Coca Cola 2010 Annual Report Download - page 124

Maturities of long-term debt for the five years succeeding December 31, 2010, are as follows (in millions):
Maturities of
Long-Term Debt
2011 $ 1,276
2012 2,057
2013 1,804
2014 1,993
2015 1,636
NOTE 11: COMMITMENTS AND CONTINGENCIES
Guarantees
As of December 31, 2010, we were contingently liable for guarantees of indebtedness owed by third parties of
approximately $683 million, of which approximately $336 million related to VIEs. Refer to Note 1 for additional
information related to the Company’s maximum exposure to loss due to our involvement with VIEs. Our guarantees
primarily are related to third-party customers, bottlers, vendors and container manufacturing operations and have arisen
through the normal course of business. These guarantees have various terms, and none of these guarantees was
individually significant. The amount represents the maximum potential future payments that we could be required to
make under the guarantees; however, we do not consider it probable that we will be required to satisfy these
guarantees.
We believe our exposure to concentrations of credit risk is limited due to the diverse geographic areas covered by our
operations.
Legal Contingencies
The Company is involved in various legal proceedings. We establish reserves for specific legal proceedings when we
determine that the likelihood of an unfavorable outcome is probable and the amount of loss can be reasonably
estimated. Management has also identified certain other legal matters where we believe an unfavorable outcome is
reasonably possible and/or for which no estimate of possible losses can be made. Management believes that any liability
to the Company that may arise as a result of currently pending legal proceedings will not have a material adverse effect
on the financial condition of the Company taken as a whole.
During the period from 1970 to 1981, our Company owned Aqua-Chem, Inc., now known as Cleaver-Brooks, Inc.
(‘‘Aqua-Chem’’). A division of Aqua-Chem manufactured certain boilers that contained gaskets that Aqua-Chem
purchased from outside suppliers. Several years after our Company sold this entity, Aqua-Chem received its first lawsuit
relating to asbestos, a component of some of the gaskets. In September 2002, Aqua-Chem notified our Company that it
believed we were obligated for certain costs and expenses associated with its asbestos litigations. Aqua-Chem demanded
that our Company reimburse it for approximately $10 million for out-of-pocket litigation-related expenses. Aqua-Chem
also demanded that the Company acknowledge a continuing obligation to Aqua-Chem for any future liabilities and
expenses that are excluded from coverage under the applicable insurance or for which there is no insurance. Our
Company disputes Aqua-Chem’s claims, and we believe we have no obligation to Aqua-Chem for any of its past,
present or future liabilities, costs or expenses. Furthermore, we believe we have substantial legal and factual defenses to
Aqua-Chem’s claims. The parties entered into litigation in Georgia to resolve this dispute, which was stayed by
agreement of the parties pending the outcome of litigation filed in Wisconsin by certain insurers of Aqua-Chem. In that
case, five plaintiff insurance companies filed a declaratory judgment action against Aqua-Chem, the Company and 16
defendant insurance companies seeking a determination of the parties’ rights and liabilities under policies issued by the
insurers and reimbursement for amounts paid by plaintiffs in excess of their obligations. During the course of the
Wisconsin coverage litigation, Aqua-Chem and the Company reached settlements with several of the insurers, including
plaintiffs, who have or will pay funds into an escrow account for payment of costs arising from the asbestos claims
against Aqua-Chem. On July 24, 2007, the Wisconsin trial court entered a final declaratory judgment regarding the
rights and obligations of the parties under the insurance policies issued by the remaining defendant insurers, which
judgment was not appealed. The judgment directs, among other things, that each insurer whose policy is triggered is
jointly and severally liable for 100 percent of Aqua-Chem’s losses up to policy limits. The Company and Aqua-Chem
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