SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 13D/A

(Amendment No. 22)*

Under the Securities Exchange Act of 1934

AVIS BUDGET GROUP, INC.

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(Name of Issuer)

Common Stock, par value $0.01 per share

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(Title of Class of Securities)

053774105

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(CUSIP Number)

David Zales

SRS Investment Management, LLC

One Bryant Park

39th Floor

New York, New York 10036

(212) 520-7900

With a copy to:


Stephen Fraidin
Richard M. Brand
Kiran Kadekar
Cadwalader, Wickersham & Taft LLP
200 Liberty Street
New York, New York 10281
(212) 504-6000

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(Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications)

December 23, 2022

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(Date of Event which Requires Filing of this Statement)

If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of Rule 13d-1(e), Rule 13d-1(f) or Rule 13d-1(g), check the following box. ☐

*  The remainder of this cover page shall be filled out for a reporting person's initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter disclosures provided in a prior cover page.

The information required on the remainder of this cover page shall not be deemed to be "filed" for the purpose of Section 18 of the Securities Exchange Act of 1934 (“Act”) or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes).

Percentage beneficial ownership reported herein is based on 41,466,412 shares of common stock outstanding as of October 28, 2022, as reported in the Issuer’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2022.

This Amendment amends Items 4 and 6 as set forth below:

 

The response to Item 4 is amended and supplemented by adding the following:

 

On December 23, 2022, the SRS Parties entered into a Fourth Amended and Restated Cooperation Agreement with the Issuer (the “Fourth Amended Cooperation Agreement”), whereby the parties agreed, among other things, that (i) during the Standstill Period (as defined below), the SRS Parties will be entitled to appoint two (2) directors (or if a Board Expansion Notice (as defined below) has been delivered, three (3)) directors (the “SRS Directors”) to the board of directors of the Issuer (the “Board”), (ii) the Issuer will include each of Jagdeep Pahwa and Karthik Sarma, who shall continue to serve as SRS Directors, in its slate of nominees for election as directors at the Issuer’s next annual meeting of stockholders  and the Issuer will include the SRS Directors in its slate of nominees for election as directors at any meeting of stockholders during the Standstill Period at which directors are to be elected; (iii) during the Standstill Period, the SRS Parties may at any time deliver a notice to the Issuer (a “Board Expansion Notice”) whereupon (x) the SRS Parties will be entitled  to appoint a third SRS Director to the Board and (y) the Issuer shall, at its option, have the right (the “Company Expansion Right”) to appoint an additional non-SRS Director to the Board; (iv) during the Standstill Period, the Board will take all necessary actions so that the size of the Board is, if no Board Expansion Notice has been delivered, no more than six (6) directors, if a Board Expansion Notice has been delivered but the Company Expansion Right has not been exercised, no more than seven (7) directors and, if a Board Expansion Notice has been delivered and the Company Expansion Right has been exercised, no more than eight (8) directors; (v) during the Standstill Period, SRS will be entitled to appoint the Vice Chairman of the Board, with Mr. Pahwa continuing as of the date of the Fourth Amended Cooperation Agreement to serve as Vice Chairman; (vi) during the Standstill Period, SRS will be entitled to appoint one person to serve as a member of the Corporate Governance Committee and one person to serve as a Chair of the Compensation Committee and Mr. Sarma will be the initial appointee to serve in both such roles; (vii) the SRS Parties will abide by certain standstill provisions during the Standstill Period; (viii) the SRS Parties will vote all voting securities of the Issuer owned by the SRS Parties in favor of the Issuer’s nominees and other ordinary course proposals at any stockholder meeting during the Standstill Period, subject to certain exceptions and, in the event that the SRS Parties acquire more than 35% of the outstanding voting securities of the Issuer, the SRS Parties will vote such shares in excess of 35% of the outstanding voting securities in the same proportion in which all other voting securities are voted; and (ix) for so long as (x) the SRS Parties continue to beneficially own at least 5% of the Issuer’s voting securities or (y) a director of the Issuer appointed or designated by SRS continues to serve on the Board, the SRS Parties have agreed not to participate in certain extraordinary transactions unless such transaction provides for the same type and amount of per share consideration for all eligible stockholders. For purposes of the Fourth Amended Cooperation Agreement, the Standstill Period means the period from the date of the Fourth Amended Cooperation Agreement until the earlier of (i) December 31, 2024, (ii) the date on which the SRS Parties’ beneficial ownership is less than the greater of (x) 1,973,485 and (y) 5% of the outstanding voting securities of the Issuer and (iii) the date that is sixty (60) calendar days prior to the advance notice deadline for the Issuer’s 2025 annual meeting of stockholders.

