1. Unwrap caramels, of course, and melt in a heavy saucepan with butter and water over low heat.
2. Stir constantly until it is smooth.
3. Stir in pecan halves and let mixture cool in pan for about 5 minutes.
4. Drop by tablespoonfuls onto lightly greased wax paper.
5. Chill 1 hour, or freeze 20 minutes until firm.
6. When caramel and nut mixture is cold to touch, melt chocolate chips and candy coating in a small heavy saucepan over low heat, stirring until smooth.
7. Dip caramel candies into chocolate mixture, allowing excess to drip; place on lightly greased wax paper.
8. Let stand until firm.