Avis 2009 Annual Report Download

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AVIS BUDGET GROUP, INC.
FORM 10-K
(Annual Report)
Filed 02/24/10 for the Period Ending 12/31/09
Telephone 973-496-2579
CIK 0000723612
Symbol CAR
SIC Code 7510 - Automotive Rental And Leasing, Without Drivers
Industry Rental & Leasing
Sector Services
Fiscal Year 12/31
http://www.edgar-online.com
© Copyright 2011, EDGAR Online, Inc. All Rights Reserved.
Distribution and use of this document restricted under EDGAR Online, Inc. Terms of Use.

Table of contents

  • Page 1
    AVIS BUDGET GROUP, INC. FORM 10-K (Annual Report) Filed 02/24/10 for the Period Ending 12/31/09 Telephone CIK Symbol SIC Code Industry Sector Fiscal Year 973-496-2579 0000723612 CAR 7510 - Automotive Rental And Leasing, Without Drivers Rental & Leasing Services 12/31 http://www.edgar-online.com...

  • Page 2
    ... New York Stock Exchange SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT: None Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Indicate by check mark if the registrant is not required to file reports pursuant...

  • Page 3
    ... Officers and Corporate Governance Executive Compensation Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters Certain Relationships and Related Transactions, and Director Independence Principal Accountant Fees and Services PART IV Exhibits and Financial...

  • Page 4
    ... of an increase in the cost of new vehicles and/or a decrease in the price at which we dispose of used vehicles either in the used vehicle market or under repurchase or guaranteed depreciation programs; the results of operations or financial condition of the manufacturers of our cars, which could...

  • Page 5
    ... to personally identifiable information; any impact on us from the actions of our licensees, dealers and independent contractors; substantial increases in the cost, or decreases in the supply, of fuel, vehicle parts, energy or other resources on which we depend to operate our business; risks related...

  • Page 6
    ... leading vehicle rental operator in North America, Australia, New Zealand and certain other regions we serve, based on published airport statistics. We maintain a leading share of airport car rental revenue and operate one of the leading consumer truck rental businesses in the United States. Our car...

  • Page 7
    ... and corporate managed business travel agency networks. We are an "approved" or "preferred" provider for customers of a majority of the largest auto insurance companies in the United States. In 2009, as a result of our heightened focus on car class upgrades, sales of ancillary products and services...

  • Page 8
    ... our avis.com and budget.com websites, which are our least-expensive sources of advance bookings. • Expanding Our Revenue Sources . We plan to continue to focus on car class upgrades and expand our ancillary revenues by offering additional products and services to on- and off-airport customers and...

  • Page 9
    ... based on total revenue and number of locations. The Avis System encompasses locations at most of the largest airports and cities in the United States and internationally. The Avis System in Europe, Africa, the Middle East and parts of Asia is primarily operated under royalty-free license agreements...

  • Page 10
    ... Avis brand provides high-quality car rental services at price points generally above non-branded and value-branded national car rental companies. We offer Avis customers a variety of premium services, including Avis Preferred, a counter bypass program, which is available at major airport locations...

  • Page 11
    ... from customers renting at airports and locally, respectively. Budget is a leading rental car supplier to the value-conscious segments of the industry. Budget offers its customers Fastbreak, an expedited rental service for frequent travelers, which operates much like Avis Preferred, as well as...

  • Page 12
    ... brands whereby lodging customers making reservations by telephone may be transferred to Avis if they desire to rent a vehicle. In 2009, approximately 82% of domestic vehicle rental transactions from our owned and operated Avis locations in the United States were generated by travelers who rented...

  • Page 13
    ...or Budget car and/or truck rental business in a particular geographic area. Under agreements that predate our ownership of Avis or Budget, a limited number of franchisees in the United States are also separately franchised exclusively to sell used cars under the Avis and/or Budget brand. Our current...

  • Page 14
    ... the rental agreement. In addition, we receive reimbursement from our customers for certain operating expenses we incur, including gasoline and vehicle licensing fees, as well as airport concession fees, which we pay in exchange for the right to operate at airports and other locations. Websites Avis...

  • Page 15
    ... System, and to obtain Avis or Budget rate, location and fleet information as well as book reservations for their customers; and Operations management programs that, among other things, enable field personnel to manage which vehicles will be rented next. We also use data supplied from the Wizard...

  • Page 16
    ... number of vehicles purchased for our fleet by approximately 15% in 2009 compared to 2008, to reduce fleet costs and keep fleet levels aligned with rental demand. Vehicle disposition . We generally hold a vehicle in our domestic fleet for a term of four to 16 months. For 2009 and 2008, approximately...

  • Page 17
    ...their rental experience. Results are analyzed generally and by location to help further enhance our service levels to our customers. In addition, we utilize a toll-free "800" number and a dedicated customer service e-mail address to allow customers of both Avis and Budget to report problems directly...

  • Page 18
    ... and corporate customers to offset the emissions from their rental car use. Renters can offset emissions on a daily, weekly or monthly basis on avis.com or budget.com. Airport Concession Fees In general, concession fees for on-airport locations are based on a percentage of total commissionable...

  • Page 19
    ..." moving services. INSURANCE We generally assume the risk of liability to third parties arising from vehicle rental services in the United States, Canada, Puerto Rico and the U.S. Virgin Islands, in accordance with the minimum financial responsibility requirements and primacy of coverage laws of the...

  • Page 20
    ... partners. Carey recorded operating losses in 2009, and we have reduced the carrying value of our investment to zero. TRADEMARKS AND INTELLECTUAL PROPERTY The service marks "Avis" and "Budget", related marks incorporating the words "Avis" or "Budget", and related logos and marks such as "We try...

  • Page 21
    ...-corporate transfers of assets within the holding company structure. Such insurance statutes may also require that we obtain limited licenses to sell optional insurance coverage to our customers at the time of rental. Franchise Regulation The sale of franchises is regulated by various state laws...

  • Page 22
    ... Contents COMPANY INFORMATION Our principal executive office is located at 6 Sylvan Way, Parsippany, New Jersey 07054 (telephone number: (973) 496-4700). We are subject to the informational requirements of the Securities Exchange Act of 1934, as amended, and in accordance therewith, we file reports...

  • Page 23
    ...be used to anticipate results or trends in future periods. Risks related to our business The high level of competition in the vehicle rental industry may lead to reduced rental volumes and increased pricing pressure, which could have an adverse impact on our results of operations. The vehicle rental...

  • Page 24
    ... or reduce the terms of these incentive programs. Our failure to purchase pre-determined volumes of cars for our rental fleet, or an elimination of or reduction in incentive payments, could cause our per-unit fleet costs to increase substantially and adversely impact our financial condition and...

  • Page 25
    ... manufacturers significantly curtail production, or determine to curtail sales to us or the vehicle rental industry for any reason, we may not be able to obtain a sufficient number of vehicles to operate our business without significantly increasing our fleet costs. In addition, our vehicles may be...

  • Page 26
    ... costs through these actions, our financial condition and results of operations could be adversely impacted. Similarly, we have been increasing the ancillary revenues associated with our vehicle rental business, such as revenue from selling insurance coverages and where2 GPS navigation rentals...

  • Page 27
    ...to liability and insurance. Our businesses expose us to claims for personal injury, death and property damage related to the use of our vehicles and for workers' compensation claims and other employment-related claims by our employees. We may become exposed to uninsured liability at levels in excess...

  • Page 28
    .... Optional insurance products, including, but not limited to, supplemental liability insurance, personal accident insurance and personal effects protection, we offer to renters providing various insurance coverages in our domestic vehicle rental operations, are regulated under state laws governing...

  • Page 29
    ... loss of the right to collect credit card payments, which would materially impact operations. Failure to protect customer credit card and other information can also result in governmental investigations or material civil or criminal liability. Significant increases in fuel costs or reduced supplies...

  • Page 30
    ... to fund working capital, capital expenditures, debt service requirements, execution of our business strategy, or acquisitions and other purposes; requiring us to dedicate a substantial portion of our cash flow from operations to pay principal and interest on our debt, which would reduce the funds...

  • Page 31
    ... that we would be able to replace the relevant financings on reasonable terms or at all. An increase in interest rates would increase the cost of servicing our debt and could reduce our profitability. A significant amount of our borrowings, primarily our vehicle-backed borrowings, bear interest at...

  • Page 32
    ... our future debt instruments may contain, various provisions that limit our ability to, among other things incur additional debt; provide guarantees in respect of obligations of other persons; issue redeemable stock and preferred stock; pay dividends or distributions or redeem or repurchase capital...

  • Page 33
    ... by securities analysts or our ability to meet those estimates; changes in investors' and analysts' perceptions of our industry, business or related industries; the operating and stock price performance of other comparable companies; overall market fluctuations; and general economic conditions and...

  • Page 34
    ... consent; rules regarding how stockholders may present proposals or nominate directors for election at stockholder meetings; the right of our Board to issue preferred stock without stockholder approval; and limitations on the right of stockholders to remove directors. Delaware law also imposes...

  • Page 35
    ... operations. In addition, there are approximately eight other leased office locations in the United States used for administrative activities, regional sales and operations activities. In 2009, our contact center located in Wichita Falls, Texas and our office located in Orlando, Florida were closed...

  • Page 36
    ...attorneys' fees and costs. The Company filed an answer on July 7, 2008 and the parties have completed discovery on class certification issues. A second civil collective action complaint was filed against us in the District of New Jersey in July 2009, alleging misclassification of airport managers as...

  • Page 37
    ...jury trial for damages related to breach of contract in the United States District Court for the District of Alaska. The lawsuit, which was filed in 2003 by one of our licensees, involved breach of contract and other claims related to the acquisition of our Budget vehicle rental business in 2002. We...

  • Page 38
    ... the New York Stock Exchange ("NYSE") under the symbol "CAR". At January 29, 2010, the number of stockholders of record was approximately 3,884. The following table sets forth the quarterly high and low sales prices per share of our common stock as reported by the NYSE for 2009 and 2008. 2009 First...

  • Page 39
    ...1998 Employee Stock Purchase Plan and the 2009 Employee Stock Purchase Plan, both approved by stockholders. Of the approximately 9.8 million shares of our common stock to be issued upon exercise of outstanding options, stock settled stock appreciation rights and restricted stock units, approximately...

  • Page 40
    Table of Contents options granted under this plan may be authorized and unissued shares or treasury shares. In the event of any change in corporate capitalization, any reorganization of our Company or a similar event, shares subject to outstanding options, the exercise price of outstanding options ...

  • Page 41
    ... commencing on the last trading day before January 1, 2005 and ending on December 31, 2009, and (b) the difference between our stock price at the end and the beginning of the periods presented by (ii) the share price at the beginning of the periods presented with (B) the Standard & Poor's MidCap...

