Starwood 2008 Annual Report Download - page 107

Based upon the current level of operations, management believes that our cash flow from operations and asset
sales, together with our significant cash balances (approximately $491 million at December 31, 2008, including
$102 million of short-term and long-term restricted cash), available borrowings under the Facilities and other bank
credit facilities (approximately $1.585 billion at December 31, 2008 which includes $35 million from international
revolving lines of credit), our expected income tax refund of over $200 million in 2009 (see Note 14 of the
consolidated financial statements), and capacity for additional borrowings will be adequate to meet anticipated
requirements for scheduled maturities, dividends, working capital, capital expenditures, marketing and advertising
program expenditures, other discretionary investments, interest and scheduled principal payments and share
repurchases for the foreseeable future. However, there can be no assurance that we will be able to refinance our
indebtedness as it becomes due and, if refinanced, on favorable terms. In addition, there can be no assurance that in
our continuing business we will generate cash flow at or above historical levels, that currently anticipated results
will be achieved or that we will be able to complete dispositions on commercially reasonable terms or at all.
If we are unable to generate sufficient cash flow from operations in the future to service our debt, we may be
required to sell additional assets at lower than preferred amounts, reduce capital expenditures, refinance all or a
portion of our existing debt or obtain additional financing at unfavorable rates. Our ability to make scheduled
principal payments, to pay interest on or to refinance our indebtedness depends on our future performance and
financial results, which, to a certain extent, are subject to general conditions in or affecting the hotel and vacation
ownership industries and to general economic, political, financial, competitive, legislative and regulatory factors
beyond our control.
We had the following contractual obligations
(1)
outstanding as of December 31, 2008 (in millions):
Total
Due in Less
Than 1 Year
Due in
1-3 Years
Due in
3-5 Years
Due After
5 Years
Debt ............................ $4,006 $506 $1,101 $1,500 $ 899
Capital lease obligations
(2)
............ 2 — — — 2
Operating lease obligations ............ 1,158 90 200 170 698
Unconditional purchase obligations
(3)
.... 98 35 59 2 2
Other long-term obligations ........... 4 — 3 1 —
Total contractual obligations ........... $5,268 $631 $1,363 $1,673 $1,601
(1) The table below excludes unrecognized tax benefits that would require cash outlays for $503 million, the timing
of which is uncertain. Refer to Note 14 of the consolidated financial statements for additional discussion on this
matter. In addition, the table excludes amounts related to the construction of our St. Regis Bal Harbour project
that has a total project cost of $780 million, of which $226 million has been paid through December 31, 2008.
(2) Excludes sublease income of $2 million.
(3) Included in these balances are commitments that may be reimbursed or satisfied by our managed and franchised
properties.
We had the following commercial commitments outstanding as of December 31, 2008 (in millions):
Total
Less Than
1 Year 1-3 Years 3-5 Years
After
5 Years
Amount of Commitment Expiration Per Period
Standby letters of credit .................. $115 $115 $— $— $—
A dividend of $0.90 per share was paid in January 2009 to shareholders of record as of December 31, 2008.
A dividend of $0.90 per share was paid in January 2008 to shareholders of record as of December 31, 2007.
Stock Sales and Repurchases
Share Repurchases. In April of 2007, the Board of Directors authorized an additional $1 billion in Share
repurchases under our existing Corporate Share Repurchase Authorization (the “Share Repurchase Authoriza-
tion”). In November 2007, the Board of Directors of Starwood further authorized the repurchase of up to an
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