Thrifty Car Rental 2006 Annual Report Download - page 65

The 2006 Series notes are floating rate notes that were converted to a fixed rate of 5.27% by
entering into interest rate swap agreements (Note 11) in conjunction with the issuance of the notes.
The 2005 Series notes are comprised of $110 million 4.59% fixed rate notes and $290 million of
floating rate notes. In conjunction with the issuance of the 2005 Series notes, the Company also
entered into interest rate swap agreements (Note 11) to convert $190 million of the floating rate debt
to fixed rate debt at a 4.58% interest rate. Additionally, in December 2006, the Company entered
into an interest rate swap agreement to convert the remaining $100 million of the floating rate debt
to fixed rate debt at a 5.09% interest rate.
The 2004 Series notes are floating rate notes that were converted to a fixed rate of 4.20% by
entering into interest rate swap agreements (Note 11) in conjunction with the issuance of the notes.
The 2003 Series notes are floating rate notes that were converted to a fixed rate of 3.64% by
entering into an interest rate swap agreement (Note 11) in conjunction with the issuance of the
notes.
The 2001 Series notes were floating rate notes that were converted to a fixed rate of 6.04% by
entering into an interest rate swap agreement (Note 11) in conjunction with the issuance of the
notes. During 2006, the 2001 Series notes were paid in full.
The assets of RCFC, including revenue-earning vehicles related to the asset backed notes,
restricted cash and investments, and certain receivables related to revenue-earning vehicles are
available to satisfy the claims of its creditors. Dollar and Thrifty lease vehicles from RCFC under the
terms of a master lease and servicing agreement. The asset backed note indentures also provide for
additional credit enhancement through over collateralization of the vehicle fleet, cash or letters of
credit and maintenance of a liquidity reserve. RCFC is in compliance with the terms of the
indentures.
The asset backed notes mature from 2007 through 2011 and are generally subject to repurchase on
any payment date subject to a prepayment penalty.
Conduit Facility – On March 28, 2006, the asset backed Variable Funding Note Purchase Facility
(the “Conduit”) was renewed for another 364-day period at a capacity of $425,000,000. Proceeds
are used for financing of vehicle purchases and for periodic refinancing of asset backed notes. The
Conduit generally bears interest at market–based commercial paper rates (5.72% and 4.65% at
December 31, 2006 and 2005, respectively). The Company had $425,000,000 and $375,000,000
outstanding under the Conduit at December 31, 2006 and 2005, respectively.
Commercial Paper – On March 28, 2006, the commercial paper program (the “Commercial Paper
Program”), representing $649,000,000 of borrowing capacity as a part of the existing asset backed
note program, was renewed for another 364-day period. Concurrently with the establishment of the
Commercial Paper Program, DTFC also entered into a 364-day, $560,000,000 liquidity facility (the
“Liquidity Facility”) to support the Commercial Paper Program. Proceeds are used for financing of
vehicle purchases and for periodic refinancing of asset backed notes. The Liquidity Facility provides
the Commercial Paper Program with an alternative source of funding if DTFC is unable to refinance
maturing commercial paper by issuing new commercial paper. Commercial paper bears interest at
rates ranging from 5.33% to 5.38% at December 31, 2006 and 4.25% to 4.47% at December 31,
2005 and matured within 60 days of December 31, 2006.
Other Vehicle Debt includes various lines of credit that are collateralized by the related vehicles,
including up to $150,000,000 from vehicle manufacturers at December 31, 2006, and $162,000,000
in capacity from various banks at December 31, 2006. These lines of credit bear interest at varying
rates based on LIBOR, prime or commercial paper rates. The weighted average variable interest
rate for these lines of credit was 7.29% and 6.23% at December 31, 2006 and 2005, respectively.
These lines of credit are primarily renewable annually.
Limited Partner Interest in Limited Partnership – DTG Canada has a partnership agreement (the
“Partnership Agreement”) with an unrelated bank’s conduit (the “Limited Partner”). This transaction
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