  • Page 42
    ... (a) Financial Position Total assets Assets of discontinued operations Assets under vehicle programs Long-term debt, including current portion Debt under vehicle programs (b) Stockholders' equity (a) At or For the Year Ended December 31, 2008 2007 2006 (In millions, except per share data) $ 5,984...

  • Page 43
    ... valuations for vehicle services and other companies, as well as reduced profit forecasts due to soft economic conditions and increased financing costs. In 2007, we recorded a $1,195 million ($1,073 million, net of tax) noncash charge for the impairment of goodwill at each of our reporting units to...

  • Page 44
    ...financial condition and results of operations Domestic enplanements, which declined in 2009 compared to 2008; Difficulty in achieving sustained pricing increases; Rising per-unit car fleet costs and changes in conditions in the used vehicle marketplace; Changes in the financial condition of vehicle...

  • Page 45
    Table of Contents Our strategies to expand in off-airport or local vehicle rentals, including insurance replacement rentals; Increases in borrowing costs, and decreases in market willingness to purchase, corporate and vehicle-related debt; Changes in foreign exchange rates; and Demand for truck ...

  • Page 46
    ... selling, general and administrative expenses mainly related to reduced marketing and commission costs in light of lower rental volumes. The decrease in total expenses includes a positive impact from foreign currency exchange rates of $42 million and also reflects numerous actions taken in late 2008...

  • Page 47
    ... reduced costs during 2009 in response to the sharp decline in demand. EBITDA reflected a $425 million (16%) decrease in operating expenses, including (i) a $218 million decrease in maintenance and damage, agency operator commissions, shuttling, credit card fees, and other costs amid lower rental...

  • Page 48
    ... million (8%) increase in ancillary revenues, such as counter sales of insurance products, GPS navigation unit rentals, gasoline sales and fees charged to customers. In addition, the total revenue decrease includes a $7 million favorable effect related to foreign currency exchange rate fluctuations...

  • Page 49
    ... * 2008 $ 12 141 (4) (13) 136 88 129 1,262 $(1,343) EBITDA 2007 $ 265 131 17 1 414 84 127 1,195 $ (992) (a) Domestic Car Rental International Car Rental Truck Rental Corporate and Other (b) Total Company Less: Non-vehicle related depreciation and amortization Interest expense related to corporate...

  • Page 50
    ... charges recorded in 2008 for severance related expenses and costs for facility closures. These cost increases were offset by a $3 million reduction in insurance costs due to favorable claims experience and a $7 million gain on our foreign exchange earnings hedges. Truck Rental Revenues and EBITDA...

  • Page 51
    ...to reductions in the size of our car rental fleet to reflect reduced car rental demand. See "Liquidity and Capital Resources-Debt and Financing Arrangements" for a detailed account of the change in our debt related to vehicle programs. Stockholders' equity increased $129 million, primarily due to an...

  • Page 52
    ... programs, which (i) used approximately $1.8 billion less cash to purchase vehicles during the year as we strategically maintained a smaller car rental fleet and (ii) recorded a $422 million increase in proceeds on disposition of vehicles. Additionally, we reduced spending by $144 million related...

  • Page 53
    ... reflects maturities of capital lease arrangements. The following table provides the contractual maturities for our corporate debt and our debt under vehicle programs (including related party debt due to Avis Budget Rental Car Funding) at December 31, 2009: Debt under Corporate Debt Due in...

  • Page 54
    ... debt arrangements related to our vehicle programs at December 31, 2009: Total Capacity (a) Outstanding Borrowings $ 3,660 220 31 463 4,374 Available Capacity $ 2,325 411 2,736 Debt due to Avis Budget Rental Car Funding (b) Budget Truck Financing: Budget Truck Funding program (c) Capital leases...

  • Page 55
    ...vehicle programs (including related party debt due to Avis Budget Rental Car Funding, an unconsolidated bankruptcy remote qualifying special purpose limited liability company, see Note 18 to our Consolidated Financial Statements), which was issued to support the purchase of vehicles. Operating lease...

  • Page 56
    ... vehicle services and other companies, as well as reduced profit forecasts due to soft economic conditions and increased financing costs. Domestic Car Rental operations recorded $882 million and International Car Rental recorded $275 million, for goodwill and tradename impairment, and Truck Rental...

  • Page 57
    ...levels based on interest rate yield curves, credit spreads of the Company and counterparties, volatility factors, and an estimation of the timing of future cash flows. The use of different assumptions may have a material effect on the estimated fair value amounts recorded in the financial statements...

  • Page 58
    ... MARKET RISK We use various financial instruments, particularly swap contracts, futures and options contracts, to manage and reduce the interest rate risk related specifically to our debt. Foreign currency forwards are also used to manage and reduce the foreign currency exchange rate risk associated...

  • Page 59
    ... necessity to conduct the analysis based on a single point in time and the inability to include the complex market reactions that normally would arise from the market shifts modeled. We used December 31, 2009, 2008 and 2007 market rates on outstanding financial instruments to perform the sensitivity...

  • Page 60
    Table of Contents REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Board of Directors and Stockholders of Avis Budget Group, Inc. We have audited the internal control over financial reporting of Avis Budget Group, Inc. and subsidiaries (the "Company") as of December 31, 2009, based on ...

  • Page 61
    ... Company's Annual Proxy Statement under the section titled "Certain Relationships and Related Transactions" and "Board of Directors" is incorporated herein by reference in response to this item. ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES The information contained in the Company's Annual Proxy...

  • Page 62
    ...duly authorized. AVIS BUDGET GROUP, INC. By: /s/ BRETT D. WEINBLATT Brett D. Weinblatt Senior Vice President and Chief Accounting Officer Date: February 23, 2010 Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf...

  • Page 63
    Table of Contents INDEX TO CONSOLIDATED FINANCIAL STATEMENTS Page Report of Independent Registered Public Accounting Firm Consolidated Statements of Operations for the years ended December 31, 2009, 2008 and 2007 Consolidated Balance Sheets as of December 31, 2009 and 2008 Consolidated Statements of...

  • Page 64
    ... respects, the financial position of the Company as of December 31, 2009 and 2008, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2009, in conformity with accounting principles generally accepted in the United States of America. Also...

  • Page 65
    Table of Contents Avis Budget Group, Inc. CONSOLIDATED STATEMENTS OF OPERATIONS (In millions, except per share data) Year Ended December 31, 2009 2008 2007 Revenues Vehicle rental Other Net revenues Expenses Operating Vehicle depreciation and lease charges, net Selling, general and administrative ...

  • Page 66
    ...: Program cash Vehicles, net Receivables from vehicle manufacturers and other Investment in Avis Budget Rental Car Funding (AESOP) LLC-related party Total assets Liabilities and stockholders' equity Current liabilities: Accounts payable and other current liabilities Current portion of long-term debt...

  • Page 67
    ... Accounts payable and other current liabilities Other, net Net cash provided by operating activities exclusive of vehicle programs Vehicle programs: Vehicle depreciation Net cash provided by operating activities Investing activities Property and equipment additions Proceeds received on asset sales...

  • Page 68
    Table of Contents Avis Budget Group, Inc. CONSOLIDATED STATEMENTS OF CASH FLOWS (Continued) (In millions) 2009 Financing activities Proceeds from borrowings Principal payments on borrowings Proceeds from warrant issuance Purchase of call options Repurchases of common stock Issuances of common stock ...

  • Page 69
    ...of $59 Pension liability adjustment, net of tax of $(5) Total comprehensive loss Adoption of FIN 48 Net activity related to restricted stock units Exercise of stock options Tax benefit from exercise of stock options Activity related to employee stock purchase plan Post-separation dividend adjustment...

  • Page 70
    Table of Contents Avis Budget Group, Inc. CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (Continued) (In millions) Common Stock Shares 136.8 Amount $ 1 Additional Retained Balance at January 1, 2009 Comprehensive income: Net loss Currency translation adjustment Unrealized gains on cash flow hedges,...

  • Page 71
    ..., Australia, Canada, New Zealand, Puerto Rico and the U.S. Virgin Islands. Truck Rental -provides truck rentals and related services to consumers and light commercial users in the United States. In presenting the Consolidated Financial Statements in accordance with accounting principles generally...

  • Page 72
    ... the Company's former Travel Distribution Services segment. Avis Budget Group, Inc. -encompasses the Company's vehicle rental operations. On July 31, 2006, the Company completed the spin-offs of Realogy and Wyndham in tax-free distributions of one share each of Realogy and Wyndham common stock for...

  • Page 73
    ...the operation and franchising of the Avis and Budget rental systems, providing vehicle rentals and other services to business and leisure travelers and others. Other revenue includes rentals of GPS navigational units, sales of loss damage waivers and insurance products, fuel and fuel service charges...

  • Page 74
    ... asset exceeds its fair value, an impairment loss is recognized in an amount equal to that excess. The Company assesses goodwill for such impairment by comparing the carrying value of each reporting unit to its fair value using the present value of expected future cash flows. If this first step of...

  • Page 75
    ... for vehicle services and other companies, as well as reduced profit forecasts due to soft economic conditions and increased financing costs. Domestic Car Rental recorded $882 million and International Car Rental recorded $275 million for goodwill and tradenames impairment and Truck Rental recorded...

  • Page 76
    ... Consolidated Statements of Operations, include radio, television, "yellow pages" and other advertising, travel partner points programs, internet advertising and other promotions and were $87 million in 2009 and approximately $106 million in both 2008 and 2007. TAXES The Company accounts for income...

  • Page 77
    ... cost of claims incurred as of the balance sheet date. These amounts are included within accounts payable and other current liabilities. ADOPTION OF NEW ACCOUNTING STANDARDS DURING 2009 In December 2007 and April 2009, the Financial Accounting Standards Board ("FASB") issued new guidance related...

  • Page 78
    ... on its financial statements at the time of adoption. In December 2008, the FASB issued new guidance related to ASC topic 715, Compensation-Retirement Benefits , to provide additional disclosures about pension plan assets and the Company's pension plan investment policy. The Company adopted this...

  • Page 79
    ... 15, 2010. The Company is currently evaluating the impact on its financial statements. 3. Discontinued Operations Travelport. On August 23, 2006, the Company completed the sale of Travelport, which comprised the Company's former travel distribution services businesses for proceeds of approximately...

  • Page 80
    ... outstanding stock options for 2009, 2008 and 2007. Represents all outstanding warrants for 2009, 2008 and 2007. The exercise price for the warrants issued in 2009 was $22.50. The warrants outstanding in 2007 had an exercise price of $21.31 and expired in June 2008. Represents the number of shares...

  • Page 81
    ...-point plan. 2006 Restructuring Initiative In 2006, the Company committed to various strategic initiatives targeted principally at reducing costs, enhancing organizational efficiency and consolidating and rationalizing existing processes and facilities within its Budget Truck Rental and Domestic Car...

