan)
THE COASTAL CORPORATION
Coastal Tower
Nine Greenway Plaza
Houston, Texas 77046-0995
(Name of issuer of the securities held pursuant to the
plan and address of its principal executive office)
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INDEPENDENT AUDITORS' REPORT
Administrator
Coastal Aruba Refining Company N.V. Thrift Plan
Houston, Texas
We have audited the accompanying statement of net assets available for Plan
benefits of Coastal Aruba Refining Company N.V. Thrift Plan (the "Plan") as
of December 31, 1993 and 1992, and the related statement of changes in net
assets available for Plan benefits for each of the three years in the period
ended December 31, 1993. Our audits also included the financial statement
schedules on pages 7 through 10. These financial statements and financial
statement schedules are the responsibility of the Plan's management. Our
responsibility is to express an opinion on these financial statements and
financial statement schedules based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audits to
obtain reasonable assurance that 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, such financial statements present fairly, in all material
respects, net assets available for Plan benefits as of December 31, 1993 and
1992, and the changes in net assets available for Plan benefits for each of
the three years in the period ended December 31, 1993 in conformity with
generally accepted accounting principles. Also, in our opinion, such
financial statement schedules, when considered in relation to the basic
financial statements taken as a whole, present fairly in all material
respects the information set forth therein.
DELOITTE & TOUCHE
Houston, Texas
March 15, 1994
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<PAGE> 3
COASTAL ARUBA REFINING COMPANY N.V. THRIFT PLAN
STATEMENT OF NET ASSETS AVAILABLE FOR PLAN BENEFITS
<TABLE>
December 31,
-----------------------------
1993 1992
---------- ----------
<S> <C> <C>
ASSETS:
Investments, at market:
Securities of The Coastal Corporation:
Common stock (cost: 1993-$340,351; 1992-$120,503) . . . . . . . . . . $ 356,091 $ 109,323
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27,010 9,567
---------- ----------
Total Investments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 383,101 118,890
---------- ----------
Receivables:
Dividends . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 821 296
Contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42,070 1,263
---------- ----------
Total Receivables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42,891 1,559
---------- ----------
Cash . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . - 8,732
---------- ----------
TOTAL ASSETS . . . . . . . . . . . . . . . . . . . . . . . . . . . 425,992 129,181
---------- ----------
LIABILITIES:
Payable to participants . . . . . . . . . . . . . . . . . . . . . . . . 2,885 -
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 903 104
---------- ----------
TOTAL LIABILITIES . . . . . . . . . . . . . . . . . . . . . . . . . 3,788 104
---------- ----------
NET ASSETS AVAILABLE FOR PLAN BENEFITS . . . . . . . . . . . . . . . . . . $ 422,204 $ 129,077
---------- ----------
---------- ----------
</TABLE>
See Notes and Schedules to Financial Statements.
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COASTAL ARUBA REFINING COMPANY N.V. THRIFT PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR PLAN BENEFITS
<TABLE>
For the Years Ended
December 31,
-----------------------------------
1993 1992 1991
---------- ---------- ----------
<S> <C> <C> <C>
ADDITIONS:
Investment income:
Dividends . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 2,299 $ 796 $ -
Interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . 802 327 9
---------- ---------- ---------
Total investment income . . . . . . . . . . . . . . . . . . . . 3,101 1,123 9
---------- ---------- ---------
Net change in appreciation (depreciation) of investments (Note 6) . 26,920 (10,211) (969)
---------- ---------- ---------
Contributions:
Employer . . . . . . . . . . . . . . . . . . . . . . . . . . . . 95,435 43,715 8,985
Employees . . . . . . . . . . . . . . . . . . . . . . . . . . . 184,856 78,509 15,927
---------- ---------- ---------
Total contributions . . . . . . . . . . . . . . . . . . . . . . 280,291 122,224 24,912
---------- ---------- ---------
DEDUCTIONS:
Withdrawals . . . . . . . . . . . . . . . . . . . . . . . . . . 17,185 8,011 -
---------- ---------- ---------
Increase in net assets available for Plan benefits . . . . . . . . 293,127 105,125 23,952
---------- ---------- ---------
NET ASSETS, JANUARY 1 . . . . . . . . . . . . . . . . . . . . . . . 129,077 23,952 -
---------- ---------- ---------
NET ASSETS, DECEMBER 31 . . . . . . . . . . . . . . . . . . . . . . $ 422,204 $ 129,077 $ 23,952
---------- ---------- ---------
---------- ---------- ---------
</TABLE>
See Notes and Schedules to Financial Statements.
