Avis 2012 Annual Report Download - page 82

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F-26
face value, and the $125 million were issued at 103.5% of their face value, for aggregate proceeds of $731 million. The
notes pay interest semi-annually on January 15 and July 15 of each year. The Company has the right to redeem these
notes in whole or in part at any time on or after October 15, 2014 at the applicable redemption price, plus any accrued
and unpaid interest through the redemption date. In connection with the March 2012 issuance, the Company entered into
a registration rights agreement, pursuant to which it completed in September 2012 an offer to exchange the notes for new
notes with terms substantially identical to those of the originally issued notes, except that the transfer restrictions and
registration rights provisions relating to the originally issued notes do not apply to the new notes.
9¾% Senior Notes
The Company’s 9¾% Senior Notes were issued in October 2011 at 100% of their face value for aggregate proceeds of
$250 million. The notes pay interest semi-annually on March 15 and September 15 of each year. The Company has the
right to redeem these notes in whole or in part at any time on or after September 15, 2015 at the applicable redemption
price, plus any accrued and unpaid interest through the redemption date.
4% Senior Notes
The Company’s 4% Senior Notes were issued in November 2012 at 100% of their face value for aggregate proceeds of
$300 million. The notes pay interest semi-annually on May 15 and November 15 of each year, beginning in May 2013.
The Company has the right to redeem these notes in whole or in part at any time on or after May 15, 2015, at the
applicable redemption price, plus any accrued and unpaid interest through the redemption date. The Company used the
proceeds of these notes to repay a portion of the 7¾% Notes.
In connection with the sale of the notes, the Company entered into a registration rights agreement, under which it has
agreed to use its reasonable best efforts to file an exchange offer registration statement related to the notes with the
Securities and Exchange Commission and cause to become effective a registration statement with respect to a registered
offer to exchange the notes for new notes, with substantially identical terms in a all material respects. In accordance with
the registration rights agreement, the Company could be required to pay additional interest of up to 0.50% per annum on
the principal amount of the notes from February 1, 2014 until the exchange offer is completed, a shelf registration
statement, if required, is declared effective or the restricted notes become freely tradable under the Securities Act. The
Company believes the likelihood of occurrence of such event is remote and, as such, the Company has not recorded a
related liability as of December 31, 2012.
The Floating Rate Senior Notes, the 9% Senior Notes, the 8¼% Senior Notes, the 9¾% Senior Notes and the 4%
Senior Notes, in each case as described above, are senior unsecured obligations of the Company, ranking equally in right
of payment with all of the Company’s existing and future senior indebtedness and are guaranteed on a senior basis by the
Company and certain of its domestic subsidiaries.
CORPORATE GUARANTEE
In February 2007, the Company agreed to guarantee the payment of principal, premium, if any, and interest on the 7%
Senior Notes, 7¾% Senior Notes and Floating Rate Senior Notes. The Company executed a Supplemental Indenture to
provide the guarantee in accordance with the terms and limitations of such notes and the indenture governing the notes.
In consideration for providing the guarantee, the Company received $14 million, before fees and expenses, from certain
institutional investors. This consideration has been deferred and is being amortized over the life of the debt. As of
December 31, 2012, the remaining deferred consideration to be recognized amounted to approximately $1 million.
DEBT MATURITIES
The following table provides contractual maturities of the Company’s corporate debt at December 31, 2012:
Year
Amount
2013
$
57
2014
395
2015
19
2016
45
2017
309
Thereafter
2,080
$
2,905