  • Page 82
    ...termination of employment to approximately 1,750 employees, representing a wide range of employee groups. As of December 31, 2009, the Company had terminated substantially all of these employees. At December 31, 2009, the remaining liability relates primarily to required minimum lease payments. The...

  • Page 83
    ... 2009, 2008 and 2007, respectively. The number of Company-owned and franchised outlets in operation (excluding independent commissioned dealer locations for the Budget truck rental business and Avis and Budget locations operated by or through Avis Europe Holdings, Limited, an independent third party...

  • Page 84
    ... The increase in trademarks is primarily due to fluctuations in foreign currency. Amortization expense relating to all intangible assets was as follows: 2009 Franchise agreements Customer lists Total $ $ Year Ended December 31, 2008 2007 2 $ 2 $ 2 1 1 1 3 $ 3 $ 3 Based on the Company's amortizable...

  • Page 85
    ...the Company's Avis Budget Car Rental, LLC ("Avis Budget Car Rental") subsidiary. Such interest is recorded within interest expense related to corporate debt, net on the accompanying Consolidated Statements of Operations. 10. Income Taxes The income tax benefit consists of the following: 2009 Current...

  • Page 86
    Table of Contents Pretax income (loss) for domestic and foreign operations consists of the following: Year Ended December 31, 2009 2008 2007 $ (146) $ (1,404) $ (1,064) 69 61 72 $ (77) $ (1,343) $ (992) Domestic Foreign Pretax loss Current and non-current deferred income tax assets and liabilities...

  • Page 87
    ...in Australia. The following is a tabular reconciliation of the total amounts of unrecognized tax benefits for the year: 2009 $ 601 1 6 (4) (1) $ 603 F-25 December 31, 2008 $ 612 27 (36) (2) $ 601 2007 614 21 (23) $ 612 $ Balance at January 1, Additions based on tax positions related to the current...

  • Page 88
    ... tax credits in the amount of $104 million and tax loss carryforwards in the amount of $10 million, $10 million and $15 million as of December 31, 2009, 2008 and 2007, respectively. As of December 31, 2009, the unrecognized tax benefits recorded in Accounts payable and other current liabilities were...

  • Page 89
    ... amounts are due from Realogy and Wyndham on demand upon the Company's settlement of the related liability. At December 31, 2009 and 2008, there are corresponding liabilities recorded within accounts payable and other current liabilities. During 2009, $573 million of receivables from Realogy and...

  • Page 90
    ... value below its carrying value, based on cash flow estimates. This impairment charge reduced the carrying value of the Company's investment in Carey to zero. In 2009, the Company's share of Carey's operating results was a net loss of $11 million. In 2008, the Company recorded an $18 million charge...

  • Page 91
    ...Other Current Liabilities Accounts payable and other current liabilities consisted of: As of December 31, 2009 2008 $ 399 $ 151 162 145 134 97 106 89 62 73 35 106 294 320 $ 1,272 $ 901 Income taxes payable-current (a) Accounts payable Accrued payroll and related Public liability and property damage...

  • Page 92
    ... and up to 66% of the capital stock of each direct foreign subsidiary, subject to certain exceptions, and liens on substantially all of the Company's intellectual property and certain other real and personal property. AVIS BUDGET GROUP, INC. CORPORATE DEBT 3 1 / 2 % Convertible Senior Notes The...

  • Page 93
    ...AVIS BUDGET CAR RENTAL CORPORATE DEBT Floating Rate Term Loan The Company's floating rate term loan was entered into in April 2006. This facility has a six year term and bears interest at three month LIBOR plus 375 basis points, for a rate of 4.0% at December 31, 2009. Quarterly installment payments...

  • Page 94
    ... Avis Budget Rental Car Funding (a) Budget Truck financing: Budget Truck Funding program (b) Capital leases (c) Other (a) As of December 31, $ 2008 5,142 316 126 450 6,034 $ 2009 3,660 220 31 463 4,374 $ $ (b ) (c) The decrease reflects reduced borrowing within Domestic Car Rental operations...

  • Page 95
    Table of Contents Avis Budget Rental Car Funding (AESOP) LLC . Avis Budget Rental Car Funding, an unconsolidated bankruptcy remote qualifying special purpose limited liability company, issues private placement notes to investors as well as to bank conduit facilities. Avis Budget Rental Car Funding ...

  • Page 96
    ... average interest rate as of December 31, 2009 and 2008 was 4% and 5%, respectively. The following table provides the contractual maturities of the Company's debt under vehicle programs (including related party debt due to Avis Budget Rental Car Funding) at December 31, 2009: VehicleCapital 2010...

  • Page 97
    ... are recoverable from vehicle rental customers. The Company maintains concession agreements with various airport authorities that allow the Company to conduct its car rental operations onsite. In general, concession fees for airport locations are based on a percentage of total commissionable revenue...

  • Page 98
    ... of the contingent and other corporate liabilities may be adversely impacted. In accordance with the terms of the Separation Agreement, Realogy posted a letter of credit in April 2007 for the benefit of the Company to cover its estimated share of the Assumed Liabilities discussed above, subject to...

  • Page 99
    ... upon the sale of vehicles in the used car market and under repurchase and guaranteed depreciation programs. Other Purchase Commitments In the normal course of business, the Company makes various commitments to purchase goods or services from specific suppliers, including those related to capital...

  • Page 100
    ... various real estate operating leases. The maximum potential amount of future payments that the Company may be required to make under the guarantees relating to the various real estate operating leases is estimated to be approximately $237 million. At December 31, 2009, the liability recorded by the...

  • Page 101
    ... 2009, 2008 and 2007, the Company did not pay cash dividends. Share Repurchases During 2009 and 2007, the Company did not repurchase any of its common stock. During 2008, the Company used approximately $33 million of available cash to repurchase approximately 2.9 million shares of Avis Budget Group...

  • Page 102
    ... rate debt (see Note 23-Financial Instruments). Such amount in 2009 includes $78 million ($47 million, net of tax) of unrealized gains on cash flow hedges related to the Company's vehicle-backed debt and is offset by a corresponding increase in the Company's Investment in Avis Budget Rental Car...

  • Page 103
    ... following table presents the assumptions used to estimate the fair value of stock options at the time of the grant using the Black-Scholes and Monte Carlo simulation option pricing models: Expected volatility of stock price Risk-free interest rate Expected life of options Dividend yield The annual...

  • Page 104
    ... Employee Stock Purchase Plan, the purchase price of the stock was calculated as 95% of the fair market value of Avis Budget common stock as of last business day each month. During 2009, the Company sold approximately 16,000 shares under this plan. As of December 31, 2009, the 1998 Employee Stock...

  • Page 105
    Table of Contents In June 2009, stockholders approved the adoption of the Avis Budget Group Inc. Employee Stock Purchase Plan, which became effective on January 1, 2010. Under the new terms of the ESPP, the fair market value of the shares of Avis Budget common stock which may be purchased by any ...

  • Page 106
    ... 2008 6.25% 6.25% 8.25% 2009 Discount rate: Net periodic benefit cost Benefit obligation Long-term rate of return on plan assets 6.25% 5.75% 8.25% 2007 5.75% 6.25% 8.25% To select a discount rate for its defined benefit pension plans, the Company uses a modeling process that involves matching the...

  • Page 107
    ... with current market conditions and broad asset mix considerations. The expected rate of return is a long term assumption and generally does not change annually. As of December 31, 2009, substantially all of the Company's defined benefit pension plans had a projected benefit obligation in excess of...

  • Page 108
    ...Class Cash equivalents Short term investments Domestic stock International stock Real estate investment trusts U.S. Government securities Non-U.S. government securities Corporate bonds Other assets Total assets Level 2 $ 2 3 66 26 5 11 3 38 2 $ 156 The Company estimates that future benefit payments...

  • Page 109
    ... at December 31, 2009 or 2008 other than (i) risks related to the Company's repurchase and guaranteed depreciation agreements with General Motors Company, Ford Motor Company, Hyundai Motor America, Chrysler Group LLC and Kia Motors America, Inc. with respect to program cars that were returned to the...

  • Page 110
    ...Interest rate contracts Total (a) $ $ - $ - Liabilities under vehicle programs $ 9 9 Amounts in this table exclude derivatives issued by Avis Budget Rental Car Funding (AESOP) LLC ("Avis Budget Rental Car Funding"), as it is not consolidated by the Company; however, certain amounts related to...

  • Page 111
    ... of financial instruments at December 31 are as follows: 2009 Estimated Carrying Amount Corporate debt Current portion of long-term debt Long-term debt Convertible debt Interest rate swaps and commodity instruments (a) Debt under vehicle programs Vehicle-backed debt due to Avis Budget Rental Car...

  • Page 112
    ..., 2009 Estimated Carrying Fair Value Amount $ $ December 31, 2008 Estimated Carrying Fair Value Amount $ 43 $ 43 Investment in Carey Holdings, Inc. 24. Segment Information The reportable segments presented below represent the Company's operating segments for which separate financial information is...

  • Page 113
    ... under vehicle programs Assets under vehicle programs Capital expenditures (excluding vehicles) (a) Truck Rental $ 382 83 29 (4) 3 106 508 1 Corporate and Other (a) Domestic Car Rental $ 4,695 1,403 262 12 77 1,928 6,538 72 Car Rental $ 904 211 30 141 8 485 780 10 $ 3 (13) 973 - Total $5,984...

  • Page 114
    ... financial information is being presented in relation to the Company's Guarantee of the Notes issued by Avis Budget Car Rental. See Note 17-Long-term Debt and Borrowing Arrangements for additional description of these Notes. The Notes have separate investors than the equity investors of the Company...

  • Page 115
    ... December 31, 2009 Subsidiary Parent Revenues Vehicle rental Other Net revenues Expenses Operating Vehicle depreciation and lease charges, net Selling, general and administrative Vehicle interest, net Non-vehicle related depreciation and amortization Interest expense related to corporate debt, net...

  • Page 116
    ... December 31, 2008 Subsidiary Parent Revenues Vehicle rental Other Net revenues Expenses Operating Vehicle depreciation and lease charges, net Selling, general and administrative Vehicle interest, net Non-vehicle related depreciation and amortization Interest expense related to corporate debt, net...

  • Page 117
    ... December 31, 2007 Subsidiary Parent Revenues Vehicle rental Other Net revenues Expenses Operating Vehicle depreciation and lease charges, net Selling, general and administrative Vehicle interest, net Non-vehicle related depreciation and amortization Interest expense related to corporate debt, net...

  • Page 118
    ...: Program cash Vehicles, net Receivables from vehicle manufacturers and other Investment in Avis Budget Rental Car Funding (AESOP) LLC-related party Total assets Liabilities and stockholders' equity Current liabilities: Accounts payable and other current liabilities Current portion of long-term debt...

