Item 1. Business
The Sears Credit Account Trust 1990 E (the "Trust") was formed pursuant to the Pooling and Servicing Agreement dated as of December 1, 1990 (the "Pooling and Servicing Agreement") among Sears, Roebuck and Co. ("Sears") as Servicer, its wholly-owned subsidiary, Sears Receivables Financing Group, Inc. ("SRFG") as Seller, and Continental Bank, National Association as trustee (the "Trustee"). The Trust's only business is to act as a passive conduit to permit investment in a pool of retail consumer receivables.
Item 2.

Item 2. Properties
The property of the Trust includes a portfolio of receivables (the "Receivables") arising in selected accounts under open-end credit plans of Sears (the "Accounts") and all monies received in payment of the Receivables. At the time of the Trust's formation, Sears sold and contributed to SRFG, which in turn conveyed to the Trust, all Receivables existing under the Accounts as of the end of certain of Sears regular billing cycles ending in November, 1990 and all Receivables arising under the Accounts from time to time thereafter until the termination of the Trust. Information related to the performance of the Receivables during 1993 is set forth in the ANNUAL STATEMENT filed as Exhibit 21 to this Annual Report on Form 10-K.
Item 3.

Item 4. Submission of Matters to a Vote of Security Holders
None PART II
Item 5.

Item 5. Market for Registrant's Common Equity and Related Stockholder Matters
Investor Certificates are held and delivered in book-entry form through the facilities of The Depository Trust Company ("DTC"), a "clearing agency" registered pursuant to the provisions of Section 17A of the Securities Exchange Act of 1934, as amended. All outstanding definitive Investor Certificates are held by CEDE and Co., the nominee of DTC.
Item 9.

Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
None
PART III
Item 12.

Item 12. Security Ownership of Certain Beneficial Owners and Management
As of March 15, 1994, 100% of the Investor Certificates were held in the nominee name of CEDE and Co. for beneficial owners.
SRFG, as of March 15, 1994, owned 100% of the Seller Certificate, which represented beneficial ownership of a residual interest in the assets of the Trust as provided in the Pooling and Servicing Agreement.
Item 13.

Item 13. Certain Relationships and Related Transactions
None
PART IV
Item 14.

Item 14. Exhibits, Financial Statement Schedules, and Reports on Form 8-K
(a) Exhibits:
21. 1993 ANNUAL STATEMENT prepared by the Servicer.
28. ANNUAL INDEPENDENT AUDITOR'S REPORTS pursuant to Section 3.06 of the Pooling and Servicing Agreement.
(a) Review of servicing procedures.
(b) Annual Servicing Letter.
(b) Reports on Form 8-K:
Current reports on Form 8-K are filed on, or before the Distribution Date each month (on, or the first business day after, the 15th of the month). The reports include as an exhibit, the MONTHLY INVESTOR CERTIFICATEHOLDERS' STATEMENT. Current Reports on Form 8-K were filed on October 15, 1993, November 15, 1993 and December 15, 1993.
SIGNATURES
Pursuant to the requirements of Section 13 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.
Sears Credit Account Trust 1990 E (Registrant)
By: Sears Receivables Financing Group, Inc. (Originator of the Trust)
By: /S/ALICE M. PETERSON _____________________________________ Alice M. Peterson President and Chief Executive Officer
Dated: March 30, 1994
EXHIBIT INDEX
Page number in sequential Exhibit No. number system
21. 1993 ANNUAL STATEMENT prepared by the Servicer.
28. ANNUAL INDEPENDENT AUDITOR'S REPORTS pursuant to Section 3.06 of the Pooling and Servicing Agreement.
(a) Review of servicing procedures.
(b) Annual Servicing Letter.
Exhibit 21
SEARS CREDIT ACCOUNT TRUST 1990 E
8.80% CREDIT ACCOUNT PASS-THROUGH CERTIFICATES
1993 ANNUAL STATEMENT
Pursuant to the terms of the letter issued by the Securities and Exchange Commission dated February 19, 1991 (granting relief to the Trust from certain reporting requirements of the Securities Exchange Act of 1934, as amended), aggregated information regarding the performance of Accounts and payments to Investor Certificateholders in respect of the Due Periods related to the twelve Distribution Dates which occurred in 1993 is set forth below.
1) The total amount of the distribution to Investor Certificateholders during 1993, per $1,000 interest..$88.00
2) The amount of the distribution set forth in paragraph 1 above in respect of interest on the Investor Certificates, per $1,000 interest....................$88.00
3) The amount of the distribution set forth in paragraph 1 above in respect of principal on the Investor Certificates, per $1,000 interest.................... $0.00
4) The aggregate amount of Collections of Principal Receivables processed during the related Due Periods.................................$443,741,135.81
5) The aggregate amount of Collections of Finance Charge Receivables processed during the related Due Periods.................................$117,808,180.74
6) The aggregate amount of Collections of Principal Receivables processed during the related Due Periods which were allocated in respect of the Investor Certificates................................$341,853,855.74
7) The aggregate amount of Collections of Finance Charge Receivables processed during the related Due Periods which were allocated in respect of the Investor Certificates.................................$91,797,197.02
8) The aggregate amount of Collections of Principal Receivables processed during the related Due Periods which were allocated in respect of the Seller Certificate.................................$101,887,280.07
9) The aggregate amount of Collections of Finance Charge Receivables processed during the related Due Periods which were allocated in respect of the Seller Certificate..................................$26,010,983.72
10) The excess of the Investor Charged-Off Amount over the sum of (i) payments in respect of the Available Subordinated Amount and (ii) Excess Servicing, if any (an "Investor Loss"), per $1,000 interest.............$0.00
11) The aggregate amount of Investor Losses in the Trust as of the end of the day on December 15, 1993, per $1,000 interest.......................................$0.00
12) The total reimbursed to the Trust from the sum of the Available subordinated Amount and Excess Servicing, if any, in respect of Investor Losses, per $1,000 interest..............................................$0.00
13) The amount of the Investor Monthly Servicing Fee payable by the Trust to the Servicer..........$7,708,333.33
14) The aggregate amount which was deposited in the Principal Funding Account in respect of Collections of Principal Receivables during the related Due Periods.................................$249,999,999.96
15) The aggregate amount of Investment Income during the related Due Periods...........................$3,973,171.52
16) The total amount on deposit in the Principal Funding Account in respect of Collections of Principal Receivables, as of the end of the reportable year........................................$249,999,999.96
17) The Deficit Accumulation Amount, as of the end of the reportable year.......................................$0.00
18) The aggregate amount which was deposited in the Interest Funding Account in respect of Certificate Interest during the related Due Periods...............$44,000,000.04
19) The total amount on deposit in the Interest Funding Account in respect of Certificate Interest, as of the end of the reportable year...................$22,000,000.02
Exhibit 28(a)
February 11, 1994
Ms. Alice M. Peterson Ms. Cynthia K. Duncan Vice President and Treasurer Trust Officer Sears, Roebuck and Co. as Servicer Continental Bank, National Sears Tower Association as Trustee Chicago, Illinois 60684 231 South La Salle Street Chicago, Illinois 60697
We have applied the procedures listed below to the accounting records of Sears, Roebuck and Co. ("Sears") relating to the servicing procedures performed by Sears as Servicer under Section 3.06(b) of the Pooling and Servicing Agreement (the "Agreement") for the following Trusts:
Date of Pooling and Trust Servicing Agreement
Sears Credit Account Trust 1989E November 13, 1989 Sears Credit Account Trust 1990A January 12, 1990 Sears Credit Account Trust 1990B February 22, 1990 Sears Credit Account Trust 1990C July 31, 1990 Sears Credit Account Trust 1990D October 15, 1990 Sears Credit Account Trust 1990E December 1, 1990
It is understood that this report is solely for your information and is not to be referred to or distributed for any purpose to anyone other than Continental Bank, National Association as Trustee, Investor Certificateholders or the management of Sears. The procedures we performed are as follows:
Compared the mathematical calculations of each amount set forth in each monthly certificate forwarded by the Servicer, pursuant to Section 3.04(b) of the Agreement, during the calendar year 1993 to the Servicer's computer-generated Portfolio Monitoring and Monthly Cash Flow Allocations Report. We found such amounts to be in agreement.
February 11, 1994 Ms. Alice M. Peterson Ms. Cynthia K. Duncan Vice President and Treasurer Trust Officer Sears, Roebuck and Co. as Servicer Continental Bank, National Association as Trustee
Because the above procedures do not constitute an audit conducted in accordance with generally accepted auditing standards, we do not express an opinion on any of the items referred to above.
As a result of the procedures performed, no matters came to our attention that caused us to believe that the amounts in the monthly certificates require adjustment. Had we performed additional procedures or had we conducted an audit of the monthly certificates in accordance with generally accepted auditing standards, matters might have come to our attention that would have been reported to you. This report relates only to the items specified above and does not extend to any financial statements of Sears taken as a whole.