The foregoing summary of the Fourth Amended Cooperation Agreement is qualified in its entirety by reference to the full text of the Fourth Amended Cooperation Agreement, which is attached hereto as Exhibit 99.10 and incorporated by reference herein.

Item 6.

CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT TO SECURITIES OF THE ISSUER

Item 6 of the Schedule 13D is hereby amended and supplemented by the addition of the following:

On December 23, 2022, the Issuer and the SRS Parties entered into the Fourth Amended Cooperation Agreement, which is described in further detail in Item 4 of this Amendment. The Fourth Amended Cooperation Agreement is attached hereto as Exhibit 99.10 and incorporated by reference herein.

Item 7.

EXHIBITS

Item 7 of the Schedule 13D is hereby amended and supplemented by the addition of the following:

Exhibit

Description

    

99.10

Fourth Amended and Restated Cooperation Agreement, dated December 23, 2022.

CUSIP No. 053774105

SCHEDULE 13D

Page 5 of 5

SIGNATURES

After reasonable inquiry and to the best of his or its knowledge and belief, each of the undersigned certifies that the information set forth in this statement is true, complete and correct.

Dated: December 27, 2022

Exhibit 99.10

FOURTH AMENDED AND RESTATED

COOPERATION AGREEMENT

This Fourth Amended and Restated Cooperation Agreement, dated as of December 23, 2022 (this “Agreement”), is by and among Avis Budget Group, Inc. (the “Company”) and the entities set forth on Schedule A hereto (together with their Affiliates, “SRS”).

WHEREAS, as of the date hereof, SRS Beneficially Owns 18,430,882 shares of common stock of the Company, par value $0.01 per share (the “Common Stock”);

WHEREAS, the Company and SRS have previously entered into that certain Third Amended and Restated Cooperation Agreement, dated as of February 23, 2020, and amended on August 12, 2020, and September 15, 2021 (such agreement, as so amended, the “Prior Agreement”), with respect to certain matters relating to the Board of Directors of the Company (the “Board”) and certain other matters, as provided therein;

WHEREAS, the Company and SRS wish to amend and restate the Prior Agreement on the terms set forth herein.

NOW, THEREFORE, in consideration of the covenants and agreements contained herein, and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto agree as follows:

guidelines applicable to Board members (subject to Section 9), copies of which are either publicly available or have been provided to SRS or their counsel and (ii) not serve as a director or officer of any Competitor ((i) and (ii), the “Applicable Director Criteria”). During the Standstill Period, SRS shall ensure at least one of the Applicable Directors shall at all times qualify as “independent” of the Company pursuant to the applicable stock exchange listing requirements.

a majority of the directors who are not former or current employees of, or advisors or consultants to, SRS or an Affiliate of SRS) approves the appointment to such committee of a director who does not qualify as “independent” of the Company in accordance with an applicable exception thereunder) and (iv) SRS shall be entitled to designate one Applicable Director to serve as Vice Chairman of the Board. SRS shall be entitled to change its appointments and designations pursuant to this Section 1(d) from time to time and at any time during the Standstill Period. If SRS elects to change the Vice Chairman or the committee positions on which an Applicable Director serves, SRS shall provide written notice furnishing the name of the Person being replaced, the name of the Person to be appointed, and setting forth the positions in which the new appointee will serve. The Company shall promptly appoint the Applicable Director to the designated positions so long as, in the case of any committee appointments, such Applicable Director satisfies the applicable stock exchange listing requirements for serving on such committee. As of the Agreement Date, SRS has designated Mr. Sarma (x) to serve on the Corporate Governance Committee and (y) to serve on, and be Chair of, the Compensation Committee. SRS has presently designated Mr. Pahwa to serve as Vice Chairman of the Board.

proposal to nominate any Person for election to the Board made by SRS or its Affiliates (the matters described in clauses (i)–(iii) of this Section 1(i) referred to as “Recusal Matters”). SRS agrees that the Applicable Directors shall not have access to documents or other information relating to Recusal Matters.