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COASTAL ARUBA REFINING COMPANY N.V. THRIFT PLAN
NOTES TO FINANCIAL STATEMENTS
1. Description of the Plan
General
Coastal Aruba Refining Company N.V. Thrift Plan (the "Plan") is
primarily an employee stock purchase plan, registered under the Securities
Act of 1933, as amended, designed to provide a systematic means whereby the
contributions of eligible employees of Coastal Aruba Refining Company N.V.
and certain affiliates ("Coastal" or "Company") may be invested for the
benefit of the participating employees. The Plan is administered by the
Management Board of the Coastal Aruba Thrift Foundation (the "Foundation").
The effective date of the Plan was December 1, 1990; contributions for the
full year of participation commenced September 11, 1991. All employees
eligible for participation in the Plan receive a prospectus containing a
general description of the Plan. All participants are furnished a Plan
prospectus which may be updated by supplements from time to time. The
Foundation holds the investment assets of the Plan and Caribbean Mercantile
Bank N.V. and Smith Barney Shearson execute transactions relating thereto.
Amendment or Termination of the Plan
Although it has not expressed any intent to do so, the Company has
the right under the Plan to discontinue its contributions at any time and to
terminate the Plan. In the event of Plan termination, participants will
become 100 percent vested in their Company matching accounts. The Management
Board of the Foundation, upon recommendation of the Company, may amend the
Plan at any time.
2. Summary of Significant Accounting Policies
Accounting Basis
The financial statements of the Plan are prepared on the accrual
basis of accounting.
Marketable Securities
Securities valuations are based on the last recorded sales price at
December 31, 1993 and 1992, respectively, as reported by the principal
securities exchange on which the security is traded, or the average of the
bid and the asked price if sold over the counter. Realized gains and losses
reported on the sale or withdrawal of securities by participants are based
on the difference between market values of the securities sold and/or issued
at the effective dates and the market value at the beginning of the year and
cost of securities purchased during the year.
Taxes
The Plan is not a qualified plan for purposes of the laws of the
United States of America pursuant to Section 401(a) of the Internal Revenue
Code of 1986, as amended, nor is it subject to the provisions of the
Employee Retirement Income Security Act of 1974, as amended.
The Plan has been reviewed by the Centrale Bank van Aruba (the
"Bank") which concluded that the Plan is not subject to the prudential
supervision of the Bank because it is designed in accordance with United
States customs and does not conform to the requirements for a savings plan
in Aruba.
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<PAGE> 6
Under the present United States tax laws, the purchase and sale of
common stock of The Coastal Corporation ("Coastal Common Stock") by the
Foundation is not subject to income or withholding tax. However, dividends
paid on Coastal Common Stock are subject to withholding tax at a rate of 31%
of the amount of the dividend.
3. Contributions to the Plan
Employee Contributions
Upon enrollment, a participant may elect to contribute to the Plan,
by means of regular payroll deductions, from two percent (2%) to eight
percent (8%), in increments of one percent (1%) of the participant's basic
compensation. Basic compensation means fixed salaries or wages per hour
which are paid by the Company to the participant, excluding compensation for
bonuses, overtime, commissions and incentive compensation.
Employer Contributions
The Company will make Company matching contributions for the account
of the participant at an amount equal to the employee contributions subject
to a maximum rate of 2% of the employee's basic compensation (as defined
above) during the first and second year of active participation in the Plan;
thereafter, the Company matching contributions are increased to not more
than 4% during the third and fourth years of active participation, 6% during
the fifth and sixth years of active participation and 8% after six years of
active participation in the Plan.
4. Investment Programs
Funds in which current employee contributions are invested:
The Coastal Common Stock Fund is a fund invested in Coastal Common
Stock. Cash dividends thereon are reinvested in Coastal Common Stock.
The Interest Income Fund is an unsegregated fund invested in
interest bearing investments such as bonds, notes, debentures, savings
accounts, savings certificates, commercial paper, deposit accounts
maintained by one or more legal reserve life insurance companies which
provide for the payment of fixed or variable rates of interest for specified
periods of time, and other similar types of investments. A portion of the
Interest Income Fund may be retained in cash.