  • Page 119
    ...: Program cash Vehicles, net Receivables from vehicle manufacturers and other Investment in Avis Budget Rental Car Funding (AESOP) LLC-related party Total assets Liabilities and stockholders' equity Current liabilities: Accounts payable and other current liabilities Current portion of long-term debt...

  • Page 120
    ...of vehicle programs Vehicle programs: Proceeds from borrowings Principal payments on borrowings Net change in short-term borrowings Other, net Net cash provided by (used in) financing activities Effect of changes in exchange rates on cash and cash equivalents Net increase (decrease) in cash and cash...

  • Page 121
    ...of vehicle programs Vehicle programs: Proceeds from borrowings Principal payments on borrowings Net change in short-term borrowings Other, net Net cash provided by (used in) financing activities Effect of changes in exchange rates on cash and cash equivalents Net increase (decrease) in cash and cash...

  • Page 122
    ... Proceeds from disposition of businesses, net of transaction-related payments Purchase of equity investment Other, net Net cash provided by (used in) investing activities exclusive of vehicle programs Vehicle programs: Decrease (increase) in program cash Investment in vehicles Proceeds received on...

  • Page 123
    and cash Equivalents Cash and cash equivalents, beginning of period Cash and cash equivalents, end of period 2 35 $ 37 $ 24 75 99 $ F-60 (17) 29 12 $ 33 33 66 $ $ 42 172 214

  • Page 124
    ... stock equivalents outstanding during each quarter, which may fluctuate, based on quarterly income levels, market prices and share repurchases. Therefore, the sum of the quarters' per share information may not equal the total year amounts presented on the Consolidated Statements of Operations. 2009...

  • Page 125
    Table of Contents Schedule II - Valuation and Qualifying Accounts (in millions) Balance at Beginning of Period Other - Translation Adjustment Balance at End of Period Description Allowance for Doubtful Accounts: Year Ended December 31, 2009 2008 2007 Tax Valuation Allowance: Year Ended December 31,...

  • Page 126
    ... 2009 among Avis Budget Car Rental, LLC and Avis Budget Finance, Inc. as Issuers, the guarantors from time to time parties thereto and the Bank of Nova Scotia Trust Company of New York, as trustee. Form of Exchange Floating Rate Note (Included in Exhibit 10.4 to the Company's Current Report on Form...

  • Page 127
    ... ended March 31, 2008 dated May 7, 2008). †Amendment No. 2 to the Avis Budget Group, Inc. 2007 Equity and Incentive Plan (Incorporated by reference to Exhibit 10.1 of the Company's Current Report on Form 8-K dated June 18, 2009). †Amendment No. 3 to the Avis Budget Group, Inc. 2007 Equity and...

  • Page 128
    ....16 to the Company's Annual Report on Form 10-K for the year ended December 31, 2005 dated March 1, 2006). †Avis Budget Group, Inc. Employee Stock Purchase Plan (Incorporated by reference to Exhibit 10.2 to the Company's Current Report on Form 8-K dated June 18, 2009). †Form of Award Agreement...

  • Page 129
    ... the Company's Current Report on Form 8-K dated January 20, 2006). Second Amendment, dated as of May 9, 2007, among AESOP Leasing L.P., as Borrower, PV Holding Corp., as Permitted Nominee, Quartx Fleet Management, Inc., as Permitted Nominee, and Avis Budget Rental Car Funding (AESOP) LLC, as Lender...

  • Page 130
    ... Motor Vehicle Operating Lease Agreement, dated as of December 23, 2005 (Incorporated by reference to Exhibit 10.3 to the Company's Current Report on Form 8-K dated January 20, 2006). Third Amendment, dated as of May 9, 2007, among AESOP Leasing L.P., as Lessor and Avis Budget Car Rental, LLC, as...

  • Page 131
    ..., dated as of May 9, 2007, among Avis Budget Rental Car Funding (AESOP) LLC, as Issuer, Avis Budget Car Rental, LLC, as Administrator, Mizuho Corporate Bank, Ltd., as Administrative Agent, certain financial institutions, as Purchasers, and The Bank of New York Trust Company, N.A. (as successor in...

  • Page 132
    ... 10.1 to the Company's Current Report on Form 8-K dated May 22, 2008). First Amendment, dated as of November 11, 2008, between Avis Budget Rental Car Funding (AESOP) LLC, as Issuer, and The Bank of New York Mellon Trust Company, N.A. (as successor in interest to The Bank of New York), as Trustee and...

  • Page 133
    ...LLC, Avis Budget Car Rental, LLC, as administrator, JPMorgan Chase Bank, N.A., as administrative agent, the commercial paper conduit purchasers, the funding agents and the APA Banks named therein, and The Bank of New York Mellon Trust Company, N.A., as trustee and as Series 2008-1 Agent. Series 2009...

  • Page 134
    ...Vehicle Operating Lease Agreement, dated as of May 11, 2006, among Budget Truck Funding, LLC††, as Lessor, Budget Truck Rental, LLC, as Administrator and as Lessee, and Avis Budget Car Rental, LLC, as Guarantor (Incorporated by reference to Exhibit 10.15 to the Company's Quarterly Report on Form...

  • Page 135
    ... Company's Annual Report on Form 10-K for the year ended December 31, 2008). Amendment No. 5 to the Series 2006-1 Supplement, dated as of August 21, 2009, between Centre Point Funding, LLC, as Issuer, Budget Truck Rental, LLC, as Administrator, Deutsche Bank Securities, Inc., Riverside Funding LLC...

  • Page 136
    ....4 to the Company's Current Report on Form 8-K dated February 4, 2005 Cendant Corporation* Officer Personal Financial Services Policy (Incorporated by reference to Exhibit 10.3 of the Company's Current Report on Form 8-K dated January 26, 2005). Form of TRAC Participation Agreement (Incorporated by...

  • Page 137
    ... of Bay Street Funding Trust, as limited partners (Incorporated by reference to Exhibit 10.4 to the Company's Current Report on Form 8-K dated December 20, 2006). Credit Agreement, dated as of April 19, 2006, among Avis Budget Holdings, LLC and Avis Budget Car Rental, LLC, as Borrower, the lenders...

  • Page 138
    ... Avis Budget Car Rental 2010 Model Year Program Letter dated August 28, 2009 between Avis Budget Car Rental, LLC and Ford Motor Company (Incorporated by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K dated September 2, 2009 Purchase Agreement by and among Cendant Corporation...

  • Page 139
    ...Car System, Inc. and Avis Europe plc (Incorporated by reference to Exhibit 10.61 to the Company's Annual Report on Form 10-K for the year ended December 31, 2007, dated February 29, 2008). Purchase Agreement dated as of October 7, 2009, by and among Avis Budget Group, Inc. and J.P. Morgan Securities...

  • Page 140
    ... Avis Budget Group, Inc. and Bank of America, N.A. (Incorporated by reference to Exhibit 10.4(e) to the Company's Current Report on Form 8-K dated October 13, 2009). Confirmation of Additional Warrants dated October 9, 2009, by and between Avis Budget Group, Inc. and JPMorgan Chase Bank, National...

  • Page 141
    ...Rental Car Funding (AESOP) LLC. **** Avis Rent A Car System, Inc. is now known as Avis Rent A Car System, LLC. ***** Avis Group Holdings, Inc. is now known as Avis Group Holdings, LLC. †Denotes management contract or compensatory plan. ††Budget Truck Funding, LLC is now known as Centre Point...

  • Page 142
    ..., LLC, a Delaware limited liability company (the " Company "), Avis Budget Finance, Inc., a Delaware corporation (" Finance " and, together with the Company, the " Issuers "), the Guarantors from time to time parties hereto (the " Guarantors "), and The Bank of Nova Scotia Trust Company of New York...

  • Page 143
    ..., such Guarantee shall also be reinstated), provided that the release of obligations described in this clause (ii) shall not apply to Avis Budget Group, Inc., (iii) upon the merger or consolidation of any Guarantor with and into the Company or another Guarantor that is the surviving Person in such...

  • Page 144
    ...Indenture and shall in no way modify or restrict any of the terms or provisions hereof. SECTION 2.08. BENEFITS OF THIRD SUPPLEMENTAL INDENTURE. Nothing in this Third Supplemental Indenture or the Notes, express or implied, shall give to any Person, other than the parties hereto and thereto and their...

  • Page 145
    ...GROUP HOLDINGS, LLC AVIS INTERNATIONAL, LTD. AVIS LEASING CORPORATION AVIS RENT A CAR SYSTEM, LLC PF CLAIMS MANAGEMENT, LTD. WIZARD CO., INC. AB CAR RENTAL SERVICES, INC. ARACS LLC AVIS OPERATIONS, LLC PR HOLDCO, INC. By: /s/ David Calabria Name: David Calabria Title: Assistant Treasurer AVIS BUDGET...

  • Page 146
    THE BANK OF NOVA SCOTIA TRUST COMPANY OF NEW YORK, as Trustee By: /s/ Warren Goshine Name: Warren Goshine Title: Authorized Officer Signature Page to Third Supplemental Indenture 5

  • Page 147
    ... our offer of employment with Avis Budget Car Rental LLC as Executive Vice President, Sales & Marketing. This position reports to Robert Salerno, President & Chief Operating Officer. We anticipate your start date to be on or about April 28, 2008. Your salary, paid on a bi-weekly basis, will be...

  • Page 148
    ... Avis Budget Car Rental LLC (or its successor) in an amount equal to 24 months of your then current annual base salary, plus target bonus, in lieu of any other severance payment under any other severance plan or policy. In addition, the Company will subsidize CORBA medical benefits to ensure you pay...

  • Page 149
    ... offer by signing the enclosed copy of this letter and returning to me in the enclosed envelope. In addition, please complete the W-4, I-9 and Avis Budget Car Rental Personal Data Form and fax to me at 973/496-3322 prior to your first day of employment. Per Avis Budget's standard policy, this letter...

  • Page 150
    .... Thomas Gartland Executive Vice President, Sales & Marketing Avis Budget Group 6 Sylvan Way Parsippany, NJ 07054 Dear Tom: We are pleased to confirm your continued employment with Avis Budget Car Rental, LLC, ("ABCR" or the "Company"), a subsidiary of Avis Budget Group, as Executive Vice President...

  • Page 151
    ...receive a lump sum cash payment within 15 days following the Release Date (or, in the event of your death, within 30 days of your death) equal to the fair market value as of your termination of employment of all of your stock-based awards. "Termination for Cause" shall mean: (i) your willful failure...

  • Page 152
    ...to this letter (or any other plan or agreement of the Company proving you with payments or benefits upon your separation from service) during the six-month period immediately following your separation from service shall instead be paid or provided on the first business day after the date that is six...

