Starwood 2005 Annual Report Download - page 39

We had the following contractual obligations outstanding as of December 31, 2005 (in millions):
Due in Less Due in Due in Due After
Total Than 1 Year 1-3 Years 3-5 Years 5 Years
Long-term debt ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ $4,143 $1,219 $ 851 $481 $1,592
Capital lease obligations(1) ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 2 Ì Ì Ì 2
Operating lease obligationsÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 1,142 78 140 125 799
Unconditional purchase obligations(2) ÏÏÏÏÏÏÏÏÏÏÏ 135 45 57 25 8
Other long-term obligations ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ Ì Ì Ì Ì Ì
Total contractual obligations ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ $5,422 $1,342 $1,048 $631 $2,401
(1) Excludes sublease income of $2 million.
(2) Included in these balances are commitments that may be satisÑed by our managed and franchised properties.
We had the following commercial commitments outstanding as of December 31, 2005 (in millions):
Amount of Commitment Expiration Per Period
Less Than After
Total 1 Year 1-3 Years 3-5 Years 5 Years
Standby letters of creditÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ $129 $129 $Ì $Ì $Ì
Hotel loan guarantees(1)ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 47 4 43 Ì Ì
Other commercial commitments ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ Ì Ì Ì Ì Ì
Total commercial commitments ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ $176 $133 $43 $Ì $Ì
(1) Excludes fair value of guarantees which are reÖected in our consolidated balance sheet.
In January 2004, we acquired a 95% interest in Bliss World LLC which at that time operated three stand
alone spas (two in New York, New York and one in London, England) and a beauty products business with
distribution through its own internet site and catalogue as well as through third party retail stores. The
purchase price for the acquired interest was approximately $25 million, and was funded from available cash. In
2005, we acquired the remaining 5% interest for approximately $1 million.
We intend to Ñnance the acquisition of additional hotel properties (including equity investments), hotel
renovations, VOI and residential construction, capital improvements, technology spend and other core and
ancillary business acquisitions and investments and provide for general corporate purposes (including dividend
payments) through our credit facilities described below, through the net proceeds from dispositions, through
the assumption of debt, through the issuance of additional equity or debt securities and from cash generated
from operations.
We are actively reviewing our business to identify properties or other assets that we believe either are
non-core (including hotels where the return on invested capital is not adequate), no longer complement our
business, are in markets which may not beneÑt us as much as other markets during an economic recovery or
could be sold at signiÑcant premiums. We are focused on restructuring and enhancing real estate returns and
monetizing investments. In 2005 we sold ten hotels for cash proceeds of approximately $510 million and, in
January 2006, we sold four hotels for cash proceeds of approximately $234 million. Additionally, we have
entered into an agreement to sell approximately $4.1 billion of assets to Host Marriott Corporation which we
expect to consummate in the second quarter of 2006. There can be no assurance, however, that we will be able
to complete dispositions on commercially reasonable terms or at all.
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