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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

Form 10-Q


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2024


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _____ to _____

Commission File No. 001-10308


Avis Budget Group, Inc.
(Exact name of registrant as specified in its charter)

Delaware

06-0918165

(State or other jurisdiction of
incorporation or organization)

(I.R.S. Employer
Identification Number)

379 Interpace Parkway

Parsippany,

07054

(Address of principal executive offices)

(Zip Code)

(973)

496-4700

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, Par Value $0.01	CAR	The Nasdaq Global Select Market

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or emerging growth company. See the definitions of “large accelerated filer”, “accelerated filer”, “smaller reporting company”, and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large Accelerated Filer

☒

Accelerated Filer

☐

Non-accelerated Filer

☐

Smaller Reporting Company

☐

Emerging Growth Company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

The number of shares outstanding of the issuer’s common stock was 35,647,164 shares as of April 26, 2024.

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		Page
PART I	Financial Information
Item 1.	Financial Statements
	Consolidated Condensed Statements of Comprehensive Income for the Three Months Ended March 31, 2024 and 2023 (Unaudited)	4
	Consolidated Condensed Balance Sheets as of March 31, 2024 and December 31, 2023 (Unaudited)	5
	Consolidated Condensed Statements of Cash Flows for the Three Months Ended March 31, 2024 and 2023 (Unaudited)	6
	Consolidated Condensed Statements of Stockholders’ Equity for the Three Months Ended March 31, 2024 and 2023 (Unaudited)	8
	Notes to Consolidated Condensed Financial Statements (Unaudited)	9
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	27
Item 3.	Quantitative and Qualitative Disclosures about Market Risk	34
Item 4.	Controls and Procedures	34
PART II	Other Information
Item 1.	Legal Proceedings	35
Item 1A.	Risk Factors	35
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	35
Item 5.	Other Information	35
Item 6.	Exhibits	35
	Signatures	36

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FORWARD-LOOKING STATEMENTS

Certain statements contained in this Quarterly Report on Form 10-Q may be considered “forward-looking statements” as that term is defined in the Private Securities Litigation Reform Act of 1995. The forward-looking statements contained herein are subject to known and unknown risks, uncertainties, assumptions and other factors that may cause our actual results, performance or achievements to be materially different from those expressed or implied by any such forward-looking statements. Forward-looking statements include information concerning our future financial performance, business strategy, projected plans and objectives. These statements may be identified by the fact that they do not relate to historical or current facts and may use words such as “believes,” “expects,” “anticipates,” “will,” “should,” “could,” “may,” “would,” “intends,” “projects,” “estimates,” “plans,” “forecasts,” “guidance,” and similar words, expressions or phrases. The following important factors and assumptions could affect our future results and could cause actual results to differ materially from those expressed in such forward-looking statements. These factors include, but are not limited to:

•the high level of competition in the mobility industry, including from new companies or technology, and the impact such competition may have on pricing and rental volume;

•a change in our fleet costs, including as a result of a change in the cost of new vehicles, resulting from inflation or otherwise, manufacturer recalls, disruption in the supply of new vehicles, including due to labor actions or otherwise, shortages in semiconductors used in new vehicle production, and/or a change in the price at which we dispose of used vehicles either in the used vehicle market or under repurchase or guaranteed depreciation programs;

•the results of operations or financial condition of the manufacturers of our vehicles, which could impact their ability to perform their payment obligations under our agreements with them, including repurchase and/or guaranteed depreciation arrangements, and/or their willingness or ability to make vehicles available to us or the mobility industry as a whole on commercially reasonable terms or at all;

•levels of and volatility in travel demand, including future volatility in airline passenger traffic;

•a deterioration in economic conditions, resulting in a recession or otherwise, particularly during our peak season or in key market segments;

•an occurrence or threat of terrorism, pandemic diseases such as COVID-19, natural disasters, military conflicts, including the ongoing military conflicts in the Middle East and Eastern Europe, or civil unrest in the locations in which we operate, and the potential effects of sanctions on the world economy and markets and/or international trade;

•any substantial changes in the cost or supply of fuel, vehicle parts, energy, labor or other resources on which we depend to operate our business, including as a result of a global pandemic such as COVID-19, inflation, the ongoing military conflicts in the Middle East and Eastern Europe, and any embargoes on oil sales imposed on or by the Russian government;

•our ability to successfully implement or achieve our business plans and strategies, achieve and maintain cost savings and adapt our business to changes in mobility;

•political, economic or commercial instability in the countries in which we operate, and our ability to conform to multiple and conflicting laws or regulations in those countries;

•the performance of the used vehicle market from time to time, including our ability to dispose of vehicles in the used vehicle market on attractive terms;

