4.	Restructuring

During fourth quarter 2012, the Company initiated a strategic restructuring initiative to better position the business of its Truck Rental segment, in which it will close certain rental locations and decrease the size of the rental fleet, which the Company believes will increase fleet utilization and reduce costs. During the year ended December 31, 2012, as part of this process, the Company recorded restructuring expense of $1 million. The Company expects further restructuring expenses of approximately $12 million to be incurred in 2013 related to this initiative.

In fourth quarter 2011, subsequent to the acquisition of Avis Europe, the Company initiated a restructuring initiative, identifying synergies across the Company, enhancing organizational efficiencies and consolidating and rationalizing processes. During the years ended December 31, 2012 and 2011, as part of this process, the Company formally communicated the termination of employment to approximately 550 and 50 employees, respectively. During 2012 and 2011, the Company recorded restructuring expenses in connection with these initiatives of $37 million and $3 million, respectively, and the majority of which have been or are expected to be settled in cash. These expenses primarily represent costs associated with severance, outplacement services and other costs associated with employee terminations. As of December 31, 2012, the Company has terminated substantially all of these employees. The Company expects further restructuring expenses of approximately $20 million to be incurred through 2013 related to this initiative.

Beginning in 2008, the Company initiated strategic initiatives within the Company’s North America, International and Truck Rental segments, as part of a cost-reduction and efficiency improvement plan to reduce costs, enhance organizational efficiency and consolidate and rationalize existing processes and facilities. The Company recorded restructuring expenses in connection with these initiatives of $2 million and $11 million in 2011 and 2010, respectively. The majority of these restructuring expenses have been settled in cash. These expenses primarily represented costs associated with the closure and consolidation of certain administrative facilities and severance, outplacement services and other costs associated with employee terminations. The Company has substantially completed its activities under this restructuring initiative. As of December 31, 2012, the remaining liability relating to these restructuring actions was immaterial, and the Company does not expect any costs to be incurred.

The following tables summarize the change to our restructuring-related liabilities and identify the amounts recorded within the Company’s reporting segments for restructuring charges and corresponding payments and utilizations:


	Personnel Related		Facility Related		Other ^(a)		Total
Balance as of January 1, 2010	$	1	$	4	$	-	$	5
Restructuring expense		4		7		-		11
Cash payment/utilization		(5)		(5)		-		(10)

Balance as of December 31, 2010		-		6		-		6
Restructuring expense		5		-		-		5
Acquired restructuring obligation		-		1		-		1
Cash payment/utilization		(4)		(6)		-		(10)

Balance as of December 31, 2011		1		1		-		2
Restructuring expense		37		-		1		38
Cash payment/utilization		(26)		-		(1)		(27)

Balance as of December 31, 2012	$	12	$	1	$	-	$	13

^(a)

Includes expenses related to the disposition of vehicles.


	North America		International		Truck Rental		Total
Balance as of January 1, 2010	$	3	$	1	$	1	$	5
Restructuring expense		11		-		-		11
Cash payment/utilization		(8)		(1)		(1)		(10)

Balance as of December 31, 2010		6		-		-		6
Restructuring expense		2		3		-		5
Acquired restructuring obligation		-		1		-		1
Cash payment/utilization		(7)		(3)		-		(10)

Balance as of December 31, 2011		1		1		-		2
Restructuring expense		1		36		1		38
Cash payment/utilization		(1)		(25)		(1)		(27)

Balance as of December 31, 2012	$	1	$	12	$	-	$	13