The format is designed for Kodak cameras to store uncompressed RAW images in their original form without auto color and white balance correction. The file has a TIFF-structure that allows you to edit the color temperature and exposure of the finished image without losing information and quality, which is something that cannot be done with JPEG format images.
The SXW file format was originally created for StarOffice Writer, the word processing application for Sun Microsystem's StarOffice suite. Programs that can open SXW files include StarOffice Writer and OpenOffice.org Writer. To open an SXW file in Microsoft Word, it's usually possible by renaming it as a DOC file.