•our dependence on third-party distribution channels, third-party suppliers of other services and co-marketing arrangements with third parties;

•risks related to completed or future acquisitions or investments that we may pursue, including the incurrence of incremental indebtedness to help fund such transactions and our ability to promptly and

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effectively integrate any acquired businesses or capitalize on joint ventures, partnerships and other investments;

•our ability to utilize derivative instruments, and the impact of derivative instruments we utilize, which can be affected by fluctuations in interest rates, fuel prices and exchange rates, changes in government regulations and other factors;

•our exposure to uninsured or unpaid claims in excess of historical levels and our ability to obtain insurance at desired levels and the cost of that insurance;

•risks associated with litigation or governmental or regulatory inquiries, or any failure or inability to comply with laws, regulations or contractual obligations or any changes in laws, regulations or contractual obligations, including with respect to personally identifiable information and consumer privacy, labor and employment, and tax;

•risks related to protecting the integrity of, and preventing unauthorized access to, our information technology systems or those of our third-party vendors, licensees, dealers, independent operators and independent contractors, and protecting the confidential information of our employees and customers against security breaches, including physical or cybersecurity breaches, attacks, or other disruptions, compliance with privacy and data protection regulation, and the effects of any potential increase in cyberattacks on the world economy and markets and/or international trade;

•any impact on us from the actions of our third-party vendors, licensees, dealers, independent operators and independent contractors and/or disputes that may arise out of our agreements with such parties;

•any major disruptions in our communication networks or information systems;

•risks related to tax obligations and the effect of future changes in tax laws and accounting standards;

•risks related to our indebtedness, including our substantial outstanding debt obligations, recent and future interest rate increases, which increase our financing costs, downgrades by rating agencies and our ability to incur substantially more debt;

•our ability to obtain financing for our global operations, including the funding of our vehicle fleet through the issuance of asset-backed securities and use of the global lending markets;

•our ability to meet the financial and other covenants contained in the agreements governing our indebtedness, or to obtain a waiver or amendment of such covenants should we be unable to meet such covenants;

•significant changes in the assumptions and estimates that are used in our impairment testing for goodwill or intangible assets, which could result in a significant impairment of our goodwill or intangible assets; and

•other business, economic, competitive, governmental, regulatory, political or technological factors affecting our operations, pricing or services.

We operate in a continuously changing business environment and new risk factors emerge from time to time. New risk factors, factors beyond our control, or changes in the impact of identified risk factors may cause actual results to differ materially from those set forth in any forward-looking statements. Accordingly, forward-looking statements should not be relied upon as a prediction of actual results. Moreover, we do not assume responsibility if future results are materially different from those forecasted or anticipated. Other factors and assumptions not identified above, including those discussed in “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” in Item 2 and “Risk Factors” in Item 1A in this quarterly report and in similarly titled sections set forth in Item 7 and in Item 1A and in other portions of our 2023 Annual Report on Form 10-K filed with the Securities and Exchange Commission (the “SEC”) on February 16, 2024 (the “2023 Form 10-K”), may cause actual results to differ materially from those projected in any forward-looking statements.

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Although we believe that our assumptions are reasonable, any or all of our forward-looking statements may prove to be inaccurate and we can make no guarantees about our future performance. Should unknown risks or uncertainties materialize or underlying assumptions prove inaccurate, actual results could differ materially from past results and/or those anticipated, estimated or projected. We undertake no obligation to release any revisions to any forward-looking statements, to report events or to report the occurrence of unanticipated events. For any forward-looking statements contained in any document, we claim the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995.

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PART I — FINANCIAL INFORMATION

Item 1. Financial Statements

Avis Budget Group, Inc.

CONSOLIDATED CONDENSED STATEMENTS OF COMPREHENSIVE INCOME

(In millions, except per share data)

(Unaudited)


	Three Months Ended March 31,
		2024		2023
Revenues		$	2,551	$	2,557

Expenses
Operating		1,344		1,307
Vehicle depreciation and lease charges, net		636		265
Selling, general and administrative		325		324
Vehicle interest, net		239		133
Non-vehicle related depreciation and amortization		61		56

Interest expense related to corporate debt, net		83		73

Restructuring and other related charges		3		4
Transaction-related costs, net		1		—
Other (income) expense, net		1		(2)
Total expenses		2,693		2,160

Income (loss) before income taxes		(142)		397
Provision for (benefit from) income taxes		(29)		85
Net income (loss)		(113)		312
Less: net income attributable to non-controlling interests		1		—
Net income (loss) attributable to Avis Budget Group, Inc.		$	(114)	$	312

Comprehensive income (loss) attributable to Avis Budget Group, Inc.		$	(158)	$	302

Earnings (loss) per share
Basic		$	(3.21)	$	7.88
Diluted		$	(3.21)	$	7.72

See Notes to Consolidated Condensed Financial Statements (Unaudited).