Item 1. BUSINESS
GENERAL
Great Lakes Chemical Corporation is a Delaware corporation incorporated in 1933, having its principal executive offices in West Lafayette, Indiana. The Company's operations consist of one dominant industry segment - chemicals and allied products. Within this segment the Company is well diversified focusing on performance chemicals, water treatment chemicals, petroleum additives and specialized services and manufacturing. The Corporate profile on page 3 and the Review of Operations on pages 14 through 19 of the 1993 Annual Report to Stockholders is incorporated herein by reference.
The term "Great Lakes" as used herein means Great Lakes Chemical Corporation and Subsidiaries unless the context indicates otherwise.
Net sales by product group are set forth in the following table (dollars in millions):
1993 Developments
In June 1993, the Company augmented its polymer additives business with the acquisition of Chemische Werke LOWI GmbH & Co. (Lowi), a leading manufacturer of antioxidants, and hindered amine light stabilizers (HALS). This acquisition also expanded the polymer additives business into the rubber and adhesives markets.
In the Functional Intermediates and Fine Chemicals Group, the Company increased bromine capacity and other derivative production to meet incremental market demands for bromine-based specialty derivatives. Also, the Company expanded production facilities in El Dorado, AR, to meet increased demand for tetrabromobisphenol-A.
Octel Chemicals Limited (OCL) doubled its sales, performing a wide range of custom synthesis activities, enhancing Great Lakes' presence in the European specialty and fine chemicals industry.
A new industrial specialty chemicals plant was commissioned to produce high purity bromide salts used in photographic materials, catalysts, pharmaceutical intermediates and other fine chemicals. Also, FM-200(TM), a clean gaseous fire extinguishing agent that replaces halon-based products, received U.S. EPA approval and the Underwriters Laboratories (UL) listing mark, and passed testing for U.S. Military and Factory Mutual insured facilities applications.
The Water Treatment Chemicals Group completed two acquisitions during 1993 that strengthened its presence in the recreational market. In January 1993, Bayrol Chemische Fabrik GmbH was acquired which extended the Company's presence in the European market. In May 1993, Aqua Chem was acquired which provides an important foothold in mass merchandising, the fastest growing sector of the pool and spa products market.
In the Petroleum Additives Group, Octel supplied additional quantities of antiknock compound for the Mexican market through the extension of an earlier marketing and distribution agreement with DuPont. Also, a long-term agreement to supply Ethyl Corporation's requirements for alkyl lead antiknock compound will take effect in the middle of 1994.
The Specialized Services and Manufacturing Group expanded its environmental services business with the January 1993 acquisition of Four Seasons Industrial Services, Inc. and two associated companies.
Raw Materials
The sources of essential raw materials for bromine are the brine from company-owned wells in Arkansas, sea water extraction plants in Europe and bromine purchased from an affiliated company. The Arkansas properties are located atop the Smackover lime deposits, which constitute a vast underground sea of bromine-rich brine. The area between ElDorado and Magnolia, Arkansas, (located about 35 miles west of ElDorado) provides the best geological location for bromine production and both major domestic bromine manufacturers are located there. Based on projected production rates, the Company's brine reserves are conservatively estimated to be adequate for the foreseeable future.
Furfural is extracted from agricultural by-products and waste materials such as corncobs, sugar cane bagasse, rice hulls and oat hulls for which there are few alternative uses. These raw material sources for furfural production are expected to remain abundant and relatively inexpensive. Other materials used in the chemical processes are obtained from outside suppliers through purchase contracts. Supplies of these materials are believed to be adequate for the Company's future operations.
International Operations
Great Lakes has a substantial presence in foreign markets. The Company's investment in foreign countries is principally in Western Europe and represents $793 million or 42 percent of total assets.
Sales to customers in foreign countries (primarily Europe and the Far East) amount to 62, 61 and 58 percent of total sales for the years ended December 31, 1993, 1992, and 1991, respectively. Approximately 15, 19, and 21 percent of these foreign sales, respectively for the three years shown, are products exported from the U.S., with the balance primarily being products manufactured and sold by the Company's European subsidiaries and branches. The profitability on foreign sales (including U.S. exports and foreign manufactured products, except Octel) approximates those for domestic operations. Because of value-added pricing, Octel's alkyl lead products have a higher profitability than do most of the Company's other products.
The geographic segment data contained in the note "Industry Segments and Foreign Operations" of Notes to Consolidated Financial Statements on page 36 of the 1993 Annual Report to Stockholders is incorporated herein by reference.
Customers and Distribution
During the last three years, no single customer accounted for more than 10 percent of Great Lakes' total consolidated sales. The Company has no material contract or subcontract with the government. A major portion of the Company's sales are sold to industrial or commercial users for use in the production of other products. Some products such as recreational water treatment chemicals and supplies are sold to a large number of users or distributors. Some export sales are marketed through distributors and brokers.
The Company's business does not normally reflect any material backlog of orders at year-end.
Competition
Great Lakes is in competition with businesses producing the same or similar products as well as businesses producing products intended for similar use. There is one other major bromine and alkyl lead producer in the United States who competes with the Company in varying degrees, depending on the product involved. There is also one major overseas bromine competitor. In addition, there are several small producers in the U.S. and overseas who are competitors in several individual products. The Company is the only U.S. producer of furfural and furfuryl alcohol, and it enjoys a strong market share in every major geographic and product market in which it competes. The Company competes with several manufacturers and distributors of swimming pool and spa chemicals and equipment. Through its Bio-Lab subsidiary, the Company operates 33 branch distribution outlets for chemicals and pool and spa equipment in the U.S. Products are differentiated by brand names to the retail, wholesale and mass merchandising markets.
Principal methods of competition are price, product quality and purity, technical services and ability to deliver promptly. The Company is able to move quickly in providing new products to meet identified market demands, and believes its production costs are among the lowest in the world. These factors, combined with high technical skills, allow the Company to compete effectively. One negative factor in its ability to compete with the major overseas producer of bromine is the fact that this producer receives significant subsidies from its government, and enjoys favorable duty advantages on its exports to certain markets.
Seasonality and Working Capital
The products, which the Company sells to the agricultural and swimming pool markets, do exhibit some seasonality; however, the effect on overall Company sales and profits is not material. Seasonality results
in the need to build inventories for rapid delivery at certain times of the year. The pool product season is strongest during the first six months, requiring a build-up of inventory at the beginning of the year. Except for certain arrangements with distributors and dealers of swimming pool and spa products, customers are not permitted to return unsold material at the end of a season. Extended credit terms are granted only in cases where the Company chooses to do so to meet competition.
The alkyl lead products have somewhat larger working capital requirements than do the Company's other major products, because of extended distribution lines and credit terms for large volume refinery customers.
The effect of the above items on working capital requirements is not material.
Research and Development and Patents
Research and development expenditures are included in the note "Research and Development Expense" of the Notes to Consolidated Financial Statements on page 36 of the 1993 Annual Report to Stockholders and is incorporated herein by reference. The Company holds no patents, licenses, franchises or concessions which are essential to its operations.
Environmental and Toxic Substances Control
Due to the hazardous nature of certain of its products, the Company is keenly aware of the potential damage that could be done to the environment if effective pollution controls were not maintained. Therefore, the Company has made a commitment as one of its business objectives to install, maintain and improve pollution control facilities wherever they are needed.
The Company meets or exceeds all presently known governmental requirements for protection of the environment. In addition, all new facilities include provisions for any necessary pollution controls as a normal part of their projected costs.
Employees
The Company has approximately 7,000 employees.
Item 2.

