Avis 2012 Annual Report Download - page 32

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stock by the counterparties in connection with their obligations under the note hedge and warrant transactions.
ITEM 1B. UNRESOLVED STAFF COMMENTS
None.
ITEM 2. PROPERTIES
Our principal executive offices are located at 6 Sylvan Way, Parsippany, New Jersey 07054 pursuant to a lease agreement
that expires in 2023. We also own a facility in Virginia Beach, Virginia, which serves as a satellite administrative facility for
our car and truck rental operations, and administrative offices in Madrid, Spain and Lisbon, Portugal. We also lease office
space in Greenwood Village, Colorado, and Tulsa, Oklahoma, pursuant to leases expiring in 2015 and 2022, respectively.
These locations primarily provide operational services for both brands, including contact center operations. We also lease
office space in Bracknell, England, Budapest, Hungary and Barcelona, Spain pursuant to leases expiring in 2022, 2018 and
2014, respectively, for corporate offices, contact center activities and other administrative functions, respectively, in Europe.
There are approximately 25 other leased office locations throughout the world used for administrative activities, regional
sales and operations activities.
We lease or have vehicle rental concessions for both the Avis and Budget brands at locations throughout the world. Avis
operates approximately 1,350 locations in North America and approximately 1,300 locations outside North America. Of
those locations, approximately 275 in North America and approximately 200 outside North America are at airports. Budget
operates at approximately 1,000 locations in North America, of which approximately 250 are at airports. Budget also operates
at approximately 550 locations outside North America, of which approximately 150 are at airports. We believe that our
properties are sufficient to meet our present needs and we do not anticipate any difficulty in securing additional space, as
needed, on acceptable terms.
ITEM 3. LEGAL PROCEEDINGS
On November 14, 2007, two California residents filed a putative class action lawsuit, captioned Michael Shames et al. v. The
Hertz Corp. et al., No. 07 CV 2174H (S.D. Cal.), against the Company, six other rental car companies, the California Travel
and Tourism Commission (the “CTTC”) and the CTTC’s Executive Director, alleging that the defendants violated federal
antitrust law and California’s Unfair Competition Law and False Advertising Law by allegedly agreeing to pass on airport
concession fees and a state tourism commission assessment to passenger car renters in California. Through mediation of this
matter, the Company reached a settlement agreement with the plaintiffs in May 2012. The settlement was subsequently
reviewed and approved by the district court on November 5, 2012. Certain members of the class have filed notices of intent
to appeal the settlement agreement. The Company plans to respond to these appeals in accordance with the briefing schedule
established by the court.
In October 2009, a judgment was entered against us for damages related to breach of contract in the amount of $16 million in
Alaska Rent A Car, Inc. v. Cendant Corp., et al., in the United States District Court for the District of Alaska. The lawsuit,
which was filed in 2003 by our licensee, Alaska Rent-A-Car, involved breach of contract and other claims related to the
acquisition of our Budget vehicle rental business in 2002. In addition to the judgment for damages, in June 2010 the district
court also entered an order against the Company in the amount of $3 million, in favor of the plaintiff’s motions for pre-
judgment interest and attorneys’ fees. We are awaiting a ruling from the United States Court of Appeals for the Ninth Circuit
on our appeal of the judgment and the award of attorneys’ fees.
The Company is involved in various legal proceedings related to wage and hour and employee classification claims. In one
such case, in May 2008, a civil collective action complaint captioned Matt Ravenell v. Avis Budget Group, Inc., Avis Budget
Car Rental, LLC and Avis Rent A Car System, LLC, No. 08 CV 02113 (E.D.N.Y.), was filed against us alleging that the
Company violated the Fair Labor Standards Act and the State of New York’s labor laws by misclassifying shift managers as
employees exempt from overtime. The plaintiffs, former Avis shift managers, seek to recover, on behalf of themselves and all
other individuals who are similarly situated, alleged unpaid overtime compensation, as well as attorneys’ fees and costs. In
addition, two of the named plaintiffs assert individual claims of retaliation against the Company. Conditional class
certification with respect to Plaintiff’s Fair Labor Standards Act claims was granted to plaintiffs in July 2010. The parties
have begun discovery and the court has extended the discovery deadline until February 2013. In another case, a civil
collective action complaint, similar to the Ravenell matter, was filed against the Company in the U.S. District Court for the
Middle District of Florida in September 2010, alleging misclassification of shift managers as exempt from overtime in
violation of the Fair Labor Standards Act, for which conditional class certification was granted in 2011. Discovery is
currently underway in this matter. A putative class action is pending against us in California alleging violations of state law