  • Page 153
    ... Way Parsippany, NJ 07054 Dear [ ]: We are pleased to confirm your continued employment with Avis Budget Car Rental, LLC, ("ABCR" or the "Company"), a subsidiary of Avis Budget Group, as [ ]. To comply with the requirements of Section 409A of the Internal Revenue Code and the regulations thereunder...

  • Page 154
    ... this letter (or any other plan or agreement of the Company providing you with payments or benefits upon your separation from service) during the six-month period immediately following your separation from service shall instead be paid or provided on the first business day after the date that is six...

  • Page 155
    ... Group, Inc. 2007 Equity and Incentive Plan (the " Plan "). Capitalized terms used but not defined herein have the meanings ascribed to them in the Plan. WHEREAS, Avis Budget Group, Inc. (the " Company ") has adopted the Plan; and WHEREAS, pursuant to Section 8(d) of the Plan, the Board of Directors...

  • Page 156
    IN WITNESS WHEREOF, this Amendment has been duly executed and delivered as of the date and year first written above. AVIS BUDGET GROUP, INC. /s/ Jean Marie Sera By: Jean Marie Sera Title: Senior Vice President and Secretary 2

  • Page 157
    ... or her account (including units deferred prior to the date of any amendment to the Plan), in the form of shares of Wyndham Corporation stock, on the date which is seven months immediately following the date upon which such Director is no longer a member of Avis's Board of Directors for any reason...

  • Page 158
    ... (" ABRCF "), AVIS BUDGET CAR RENTAL, LLC, a limited liability company established under the laws of Delaware, as administrator (the " Administrator "), JPMORGAN CHASE BANK, N.A., a national banking association, as administrative agent (the " Administrative Agent "), the several commercial paper...

  • Page 159
    ... 2008-1 Closing Date or such Increase Date, as applicable, or would occur and be continuing after giving effect to such Series 2008-1 Initial Invested Amount or such Increase;" 2. Direction . By their signatures hereto, each of the undersigned (excluding The Bank of New York Mellon Trust Company...

  • Page 160
    IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed by their respective duly authorized officers as of the date above first written. AVIS BUDGET RENTAL CAR FUNDING (AESOP) LLC, as Issuer By: /s/ Rochelle Tarlowe Name: Rochelle Tarlowe Title: Vice President and ...

  • Page 161
    THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A., as Trustee and Series 2008-1 Agent By: /s/ Sally R. Tokich Name: Sally R. Tokich Title: Senior Associate

  • Page 162
    JPMORGAN CHASE BANK, N.A., as Administrative Agent By: /s/ Adam Klimek Name: Adam Klimek Title: Vice President

  • Page 163
    ... SHEFFIELD RECEIVABLES CORPORATION, as a CP Conduit Purchaser under the Series 2008-1 Supplement By: Barclays Bank PLC as Attorney-in-Fact By: /s/ Jason D. Muncy Name: Jason D. Muncy Title: Associate Director BARCLAYS BANK PLC, as a Funding Agent and an APA Bank under the Series 2008-1 Supplement By...

  • Page 164
    LIBERTY STREET FUNDING LLC, as a CP Conduit Purchaser under the Series 2008-1 Supplement By: /s/ Jill A. Russo Name: Jill A. Russo Title: Vice President THE BANK OF NOVA SCOTIA, as a Funding Agent and an APA Bank under the Series 2008-1 Supplement By: /s/ Michael Eden Name: Michael Eden Title: ...

  • Page 165
    ...a CP Conduit Purchaser under the Series 2008-1 Supplement By: Bank of America, National Association, as Administrative Trustee By: /s/ William Van Beek Name: William Van Beek Title: Principal BANK OF AMERICA, NATIONAL ASSOCIATION, as a Funding Agent and an APA Bank under the Series 2008-1 Supplement...

  • Page 166
    CHARTA, LLC (as successor to Charta Corporation), as a CP Conduit Purchaser under the Series 2008-1 Supplement By: Citibank, N.A., as Attorney-in-fact By: /s/ Karrie L. Truglia Name: Karrie L. Truglia Title: Vice President CITIBANK, N.A., as an APA Bank under the Series 2008-1 Supplement By: /s/ ...

  • Page 167
    FALCON ASSET SECURITIZATION COMPANY LLC, as a CP Conduit Purchaser under the Series 2008-1 Supplement By: /s/ Adam Klimek Name: Adam Klimek Title: Vice President JPMORGAN CHASE BANK, N.A. as a Funding Agent under the Series 2008-1 Supplement By: /s/ Adam Klimek Name: Adam Klimek Title: Vice ...

  • Page 168
    ...as a CP Conduit Purchaser under the Series 2008-1 Supplement By: /s/ Lori Gebron Name: Lori Gebron Title: Vice President DEUTSCHE BANK AG, NEW YORK BRANCH, as a Funding Agent and an APA Bank under the Series 2008-1 Supplement By: /s/ Robert Sheldon Name: Robert Sheldon Title: Director By: /s/ Daniel...

  • Page 169
    ... LLC, as a CP Conduit Purchaser under the Series 2008-1 Supplement By: /s/ Sam Pilcer Name: Sam Pilcer Title: Managing Director By: /s/ Konstantina Kourmpetis Name: Konstantina Kourmpetis Title: Managing Director CALYON NEW YORK BRANCH, as a Funding Agent and an APA Bank under the Series 2008...

  • Page 170
    AMSTERDAM FUNDING CORPORATION, as a CP Conduit Purchaser under the Series 2008-1 Supplement By: /s/ Jill A. Russo Name: Jill A. Russo Title: Vice President THE ROYAL BANK OF SCOTLAND PLC, as an APA Bank under the Series 2008-1 Supplement by: RBS Securities Inc., as agent By: /s/ Michael Zappaterrini...

  • Page 171
    AVIS BUDGET CAR RENTAL, LLC, as Administrator By: /s/ Rochelle Tarlowe Name: Rochelle Tarlowe Title: Vice President and Treasurer

  • Page 172
    ... RENTAL CAR FUNDING (AESOP) LLC, as Issuer AVIS BUDGET CAR RENTAL, LLC, as Administrator DEUTSCHE BANK AG, NEW YORK BRANCH, as Administrative Agent CERTAIN CP CONDUIT PURCHASERS, CERTAIN FUNDING AGENTS, CERTAIN APA BANKS and THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A., as Trustee and Series 2009...

  • Page 173
    ... ABRCF "), AVIS BUDGET CAR RENTAL, LLC, a limited liability company established under the laws of Delaware (" ABCR "), as administrator (the " Administrator "), DEUTSCHE BANK AG, NEW YORK BRANCH (" DBNY "), in its capacity as administrative agent for the CP Conduit Purchasers, the APA Banks and the...

  • Page 174
    ... the Series 2009-3 Notes and the definitions of such terms are applicable to the singular as well as the plural form of such terms and to the masculine as well as the feminine and neuter genders of such terms: " ABCR " is defined in the recitals hereto. " ABG " means Avis Budget Group, Inc. " ABRCF...

  • Page 175
    ... such APA Bank on Schedule I. " Applicable Margin " is defined in the Fee Letter. " ARAC " means Avis Rent A Car System, LLC. " Article VII Costs " means any amounts due pursuant to Article VII and any interest accrued on such amounts pursuant to Section 3.4. " Asset Purchase Agreement " means, with...

  • Page 176
    ..." Business Day " means any day other than (a) a Saturday or a Sunday or (b) a day on which banking institutions in New York, New York or the city in which the corporate trust office of the Trustee is located are authorized or obligated by law or executive order to close. " Canadian Agent " means the...

  • Page 177
    ...Change in Law " means (a) any law, rule or regulation or any change therein or in the interpretation or application thereof (whether or not having the force of law), in each case, adopted, issued or occurring after the Series 2009-3 Closing Date or (b) any request, guideline or directive (whether or...

  • Page 178
    ...on the same terms and covering the same Vehicles as such Bankrupt Manufacturer's Manufacturer Program (and the related Assignment Agreements) in effect on the date such Bankrupt Manufacturer became subject to such Chapter 11 Proceedings and, at the time of the execution and delivery of such new post...

  • Page 179
    ... Purchaser for which the Monthly Funding Costs with respect to such Match Funding CP Conduit Purchaser is calculated by reference to a particular Discount and a particular CP Rate Period. " Credit Agreement " means the Credit Agreement, dated as of April 19, 2006, among Avis Budget Holdings, LLC...

  • Page 180
    ... 2009-3 Closing Date, the Increase Date or a conversion date, as the case may be, with respect to such Eurodollar Tranche and ending one month thereafter (or such other period which is acceptable to the Funding Agent with respect to such Purchaser Group and which in no event will be less than 7 days...

  • Page 181
    ... " Fee Letter " means the letter dated the date hereof, from ABRCF addressed to the Administrative Agent and each of the CP Conduit Purchasers, the Funding Agents and the APA Banks setting forth certain fees payable from time to time to the Purchaser Groups, as such letter may be amended or replaced...

  • Page 182
    ... time) on the second London Banking Day prior to the commencement of such Eurodollar Period, as the rate for dollar deposits with a maturity comparable to the Eurodollar Period applicable to such Eurodollar Tranche. " LOC Pro Rata Share " means, with respect to any Series 2009-3 Letter of Credit...

  • Page 183
    ... calculation shall not in any manner reduce the undersigned's actual liability in respect of any failure to pay any demand under its Series 2009-3 Letter of Credit). " London Banking Day " means any business day on which dealings in deposits in United States dollars are transacted in the London...

  • Page 184
    ... such Purchaser Group on such day times (B) the Program Fee Rate on such day divided by (C) 360. " Monthly Total Principal Allocation " means for any Related Month the sum of all Series 2009-3 Principal Allocations with respect to such Related Month. " Moody's " means Moody's Investors Service, Inc...

  • Page 185
    ... or in book-entry form which evidence (i) obligations the full and timely payment of which are to be made by or is fully guaranteed by the United States of America other than financial contracts whose value depends on the values or indices of asset values; (ii) demand deposits of, time deposits in...

  • Page 186
    ...rated by Standard & Poor's at such time. " Pooled Funding CP Conduit Purchaser " means each CP Conduit Purchaser that is not a Match Funding CP Conduit Purchaser. " Preference Amount " means any amount previously distributed to a member or members of a Purchaser Group on or relating to a Series 2009...

  • Page 187
    ... 2009-3 Demand Note Payment Amount as of the date of the conclusion or dismissal of such proceedings. " Prime Rate " means the rate of interest per annum publicly announced from time to time by Deutsche Bank AG, New York Branch as its prime rate in effect at its principal office in New York City...