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Avis Budget Group, Inc.

CONSOLIDATED CONDENSED BALANCE SHEETS

(In millions, except par value)

(Unaudited)


		March 31, 2024		December 31, 2023
Assets
Current assets:
	Cash and cash equivalents	$	522	$	555
	Receivables, net	1,032		900
	Other current assets	779		684
Total current assets		2,333		2,139

Property and equipment, net		709		719
Operating lease right-of-use assets		2,750		2,654
Deferred income taxes		1,811		1,868
Goodwill		1,088		1,099
Other intangibles, net		658		670
Other non-current assets		450		441
Total assets exclusive of assets under vehicle programs		9,799		9,590

Assets under vehicle programs:
	Program cash	73		85
	Vehicles, net	22,020		21,240
	Receivables from vehicle manufacturers and other	431		443
	Investment in Avis Budget Rental Car Funding (AESOP) LLC—related party	1,205		1,211
		23,729		22,979
Total Assets		$	33,528	$	32,569

Liabilities and Stockholders’ Equity
Current liabilities:
	Accounts payable and other current liabilities	$	2,669	$	2,627
	Short-term debt and current portion of long-term debt	405		32
Total current liabilities		3,074		2,659

Long-term debt		5,032		4,791
Long-term operating lease liabilities		2,234		2,117
Other non-current liabilities		509		528
Total liabilities exclusive of liabilities under vehicle programs		10,849		10,095

Liabilities under vehicle programs:
	Debt	3,241		3,496
	Debt due to Avis Budget Rental Car Funding (AESOP) LLC—related party	15,949		15,441
	Deferred income taxes	3,325		3,418
	Other	672		462
		23,187		22,817
Commitments and contingencies (Note 12)

Stockholders’ equity:
	Preferred stock, $0.01 par value—authorized 10 shares; none issued and outstanding, in each period	—		—
	Common stock, $0.01 par value—authorized 250 shares; issued 137 shares, in each period	1		1
	Additional paid-in capital	6,610		6,634
	Retained earnings	3,738		3,854
	Accumulated other comprehensive loss	(140)		(96)
	Treasury stock, at cost—101 and 102 shares, respectively	(10,724)		(10,742)
Stockholders’ equity attributable to Avis Budget Group, Inc.		(515)		(349)
	Non-controlling interests	7		6
Total stockholders’ equity		(508)		(343)
Total Liabilities and Stockholders’ Equity		$	33,528	$	32,569

See Notes to Consolidated Condensed Financial Statements (Unaudited).

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Avis Budget Group, Inc.

CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS

(In millions)

(Unaudited)


			Three Months Ended March 31,
			2024		2023
Operating activities
Net income (loss)			$	(113)	$	312
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
	Vehicle depreciation		562		477
	Amortization of right-of-use assets		302		251
	(Gain) loss on sale of vehicles, net		39		(250)
	Non-vehicle related depreciation and amortization		61		56

	Stock-based compensation		7		8
	Amortization of debt financing fees		12		9

	Net change in assets and liabilities:
		Receivables	(8)		34
		Income taxes and deferred income taxes	(34)		66
		Accounts payable and other current liabilities	46		82
	Operating lease liabilities		(299)		(250)
	Other, net		14		24
Net cash provided by operating activities			589		819

Investing activities
Property and equipment additions			(53)		(44)
Proceeds received on asset sales			1		—
Net assets acquired (net of cash acquired)			(1)		(3)


Net cash used in investing activities exclusive of vehicle programs			(53)		(47)

Vehicle programs:
	Investment in vehicles		(4,081)		(3,880)
	Proceeds received on disposition of vehicles		2,610		2,283
	Investment in debt securities of Avis Budget Rental Car Funding (AESOP) LLC—related party		(254)		(105)
	Proceeds from debt securities of Avis Budget Rental Car Funding (AESOP) LLC—related party		260		71
			(1,465)		(1,631)
Net cash used in investing activities			(1,518)		(1,678)

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Avis Budget Group, Inc.

CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS (Continued)

(In millions)

(Unaudited)


		Three Months Ended March 31,
		2024		2023
Financing activities
Proceeds from long-term borrowings		$	651	$	—
Payments on long-term borrowings		(10)		(7)
Net change in short-term borrowings		—		2

Repurchases of common stock		(15)		(51)
Debt financing fees		(11)		(2)


Net cash provided by (used in) financing activities exclusive of vehicle programs		615		(58)

Vehicle programs:
	Proceeds from borrowings	6,614		5,270
	Payments on borrowings	(6,296)		(4,359)
	Debt financing fees	(36)		(12)
		282		899
Net cash provided by financing activities		897		841

Effect of changes in exchange rates on cash and cash equivalents, program and restricted cash		(13)		5

Net decrease in cash and cash equivalents, program and restricted cash		(45)		(13)
Cash and cash equivalents, program and restricted cash, beginning of period		644		642
Cash and cash equivalents, program and restricted cash, end of period		$	599	$	629

See Notes to Consolidated Condensed Financial Statements (Unaudited).