Item 2. PROPERTIES
Great Lakes has plants at 32 locations in 14 states and 14 plants in 8 foreign countries. Most principal plants are owned. Listed under Item 1 above in a table captioned Products and Services are the principal locations at which products are manufactured, distributed or marketed.
The Company leases warehouses, distribution centers and space for offices throughout the world. All of the Company's facilities are in good repair, suitable for the Company's businesses, and have sufficient space to meet present marketing demands at an efficient operating level.
Item 3.

Item 3. LEGAL PROCEEDINGS
There are no material pending legal proceedings involving the Company, its subsidiaries or any of its properties. Furthermore, no director, officer or affiliate of the Company, or any associate of any director or officer is involved, or has a material interest in, any proceeding which would have a material adverse effect on the Company.
Item 103 of Regulation S-K requires disclosure of administrative or judicial proceedings arising under any federal, state or local provisions dealing with protection of the environment, if the monetary sanctions might
exceed $100,000. The following proceedings may result in sanctions exceeding $100,000.
In 1993, the Company and the United States Environmental Protection Agency agreed in principle to settle an action brought by the EPA under Section 15(1)(c) of TOSCA for a payment of $125,000 and the performance of $2,000,000 of environmentally beneficial capital projects at the Company's ElDorado, Arkansas, site. The proposed consent decree states that the Company does not admit the allegations made by the EPA.
The United States Environmental Protection Agency and the Company have agreed in principle to a payment by the Company of a civil penalty in the amount of $190,000 in full satisfaction of claims by the EPA that the Company violated the Clean Water Act based on allegations of discharges from its ElDorado, Arkansas, facility. No complaint has been filed and no formal action has been commenced. The proposed consent decree states that the Company does not admit the allegations made by the EPA.
Item 4.

Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
No matter was submitted to a vote of security holders during the quarter ended December 31, 1993.
PART II -------
Item 5.

Item 5. MARKET FOR THE REGISTRANTS COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
As of March 7, 1994, there were approximately 4,850 registered holders of Great Lakes Common Stock. Additional information is contained in the 1993 Annual Report to Stockholders, under the captions "Stock Price Data" and "Cash Dividends Paid" on pages 1 and 26, respectively, all of which are incorporated herein by reference.
Item 6.

Item 6. SELECTED FINANCIAL DATA
This information is contained in the 1993 Annual Report to Stockholders, under the caption "Financial Review" on pages 20 and 21, and is incorporated herein by reference.
Item 7.

Item 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
"Management's Discussion and Analysis of Results of Operations and Financial Condition" on pages 14 through 19 and pages 22 through 26 of the 1993 Annual Report to Stockholders, is incorporated herein by reference.
Item 8.

Item 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
The consolidated financial statements together with the report thereon of Ernst & Young dated January 31, 1994, appearing on pages 27 through 38 and the "Quarterly Results of Operations" on page 39 of the 1993 Annual Report to Stockholders, are incorporated herein by reference.
Item 9.

Item 9. DISAGREEMENT OF ACCOUNTING AND FINANCIAL DISCLOSURE
No change of auditors or disagreements on accounting methods have occurred which would require disclosure hereunder.
PART III --------
Item 10.