The Diversified Fund is an unsegregated fund invested in capital
stocks of issuers (other than Coastal Common Stock), notes, bonds,
debentures, and other similar types of investments. A portion of the
Diversified Fund may be retained in cash or invested temporarily in
commercial paper, certificates of deposit or savings accounts.
Currently, the contributions attributable to the Interest Income
Fund and the Diversified Fund are temporarily held in interest bearing
accounts at the Caribbean Mercantile Bank N.V. See "SCHEDULE I-2 - OTHER",
page 7 hereof. Such contributions will remain in such accounts pending a
determination by the investment manager that sufficient funds have
accumulated to warrant investments as described above for each fund.
All employer matched contributions are invested in the Coastal
Common Stock Fund only.
5. Expenses of the Plan
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<PAGE> 7
Reasonable compensation or expenses of administering the Plan which
are not paid by the Company will be paid out of Plan assets. The Company
reimburses the Foundation for all brokerage fees, transfer taxes, and
expenses which are paid or incurred in connection with the purchase or sale
of any securities. All taxes which may be levied or assessed under future
laws upon the assets or the income of the Plan will be paid by the Plan.
6. Net Changes in Appreciation (Depreciation) of Investments
During 1993 and 1992, the fair value of investments (including
investments bought and sold, as well as held during the year) appreciated
(depreciated) as follows:
<TABLE>
Coastal
Common Stock Fund
-----------------
<S> <C>
Balance at December 31, 1991 . . . . . . . . . . . . . . . . . . . . . . . $ (969)
Change during 1992 . . . . . . . . . . . . . . . . . . . . . . . . . . . . (10,211)
----------
Balance at December 31, 1992 . . . . . . . . . . . . . . . . . . . . . . . (11,180)
Change during 1993 . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26,920
----------
Balance at December 31, 1993 . . . . . . . . . . . . . . . . . . . . . . . $ 15,740
----------
----------
</TABLE>
7. Unit Values
The number of units and unit values are set forth in the following
table:
<TABLE>
December 31, 1993
--------------------------------------------
Net Asset
Number of Units Value
Employees Outstanding per Unit
------------- ------------ --------------
<S> <C> <C> <C>
Interest Income Fund . . . . . . . . . . . . . . . 73 14,296 $ 1.00
Diversified Fund . . . . . . . . . . . . . . . . . 64 12,318 $ 1.00
</TABLE>
<TABLE>
December 31, 1992
--------------------------------------------
Net Asset
Number of Units Value
Employees Outstanding per Unit
----------- ----------- --------------
<S> <C> <C> <C>
Interest Income Fund . . . . . . . . . . . . . . . 22 5,058 $ 1.00
Diversified Fund . . . . . . . . . . . . . . . . . 24 5,044 $ 1.00
</TABLE>
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<PAGE> 8
COASTAL ARUBA REFINING COMPANY N.V. THRIFT PLAN
SCHEDULE I-1 - INVESTMENTS
COASTAL COMMON STOCK FUND
<TABLE>
Security Shares Cost Market Value
-------- -------------- -------------- ------------------
<S> <C> <C> <C>
The Coastal Corporation Common Stock
December 31, 1993 . . . . . . . . . . . . . . . 12,605 $ 340,351 $ 356,091
-------- --------
-------- --------
December 31, 1992 . . . . . . . . . . . . . . . 4,579 $ 120,503 $ 109,323
-------- --------
-------- --------
</TABLE>
SCHEDULE I-2 - OTHER
<TABLE>
Market Value
-------------
<S> <C>
December 31, 1993:
Short Term Investments of Caribbean Mercantile Bank N.V.:
Interest Income Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 13,394
Diversified Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11,298
--------
$ 24,692
Smith Barney Shearson Money Market Fund:
Coastal Common Stock Fund . . . . . . . . . . . . . . . . . . . . . . . . . . $ 2,318
$ 2,318
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 27,010
--------
--------
December 31, 1992:
Short Term Investments of Caribbean Mercantile Bank N.V.:
Interest Income Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 4,797