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Avis Budget Group, Inc.

CONSOLIDATED CONDENSED STATEMENTS OF STOCKHOLDERS’ EQUITY

(In millions)

(Unaudited)


	Common Stock			Additional Paid-in Capital		Retained Earnings (Accumulated Deficit)		Accumulated Other Comprehensive Income (Loss)		Treasury Stock			Stockholders’ Equity Attributable to Avis Budget Group, Inc.		Non-controlling Interests		Total Stockholders’ Equity
	Shares	Amount								Shares	Amount
Balance at December 31, 2023	137.1	$	1	$	6,634	$	3,854	$	(96)	(101.6)	$	(10,742)	$	(349)	$	6	$	(343)


Comprehensive income (loss):
Net income (loss)	—	—		—		(114)		—		—	—		(114)		1		(113)
Other comprehensive loss	—	—		—		—		(44)		—	—		(44)		—		(44)
Total comprehensive income (loss)						(114)		(44)					(158)		1		(157)


Net activity related to restricted stock units	—	—		(24)		(2)		—		0.2	18		(8)		—		(8)

Balance at March 31, 2024	137.1	$	1	$	6,610	$	3,738	$	(140)	(101.4)	$	(10,724)	$	(515)	$	7	$	(508)

Balance at December 31, 2022	137.1	$	1	$	6,666	$	2,579	$	(101)	(97.6)	$	(9,848)	$	(703)	$	3	$	(700)

Comprehensive income (loss):
Net income	—	—		—		312		—		—	—		312		—		312
Other comprehensive loss	—	—		—		—		(10)		—	—		(10)		—		(10)
Total comprehensive income (loss)						312		(10)					302		—		302


Net activity related to restricted stock units	—	—		(46)		—		—		0.3	3		(43)		—		(43)

Balance at March 31, 2023	137.1	$	1	$	6,620	$	2,891	$	(111)	(97.3)	$	(9,845)	$	(444)	$	3	$	(441)

See Notes to Consolidated Condensed Financial Statements (Unaudited).

Avis Budget Group, Inc.

NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS (Unaudited)

(Unless otherwise noted, all dollar amounts are in millions, except per share amounts)

1. Basis of Presentation

Avis Budget Group, Inc. provides mobility solutions to businesses and consumers worldwide. The accompanying unaudited Consolidated Condensed Financial Statements include the accounts and transactions of Avis Budget Group, Inc. and its subsidiaries, as well as entities in which Avis Budget Group, Inc. directly or indirectly has a controlling financial interest (collectively, “we”, “our”, “us”, or the “Company”), and have been prepared pursuant to the rules and regulations of the U.S. Securities and Exchange Commission for interim financial reporting.

We operate the following reportable business segments:

•Americas - consisting primarily of (i) vehicle rental operations in North America, South America, Central America and the Caribbean, (ii) car sharing operations in certain of these markets, and (iii) licensees in the areas in which we do not operate directly.

•International - consisting primarily of (i) vehicle rental operations in Europe, the Middle East, Africa, Asia and Australasia, (ii) car sharing operations in certain of these markets, and (iii) licensees in the areas in which we do not operate directly.

The operating results of acquired businesses are included in the accompanying Consolidated Condensed Financial Statements from the dates of acquisition. Differences between the preliminary allocation of purchase price and the final allocation for our 2023 acquisitions of various licensees were not material. We consolidate joint venture activities when we have a controlling interest and record non-controlling interests within stockholders’ equity and the statement of comprehensive income equal to the percentage of ownership interest retained in such entities by the respective non-controlling party.

In presenting the Consolidated Condensed Financial Statements in accordance with accounting principles generally accepted in the United States of America (“GAAP”), management makes estimates and assumptions that affect the amounts reported and related disclosures. Estimates, by their nature, are based on judgment and available information. Accordingly, actual results could differ from those estimates. In management’s opinion, the Consolidated Condensed Financial Statements contain all adjustments necessary for a fair presentation of interim results reported. The results of operations reported for interim periods are not necessarily indicative of the results of operations for the entire year or any subsequent interim period. These financial statements should be read in conjunction with our 2023 Annual Report on Form 10-K (the “2023 Form 10-K”).

Summary of Significant Accounting Policies

Our significant accounting policies are fully described in Note 2 – Summary of Significant Accounting Policies in our 2023 Form 10-K.