  • Page 188
    ..., deposit, claims paying or credit (as the case may be) rating of at least "A1", in each case, from Moody's. " Record Date " means, with respect to each Distribution Date, the immediately preceding Business Day. " Related Additional APA Banks " is defined in Section 2.6(e). " Related Purchaser Group...

  • Page 189
    ...The Bank of New York Mellon Trust Company, N.A., as trustee and as agent for the benefit of the Series 2008-1 Noteholders, to the Base Indenture. " Series 2009-3 Accrued Interest Account " is defined in Section 3.1(b). " Series 2009-3 AESOP I Operating Lease Loan Agreement Borrowing Base " means, as...

  • Page 190
    ..., on any date after the Series 2009-3 Letter of Credit Termination Date, the Series 2009-3 Cash Collateral Account Surplus shall mean the excess, if any, of (x) the Series 2009-3 Available Cash Collateral Account Amount over (y) the Series 2009-3 Demand Note Payment Amount minus the Pre-Preference...

  • Page 191
    ...-3 Eligible Letter of Credit Provider " means a Person satisfactory to ABCR and the Demand Note Issuers and having, at the time of the issuance of the related Series 2009-3 Letter of Credit, a long-term senior unsecured debt, deposit, claims paying or credit (as the case may be) rating of at least...

  • Page 192
    ...immediately preceding Business Day over (B) the Series 2009-3 Maximum Non-Program Vehicle Percentage of the Net Book Value of all Vehicles leased under the AESOP I Operating Lease as of the immediately preceding Business Day; (ii) the Series 2009-3 Percentage of the greater of (x) the excess, if any...

  • Page 193
    ... Operating Lease as of the immediately preceding Business Day over (B) 10% of the Net Book Value of all Vehicles leased under the AESOP I Operating Lease as of the immediately preceding Business Day; (vii) the Series 2009-3 Percentage of the greater of (x) the excess, if any, of the Specified States...

  • Page 194
    ... Payment Deficit " means on any Distribution Date an amount equal to the excess, if any, of (a) the aggregate amount of Interest Collections which pursuant to Section 3.2(a), (b) or (c) would have been allocated to the Series 2009-3 Accrued Interest Account if all payments of Monthly Base Rent...

  • Page 195
    ... 2009-3 Monthly Lease Principal Payment Deficit for such Distribution Date and (b) the Series 2009-3 Lease Principal Payment Carryover Deficit for such Distribution Date. " Series 2009-3 Letter of Credit " means an irrevocable letter of credit, if any, substantially in the form of Exhibit E issued...

  • Page 196
    ... Series 2009-3 Maximum Non-Program Vehicle Amount or the Series 2009-3 Maximum Specified States Amount. " Series 2009-3 Maximum Hyundai Amount " means, as of any day, an amount equal to 20% of the aggregate Net Book Value of all Vehicles leased under the Leases on such day. " Series 2009-3 Maximum...

  • Page 197
    ... eligible for repurchase under a Manufacturer Program as of such date and (b) the denominator of which is the aggregate Net Book Value of all Vehicles leased under the AESOP I Operating Lease as of such date. " Series 2009-3 Moody's Highest Enhancement Rate " means, as of any date of determination...

  • Page 198
    ... aggregate Net Book Value of all Vehicles leased under the AESOP I Operating Lease as of such date and (b) the denominator of which is the aggregate Net Book Value of all Vehicles leased under the AESOP I Operating Lease as of such date. " Series 2009-3 Moody's Lowest Enhancement Rate " means, as of...

  • Page 199
    ... exists, the excess, if any, of (x) the Series 2009-3 AESOP I Operating Lease Loan Agreement Borrowing Base as of such date over (y) the Series 2009-3 Invested Amount as of such date. " Series 2009-3 Past Due Rent Payment " is defined in Section 3.2(f). " Series 2009-3 Percentage " means, as of...

  • Page 200
    ... the amount of cash and Permitted Investments on deposit in the Series 2009-3 Collection Account (not including amounts allocable to the Series 2009-3 Accrued Interest Account) and the Series 2009-3 Excess Collection Account on such date. " Series 2009-3 Required Reserve Account Amount " means, with...

  • Page 201
    ... to Section 3.5(c) or (d) on the Series 2009-3 Letters of Credit, the aggregate amount drawn by the Trustee on all Series 2009-3 Letters of Credit. " Standard & Poor's " means Standard & Poor's Ratings Services, a division of The McGraw-Hill Companies, Inc. " Standard & Poor's Excluded Manufacturer...

  • Page 202
    ... stock or membership interests of such Person and any other security of, or ownership interest in, such Person having ordinary voting power to elect a majority of the board of directors or a majority of the managers (or other Persons serving similar functions) of such Person. " Waiver Event " means...

  • Page 203
    ...-3 Closing Date to the Funding Agent with respect to such CP Conduit Purchaser for remittance to the Trustee for deposit into the Series 2009-3 Collection Account. (b) Maximum Purchaser Group Invested Amounts . Notwithstanding anything to the contrary contained in this Supplement, at no time shall...

  • Page 204
    ... of Exhibit B , of such request no later than 3:00 p.m. (New York City time) on the second Business Day prior to the Series 2009-3 Closing Date or such Increase Date, as the case may be. Such notice shall state (x) the Series 2009-3 Closing Date or the Increase Date, as the case may be, and (y) the...

  • Page 205
    ... of such Increase on the related Increase Date to the Funding Agent with respect to such Purchaser Group for deposit into the Series 2009-3 Collection Account. If such CP Conduit Purchaser does not fund the full amount of its Commitment Percentage of the Increase Amount and the related APA Banks are...

  • Page 206
    ... (New York City time) on the second Business Day prior to such Decrease; provided , further , that any such Decrease shall be in an amount equal to $10,000,000 and integral multiples of $1,000,000 in excess thereof (or if such Decrease will be used to reduce one or more Non-Extending Purchaser Group...

  • Page 207
    ... from time to time, with two (2) Business Day notice to the Trustee, increase the Series 2009-3 Maximum Invested Amount without the consent of the Administrative Agent or any of the APA Banks by transferring the Dollar equivalent (determined using the currency exchange rate in effect as of the close...

  • Page 208
    ...of the Base Indenture and (ii) notice to the Rating Agencies and Standard & Poor's of its request to extend the Scheduled Expiry Date. (c) On any Business Day during the Series 2009-3 Revolving Period, ABRCF may, upon two (2) Business Days' prior written notice to the Administrative Agent (effective...

  • Page 209
    ... respect to such Non-Extending Purchaser Group on such day times (y) the Program Fee Rate divided by (z) 360, and (v) for each day from but excluding the last day of the Series 2009-3 Interest Period immediately preceding the Purchase Effective Date, an amount equal to (x) the excess, if any, of the...

  • Page 210
    ...addition of the Additional CP Conduit Purchaser and the Related Additional APA Banks. No Purchaser Group shall be required to make any assignment unless such assigning Purchaser Group shall receive in cash an amount equal to the reduction in its Series 2009-3 Invested Amount. (f) On any Business Day...

  • Page 211
    ... Agent prior to 3:00 p.m. (New York City time) on the second Business Day prior to such Business Day. Such notice shall specify (i) the applicable Business Day, (ii) the CP Rate Period for each CP Tranche to which a portion of the Available CP Funding Amount with respect to such Purchaser Group...

  • Page 212
    ... the Series 2009-3 Closing Date to and including the Expiry Date with respect to such Purchaser Group in an aggregate amount equal to the sum of the amount for each day in such Series 2009-3 Interest Period equal to (i) the product of (x) the Commitment Fee Rate for such day and (y) the excess of...

  • Page 213
    ...each CP Conduit Purchaser, each APA Bank and each of their respective officers, directors, agents and employees (each, a " Company indemnified person ") from and against any loss, liability, expense, damage or injury suffered or sustained by (a " Claim ") such Company indemnified person by reason of...

  • Page 214
    ... pursuant to the Administration Agreement to allocate on each day, prior to 11:00 a.m. (New York City time) on each Series 2009-3 Deposit Date, all amounts deposited into the Collection Account as set forth below: (i) allocate to the Series 2009-3 Collection Account an amount equal to the sum of...

  • Page 215
    ... to 11:00 a.m. (New York City time) on any Series 2009-3 Deposit Date, all amounts deposited into the Collection Account as set forth below: (i) allocate to the Series 2009-3 Collection Account an amount equal to the sum of (A) the Series 2009-3 AESOP I Operating Lease Vehicle Percentage as of the...

  • Page 216
    ... be, to make principal payments in respect of the Series 2009-3 Notes. (e) Series 2009-3 Excess Collection Account . Amounts allocated to the Series 2009-3 Excess Collection Account on any Series 2009-3 Deposit Date will be (i) first, used to reduce the Purchaser Group Invested Amount with respect...

  • Page 217
    ..., the Lessees shall make payments of Monthly Base Rent or other amounts payable by the Lessees under the Leases on or prior to the fifth Business Day after the occurrence of such Series 2009-3 Lease Payment Deficit (a " Past Due Rent Payment "), the Administrator shall direct the Trustee in writing...

  • Page 218
    ... Agent (x) no later than two Business Days prior to each Determination Date, setting forth the Monthly Funding Costs with respect to such Purchaser Group with respect to the portion of the current Series 2009-3 Interest Period ending on such Business Day and a reasonable estimation of the Monthly...

  • Page 219
    ... to draw on the Series 2009-3 Letters of Credit, if any, and, the Trustee shall, by 5:00 p.m. (New York City time) on such Business Day draw an amount (identified by the Administrator) equal to the least of (i) such Series 2009-3 Lease Interest Payment Deficit, (ii) the excess, if any, of the sum...

  • Page 220
    ...described in Section 3.3 are insufficient to pay the Series 2009-3 Monthly Interest and the Commitment Fees of the Purchaser Groups on any Distribution Date, payments of interest to the Series 2009-3 Noteholders and payments of Commitment Fees to the Purchaser Groups will be reduced on a pro rata 48

  • Page 221
    ... of funds from the Paying Agent on each Distribution Date on account of Series 2009-3 Monthly Interest, the Administrative Agent shall pay to each Funding Agent with respect to a Purchaser Group an amount equal to the Monthly Funding Costs with respect to such Purchaser Group with respect to the...

  • Page 222
    ...Amount resulting from a Series 2009-3 Lease Payment Deficit, or prior to 12:00 noon (New York City time) on the second Business Day prior to such Distribution Date, in the case of any other Principal Deficit Amount, to withdraw from the Series 2009-3 Reserve Account, an amount equal to the lesser of...

  • Page 223
    ...the Series 2009-3 Demand Notes to be deposited into the Series 2009-3 Distribution Account. (iv) Letter of Credit Draw . In the event that either (x) on or prior to 10:00 a.m. (New York City time) on the Business Day prior to such Distribution Date, any Demand Note Issuer shall have failed to pay to...

