Dollar Rent A Car 2011 Annual Report Download - page 81

The Company had no material liability for unrecognized tax benefits at December 31, 2011. There are no material tax positions for which it is
reasonably possible that unrecognized tax benefits will significantly change in the twelve months subsequent to December 31, 2011.
The Company files income tax returns in the U.S. federal and various state, local and foreign jurisdictions. In the Company’s significant tax
jurisdictions, the tax years 2008 and later are subject to examination by U.S. federal taxing authorities and the tax years 2007 and later are subject to
examination by state and foreign taxing authorities.
The Company accrues interest and penalties on underpayment of income taxes related to unrecognized tax benefits as a component of income tax
expense in the consolidated statements of income. No material amounts were recognized for interest and penalties under ASC Topic 740 during the
years ended December 31, 2011, 2010 and 2009.
13. STOCKHOLDERS’ EQUITY
Share Repurchase Program
On September 26, 2011, the Company announced that its Board of Directors had increased the authorization of the share repurchase program
previously announced on February 24, 2011 of up to $100 million to up to $400 million. The share repurchase program is discretionary and has no
expiration date. Subject to applicable law, the Company may repurchase shares through forward stock repurchase agreements, accelerated stock
buyback programs, directly in the open market, in privately negotiated transactions, or pursuant to derivative instruments or plans complying with
SEC Rule 10b5-1, among other types of transactions and arrangements. Additionally, share repurchases are subject to applicable limitations under the
Senior Secured Credit Facilities, which as of December 31, 2011, permitted share repurchases totaling approximately $280 million, after giving effect
to the $100 million forward stock repurchase plan pre-funded in November 2011. The New Revolving Credit Facility contains limitations on share
repurchases. See Note 8 for further discussion. Although payments were funded in 2011 for share repurchases under the forward stock repurchase
agreement described below, no shares were repurchased under the share repurchase program as of December 31, 2011.
On November 3, 2011, the Company entered into and pre-funded a forward stock repurchase agreement with Goldman Sachs & Co. (“Goldman”)
under which the Company agreed to acquire $100 million of Company common stock. The Company currently expects to repurchase shares in 2012
under the remaining authorization of the share repurchase program. The share repurchase program may be increased, suspended or discontinued at
any time.
On February 7, 2012, the Company settled the $100 million forward stock repurchase agreement that was executed on November 3, 2011 and acquired
1,451,193 shares of common stock at an average share price of approximately $68.91.
Shareholder Rights Plan
On May 18, 2011, the Company adopted a shareholder rights plan (the “Rights Plan”) under which the Company’s shareholders will receive rights to
purchase shares of a new series of preferred stock in certain circumstances. Under the provisions of the Rights Plan, which has an expiration date of
May 30, 2012, the rights will be exercisable if a person or group, without the Company’s approval, acquires 20% or more of the Company’s common
stock or announces a tender offer which results in the ownership of 20% or more of the Company’s common stock. The rights also will be exercisable
if a person or group that already owns 20% or more of the Company’s common stock, without the Company’s approval, acquires any additional
shares. If the rights become exercisable, all rights holders (other than the person triggering the rights) will be entitled to acquire the Company’s common
stock at a 50% discount.
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