Cash and cash equivalents, Program cash and Restricted cash. The following table provides a detail of cash and cash equivalents, program and restricted cash reported within the Consolidated Condensed Balance Sheets to the amounts shown in the Consolidated Condensed Statements of Cash Flows.


	As of March 31,
	2024		2023
Cash and cash equivalents	$	522	$	548
Program cash	73		80
Restricted cash (a)	4		1
Total cash and cash equivalents, program and restricted cash	$	599	$	629

________

(a)Included within other current assets.

Vehicle Programs. We present separately the financial data of our vehicle programs. These programs are distinct from our other activities since the assets under vehicle programs are generally funded through the issuance of debt that is collateralized by such assets. The income generated by these assets is used, in part, to repay the principal and interest associated with the debt. Cash inflows and outflows relating to the acquisition of such assets and the principal debt repayment or financing of such assets are classified as activities of our vehicle programs. We believe it is appropriate to segregate the financial data of our vehicle programs because, ultimately, the source of repayment of such debt is the realization of such assets.

Transaction-related costs, net. Transaction-related costs, net are classified separately in the Consolidated Condensed Statements of Comprehensive Income. These costs are comprised of expenses primarily related to acquisition-related activities such as due diligence and other advisory costs, expenses related to the integration of the acquiree’s operations with those of our operations, including the implementation of best practices and process improvements, non-cash gains and losses related to re-acquired rights, expenses related to pre-acquisition contingencies and contingent consideration related to acquisitions.

Currency Transactions. We record the gain or loss on foreign currency transactions on certain intercompany loans and the gain or loss on intercompany loan hedges within interest expense related to corporate debt, net.

Variable Interest Entity (“VIE”). We review our investments to determine if they are VIEs. A VIE is an entity in which either (i) the equity investors as a group lack the power through voting or similar rights to direct the activities of such entity that most significantly impact such entity’s economic performance or (ii) the equity investment at risk is insufficient to finance that entity’s activities without additional subordinated financial support. Entities that are determined to be VIEs are consolidated if we are the primary beneficiary of the entity. The primary beneficiary possesses the power to direct the activities of the VIE that most significantly impact its economic performance and has the obligation to absorb losses or the right to receive benefits from the VIE that are significant to it. We will reconsider our original assessment of a VIE upon the occurrence of certain events such as contributions and redemptions, either by us, or third parties, or amendments to an entity’s governing documents. On an ongoing basis, we reconsider whether we are deemed to be a VIE’s primary beneficiary. See Note 14 – Related Party Transactions for our VIE investment in our former subsidiary.

Investments. As of March 31, 2024 and December 31, 2023, we had equity method investments with a carrying value of $95 million and $93 million, respectively, which are included in other non-current assets. Earnings from our equity method investments are included within operating expenses. For the three months ended March 31, 2024 and 2023 we recorded $3 million and an immaterial amount related to our equity method investments, respectively. See Note 14 – Related Party Transactions for our equity method investment in our former subsidiary.

Revenues. Revenues are recognized under “Leases (Topic 842),” with the exception of royalty fee revenue derived from our licensees and revenue related to our customer loyalty program, which were approximately $42 million and $44 million during the three months ended March 31, 2024 and 2023, respectively.

The following table presents our revenues disaggregated by geography:


	Three Months Ended March 31,
		2024		2023
Americas		$	1,993	$	2,016
Europe, Middle East and Africa		382		367
Asia and Australasia		176		174
Total revenues		$	2,551	$	2,557

The following table presents our revenues disaggregated by brand:


	Three Months Ended March 31,
		2024		2023
Avis		$	1,460	$	1,415
Budget		921		977
Other		170		165
Total revenues		$	2,551	$	2,557

________

Other includes Zipcar and other operating brands.

Recently Issued Accounting Pronouncements

Improvements to Income Tax Disclosures

In December 2023, the FASB issued ASU 2023-09, “Improvements to Income Tax Disclosures,” which amends Topic 740 primarily through enhanced disclosures about an entity’s tax risks and tax planning. The amendments are effective for public business entities in annual periods beginning after December 15, 2024, with early adoption permitted on a prospective or retrospective basis. ASU 2023-09 will become effective for us on January 1, 2025. We are currently evaluating the impact of the adoption of this accounting pronouncement on our Consolidated Financial Statements.

Improvements to Reportable Segment Disclosures

In November 2023, the FASB issued ASU 2023-07, “Improvements to Reportable Segment Disclosures,” which amends Topic 280 primarily through enhanced disclosures about significant segment expenses. The amendments are effective for fiscal years beginning after December 15, 2023 and interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted. ASU 2023-07 became effective for us on January 1, 2024. We are currently evaluating the impact of the adoption of this accounting pronouncement on our Consolidated Condensed Financial Statements.