Item 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
Executive Officers
Information with respect to directors of the Company is contained under the heading "Proposal One: Election of Directors" in the Great Lakes' Proxy Statement relating to the 1994 Annual Meeting of Shareholders dated March 29, 1994, which is incorporated herein by reference.
Item 11.

Item 11. EXECUTIVE COMPENSATION
The information under the heading "Executive Compensation and Other Information" in the 1994 Proxy Statement is incorporated by reference in this report.
Item 12.

Item 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The information under the heading "Security Ownership of Certain Beneficial Owners and Management" in the 1994 Proxy Statement is included by reference in this report.
Item 13.

Item 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The information under the heading "Compensation Committee Interlocks and Insider Participation" in the 1994 Proxy Statement is included by reference in this report.
PART IV -------
Item 14.

Item 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K
(a) 1. Financial Statements
The following Consolidated financial statements of Great Lakes Chemical Corporation and Subsidiaries and related notes thereto, together with the report thereon of Ernst & Young dated January 31, 1994, appearing on pages 27 through 38 of the 1993 Annual Report to Stockholders, are incorporated by
reference in Item 8:
Consolidated Balance Sheets -- December 31, 1993 and 1992 Consolidated Statements of Income and Retained Earnings -- Years ended December 31, 1993, 1992 and 1991 Consolidated Statements of Cash Flows -- Years ended December 31, 1993, 1992 and 1991 Notes to Consolidated Financial Statements
2. Financial Statement Schedules
The following additional information is filed as part of this report and should be read in conjunction with the 1993 financial statements.
Schedule VIII -- Valuation and Qualifying accounts
All other schedules for which provision is made in the applicable accounting regulation of the Securities and Exchange Commission are not required under the related instructions or are inapplicable, and therefore have been omitted.
3. Exhibits
11. Computation of Per Share Earnings 13. 1993 Annual Report to Stockholders 21. Subsidiaries -- Incorporated herein by reference is the list of subsidiaries appearing on page 40 of the 1993 Annual Report to Stockholders. 23. Consents of Independent Auditors
(b) Reports on Form 8-K
There were no Form 8-K's filed during the quarter ended December 31, 1993.
(c) Exhibits
The response to this section of Item 14 is submitted as a separate section of this report.
(d) Financial Statement Schedules
The response to this section of Item 14 is submitted as a separate section of this report.
(A) Reserve balance of Bayrol and Lowi at date of acquisition. (B) Uncollectible accounts receivable written off, net of recoveries and foreign currency translation.
SIGNATURES - ----------
Pursuant to the requirements of Section 13 or 15(d) 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.
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated:
INDEPENDENT AUDITORS' REPORT
To the Stockholders of Arkansas Chemicals, Inc.:
We have audited the balance sheets of Arkansas Chemicals, Inc. as of December 31, 1993 and 1992, and the related statements of income and retained earnings and of cash flows for each of the three years in the period ended December 31, 1993 (not presented separately herein). These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing standards. 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, such financial statements present fairly, in all material respects, the financial position of the Company at December 31, 1993 and 1992, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 1993 in conformity with generally accepted accounting principles.
Deloitte & Touche
Pittsburgh, Pennsylvania January 31, 1994
INDEPENDENT AUDITORS' REPORT
To the Board of Directors and Shareholders of Huntsman Chemical Corporation:
We have audited the consolidated balance sheets of Huntsman Chemical Corporation and subsidiaries as of December 31, 1993 and 1992, and the related consolidated statements of income, stockholders' equity, and cash flows for the years then ended (not presented separately herein). These financial statements are the responsibilities of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing standards. 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, such consolidated financial statements present fairly, in all material respects, the financial position of Huntsman Chemical Corporation and subsidiaries as of December 31, 1993 and 1992, and the results of their operations and their cash flows for the years then ended in conformity with generally accepted accounting principles.
Deloitte & Touche
Salt Lake City, Utah January 26, 1994 (March 18, 1994 as to note 5)