transaction involving the Company or any of its subsidiaries or any of their respective securities (each, an “Extraordinary Transaction”); provided that nothing in this paragraph (d) shall preclude or prohibit SRS (or its Affiliates) from (i) tendering into a tender or exchange offer;  (ii) making a proposal providing for a Change of Control Transaction (as defined below) involving the acquisition of all of the outstanding Common Stock of the Company (a “Wholeco Transaction”) directly to the Board or a committee thereof and making filings in connection with such proposal and related discussions or negotiations under Section 13(d) of the Exchange Act and related regulations; provided, that SRS has provided notice of its intention to make such filing (together with a reasonable description of the material items to be disclosed in such filing and, if available, a draft thereof) to the Company as soon in advance as reasonably practicable; (iii) in the event the Board is no longer engaging in good faith negotiations relating to, or rejects an offer made by SRS (whether binding or non-binding), in each case, in accordance with clause (ii) above, making such offer directly to stockholders of the Company after providing notice of its intent to do so as soon in advance as reasonably practicable; or (iv) engaging in discussions with Third Parties (other than a Competitor) for a period of no more than seventy-five (75) days after providing written notice to the Company (which notice may be given not more than once during any twelve (12) month period; provided that an additional notice may be given during any twelve (12) month period if the Third Party enters into a confidentiality and standstill agreement on customary terms with the Company with respect to a potential Wholeco Transaction), about the possibility of partnering in the making of an offer for a Wholeco Transaction under clause (ii) or, to the extent applicable, clause (iii) above and making an offer (whether binding or non-binding) contemplated by such clauses in partnership with any Person (other than a Competitor) as long as such offer to the Board under clause (ii) above is first made on or prior to the end of such 75-day period; provided, that (x) nothing in clauses (ii)–(iv) above shall be deemed to permit SRS to disclose any confidential information of the Company to any Person without the prior written consent of the Company (which consent shall not be withheld, delayed or further conditioned in the event that such Person is willing to enter into a confidentiality agreement and a standstill agreement, in each case on customary terms), (y) Sections 2(d), (f), (g), (h) and (j) shall not prevent actions (and the other subsections of Section 2 shall not be deemed to prohibit actions taken by SRS that otherwise would be prohibited by Sections 2(d), (f), (g), (h) and (j) had they applied) to the extent such actions are taken in connection with discussions and offers made in compliance with clause (iii) or (iv) above (provided, that for the avoidance of doubt, Section 2(a) shall continue to prohibit the acquisition of Voting Securities except as results solely from being deemed a “group” with another Person as a result of such discussions or offers or from consummating a Wholeco Transaction that otherwise complies with this Section 2(d)), and (z) exploratory discussions by SRS in response to an unsolicited initiation by another Person of discussions with SRS with respect to partnering in the making of an offer for a Wholeco Transaction shall not be deemed to contravene the restrictions set forth in this Section 2(d), provided that thereafter engaging in substantive discussions about the material terms of the partnership and Wholeco Transaction shall either require the consent of the Board or the giving of the notice contemplated by clause (iv) above.

(v) make any proposal at any annual or special meeting of the Company’s stockholders; provided, that, the foregoing clauses (ii) and (iv) of this Section 2(e) shall not prevent the Applicable Directors from (x) discussing such matters at any Board or Board committee meeting or discussing such matters with other members of the Board at any time and (y) introducing qualified director candidates to the Board or the Corporate Governance Committee;

Notwithstanding anything in this Agreement to the contrary, the foregoing provisions of this Section 2 shall not be deemed to (x) prohibit SRS or its directors, officers, partners, employees, members or agents (acting in such capacity) from communicating privately with the Company’s directors or officers so long as such communications are not intended to, and would not reasonably be expected to, require any public disclosure (including under Section 13(d) of the Exchange Act and related regulations) of such communications (except to the extent permitted by Section 2(d)) or (y) restrict any Applicable Director in the exercise of his fiduciary duties to the Company and all of its stockholders. Notwithstanding anything to the contrary in this Agreement, Sections 2(d), (f), (g), (h) and (j) shall be of no further force and effect (and the other subsections of Section 2 shall not be deemed to prohibit actions taken by SRS that otherwise would be prohibited by Sections 2(d), (f), (g), (h) and (j) had they been in effect to the extent such actions are taken in pursuit of a Change of Control Transaction; provided, that for the avoidance of doubt, Section 2(a) shall continue to fully apply in accordance with its terms except for offers (but not acquisitions of Voting Securities) relating to a Change of Control Transaction) in the event that (i) the Company shall enter into a definitive agreement providing for (A) a merger, consolidation, business combination or similar transaction immediately following which the stockholders of the Company immediately prior to the consummation of such transaction (other than stockholders of the Company who have entered into, or who are members of a Group any member of which has entered into, a definitive agreement with the Company in respect of a transaction of the type described in this clause (A)) will hold less than 80% of the total combined voting power of the Company or any successor holding company, (B) a tender or exchange offer for 20% or more of the Voting Securities of the Company, (C) a sale of 20% or more of the consolidated assets of the Company and its subsidiaries (including equity securities of subsidiaries) in a single transaction or series of related transactions (other than in the ordinary course of business), or (D) a sale of 20% or more of the Voting Securities outstanding immediately prior to such sale in a single transaction or series of related transactions (each of (A), (B), (C) and (D) constituting a “Change of Control Transaction”), (ii) the Company formally or publicly commences a process contemplating a Change of Control Transaction and (x) does not provide SRS an opportunity to participate in such a process on the same terms as Third Parties, or (y) includes conditions to participation that are designed to prevent SRS from participating in such a process on the same terms as Third Parties or (iii) a Third Party shall commence a tender offer or exchange offer or otherwise make a bona fide public offer to acquire the Company, all or substantially all of the assets of the Company, or 50% or more of the Voting Securities of the Company, in each case, not resulting from a violation of this Section 2.