  • Page 224
    ... Issuers for payment under the Series 2009-3 Demand Notes in an amount equal to the lesser of (i) such insufficiency and (ii) the Series 2009-3 Letter of Credit Amount. The Trustee shall, prior to 12:00 noon (New York City time) on the second Business Day preceding the Series 2009-3 Termination Date...

  • Page 225
    on the Series 2009-3 Demand Notes to be deposited into the Series 2009-3 Distribution Account on such Distribution Date. (iii) Letter of Credit Draw . In the event that either (x) on or prior to 10:00 a.m. (New York City time) on the Business Day immediately preceding any Distribution Date next ...

  • Page 226
    ... or the credit rating of any securities issued by such depositary institution or trust company shall be reduced to below "BBB-" by Standard & Poors or "Baa2" by Moody's, then ABRCF shall, within 30 days of such reduction, establish a new Series 2009-3 Reserve Account with a new Qualified Institution...

  • Page 227
    ..., general intangibles, investment property, financial assets or other property; (v) all interest, dividends, cash, instruments and other property from time to time received, receivable or otherwise distributed in respect of or in exchange for the Series 2009-3 Reserve Account, the funds on deposit...

  • Page 228
    ..., financial asset, security, instrument or cash) credited to the Series 2009-3 Reserve Account shall be treated as a financial asset (as defined in Section 8-102(a)(9) of the New York UCC) and (iv) to comply with any entitlement order (as defined in Section 8-102(a)(8) of the New York UCC) issued by...

  • Page 229
    ... asset, security, instrument or cash) credited to the Series 2009-3 Cash Collateral Account shall be treated as a financial asset (as defined in Section 8-102(a)(9) of the New York UCC) and (iv) to comply with any entitlement order (as defined in Section 8-102(a)(8) of the New York UCC) issued by...

  • Page 230
    ...by 12:00 noon (New York City time) on such Business Day draw the full amount of such Series 2009-3 Letter of Credit by presenting a Certificate of Termination Demand and shall cause the Termination Disbursement to be deposited in the Series 2009-3 Cash Collateral Account. (c) Series 2009-3 Letter of...

  • Page 231
    ... or the credit rating of any securities issued by such depository institution or trust company shall be reduced to below "BBB-" by Standard & Poor's or "Baa3" by Moody's, then ABRCF shall, within 30 days of such reduction, establish a new Series 2009-3 Cash Collateral Account with a new Qualified...

  • Page 232
    ...00 noon (New York City time) on such Business Day draw an amount equal to the lesser of (i) the excess of the Series 2009-3 Demand Note Payment Amount over the Series 2009-3 Available Reserve Account Amount (prior to giving effect to any transfer to the Series 2009-3 Cash Collateral Account pursuant...

  • Page 233
    ... or the credit rating of any securities issued by such depositary institution or trust company shall be reduced to below "BBB-" by Standard & Poor's or "Baa3" by Moody's, then ABRCF shall, within 30 days of such reduction, establish a new Series 2009-3 Distribution Account with a new Qualified...

  • Page 234
    ...financial asset, security, instrument or cash) credited to the Series 2009-3 Distribution Account shall be treated as a financial asset (as defined in Section 8-102(a)(9) of the New York UCC) and (iv) to comply with any entitlement order (as defined in Section 8-102(a)(8) of the New York UCC) issued...

  • Page 235
    ... Paying Agent or the Administrative Agent to a Funding Agent for the account of its related Purchaser Group (or amounts distributable by any such Person directly to such Purchaser Group) shall be paid by wire transfer of immediately available funds no later than 3:00 p.m. (New York time) for credit...

  • Page 236
    ... with the terms and conditions of the Indenture and the Related Documents; (c) an AESOP I Operating Lease Vehicle Deficiency shall occur and continue for at least two (2) Business Days; (d) the Collection Account, the Series 2009-3 Collection Account, the Series 2009-3 Excess Collection Account or...

  • Page 237
    ...with respect to the Series 2008-1 Notes (as such term is defined in the Series 2008-1 Supplement); (m) the occurrence and continuation of an "event of default" under the Credit Agreement or any Replacement Credit Agreement, without giving effect to any waiver of any such event of default that is not...

  • Page 238
    ... Trustee in the Series 2009-3 Collection Account for ratable distribution as described below. Within ten (10) Business Days after the Trustee receives a Waiver Request, the Trustee shall furnish notice thereof to the Administrative Agent, which notice shall be accompanied by a form of consent (each...

  • Page 239
    ... 2009-3 Collection Account and deposit the same in the Series 2009-3 Distribution Account for distribution to the Administrative Agent for the accounts of the non-consenting Purchaser Groups. Upon the receipt of funds from the Trustee pursuant to this Article V, the Administrative Agent shall pay...

  • Page 240
    ... AESOP Leasing, AESOP Leasing II, ARAC, BRAC, the Intermediary, Lord Securities Corporation and the Trustee; (xii) each Series 2009-3 Letter of Credit, if any, executed by a duly authorized officer of the applicable Series 2009-3 Letter of Credit Provider; and (xiii) each Series 2009-3 Interest Rate...

  • Page 241
    ... the bylaws, limited liability company agreement or partnership agreement of such Person, as the case may be, as in effect on the Series 2009-3 Closing Date and at all times since a date prior to the date of the resolutions described in clause (B) below, (B) that, to the extent applicable, attached...

  • Page 242
    ... . The Administrative Agent shall have received a written search report listing all effective financing statements that name ABRCF, AESOP Leasing, AESOP Leasing II, Original AESOP, each of the Permitted Nominees or ABCR as debtor or assignor and that are filed in the State of New York, the State of...

  • Page 243
    ..., in form and substance satisfactory to such Funding Agent, from each of Moody's and Standard & Poor's confirming the commercial paper rating of the related CP Conduit Purchaser after giving effect to such CP Conduit Purchaser's purchase of Series 2009-3 Notes (and any fees of the Rating Agencies in...

  • Page 244
    ... additional costs incurred or reduction suffered. (b) If any Affected Party determines that any Change in Law regarding capital requirements has or would have the effect of reducing the rate of return on such Affected Party's capital or the capital of any corporation controlling such Affected Party...

  • Page 245
    ... is made and the applicable forms are provided to the Administrative Agent, such Funding Agent, such member of such Purchaser Group or such Program Support Provider or (ii) thirty (30) Business Days before prescribed by applicable law as will permit such payments to be made without withholding...

  • Page 246
    ... Group (instead of the Administrative Agent, the Funding Agent, the Program Support Provider or the member of the Purchaser Group itself) is required under United States federal income tax law or the terms of a relevant treaty to provide IRS Form W-8BEN, W-8ECI or W-9, or any successor applicable...

  • Page 247
    ... be, in order to claim an exemption from withholding of United States federal income taxes or backup withholding taxes, then each such beneficial owner or equity owner shall be considered to be the Administrative Agent, a Funding Agent, a Program Support Provider or a member of a Purchaser Group for...

  • Page 248
    ... Party or Purchaser Group, as the case may be, shall use commercially reasonable efforts to designate a different lending office for funding or booking its obligations hereunder or to assign its rights and obligations hereunder to another of its offices, branches or affiliates, which pays a price...

  • Page 249
    ... Agent with respect to a Purchaser Group, the Trustee or any representatives of any such Funding Agent or the Trustee access to all records relating to the Leases, the Subleases, the Vehicles, the Manufacturer Programs and the Loan Agreements at any reasonable time during regular business hours...

  • Page 250
    ... case, as of the last day of the Related Month with respect to such Determination Date; and (j) they shall provide the Administrative Agent with ten days' prior notice of any appointment of an Independent Manager in accordance with the ABRCF Limited Liability Company Agreement; provided that if such...

  • Page 251
    ... nor any of its officers, directors, employees, agents, attorneys-in-fact or Affiliates shall be (i) liable for any action lawfully taken or omitted to be taken by it or such Person under or in connection with the Base Indenture, this Supplement or any other Related Document (except to the extent...

  • Page 252
    ... or any other CP Conduit Purchaser, APA Bank or Funding Agent and based on such documents and information as it has deemed appropriate, made its own appraisal of and investigation into the business, operations, property, financial and other condition and creditworthiness of ABRCF, the Lessors, the...

  • Page 253
    ... officers, directors, employees, agents, attorneys-in-fact or Affiliates. Section 9.7. Indemnification . Each of the APA Banks in a Purchaser Group agrees to indemnify the Administrative Agent in its capacity as such (to the extent not reimbursed by ABRCF and the Administrator and without limiting...

  • Page 254
    ...and any of its officers, directors, employees, agents, attorneys-in-fact or Affiliates shall not be (i) liable for any action lawfully taken or omitted to be taken by it or such Person under or in connection with the Base Indenture, this Supplement or any other Related Document (except to the extent...

  • Page 255
    ... and APA Banks in its Purchaser Group. Section 10.6. Non-Reliance on Each Funding Agent and Other Purchaser Groups . Each CP Conduit Purchaser and each of the related APA Banks expressly acknowledge that neither its Funding Agent nor any of its officers, directors, employees, agents, attorneys-in...

  • Page 256
    ... such related Funding Agent's gross negligence or willful misconduct. The agreements in this Section shall survive the payment of all amounts payable hereunder. ARTICLE XI GENERAL Section 11.1. Successors and Assigns . (a) This Supplement shall be binding upon and inure to the benefit of the parties...

  • Page 257
    ... definitions of the terms "Monthly Funding Costs" and "Discount" shall be determined in the manner set forth in the definition of "Monthly Funding Costs" and "Discount" applicable to such CP Conduit Purchaser on the basis of the interest rate or discount applicable to commercial paper issued by such...

  • Page 258
    ... Agent, a Funding Agent, a Program Support Provider or a member of a Purchaser Group. (e) Any CP Conduit Purchaser and the APA Bank with respect to such CP Conduit Purchaser may at any time sell all or any part of their respective rights and obligations under this Supplement and the Series 2009...

  • Page 259
    ... public distribution thereof, and that such CP Conduit Purchaser and APA Bank will not offer to sell or otherwise dispose of its Series 2009-3 Note (or any interest therein) in violation of any of the registration requirements of the Securities Act, or any applicable state or other securities laws...

  • Page 260
    ...any party hereto are solely the corporate or limited liability company obligations of such CP Conduit Purchaser and shall be payable at such time as funds are received by or are available to such CP Conduit Purchaser in excess of funds necessary to pay in full all of its outstanding Commercial Paper...

  • Page 261
    ... Funding Note Form of Increase Notice Form of Consent Form of Series 2009-3 Demand Note Form of Series 2009-3 Letter of Credit Form of Lease Payment Deficit Notice Form of Demand Notice Form of Transfer Supplement Form of Purchaser Group Supplement Canadian Variable Funding Note Facility Term Sheet...