Item 1. Business
GTE Northwest Incorporated (the Company) (formerly General Telephone Company of the Northwest, Inc., formerly West Coast Telephone Company) was incorporated in Washington on March 31, 1964. The Company is a wholly-owned subsidiary of GTE Corporation (GTE). Together with its wholly-owned subsidiary, GTE West Coast Incorporated, the Company provides communications services in the states of California, Idaho, Montana, Oregon and Washington.
On February 23, 1993, the Idaho properties of Contel of the West, Inc. were purchased by the Company. On February 26, 1993, Contel of the Northwest, Inc. merged into the Company. Both Contel of the West, Inc. and Contel of the Northwest, Inc. were wholly-owned subsidiaries of Contel Corporation (a wholly- owned subsidiary of GTE). The merger was accounted for in a manner consistent with a transfer of entities under common control which is similar to that of a "pooling of interests."
On December 31, 1993, the Company sold its telephone plant in service, materials and supplies and customers (representing 17,000 access lines) in the state of Idaho to Citizens Utilities Company.
The Company provides local telephone service within its franchise area and intraLATA (Local Access Transport Area) long distance service between the Company's facilities and the facilities of other telephone companies within the Company's LATAs in Idaho and Montana. InterLATA service to other points in and out of the states in which the Company operates is provided through connection with interexchange (long distance) common carriers. These common carriers are charged fees (access charges) for interconnection to the Company's local facilities. End user business and residential customers are also charged for access to the facilities of the long distance carrier. The Company also earns other revenues by leasing interexchange plant facilities and providing such services as billing and collection and operator services to interexchange carriers, primarily the American Telephone and Telegraph Company (AT&T). The number of access lines served has grown steadily from 934,856 on January 1, 1989 to 1,271,916 on December 31, 1993.
The following table denotes the access lines in the states in which the Company operates as of December 31, 1993:
Access State Lines Served ----- ------------ Washington 753,005 Oregon 397,799 Idaho 101,474 California 12,010 Montana 7,628 --------- Total 1,271,916 =========
The Company's principal line of business is providing telecommunication services. These services fall into five major classes: local network, network access, long distance, equipment sales and services and other. Revenues from each of these classes over the last three years are as follows:
Years Ended December 31 --------------------------------------------- 1993 1992 1991 ---- ---- ---- (Thousands of Dollars)
Local Network Services $ 331,369 $ 321,575 $ 303,880 % of Total Revenues 38% 36% 36%
Network Access Services $ 370,980 $ 382,997 $ 379,382 % of Total Revenues 42% 43% 45%
Long Distance Services $ 14,444 $ 17,789 $ 16,994 % of Total Revenues 2% 2% 2%
Equipment Sales and Services $ 77,989 $ 78,279 $ 80,272 % of Total Revenues 9% 9% 9%
Other $ 80,513 $ 86,147 $ 67,365 % of Total Revenues 9% 10% 8%
At December 31, 1993, the Company had 4,509 employees. The Company has written agreements with the Communications Workers of America (CWA) and the International Brotherhood of Electrical Workers (IBEW) covering substantially all non-management employees. In 1993, agreements were reached on two contracts with the IBEW. During 1994, there are no contracts which will expire.
Telephone Competition
The Company holds franchises, licenses and permits adequate for the conduct of its business in the territories which it serves.
The Company is subject to regulation by the regulatory bodies of the states of California, Idaho, Montana, Oregon and Washington as to its intrastate business operations and the Federal Communications Commission (FCC) as to its interstate business operations. Information regarding the Company's activities with the various regulatory agencies and revenue arrangements with other telephone companies can be found in Note 12 of the Company's Annual Report to Shareholders for the year ended December 31, 1993, incorporated herein and filed as Exhibit 13.
The year was marked by important changes in the U.S. telecommunications industry. Rapid advances in technology, together with government and industry initiatives to eliminate certain legal and regulatory barriers are accelerating and expanding the level of competition and opportunities available to the Company. As a result, the Company faces increasing competition in virtually all aspects of its business. Specialized communications companies have constructed new systems in certain markets to bypass the local exchange network. Additional competition from interexchange carriers as well as wireless companies continues to evolve for both intrastate and interstate communications.
During 1994, the Company will begin implementation of a re-engineering plan that will redesign and streamline processes. Implementation of its re- engineering plan will allow the Company to continue to respond aggressively to these competitive and regulatory developments through reduced costs, improved service quality, competitive prices and new product offerings. Moreover, implementation of this program will position the Company to accelerate delivery of a full array of voice, video and data services. The re-engineering program will be implemented over three years. During the year, the company continued to introduce new business and consumer services utilizing advanced technology, offering new features and pricing options while at the same time reducing costs and prices.
During 1991, the FCC announced its decision to auction licenses during 1994 in 51 major markets and 492 basic trading areas across the united States to encourage the development of a new generation of wireless personal communications services (PCS). These services will both complement and compete with the Company's traditional wireline services. The Company will be permitted to fully participate in the license auctions in areas outside of GTE's existing cellular service areas. Limited participation will be permitted in areas in which GTE has an existing cellular presence.
In 1992, the FCC issued a "video dialtone" ruling that allows telephone companies to transmit video signals over their networks. The FCC also recommended that Congress amend the Cable Act of 1984 to permit telephone companies to supply video programming in their service areas.
Activity directed toward changing the traditional cost-based rate of return regulatory framework for intrastate and interstate telephone services has continued. Various forms of alternative regulation have been adopted, which provide economic incentives to telephone service providers to improve productivity and provide the foundation for the pricing flexibility necessary to address competitive entry into the markets the Company serves.
In September 1993, the FCC released an order allowing competing carriers to interconnect to the local-exchange network for the purpose of providing switched access transport services. This ruling complements similar interconnect arrangements for private line services ordered during 1992. The order encourages competition for the transport of telecommunications traffic between local exchange carriers' (LECs) switching offices and interexchange carrier locations. In addition, the order allows LECs flexibility in pricing competitive services.
The GTE Consent Decree, which was issued in connection with the 1983 acquisition of GTE Sprint (since divested) and GTE Spacenet, prohibits GTE's domestic telephone operating subsidiaries from providing long distance service beyond the boundaries of the LATA. This prohibition restricts their direct provision of long distance service to relatively short distances. The degree of competition allowed in the intraLATA market is subject to state regulation. However, regulatory constraints on intraLATA competition are gradually being relaxed. In fact, some form of intraLATA competition is authorized in many of the states in which the Company provides service.
These and other actions to eliminate the existing legal and regulatory barriers, together with rapid advances in technology, are facilitating a convergence of the computer, media and telecommunications industries. In addition to allowing new forms of competition, these developments are also creating new opportunities to develop interactive communications networks. The Company supports these initiatives to assure greater competition in telecommunications, provided that overall the changes allow an opportunity for all service providers to participate equally in a competitive marketplace under comparable conditions.
Item 2.

Item 2. Properties
The Company's property consists of network facilities (82%), customer premises equipment (14%), company facilities (1%) and other (3%). From January 1, 1989 to December 31, 1993, the Company made gross property additions of $1.2 billion and property retirements of $0.5 billion. Substantially all of the Company's property is subject to liens securing long-term debt. In the opinion of management, the Company's telephone plant is substantially in good repair.
Item 3.

Item 3. Legal Proceedings
There are no pending legal proceedings, either for or against the Company, which would have a material impact on the Company's financial statements.
Item 4.

Item 4. Submission of Matters to a Vote of Security Holders
None.
PART II
Item 5.

Item 5. Market for the Registrant's Common Equity and Related Shareholder Matters
Market information is omitted since the Company's common stock is wholly-owned by GTE Corporation.
Item 6.

Item 6. Selected Financial Data
Reference is made to the Registrant's Annual Report to Shareholders, page 32, for the year ended December 31, 1993, incorporated herein and filed as Exhibit 13.
Item 7.

Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations
Reference is made to the Registrant's Annual Report to Shareholders, pages 27 to 31, for the year ended December 31, 1993, incorporated herein and filed as Exhibit 13.
Item 8.

Item 8. Financial Statements and Supplementary Data
Reference is made to the Registrant's Annual Report to Shareholders, pages 5 to 25, for the year ended December 31, 1993, incorporated herein and filed as Exhibit 13.
Item 9.

Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
None.
PART III
Item 10.