Diversified Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,770
--------
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 9,567
--------
--------
</TABLE>
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<PAGE>
<PAGE> 9
COASTAL ARUBA REFINING COMPANY N.V. THRIFT PLAN
SCHEDULE II
ALLOCATION OF PLAN ASSETS AND LIABILITIES TO INVESTMENT PROGRAMS
<TABLE>
December 31, 1993
----------------------------------------------------
Coastal Interest
Total Common Income Diversified
PLAN ASSETS Plan Stock Fund Fund Fund
----------- -------- ---------- -------- ------------
<S> <C> <C> <C> <C>
INVESTMENTS, at market:
Securities of The Coastal Corporation
Common Stock (Schedule I-1) (Cost $340,351) . . $ 356,091 $ 356,091 $ - $ -
Other (Schedule I-2) . . . . . . . . . . . . . 27,010 2,318 13,394 11,298
--------- --------- -------- ---------
383,101 358,409 13,394 11,298
--------- --------- -------- ---------
RECEIVABLES:
Dividends . . . . . . . . . . . . . . . . . . . . 821 821 - -
Contributions . . . . . . . . . . . . . . . . . . 42,070 39,131 1,547 1,392
--------- --------- -------- ---------
42,891 39,952 1,547 1,392
--------- --------- -------- ---------
LIABILITIES:
Payable to Participants . . . . . . . . . . . . . 2,885 2,771 - 114
Other . . . . . . . . . . . . . . . . . . . . . . 903 - 645 258
--------- --------- -------- ---------
3,788 2,771 645 372
--------- --------- -------- ---------
Net Assets Available for Plan Benefits . . . . . . . $ 422,204 $ 395,590 $ 14,296 $ 12,318
--------- --------- -------- ---------
--------- --------- -------- ---------
</TABLE>
<TABLE>
December 31, 1992
----------------------------------------------------
Coastal Interest
Total Common Income Diversified
PLAN ASSETS Plan Stock Fund Fund Fund
----------- -------- ---------- -------- ------------
<S> <C> <C> <C> <C>
INVESTMENTS, at market:
Securities of The Coastal Corporation
Common Stock (Schedule I-1) (Cost $120,503) . . $ 109,323 $ 109,323 $ - $ -
Other (Schedule I-2) . . . . . . . . . . . . . 9,567 - 4,797 4,770
--------- --------- -------- -------
118,890 109,323 4,797 4,770
--------- --------- -------- -------
RECEIVABLES:
Dividends . . . . . . . . . . . . . . . . . . . . 296 296 - -
Contributions . . . . . . . . . . . . . . . . . . 1,263 728 261 274
--------- --------- -------- -------
1,559 1,024 261 274
--------- --------- -------- -------
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<PAGE> 10
CASH . . . . . . . . . . . . . . . . . . . . . . 8,732 8,732 - -
--------- --------- -------- -------
LIABILITIES:
Other . . . . . . . . . . . . . . . . . . . . . . 104 104 - -
--------- --------- -------- -------
Net Assets Available for Plan Benefits . . . . . . . $ 129,077 $ 118,975 $ 5,058 $ 5,044
--------- --------- -------- -------
--------- --------- -------- -------
</TABLE>
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<PAGE> 11
COASTAL ARUBA REFINING COMPANY N.V. THRIFT PLAN
SCHEDULE III - STATEMENT OF CHANGES
IN NET ASSETS AVAILABLE FOR PLAN
BENEFITS BY FUND
<TABLE>
For the Year Ended December 31, 1993
----------------------------------------------------
Coastal Interest
Total Common Income Diversified
Plan Stock Fund Fund Fund
-------- ---------- -------- ------------
<S> <C> <C> <C> <C>
Investment Income:
Dividends . . . . . . . . . . . . . . . . . . . . $ 2,299 $ 2,299 $ - $ -
Interest . . . . . . . . . . . . . . . . . . . . . 802 34 398 370
---------- --------- -------- --------
3,101 2,333 398 370
---------- --------- -------- --------
Appreciation on Common Stock:
The Coastal Corporation . . . . . . . . . . . . . 26,920 26,920 - -
---------- --------- -------- --------
Contributions:
Employer . . . . . . . . . . . . . . . . . . . . . 95,435 95,435 - -
Employees . . . . . . . . . . . . . . . . . . . . 184,856 168,096 9,485 7,275
---------- --------- -------- --------
Total . . . . . . . . . . . . . . . . . . . . . 280,291 263,531 9,485 7,275
---------- --------- -------- --------
Withdrawals . . . . . . . . . . . . . . . . . . . . . 17,185 16,169 645 371
