E-Z-GO 2008 Annual Report Download - page 44

At January 3, 2009, the Finance group had $1.2 billion of unused commitments to fund new and existing customers under revolving lines of
credit, compared to $1.6 billion at December 29, 2007. These loan commitments generally have an original duration of less than three years,
and funding under these facilities is dependent on the availability of eligible collateral and compliance with customary financial covenants.
Since many of the agreements will not be used to the extent committed or will expire unused, the total commitment amount does not necessarily
represent future cash requirements. We also have ongoing customer relationships, including manufacturers and dealers in the Distribution
Finance division, which do not contractually obligate us to provide funding, however, we may choose to fund certain of these relationships
to facilitate an orderly liquidation and mitigate credit losses. Neither of these potential fundings is included as contractual obligations in the
table above.
Manufacturing Group
The following table summarizes the known contractual obligations, as defined by reporting regulations, of our Manufacturing group as of January
3, 2009, as well as an estimate of the timing in which these obligations are expected to be satisfied:
Payments Due by Period
Less than More than
(In millions) 1 Year 2 Years 3 Years 4 Years 5 Years 5 Years Total
Liabilities reflected in balance sheet:
Commercial paper (1) $ — $ — $ — $ 867 $ — $ — $ 867
Long-term debt (2) 2 254 15 300 429 558 1,558
Capital lease obligations (2) 7 2 5 5 5 120 144
Pension benefits for unfunded plans 17 18 19 19 18 206 297
Postretirement benefits other than
pensions 67 64 60 56 51 381 679
Other long-term liabilities 75 82 46 41 53 179 476
Liabilities not reflected in balance sheet:
Operating leases 61 51 38 32 26 178 386
Purchase obligations 2,117 607 155 78 7 3 2,967
Total Manufacturing group $ 2,346 $ 1,078 $ 338 $ 1,398 $ 589 $ 1,625 $ 7,374
(1) Commercial paper outstanding at January 3, 2009 is reflected as being repaid in connection with the maturity of our $1.75 billion committed multi-year credit
facility in 2012. Actual commercial paper issuances generally are outstanding for less than 90 days; however, these issuances were replaced by a full draw-
down on the multi-year credit facility in February 2009.
(2) Amounts exclude interest payments.
We maintain defined benefit pension plans and postretirement benefit plans other than pensions as discussed in Note 14 to the Consolidated
Financial Statements. Included in the above table are discounted estimated benefit payments we expect to make related to unfunded pension and
other postretirement benefit plans. Actual benefit payments are dependent on a number of factors, including mortality assumptions, expected
retirement age, rate of compensation increases and medical trend rates, which are subject to change in future years. Our policy for funding
pension plans is to make contributions annually, consistent with applicable laws and regulations; however, future contributions to our pension
plans are not included in the above table. We expect to make contributions to our funded pension plans in the range of approximately $50 million
to $55 million in 2009. Based on our current assumptions, which may change with changes in market conditions, our current annual contribution
for each of the years from 2010 through 2013 is estimated to be approximately $375 million under the plan provisions in place at this time.
Other long-term liabilities included in the table consist primarily of undiscounted amounts on the Consolidated Balance Sheet as of January 3,
2009, representing obligations under deferred compensation arrangements and estimated environmental remediation costs. Payments under
deferred compensation arrangements have been estimated based on management’s assumptions of expected retirement age, mortality, stock price
and rates of return on participant deferrals. The timing of cash flows associated with environmental remediation costs is largely based on
historical experience. Other long-term liabilities, such as deferred taxes and unrecognized tax benefits, have been excluded from the table due to
the uncertainty of the timing of payments combined with the absence of historical trends to be used as a predictor for such payments.
Operating leases represent undiscounted obligations under noncancelable leases. Purchase obligations represent undiscounted obligations for
which we are committed to purchase goods and services as of January 3, 2009. The ultimate liability for these obligations may be reduced based
upon termination provisions included in certain purchase contracts, the costs incurred to date by vendors under these contracts or by recourse
under firm contracts with the U.S. Government under normal termination clauses.
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Textron Inc.