Item 10. Directors and Executive Officers of the Registrant
The names, ages and positions of all the directors and executive officers of the Company as of March 21, 1994 are listed below along with their business experience during the past five years.
a. Identification of Directors
Director Name Age Since Business Experience ---- --- -------- ----------------------------------------
Kent B. Foster 50 1993 Vice Chairman of the Board of Directors of GTE Corporation, October 1993. President, GTE Telephone Operations, 1989; Director, GTE Corporation, 1992; Director, all GTE domestic telephone subsidiaries, 1993; Director, BC Telecom, Inc.; Director, Compania Anonima Nacional Telefonos de Venezuela; Director, National Bank of Texas.
Richard M. Cahill 55 1993 Vice President - General Counsel of GTE Telephone Operations, 1988; Director, all GTE domestic telephone subsidiaries, 1993; Director, GTE Vantage Incorporated, 1991; Director, GTE Intelligent Network Services Incorporated, 1993.
Gerald K. Dinsmore 44 1993 Senior Vice President - Finance and Planning for GTE Telephone Operations, 1994. Vice President - Finance, GTE Telephone Operations, 1993; Vice President - Intermediary Customer Markets, GTE Telephone Operations, 1991. President, South Area, GTE Telephone Operations, 1992; Director, all GTE domestic telephone subsidiaries, 1993.
Michael B. Esstman 47 1993 Executive Vice President-Operations, GTE Telephone Operations, 1993; President, Central Area, GTE Telephone Operations, 1991. President, Contel Eastern Region, Telephone Operations Sector, 1983; Director, AG Communications System; Director, all GTE domestic telephone subsidiaries, 1993.
Larry J. Sparrow 50 1992 Director and President, GTE California Incorporated and GTE Northwest Incorporated; Director and Chairman of the Board and Chief Executive Officer of GTE Hawaiian Telephone Company Incorporated, 1992; Vice President - Regulatory and Governmental Affairs, GTE Telephone Operations, 1989; Director, California Chamber of Commerce; Director, The Los Angeles Area Chamber of Commerce; Director, California Economic Development Corporation.
Thomas W. White 47 1993 Executive Vice President of GTE Telephone Operations, 1993; Senior Vice President - General Office Staff, GTE Telephone Operations, 1989; Director, all GTE domestic telephone subsidiaries, 1993; Director, Quebec- Telephone.
Directors are elected annually. The term of each director expires on the date of the next annual meeting of shareholders, which may be held on any day during March, as specified in the notice of the meeting.
There are no family relationships between any of the directors or executive officers of the Company.
All of the directors, with the exception of Mr. Sparrow, were elected December 10, 1993 following the resignations from the Board of Donald M. Anderson, J. Cleve Borth, Walter A. Dods, Jr., Elizabeth A. Edwards, Admiral Ronald J. Hays, William N. Lampson, Dr. John N. Lein, Donald A. Lockwood, Harry F. Magnuson, Charles T. Manatt, Esq. and James B. Thayer.
b. Identification of Executive Officers
Year Assumed Current Name Age Position Position with Company --------- --- -------- --------------------------------
Larry J. Sparrow(1) 50 1992 Area President - West
Elizabeth A. Edwards 42 1991 Regional Vice President - General Manager-Northwest
Anthony W. Armstrong 47 1984 Regional Vice President - External Affairs-Northwest
Clark Michael Crawford (1) 47 1992 Area Vice President - General Manager
Jorge Jackson (1)(2) 49 1993 Area Vice President - Public Affairs
Timothy J. McCallion (1)(3) 40 1993 Area Vice President - Regulatory and Governmental Affairs
Robert G. McCoy (1) 49 1992 Area Vice President - Sales
Richard J. Nordman (1)(4) 44 1993 Area Vice President - Finance
Kenneth K. Okel (1) 47 1991 Area Vice President - General Counsel and Secretary
Ronald E. Pejsa (1)(5) 50 1993 Area Vice President - Human Resources
Year Assumed Current Position with Name Age Position GTE Telephone Operations (6) ---- --- -------- ---------------------------------
Kent B. Foster 50 1989 President
Michael B. Esstman (7) 47 1993 Executive Vice President - Operations
Thomas W. White 47 1989 Executive Vice President
Guillermo Amore 55 1990 Senior Vice President - International
Gerald K. Dinsmore (8) 44 1993 Senior Vice President - Finance and Planning
Robert C. Calafell (9) 52 1993 Vice President - Video Services
A. T. Jones 54 1992 Vice President - International
Brad M. Krall (10) 52 1993 Vice President - Centralized Services
Donald A. Hayes 56 1992 Vice President - Information Technology
Richard L. Schaulin 51 1989 Vice President - Human Resources
Clarence F. Bercher 50 1991 Vice President - Sales
Mark S. Feighner 45 1991 Vice President - Product Management
Geoff C. Gould 41 1989 Vice President - Regulatory and Governmental Affairs
G. Bruce Redditt 43 1991 Vice President - Public Affairs
Richard M. Cahill 55 1989 Vice President and General Counsel
Leland W. Schmidt 60 1989 Vice President - Industry Affairs
Paul E. Miner 49 1990 Vice President - Regional Operations Support
Katherine J. Harless 43 1992 Vice President- Intermediary Markets
William M. Edwards, III(11) 45 1993 Controller
Each of these executive officers has been an employee of the Company or an affiliated company for the last five years.
Except for duly elected officers and directors, no other employees had a significant role in decision making.
All officers are appointed for a term of one year.
- ---------- NOTES:
(1) Individual is an executive officer for West Area which is comprised of GTE California Incorporated, GTE Hawaiian Telephone Company Incorporated and GTE Northwest Incorporated.
(2) Jorge Jackson was appointed Area Vice President - Public Affairs effective November 12, 1993, replacing Jim J. Parrish who retired.
(3) Timothy J. McCallion was appointed Area Vice President- Regulatory and Governmental Affairs effective November 21, 1993, replacing Keith M. Kramer who retired.
(4) Richard J. Nordman was appointed Area Vice President - Finance effective November 7, 1993, replacing Paul R. Shuell.
(5) Ronald E. Pejsa was appointed Area Vice President - Human Resources effective October 24, 1993, replacing James R. Poling who retired.
(6) Position is with, and duties are performed at, the GTE Telephone Operations General Office Headquarters in Irving, Texas.
(7) Michael B. Esstman was appointed Executive Vice President - Operations effective April 25, 1993 replacing Charles A. Crain who retired on April 1, 1993.
(8) Gerald K. Dinsmore, previously South Area President, was appointed Senior Vice President - Finance and Planning effective November 21, 1993, replacing John L. Hume who retired.
(9) Robert C. Calafell was appointed Vice President - Video Services effective March 28, 1993.
(10) Brad M. Krall was appointed Vice President - Centralized Services effective November 7, 1993.
(11) William M. Edwards, III was appointed Controller effective November 7, 1993 replacing John D. Utzinger.
Long-Term Incentive Plan - Awards in Last Fiscal Year
The GTE Long-Term Incentive Plan (LTIP) provides for awards, currently in the form of stock options with tandem stock appreciation rights and cash bonuses, to participating employees. The stock options and stock appreciation rights awarded under the LTIP to the five most highly compensated individuals in 1993 are shown in the table on page 10.
Under the LTIP, performance bonuses are paid in cash based on the achievement of pre-established goals for GTE's return on equity (ROE) over a three-year award cycle. Performance bonuses are denominated in units of GTE Common Stock ("Common Stock Units") and are maintained in a Common Stock Unit Account.
Executive Agreements
GTE has entered into agreements (the Agreements) with Messrs. Sparrow, Foster and White regarding benefits to be paid in the event of a change in control of GTE (a "Change in Control").
A Change in Control is deemed to have occurred if a majority of the members of the Board do not consist of members of the incumbent Board (as defined in the Agreements) or if, in any 12-month period, three or more directors are elected without the approval of the incumbent Board. An individual whose initial assumption of office occurred pursuant to an agreement to avoid or settle a proxy or other election contest is not considered a member of the incumbent Board. In addition, a director who is elected pursuant to such a settlement agreement will not be deemed a director who is elected or nominated by the incumbent Board for purposes of determining whether a Change in Control has occurred. A Change in Control will not occur in the following situations: (1) certain merger transactions in which there is at least 50% GTE shareholder continuity in the surviving corporation, at least a majority of the members of the board of directors of the surviving corporation consists of members of the Board of GTE and no person owns more than 20% (or under certain circumstances, a lower percentage, not less than 10%) of the voting power of the surviving corporation following the transaction, and (2) transactions in which GTE's securities are acquired directly from GTE.
The Agreements provide for benefits to be paid in the event this individual separates from service and has a "good reason" for leaving or is terminated without "cause" within two years after a Change in Control of GTE.
Good reason for leaving includes but is not limited to the following events: demotion, relocation or a reduction in total compensation or benefits, or the new entity's failure to expressly assume obligations under the Agreements. Termination for cause includes certain unlawful acts on the part of the executive or a material violation of his or her responsibilities to the Corporation resulting in material injury to the Corporation.
An executive who experiences a qualifying separation from service will be entitled to receive up to two times the sum of (i) base salary and (ii) the average of his or her other percentage awards under the EIP for the previous three years. The executive will also continue to receive medical and life insurance coverage for up to two years and will be provided with financial and outplacement counseling.
In addition, the Agreements with Messrs. Sparrow, Foster and White provide that in the event of a separation from service, they will receive service credit in the following amounts: two times years of service otherwise credited if the executive has five or fewer years of credited service; 10 years if credited service is more than five and not more than 10 years; and, if the executive's credited service exceeds 10 years, the actual number of credited years of service. These additional years of service will apply towards vesting, retirement eligibility, benefit accrual and all other purposes under the Supplemental Executive Retirement Plan and the Executive Retired Life Insurance Plan. In addition, each executive will be considered to have not less than 76 points and 15 years of accredited service for the purpose of determining his or her eligibility for early retirement benefits. However, there will be no duplication of benefits.
The Agreements remain in effect until the earlier of July 1 of each successive year or the date on which the executive reaches age 65, unless the Agreement is terminated earlier pursuant to its terms. The Agreements will be automatically renewed on each successive July 1 unless, not later than December 31 of the preceding year, one of the parties notifies the other that he does not wish to extend the Agreement. If a Change in Control occurs, the Agreements will remain in effect until the obligations of GTE (or its successor) under the Agreements have been satisfied.
Retirement Programs
Pension Plans
The estimated annual benefits payable, calculated on a single life annuity basis, under GTE's defined benefit pension plans at normal retirement at age 65, based upon final average earnings and years of employment, are illustrated in the table below:
PENSION PLAN TABLE
Years of Service Final Average --------------------------------------------------------- Earnings 15 20 25 30 35 -------- --------- --------- --------- --------- ----------
$ 150,000 $ 31,604 $ 42,138 $ 52,672 $ 63,207 $ 73,742 200,000 42,479 56,638 70,797 84,957 99,117 300,000 64,229 85,638 107,048 128,457 149,867 400,000 85,979 114,638 143,298 171,957 200,617 500,000 107,729 143,638 179,548 215,457 251,367 600,000 129,479 172,638 215,798 258,957 302,117 700,000 151,229 201,638 252,048 302,457 352,867 800,000 172,979 230,638 288,298 345,957 403,617 900,000 194,729 259,638 324,548 389,457 454,367 1,000,000 216,479 288,638 360,798 432,957 505,117 1,200,000 259,979 346,638 433,298 519,957 606,617
GTE Service Corporation, a wholly-owned subsidiary of GTE, maintains a noncontributory pension plan for the benefit of GTE employees based on years of service. Pension benefits to be paid from this plan and contributions to this plan are related to basic salary exclusive of overtime, differentials, incentive compensation (except as otherwise described) and other similar types of payment. Under this plan, pensions are computed on a two-rate formula basis of 1.15% and 1.45% for each year of service, with the 1.15% service credit being applied to that portion of the average annual salary for the five highest consecutive years that does not exceed the Social Security Integration Level (the portion of salary subject to the Federal Security Act), and the 1.45% service credit being applied to that portion of the average annual salary that exceeds said level. As of March 1, 1994, the credited years of service under the plan for Mr. Sparrow, Ms. Edwards, Messrs. Armstrong, Foster and White are 26, 17, 20, 23 and 25, respectively.
Under Federal law, an employee's benefits under a qualified pension plan such as the GTE Service Corporation plan are limited to certain maximum amounts. GTE maintains a Supplemental Executive Retirement Plan (SERP), which supplements the benefits of any participant in the qualified pension plan by direct payment of a lump sum or by an annuity, on an unfunded basis, of the amount by which any participant's benefits under the GTE Service Corporation pension plan are limited by law. In addition, the SERP includes a provision permitting the payment of additional retirement benefits determined in a similar manner as under the qualified pension plan on remuneration accrued under management incentive plans as determined by the Executive Compensation and Organizational Structure Committee.
Executive Retired Life Insurance Plan
The Executive Retired Life Insurance Plan (ERLIP) provides Mr. Sparrow, Ms. Edwards, Messrs. Armstrong, Foster and White a maximum postretirement life insurance benefit of three times final base salary. Upon retirement, ERLIP benefits may be paid as life insurance or optionally, an equivalent amount may be paid as a lump sum payment equal to the present value of the life insurance amount (based on actuarial factors and the interest rate then in effect), as an annuity or as installment payments. If an optional payment method is selected, the ERLIP benefit will be based on the actuarial equivalent of the present value of the insurance amount.
Directors' Compensation:
The current directors, all of whom are employees of GTE, are not paid any fees or remuneration, as such, for service on the Board.
Item 12.