collectively have Beneficial Ownership of no more than the Independent Ownership Limit immediately following the consummation of such transaction).

Securities publicly disclosed as of such date, the resignation letter provided by the final Applicable Director (or any Replacement thereof), shall become effective (each of the percentages in clauses (a), (b) and (c), a “Minimum Ownership Level”); provided, that in the case of clauses (a) and (b), SRS shall promptly notify the Company of which Applicable Director (as applicable) will resign in each instance and, failing such notice, the Corporate Governance Committee of the Board shall determine which Applicable Director (as applicable) will resign. Following the effectiveness of an Applicable Director’s resignation letter pursuant to this Section 5, SRS shall no longer be entitled to recommend for appointment to the Board any Replacement for such Applicable Director and (ii) the Company shall not be obligated to nominate such Applicable Director or any Replacement thereof (as applicable) for election to the Board at any meeting of stockholders at which directors are to be elected occurring after such time. SRS shall promptly (and in any event within five (5) business days) inform the Company in writing if at any time SRS has failed to maintain any Minimum Ownership Level.

or obtained by such director by reason of his or her position as a director of the Company (“Confidential Information”).

intended to be, and shall not be interpreted as, a contractual restriction on any trading activities of SRS taken in SRS’s own judgment.

indirectly, in any way participate in a such transaction, unless such Extraordinary Transaction provides for the same type and amount of per share consideration (or the right to elect to receive the same type and amount of consideration), in respect of shares of Company Common Stock and/or any other equity interests of the Company or its subsidiaries that is subject to such Extraordinary Transaction (excluding, for the avoidance of doubt, any customarily “excluded shares” such as dissenting stockholders); provided, that, with respect to any such Extraordinary Transaction involving less than 100% of the Company Common Stock, each holder of Company Common Stock (other than customarily “excluded shares” such as dissenting stockholders) must have the same right to participate in such Extraordinary Transaction, including with respect to the election to participate in such transaction (if any) on the same economic terms and to proportionate treatment (based on economic ownership) in the case of any cut-back mechanics or offer limitations. SRS shall not, directly or indirectly, enter into any other transaction in connection with an Extraordinary Transaction that would, or may reasonably result in, additional or disparate consideration for SRS in avoidance of the intent of this provision.

(a)        In connection with entering into the Prior Agreement, the Board approved the transactions which resulted in SRS becoming an “interested stockholder” for purposes of Section 203 of the DGCL and, therefore, the restrictions contained in Section 203 of the DGCL do not apply to SRS as a matter of law.  If SRS acquires any ownership or other interest in any Voting Securities or any Synthetic Position such that SRS would collectively have Beneficial Ownership of more than the Independent Ownership Limit (an “Ownership Limit Excess Acquisition”), then, unless the Board otherwise approves such Ownership Limit Excess Acquisition prior to such acquisition by resolution that includes the approval of a majority of the directors who are not Applicable Directors (or their Replacements) from and after that date (the “Ownership Limit Excess Date”), SRS agrees that the provisions of Section 203 of the DGCL shall be deemed to apply as a matter of contract to any “business combination” (as defined in Section 203 of the DGCL, but disregarding clause (v) of the definition of “business combination” in Section 203 of the DGCL and all references to a “subsidiary” or “subsidiaries” set forth in the definition of “business combination” in Section 203 of the DGCL) between the Company and SRS as provided in Section 13(b) hereof.

