Mercedes 2008 Annual Report Download - page 196

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26. Consolidated statements of cash flows
Calculating funds. As of December 31, 2008, cash and cash
equivalents include restricted funds of €139 million (2007:
€223 million; 2006: €1,326 million) from consolidated special
purpose entities, which are solely used to settle the respective
financial liabilities.
Cash provided by operating activities. The changes in other
operating assets and liabilities are as follows:
Cash provided by operating activities includes the following cash
flows:
Cash used for financing activities. Cash used for financing
activities includes cash flows from hedging the currency risks of
financial liabilities. In 2008, cash used for financing activities
included payments for the reduction of the outstanding finance
lease liabilities of €79 million (2007: €77 million; 2006: €80
million).
27. Legal proceedings
Various legal proceedings, claims and governmental investigations
are pending against Daimler AG and its subsidiaries on a wide
range of topics, including vehicle safety, emissions, fuel economy,
financial services, dealer, supplier and other contractual relation-
ships, intellectual property rights, product warranties, environmen-
tal matters, and shareholder matters. Some of these proceedings
allege defects in various components in several different vehicle
models or allege design defects relating to vehicle stability, pedal
misapplication, brakes or crashworthiness. Some of these
proceedings are filed as class action lawsuits that seek repair or
replacement of the vehicles or compensation for their alleged
reduction in value, while others seek recovery for damage to prop-
erty, personal injuries or wrongful death. Adverse decisions in
one or more of these proceedings could require us to pay substan-
tial compensatory and punitive damages or undertake service
actions, recall campaigns or other costly actions.
The Federal Republic of Germany initiated arbitration proceedings
against Daimler Financial Services AG, Deutsche Telekom AG and
Toll Collect GbR and submitted its statement of claims in August
2005. It seeks damages, contractual penalties and the transfer of
intellectual property rights to Toll Collect GmbH. In particular,
the Federal Republic of Germany is claiming lost revenue of €3.51
billion plus interest (€236 million through July 31, 2005 plus 5%
per annum over the respective base rate since then) for the period
September 1, 2003, through December 31, 2004, and contractual
penalties of approximately €1.65 billion through July 31, 2005 plus
interest (€107 million through July 31, 2005 plus 5% per annum
over the respective base rate since then). Since some of the con-
tractual penalties, among other things, are dependent on time
and as further claims for contractual penalties have been asserted
by the Federal Republic of Germany, the amount claimed as
contractual penalties may increase. Defendants submitted their
response to the statement of claims on June 30, 2006. The Fed-
eral Republic of Germany delivered its reply to the arbitrators on
February 15, 2007, and the defendants delivered their rebuttal on
October 1, 2007 (see also Note 28). The arbitrators held the first
hearing on June 16 and 17, 2008. Additional briefs from the
claimant and the defendants are due on April 3, 2009. Daimler
believes the claims are without merit and will continue to defend
itself vigorously.
2006
20072008
(1,647)
1,761
(898)
67
(977)
716
(1,494)
191
(1,541)
977
(1,020)
69
Interest paid
Interest received
Income taxes paid, net
Dividends received
in millions of €
2006
20072008
(1,382)
217
303
(862)
(979)
(477)
(340)
(1,796)
(859)
(159)
1,407
389
Provisions
Financial instruments
Miscellaneous other assets
and liabilities
in millions of €