  • Page 262
    ... 2009-3 Notes which have been replaced or paid) to the Trustee for cancellation and ABRCF has paid all sums payable hereunder and, if the Series 2009-3 Demand Note Payment Amount on the Series 2009-3 Letter of Credit Termination Date was greater than zero, the Series 2009-3 Cash Collateral Account...

  • Page 263
    ... case, other than the Vehicles) consist of "instruments," "general intangibles" and "deposit accounts" within the meaning of the applicable UCC. (c) ABRCF owns and has good and marketable title to the Collateral and the Series 2009-3 Collateral free and clear of any lien, claim or encumbrance of any...

  • Page 264
    ... case of the CP Conduit Purchasers, the APA Banks and the Funding Agents; or to such other address as may be hereafter notified by the respective parties hereto: Administrative Agent: Deutsche Bank AG, New York Branch 60 Wall Street, 19th Floor New York, New York 10005 Attention: Robert Sheldon Fax...

  • Page 265
    ...or such Series 2009-3 Noteholder in good faith to protect Confidential Information of third parties delivered to such Person; provided , that such Person may deliver or disclose Confidential Information to: (i) such Person's directors, trustees, officers, employees, agents, attorneys, independent or...

  • Page 266
    ... IN THE BOROUGH OF MANHATTAN, NEW YORK CITY, STATE OF NEW YORK, OVER ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS SUPPLEMENT, THE SERIES 2009-3 NOTES OR ANY OTHER SERIES 2009-3 DOCUMENT AND EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY AGREES THAT ALL CLAIMS IN RESPECT OF SUCH ACTION...

  • Page 267
    SHALL PRECLUDE ANY PARTY HERETO FROM BRINGING AN ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS SUPPLEMENT, THE SERIES 2009-3 NOTES OR ANY OTHER SERIES 2009-3 DOCUMENT IN ANY OTHER COUNTRY, STATE OR PLACE HAVING JURISDICTION OVER SUCH ACTION OR PROCEEDING. 95

  • Page 268
    IN WITNESS WHEREOF, each of the parties hereto have caused this Supplement to be duly executed by their respective duly authorized officers as of the date above first written. AVIS BUDGET RENTAL CAR FUNDING (AESOP) LLC, as Issuer By: /s/ Rochelle Tarlowe Name: Rochelle Tarlowe Title: Vice President ...

  • Page 269
    THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A., as Trustee and Series 2009-3 Agent By: /s/ Sally R. Tokich Name: Sally R. Tokich Title: Senior Associate 1

  • Page 270
    DEUTSCHE BANK AG, NEW YORK BRANCH, as Administrative Agent By: /s/ Robert Sheldon Name: Robert Sheldon Title: Director By: /s/ Daniel Gerber Name: Daniel Gerber Title: Director 2

  • Page 271
    ...., LLC, as a CP Conduit Purchaser under the Series 2009-3 Supplement By: /s/ Frank B. Bilotta Name: Frank B. Bilotta Title: President DEUTSCHE BANK AG, NEW YORK BRANCH, as a Funding Agent and an APA Bank under the Series 2009-3 Supplement By: /s/ Robert Sheldon Name: Robert Sheldon Title: Director...

  • Page 272
    AVIS BUDGET CAR RENTAL, LLC, as Administrator By: /s/ Rochelle Tarlowe Name: Rochelle Tarlowe Title: Vice President and Treasurer 4

  • Page 273
    SCHEDULE I TO SERIES 2009-3 SUPPLEMENT Maximum Purchaser Group Invested Amount APA Bank CP Conduit APA Bank Funding Agent Percentage Purchased Match Funding Percentage 1. Gemini Securitization Corp., LLC Deutsche Bank AG, New York Branch Deutsche Bank AG, New York Branch 1 100% $200,000,000...

  • Page 274
    ... and Series 2009-3 Cash Collateral Account Section 3.9. Series 2009-3 Distribution Account Section 3.10. Series 2009-3 Demand Notes Constitute Additional Collateral for Series 2009-3 Notes Section 3.11. Series 2009-3 Interest Rate Caps Section 3.12. Payments to Funding Agents or Purchaser Groups

  • Page 275
    ...TO WAIVE PURCHASE RESTRICTIONS ARTICLE VI CONDITIONS PRECEDENT Section 6.1. Conditions Precedent to Effectiveness of Supplement ARTICLE VII CHANGE IN CIRCUMSTANCES Section 7.1. Section 7.2. Section 7.3. Section 7.4. Section 7.5. Increased Costs Taxes Break Funding Payments Alternate Rate of Interest...

  • Page 276
    ....23. Successors and Assigns Securities Law Adjustments; Set-off No Bankruptcy Petition Limited Recourse Costs and Expenses Exhibits Ratification of Base Indenture Counterparts Governing Law Amendments Discharge of Indenture Capitalization of ABRCF Series 2009-3 Demand Notes Termination of Supplement...

  • Page 277
    ... under the laws of Delaware (" ABRCF "), AVIS BUDGET CAR RENTAL, LLC, a limited liability company established under the laws of Delaware, as administrator (the " Administrator "), DEUTSCHE BANK AG, NEW YORK BRANCH, as administrative agent (the " Administrative Agent "), the several commercial paper...

  • Page 278
    ... 2009-3 Closing Date or such Increase Date, as applicable, or would occur and be continuing after giving effect to such Series 2009-3 Initial Invested Amount or such Increase;" 2. Direction . By their signatures hereto, each of the undersigned (excluding The Bank of New York Mellon Trust Company...

  • Page 279
    IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed by their respective duly authorized officers as of the date above first written. AVIS BUDGET RENTAL CAR FUNDING (AESOP) LLC, as Issuer By: /s/ Rochelle Tarlowe Name: Rochelle Tarlowe Title: Vice President and ...

  • Page 280
    THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A., as Trustee and Series 2009-3 Agent By: /s/ Sally R. Tokich Name: Sally R. Tokich Title: Senior Associate

  • Page 281
    DEUTSCHE BANK AG, NEW YORK BRANCH, as Administrative Agent By: /s/ Robert Sheldon Name: Robert Sheldon Title: Director By: /s/ Daniel Gerber Name: Daniel Gerber Title: Director

  • Page 282
    ...., LLC, as a CP Conduit Purchaser under the Series 2009-3 Supplement By: /s/ Frank B. Bilotta Name: Frank B. Bilotta Title: President DEUTSCHE BANK AG, NEW YORK BRANCH, as a Funding Agent and an APA Bank under the Series 2009-3 Supplement By: /s/ Robert Sheldon Name: Robert Sheldon Title: Director...

  • Page 283
    AVIS BUDGET CAR RENTAL, LLC, as Administrator By: /s/ Rochelle Tarlowe Name: Rochelle Tarlowe Title: Vice President and Treasurer

  • Page 284
    ... 7, 2006, December 11, 2006, November 21, 2007, February 12, 2008, March 5, 2008, April 30, 2008, June 16, 2008, December 22, 2008 and March 16, 2009 (collectively, the " Limited Partnership Agreement "); AND WHEREAS the Avis General Partner, the Budget General Partner, the STARS Limited Partner and...

  • Page 285
    ...Limited Partnership Agreement is hereby deleted in its entirety and replaced with the following: "(b) The balance of the STARS Limited Partner's Capital Account shall not at any time exceed an amount equal to the sum of $215,000,000 plus the aggregate Principal Amount of Bonds issued and outstanding...

  • Page 286
    ... the exception of the foregoing amendments, the Limited Partnership Agreement shall continue in full force and effect, unamended. This Agreement shall enure to the benefit of and be binding upon the parties, their successors and any permitted assigns. This Agreement may be executed in one or more...

  • Page 287
    IN WITNESS WHEREOF, the parties hereto have cause this Agreement to be executed by their authorizes signatories thereunto duly authorized, as of the date first above written. AVISCAR INC. By: /s/ David Calabria Name: David Calabria ...

  • Page 288
    ... By: /s/ Christopher Romano Name: Christopher Romano Title: Managing Director MONTREAL TRUST COMPANY OF CANADA , as trustee of BAY STREET FUNDING TRUST (with liability limited to the assets of Bay Street Funding Trust) by its administrator, SCOTIA CAPITAL INC . By: /s/ Douglas Noe Name: Douglas Noe...

  • Page 289
    The undersigned hereby acknowledges notice of and consents to the foregoing amendments to the Limited Partnership Agreement. DATED this 9 th day of November, 2009. AVIS BUDGET CAR RENTAL, LLC By: /s/ David Calabria Name: David Calabria Title: Assistant Treasurer -6-

  • Page 290
    ... operating lease rental expense that is representative of the interest factor. Interest expense on all indebtedness is detailed as follows: 2009 $ 186 157 $ 343 Year Ended December 31, 2008 2007 2006 $ 266 $ 356 $ 361 136 141 271 $ 402 $ 497 $ 632 2005 313 199 $ 512 $ Related to debt under vehicle...

  • Page 291
    ...LLC Avis Budget Group Limited Avis Car Rental Group LLC Avis Caribbean, Limited Avis Enterprises Inc. Avis Group Holdings LLC Avis International Ltd. Avis Leasing Corporation Avis Lube Inc. Avis Management Pty. Limited Avis Management Services, Ltd. Avis Operations LLC Avis Rent A Car de Puerto Rico...

  • Page 292
    ... Company Limited HFS Truck Funding Corporation Motorent Inc. Pathfinder Insurance Company PF Claims Management Ltd. PR Holdco, Inc. PV Holding Corp. Quartx Fleet Management Inc. Rent-A-Car Company, Incorporated Runabout, LLC Servicios Avis S.A. Show Group Enterprises Pty Limited Team Fleet...

  • Page 293
    ... Avis Budget Group, Inc. (formerly Cendant Corporation) and effectiveness of Avis Budget Group, Inc.'s internal control over financial reporting appearing in this Annual Report on Form 10-K of Avis Budget Group, Inc. for the year ended December 31, 2009. /s/ DELOITTE & TOUCHE LLP New York, New York...

  • Page 294
    ... CERTIFICATIONS I, Ronald L. Nelson, certify that: 1. 2. I have reviewed this annual report on Form 10-K of Avis Budget Group, Inc.; Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in...

  • Page 295
    ..., not misleading with respect to the period covered by this report; Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of...

  • Page 296
    ... Annual Report of Avis Budget Group, Inc. (the "Company") on Form 10-K for the period ended December 31, 2009, as filed with the Securities and Exchange Commission on the date hereof (the "Report"), Ronald L. Nelson, as Chief Executive Officer of the Company, and David B. Wyshner, as Chief Financial...