(ii)             upon consummation of a Ownership Limit Excess Acquisition, SRS owned at least 85% of the voting power of the Voting Securities outstanding at the time the transaction commenced, excluding for purposes of determining the Voting Securities outstanding (but not the outstanding Voting Securities owned by SRS) those shares owned (x) by Persons who are directors and also officers of the Company and (y) employee stock plans in which employee participants do not have the right to determine confidentially whether shares held subject to the plan will be tendered in a tender or exchange offer;

(iii)            at or subsequent to such time the “business combination” is approved by the Board, including approval by a majority of the directors who are not Applicable Directors (or their Replacements), and authorized at an annual or special meeting of stockholders (and not by written consent) by the affirmative vote of at least 66 2/3% of the voting power of the outstanding Voting Securities which is not owned by SRS; or

(iv)           unless any of the exceptions in Section 203(b) (3), (4), (5) (6) or (7) of the DGCL would apply if the Ownership Limit Excess Acquisition had caused SRS to become an “interested stockholder” for purposes of Section 203 of the DGCL (with references to “15%” in Section 203 of the DGCL being deemed to be replaced with “Independent Ownership Limit”).

right, option or obligation to own, acquire or control or direct the voting of upon conversion, exercise, expiration, settlement or similar event (an “Exercise”) under or pursuant to (i) any Derivative (whether such Derivative is subject to Exercise immediately or only after the passage of time or upon the satisfaction of one or more conditions) and (ii) any Synthetic Position that is required or permitted to be settled, in whole or in part, in Voting Securities.

or proceeding for itself and in respect of its property, generally and unconditionally, to the personal jurisdiction of the aforesaid courts and agrees that it will not bring any action relating to this Agreement in any court other than the aforesaid courts. Each of the parties hereto hereby irrevocably waives, and agrees not to assert in any action or proceeding with respect to this Agreement, (a) any claim that it is not personally subject to the jurisdiction of the above-named courts for any reason, (b) any claim that it or its property is exempt or immune from jurisdiction of any such court or from any legal process commenced in such courts (whether through service of notice, attachment prior to judgment, attachment in aid of execution of judgment, execution of judgment or otherwise) and (c) to the fullest extent permitted by applicable legal requirements, any claim that (i) the suit, action or proceeding in such court is brought in an inconvenient forum, (ii) the venue of such suit, action or proceeding is improper or (iii) this Agreement, or the subject matter hereof, may not be enforced in or by such courts.

if to the Company:

Avis Budget Group, Inc.
6 Sylvan Way
Parsippany, New Jersey 07054
Attention: Jean Sera
Email: Jean.Sera@avisbudget.com

with a copy (which shall not constitute notice) to:

Paul, Weiss, Rifkind, Wharton & Garrison  LLP
1285 Avenue of the Americas
New York, NY 10019
Attention: Robert B. Schumer
      Brian C. Lavin

Email: rschumer@paulweiss.com
            blavin@paulweiss.com

if to SRS:

SRS Investment Management, LLC
1 Bryant Park, 39th Floor
New York, NY 10036
Attention: David Zales
Email: david.zales@srsfund.com

with a copy (which shall not constitute notice) to:

Cadwalader, Wickersham & Taft LLP
200 Liberty St.
New York, New York 10281
Attention: Stephen Fraidin
      Richard Brand
      Kiran Kadekar
Email: stephen.fraidin@cwt.com
 richard.brand@cwt.com
 kiran.kadekar@cwt.com

[Signature Pages Follow]

IN WITNESS WHEREOF, each of the parties hereto has executed this Agreement, or caused the same to be executed by its duly authorized representative as of the date first above written.

	AVIS BUDGET GROUP, INC.
	By:	/s/ Jean Sera
		Name:  Jean Sera
		Title:     Senior Vice President, Corporate Secretary and Global Programs

	SRS INVESTMENT MANAGEMENT, LLC
	By:	/s/ David B. Zales
		Name:  David B. Zales
		Title:     General Counsel

	SRS PARTNERS MASTER FUND LP
	By:	SRS Investment Management, LLC, its investment manager
	By:	/s/ David B. Zales
		Name:  David B. Zales
		Title:     General Counsel

	SRS SPECIAL OPPORTUNITIES MASTER II, LP
	By:	SRS Investment Management, LLC, its investment manager
	By:	/s/ David B. Zales
		Name:  David B. Zales
		Title:     General Counsel

	SRS LONG OPPORTUNITIES MASTER FUND, LP
	By:	SRS Investment Management, LLC, its investment manager
	By:	/s/ David B. Zales
		Name:  David B. Zales
		Title:     General Counsel

SRS Investment Management, LLC

SRS Partners Master Fund LP

SRS Special Opportunities Master II, LP

SRS Long Opportunities Master Fund, LP

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