Reference Rate Reform

In January 2021, the FASB issued ASU 2021-01, “Reference Rate Reform (Topic 848),” which amends ASU 2020-04 and clarifies the scope and guidance of Topic 848 to allow derivatives impacted by the reference rate reform to qualify for certain optional expedients and exceptions for contract modifications and hedge accounting. The guidance is optional and is effective for a limited period of time. In December 2022, the FASB also issued ASU 2022-06, “Reference Rate Reform (Topic 848): Deferral of the Sunset Date of Topic 848,” to defer the sunset date of ASC 848 from December 31, 2022 to December 31, 2024. As of March 31, 2024, this guidance had no impact on our Consolidated Condensed Financial Statements, and we will continue to evaluate this guidance.

2. Leases

Lessor

The following table presents our lease revenues disaggregated by geography:


	Three Months Ended March 31,
		2024		2023
Americas		$	1,974	$	1,995
Europe, Middle East and Africa		364		349
Asia and Australasia		171		169
Total lease revenues		$	2,509	$	2,513

The following table presents our lease revenues disaggregated by brand:


	Three Months Ended March 31,
		2024		2023
Avis		$	1,434	$	1,388
Budget		909		964
Other		166		161
Total lease revenues		$	2,509	$	2,513

________

Other includes Zipcar and other operating brands.

Lessee

We have operating and finance leases for rental locations, corporate offices, vehicle rental fleet and equipment. Many of our operating leases for rental locations contain concession agreements with various airport authorities that allow us to conduct our vehicle rental operations on site. In general, concession fees for airport locations are based on a percentage of total commissionable revenue as defined by each airport authority, some of which are subject to minimum annual guaranteed amounts. Concession fees other than minimum annual guaranteed amounts are not included in the measurement of operating lease right of use (“ROU”) assets and operating lease liabilities, and are recorded as variable lease expense as incurred. Our operating leases for rental locations often also require us to pay or reimburse operating expenses.

The components of lease expense are as follows:


	Three Months Ended March 31,
		2024		2023
Property leases (a)
Operating lease expense		$	229	$	205
Variable lease expense		69		83
Total property lease expense		$	298	$	288

________

(a) Primarily within operating expenses.

Supplemental balance sheet information related to leases is as follows:


	As of March 31, 2024			As of December 31, 2023
Property leases
Operating lease ROU assets	$	2,750		$	2,654

Short-term operating lease liabilities (a)	$	558		$	576
Long-term operating lease liabilities	2,234			2,117
Operating lease liabilities	$	2,792		$	2,693

Weighted average remaining lease term	8.0 years			8.1 years
Weighted average discount rate	4.88		%	4.83		%

________

(a) Included in accounts payable and other current liabilities.

Supplemental cash flow information related to leases is as follows:


	Three Months Ended March 31,
	2024		2023
Cash payments for lease liabilities within operating activities:
Property operating leases	$	266	$	210
Non-cash activities - increase (decrease) in ROU assets in exchange for lease liabilities:
Property operating leases	$	380	$	154

3. Restructuring and Other Related Charges

During the first quarter of 2024, we initiated a global restructuring plan to further right size our operations (“Global Rightsizing”). The costs associated with this initiative are primarily related to the operational scaling of processes, locations, and lines of business. We expect further restructuring expense of approximately $35 million related to this initiative to be incurred this year.

During the second quarter of 2022, we initiated a restructuring plan to focus on consolidating our global operations by designing new processes and implementing new systems (“Cost Optimization”). We expect this initiative to be completed this year.

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


	Americas		International		Total
Balance as of January 1, 2024	$	2	$	2	$	4

Restructuring expense:
Global Rightsizing	2		1		3




Restructuring payments and utilization:
Global Rightsizing	(2)		(1)		(3)
Cost Optimization	—		(1)		(1)



Balance as of March 31, 2024	$	2	$	1	$	3

4. Earnings Per Share

The following table sets forth the computation of basic and diluted earnings (loss) per share (“EPS”) (shares in millions):


		Three Months Ended March 31,
			2024		2023
Net income (loss) attributable to Avis Budget Group, Inc. for basic and diluted EPS			$	(114)	$	312

Basic weighted average shares outstanding			35.6		39.6
Non-vested stock (a)			—		0.8
Diluted weighted average shares outstanding			35.6		40.4

Earnings (loss) per share:
	Basic		$	(3.21)	$	7.88
	Diluted		$	(3.21)	$	7.72

________

(a) For the three months ended March 31, 2024 and 2023, 0.3 million and 0.1 million non-vested stock awards, respectively, have an anti-dilutive effect and therefore are excluded from the computation of diluted weighted average shares outstanding.