Net Change . . . . . . . . . . . . . . . . . . . . . 293,127 276,615 9,238 7,274
---------- --------- -------- --------
Net Assets Available for Plan Benefits:
Beginning of Year . . . . . . . . . . . . . . . . 129,077 118,975 5,058 5,044
---------- --------- -------- --------
End of Year . . . . . . . . . . . . . . . . . . . $ 422,204 $ 395,590 $ 14,296 $ 12,318
---------- --------- -------- --------
---------- --------- -------- --------
</TABLE>
<TABLE>
For the Year Ended December 31, 1992
----------------------------------------------------
Coastal Interest
Total Common Income Diversified
Plan Stock Fund Fund Fund
-------- ---------- -------- ------------
<S> <C> <C> <C> <C>
Investment Income:
Dividends . . . . . . . . . . . . . . . . . . . . $ 796 $ 796 $ - $ -
Interest . . . . . . . . . . . . . . . . . . . . . 327 11 156 160
---------- --------- -------- --------
1,123 807 156 160
---------- --------- -------- --------
Depreciation on Common Stock:
The Coastal Corporation . . . . . . . . . . . . . (10,211) (10,211) - -
---------- --------- -------- --------
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<PAGE>
<PAGE> 12
Contributions:
Employer . . . . . . . . . . . . . . . . . . . . . 43,715 43,715 - -
Employees . . . . . . . . . . . . . . . . . . . . 78,509 70,302 4,020 4,187
---------- --------- -------- --------
Total . . . . . . . . . . . . . . . . . . . . . 122,224 114,017 4,020 4,187
---------- --------- -------- --------
Withdrawals . . . . . . . . . . . . . . . . . . . . . 8,011 7,201 284 526
---------- --------- -------- --------
Net Change . . . . . . . . . . . . . . . . . . . . . 105,125 97,412 3,892 3,821
---------- --------- -------- --------
Net Assets Available for Plan Benefits:
Beginning of Year . . . . . . . . . . . . . . . . 23,952 21,563 1,166 1,223
---------- --------- -------- --------
End of Year . . . . . . . . . . . . . . . . . . . $ 129,077 $ 118,975 $ 5,058 $ 5,044
---------- --------- -------- --------
---------- --------- -------- --------
</TABLE>
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<PAGE>
<PAGE> 13
COASTAL ARUBA REFINING COMPANY N.V. THRIFT PLAN
SCHEDULE III - STATEMENT OF CHANGES
IN NET ASSETS AVAILABLE FOR PLAN
BENEFITS BY FUND
<TABLE>
For the Year Ended December 31, 1991
----------------------------------------------------
Coastal Interest
Total Common Income Diversified
Plan Stock Fund Fund Fund
-------- ---------- -------- -----------
<S> <C> <C> <C> <C>
Investment Income:
Interest . . . . . . . . . . . . . . . . . . . . . $ 9 $ - $ 4 $ 5
---------- --------- -------- --------
Depreciation on Common Stock:
The Coastal Corporation . . . . . . . . . . . . . (969) (969) - -
---------- --------- -------- --------
Contributions:
Employer . . . . . . . . . . . . . . . . . . . . . 8,985 8,985 - -
Employees . . . . . . . . . . . . . . . . . . . . 15,927 13,547 1,162 1,218
---------- --------- -------- --------
Total . . . . . . . . . . . . . . . . . . . . . 24,912 22,532 1,162 1,218
---------- --------- -------- --------
Net Change . . . . . . . . . . . . . . . . . . . . . 23,952 21,563 1,166 1,223
---------- --------- -------- --------
Net Assets Available for Plan Benefits:
Beginning of Year . . . . . . . . . . . . . . . . - - - -
---------- --------- -------- --------
End of Year . . . . . . . . . . . . . . . . . . . $ 23,952 $ 21,563 $ 1,166 $ 1,223
---------- --------- -------- --------
---------- --------- -------- --------
</TABLE>
-12-
<PAGE>
<PAGE> 14
SIGNATURES
The Plan. Pursuant to the requirements of the Securities Exchange
Act of 1934, the Management Board of the Coastal Aruba Thrift Foundation, as
Administrator, has duly caused this Annual Report to be signed on its behalf
by the undersigned hereunto duly authorized.
MANAGEMENT
BOARD OF THE COASTAL
ARUBA THRIFT FOUNDATION,
AS ADMINISTRATOR OF
COASTAL ARUBA REFINING COMPANY N.V.
THRIFT PLAN
Date: March ___, 1994 By: RONALD A. BROWNLEE
---------------------------------
Ronald A. Brownlee
Chairman
-13-
<PAGE>
<PAGE> 15
</DOUCMENT>
