Comfort Inn 2013 Annual Report Download - page 66

Table of Contents

See Footnotes No. 1 “Recently Adopted Accounting Guidance” and Note 28 "Future Adoption of Accounting Standards" of the Notes to our Financial
Statements for information related to our adoption of new accounting standards in 2013 and for information on our anticipated adoption of recently issued
accounting standards.

Certain matters discussed in this report constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of
1995. Generally, our use of words such as "expect," "estimate," "believe," "anticipate," "should," "will," "forecast," "plan," "project," "assume" or similar
words of futurity identify such forward-looking statements. These forward-looking statements are based on management's current beliefs, assumption and
expectations regarding future events, which in turn are based on information currently available to management. Such statements may relate to projections of
the Company’s revenue, earnings and other financial and operational measures, Company debt levels, ability to repay outstanding indebtedness, payment of
dividends, and future operations, among other matters. We caution you not to place undue reliance on any such forward-looking statements. Forward-looking
statements do not guarantee future performance and involve known and unknown risks, uncertainties and other factors.
Several factors could cause actual results, performance or achievements of the Company to differ materially from those expressed in or contemplated by
the forward-looking statements. Such risks include, but are not limited to, changes to general, domestic and foreign economic conditions; operating risks
common in the lodging and franchising industries; changes to the desirability of our brands as viewed by hotel operators and customers; changes to the terms
or termination of our contracts with franchisees; our ability to keep pace with improvements in technology utilized for marketing and reservations systems and
other operating systems; fluctuations in the supply and demand for hotels rooms; the level of acceptance of alternative growth strategies we may implement;
operating risks associated with our international operations; the outcome of litigation; and our ability to effectively manage our indebtedness. These and other
risk factors are discussed in detail in Item 1A. “Risk Factors” of this report. We undertake no obligation to publicly update or revise any forward-looking
statement, whether as a result of new information, future events or otherwise, except as required by law.
 
The Company is exposed to market risk from changes in interest rates and the impact of fluctuations in foreign currencies on the Company’s foreign
investments and operations. The Company manages its exposure to these market risks through the monitoring of its available financing alternatives including
in certain circumstances the use of derivative financial instruments. We are also subject to risk from changes in debt and equity prices from our non-qualified
retirement savings plan investments in debt securities and common stock, which have a carrying value of $16.4 million at December 31, 2013, which we
account for as trading securities. The Company will continue to monitor the exposure in these areas and make the appropriate adjustments as market
conditions dictate.
At December 31, 2013, the Company had $138.8 million of variable interest rate debt instruments outstanding at an effective rate of 2.2%. A
hypothetical change of 10% in the Company’s effective interest rate from December 31, 2013 levels would increase or decrease annual interest expense by $0.3
million. The Company expects to refinance its fixed and variable long-term debt obligations prior to their scheduled maturities.
66