Item 12. Security Ownership of Certain Beneficial Owners and Management
(a) Security Ownership of Certain Beneficial Owners as of February 28, 1994:
Name and Shares of Title Address of Beneficial Percent of Class Beneficial Owner Ownership of Class -------- ---------------- ---------- ----------- Common Stock of GTE Corporation 17,920,000 100% GTE Northwest One Stamford Forum shares of Incorporated Stamford, Connecticut record
(b) Security Ownership of Management as of December 31, 1993:
Name of Director or Nominee --------------------------- Common Stock of Richard M. Cahill (1) 37,188 All less GTE Corporation Gerald K. Dinsmore (1) 18,503 than 1% Michael B. Esstman 54,051 Kent B. Foster 168,299 Larry J. Sparrow 33,749 Thomas W. White 83,071 ------- 394,861 =======
Executive Officers(1)(2) ------------------------ Larry J. Sparrow 33,749 Elizabeth A. Edwards 11,256 Anthony W. Armstrong 1,451 Kent B. Foster 168,299 Thomas W. White 33,749 ------- 248,504 ======= All directors and executive officers as a group(1)(2) 771,063 ======= - ---------- (1) Includes shares acquired through participation in GTE's Consolidated Employee Stock Ownership Plan and/or the GTE Savings Plan.
(2) Included in the number of shares beneficially owned by Mr. Sparrow, Ms. Edwards, Messrs. Armstrong, Foster and White and all directors and executive officers as a group are 27,537; 6,033; 0; 115,583; 69,466 and 522,451, shares, respectively, which such persons have the right to acquire within 60 days pursuant to stock options.
(c) There were no changes in control of the Company during 1993.
Item 13.

