Debt Under Vehicle Programs and Borrowing Arrangements

3 Months Ended

Mar. 31, 2013

Debt Under Vehicle Programs and Borrowing Arrangements

During March 2013, the Company entered into a three-year, €500 million (approximately $640 million) European rental fleet securitization program, which matures in 2016, and will be used to finance fleet purchases for certain of the Company’s European operations.

Debt under vehicle programs (including related party debt due to Avis Budget Rental Car Funding) consisted of:



	As of		As of
	March 31, 2013		December 31, 2012
Debt due to Avis Budget Rental Car Funding ^(a)	$	5,873	$	5,203
Budget Truck financing	236		253
Capital leases	298		315
European securitization	142		—
Other	913		1,035
	$	7,462	$	6,806

__________


^(a)	The increase principally reflects increased borrowing to fund an increase in the size of the Company’s U.S. car rental fleet.

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 March 31, 2013:



	Vehicle- Backed Debt
Within 1 year ^(a)	$	727
Between 1 and 2 years	2,425
Between 2 and 3 years	1,250
Between 3 and 4 years	1,294
Between 4 and 5 years	843
Thereafter	923
	$	7,462

__________


^(a)	Vehicle-backed debt maturing within one year includes term asset-backed securities of approximately $509 million and bank and bank-sponsored borrowings of $218 million.

As of March 31, 2013, available funding under the Company’s vehicle programs (including related party debt due to Avis Budget Rental Car Funding) consisted of:



	Total Capacity ^(a)		Outstanding Borrowings		Available Capacity
Debt due to Avis Budget Rental Car Funding ^(b)	$	7,403	$	5,873	$	1,530
Budget Truck financing ^(c)	277		236		41
Capital leases	465		298		167
European securitization ^(d)	641		142		499
Other ^(e)	1,458		913		545
	$	10,244	$	7,462	$	2,782

__________


^(a)	Capacity is subject to maintaining sufficient assets to collateralize debt.


^(b)	The outstanding debt is collateralized by approximately $7.7 billion of underlying vehicles and related assets.


^(c)	The outstanding debt is collateralized by $375 million of underlying vehicles and related assets.


^(d)	The outstanding debt is collateralized by approximately $442 million of underlying vehicles and related assets.


^(e)	The outstanding debt is collateralized by approximately $1.3 billion of underlying vehicles and related assets.

Debt agreements under the Company’s vehicle-backed funding programs contain restrictive covenants, including restrictions on dividends paid to the Company by certain of its subsidiaries and restrictions on indebtedness, mergers, liens, liquidations and sale and leaseback transactions and in some cases also require compliance with certain financial requirements. As of March 31, 2013, the Company is not aware of any instances of non-compliance with any of the financial or restrictive covenants contained in the debt agreements under its vehicle-backed funding programs.

- Definition

The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants.

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