5. Other Current Assets

Other current assets consisted of:


	As of		As of
	March 31,		December 31,
	2024		2023
Prepaid expenses	$	312	$	239
Sales and use taxes	221		192
Other	246		253
Other current assets	$	779	$	684

6. Intangible Assets

Intangible assets consisted of:


	As of March 31, 2024						As of December 31, 2023
	Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount		Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount
Amortized Intangible Assets
License agreements	$	312	$	236	$	76	$	316	$	234	$	82
Customer relationships	250		220		30		253		221		32
Other	54		46		8		56		46		10
Total	$	616	$	502	$	114	$	625	$	501	$	124
Unamortized Intangible Assets
Goodwill	$	1,088					$	1,099
Trademarks	$	544					$	546

For the three months ended March 31, 2024 and 2023, amortization expense related to amortizable intangible assets was approximately $8 million in each period.

Based on our amortizable intangible assets at March 31, 2024, we expect amortization expense of approximately $21 million for the remainder of 2024, $22 million for 2025, $21 million for 2026, $16 million for 2027, $9 million for 2028 and $7 million for 2029, excluding effects of currency exchange rates.

7. Vehicle Rental Activities

The components of vehicles, net within assets under vehicle programs are as follows:


	As of		As of
	March 31,		December 31,
	2024		2023
Rental vehicles	$	24,110	$	23,114
Less: Accumulated depreciation	(2,647)		(2,639)
	21,463		20,475
Vehicles held for sale	521		734
Vehicles, net investment in lease (a)	36		31
Vehicles, net	$	22,020	$	21,240

________

(a) See Note 14 – Related Party Transactions.

The components of vehicle depreciation and lease charges, net are summarized below:


	Three Months Ended March 31,
		2024		2023
Depreciation expense		$	562	$	477
Lease charges		35		38
(Gain) loss on sale of vehicles, net		39		(250)
Vehicle depreciation and lease charges, net		$	636	$	265

At March 31, 2024 and 2023, we had payables related to vehicle purchases included in liabilities under vehicle programs - other of $483 million and $314 million, respectively, and receivables related to vehicle sales included in assets under vehicle programs - receivables from vehicle manufacturers and other of $239 million and $137 million, respectively.

8. Income Taxes

Our effective tax rate for the three months ended March 31, 2024 was a benefit of 20.4%. Such rate differed from the Federal Statutory rate of 21.0% primarily due to the effect of certain tax credits, partially offset by foreign taxes on our International operations and state taxes.

Our effective tax rate for the three months ended March 31, 2023 was a provision of 21.4%. Such rate differed from the Federal Statutory rate of 21.0% primarily due to foreign taxes on our International operations and state taxes, partially offset by the effect of certain tax credits and the favorable adjustments related to stock-based compensation.

The Organisation for Economic Cooperation and Development (“OECD”) published a proposal for the establishment of a global minimum tax rate of 15% (the “Pillar Two rule”), effective for fiscal 2024. We are closely monitoring developments of the Pillar Two rule as the OECD continues to refine its technical guidance and member states implement tax laws and regulations based on Pillar Two proposals. Based on our preliminary analysis, we do not expect Pillar Two to have a material impact on our financial statements for 2024.

9. Accounts Payable and Other Current Liabilities

Accounts payable and other current liabilities consisted of:


	As of		As of
	March 31,		December 31,
	2024		2023
Short-term operating lease liabilities	$	558	$	576
Accounts payable	504		487
Accrued advertising and marketing	267		276
Accrued sales and use taxes	268		251
Accrued payroll and related	164		188
Deferred lease revenues - current	257		168
Public liability and property damage insurance liabilities – current	172		181
Other	479		500
Accounts payable and other current liabilities	$	2,669	$	2,627

10. Long-term Corporate Debt and Borrowing Arrangements

Long-term corporate debt and borrowing arrangements consisted of:


		As of		As of
	Maturity	March 31,		December 31,
	Date	2024		2023
4.750% euro-denominated Senior Notes (a)	January 2026	$	378	$	386
5.750% Senior Notes	July 2027	736		736
4.750% Senior Notes	April 2028	500		500
7.000% euro-denominated Senior Notes	February 2029	647		—
5.375% Senior Notes	March 2029	600		600
7.250% euro-denominated Senior Notes	July 2030	432		441
8.000% Senior Notes	February 2031	497		497

Floating Rate Term Loan (b)	August 2027	1,162		1,164
Floating Rate Term Loan (c)	March 2029	523		524
Other (d)		24		30
Deferred financing fees		(62)		(55)
Total		5,437		4,823
Less: Short-term debt and current portion of long-term debt		405		32
Long-term debt		$	5,032	$	4,791

________

(a)In April 2024, these notes were fully redeemed. See Note 18 – Subsequent Events.