Item 13. Certain Relationships and Related Transactions
The Company's executive officers or directors were not materially indebted to the Company or involved in any material transaction in which they had a direct or indirect material interest. None of the Company's directors were involved in any business relationships with the Company.
PART IV
Item 14.

Item 14. Exhibits, Financial Statement Schedules and Reports on Form 8-K
(a)(1) Financial Statements - Reference is made to the Registrant's Annual Report to Shareholders, pages 5 - 25 , for the year ended December 31, 1993, incorporated herein and filed as Exhibit 13.
Report of Independent Public Accountants.
Consolidated Balance Sheets - December 31, 1993 and 1992.
Consolidated Statements of Income for the years ended December 31, 1993-1991.
Consolidated Statements of Reinvested Earnings for the years ended December 31, 1993-1991.
Consolidated Statements of Cash Flows for the years ended December 31, 1993-1991.
Notes to Consolidated Financial Statements.
(2) Financial Statement Schedules - Included in Part IV of this report for the years ended December 31, 1993-1991: Page(s) ------- Report of Independent Public Accountants 21
Schedules:
V - Property, Plant and Equipment 22-24
VI - Accumulated Depreciation and Amortization of Property, Plant and Equipment 25
VIII - Valuation and Qualifying Accounts 26
X - Supplementary Income Statement Information 27
Note: Schedules other than those listed above are omitted as not applicable, not required, or the information is included in the financial statements or notes thereto.
(3) Exhibits - Included in this report or incorporated by reference.
2.1 Plan of Merger of Contel of the Northwest, Inc. into GTE Northwest Incorporated dated November 18, 1992.
13 Annual Report to Shareholders for the year ended December 31, 1993, filed herein as Exhibit 13.
(b) Reports on Form 8-K - No reports on Form 8-K were filed during the fourth quarter of 1993. - ---------- * Denotes exhibits incorporated herein by reference to previous filings with the Securities and Exchange Commission as designated.
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
To GTE Northwest Incorporated:
We have audited in accordance with generally accepted auditing standards, the consolidated financial statements included in GTE Northwest Incorporated and subsidiary's annual report to shareholders incorporated by reference in this Form 10-K, and have issued our report thereon dated January 28, 1994. Our report on the consolidated financial statements includes an explanatory paragraph with respect to the change in the method of accounting for income taxes in 1992 as discussed in Note 1 to the consolidated financial statements. Our audit was made for the purpose of forming an opinion on those statements taken as a whole. The schedules listed under Item 14 are the responsibility of the Company's management and are presented for purposes of complying with the Securities and Exchange Commission's rules and are not part of the basic financial statements. These schedules have been subjected to the auditing procedures applied in the audit of the basic financial statements and, in our opinion, fairly state in all material respects the financial data required to be set forth therein in relation to the basic financial statements taken as a whole.
ARTHUR ANDERSEN & CO.
Dallas, Texas January 28, 1994.
GTE NORTHWEST INCORPORATED AND SUBSIDIARY
SCHEDULE X - SUPPLEMENTARY INCOME STATEMENT INFORMATION
FOR THE YEARS ENDED DECEMBER 31, 1993, 1992 AND 1991 (Thousands of Dollars)
- ------------------------------------------------------------------------------ Column A Column B --------------- ------------------------------------------- Item Charged to Operating Expenses - ------------------------------------------------------------------------------
1993 1992 1991 ---------- ---------- ---------- Maintenance and repairs $ 144,364 $ 136,018 $ 140,579 ========== ========== ========== Taxes, other than payroll and income taxes, are as follows:
Real and personal property $ 28,742 $ 21,207 $ 26,461 State gross receipts 10,015 7,578 8,467 Other 6,926 4,728 6,728 Portion of above taxes charged to plant and other accounts (4,333) (4,301) (4,450) ---------- ---------- ---------- Total $ 41,350 $ 29,212 $ 37,206 ========== ========== ==========
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) 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.
GTE NORTHWEST INCORPORATED (Registrant)
Date March 21, 1994 By LARRY J. SPARROW -------------- --------------------------- LARRY J. SPARROW Area President - West
Pursuant to the requirements of the Securities Exchange Act of 1934, this report is signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
LARRY J. SPARROW President and Director March 21, 1994 - ---------------- (Principal Executive Officer) LARRY J. SPARROW
GERALD K. DINSMORE Senior Vice President--Finance March 21, 1994 - ------------------ and Planning and Director GERALD K. DINSMORE (Principal Financial Officer)
WILLIAM M. EDWARDS, III Controller March 21, 1994 - ----------------------- (Principal Accounting Officer) WILLIAM M. EDWARDS, III
RICHARD M. CAHILL Director March 21, 1994 - ----------------- RICHARD M. CAHILL
MICHAEL B. ESSTMAN Director March 21, 1994 - ------------------ MICHAEL B. ESSTMAN
KENT B. FOSTER Director March 21, 1994 - -------------- KENT B. FOSTER
THOMAS W. WHITE Director March 21, 1994 - --------------- THOMAS W. WHITE