(b)The floating rate term loan is part of our senior revolving credit facility, which is secured by pledges of capital stock of certain of our subsidiaries, and liens on substantially all of our intellectual property and certain other real and personal property. As of March 31, 2024, the floating rate term loan due 2027 bears interest at one-month Secured Overnight Financing Rate (“SOFR”) plus 1.75%, for an aggregate rate of 7.19%. We have entered into a swap to hedge $750 million of interest rate exposure related to the floating rate term loan at an aggregate rate of 3.26%.

(c)The floating rate term loan is part of our senior revolving credit facility, which is secured by pledges of capital stock of certain of our subsidiaries, and liens on substantially all of our intellectual property and certain other real and personal property. As of March 31, 2024, the floating rate term loan due 2029 bears interest at one-month SOFR plus 3.00% for an aggregate rate of 8.43%.

(d)Primarily includes finance leases, which are secured by liens on the related assets.

In February 2024, we issued €600 million of 7.000% euro-denominated Senior Notes due February 2029, at par, with interest payable semi-annually. Net proceeds from the offering will be used to redeem all of our outstanding 4.750% euro-denominated Senior Notes due January 2026 plus accrued interest, with the remainder being used for general corporate purposes.

Committed Credit Facilities and Available Funding Arrangements

As of March 31, 2024, the committed corporate credit facilities available to us and/or our subsidiaries were as follows:


	Total Capacity		Outstanding Borrowings		Letters of Credit Issued		Available Capacity
Senior revolving credit facility maturing 2028 (a)	$	2,000	$	—	$	1,800	$	200

________

(a)The senior revolving credit facility bears interest at one-month SOFR plus 1.75% and is part of our senior credit facilities, which include the floating rate term loan and the senior revolving credit facility, and which are secured by pledges of capital stock of certain of our subsidiaries, liens on substantially all of our intellectual property and certain other real and personal property.

Debt Covenants

The agreements governing our indebtedness contain restrictive covenants, including restrictions on dividends paid to us by certain of our subsidiaries, the incurrence of additional indebtedness and/or liens by us and certain of our subsidiaries, acquisitions, mergers, liquidations, and sale and leaseback transactions. Our senior credit facility also contains a maximum leverage ratio requirement. As of March 31, 2024, we were in compliance with the financial covenants governing our indebtedness.

11. Debt Under Vehicle Programs and Borrowing Arrangements

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


	As of		As of
	March 31,		December 31,
	2024		2023
Americas - Debt due to Avis Budget Rental Car Funding (a)	$	16,030	$	15,502
Americas - Debt borrowings	1,082		1,075
International - Debt borrowings (b)	1,973		2,203
International - Finance leases	164		172
Other	40		55
Deferred financing fees (c)	(99)		(70)
Total	$	19,190	$	18,937

________

(a)Includes approximately $843 million and $841 million of Class R notes as of March 31, 2024 and December 31, 2023, respectively, which are held by us.

(b)In February 2024, we amended our European rental fleet securitization program to increase its capacity to approximately €1.9 billion and extend the maturity of the program to September 2026. We also added £200 million to our capacity within the program.

(c)Deferred financing fees related to Debt due to Avis Budget Rental Car Funding as of March 31, 2024 and December 31, 2023 were $81 million and $61 million, respectively.

The following table provides a summary of debt issued by AESOP during the three months ended March 31, 2024:


Issuance Date	Maturity Date	Weighted Average Interest Rate		Amount Issued
January 2024	June 2029	5.51	%	$	1,200
February 2024	April 2026	6.24	%	53
February 2024	October 2026	6.18	%	37
February 2024	April 2028	6.23	%	52
March 2024	October 2027	5.26	%	400
March 2024	December 2029	5.35	%	700

Debt Maturities

The following table provides the contractual maturities of our debt under vehicle programs, including related party debt due to Avis Budget Rental Car Funding, at March 31, 2024:


	Debt under Vehicle Programs (a)
Within 1 year (b)	$	2,090
Between 1 and 2 years (c)	3,803
Between 2 and 3 years (d)	6,780
Between 3 and 4 years (e)	2,770
Between 4 and 5 years	2,365
Thereafter	1,481
Total	$	19,289

________

(a) Vehicle-backed debt primarily represents asset-backed securities.

(b) Includes $0.2 billion of bank and bank-sponsored facilities.

(d) Includes $3.5 billion of bank and bank-sponsored facilities.

(e) Includes $0.1 billion of bank and bank-sponsored facilities.

Committed Credit Facilities and Available Funding Arrangements

As of March 31, 2024, available funding under our debt arrangements related to our vehicle programs, including related party debt due to Avis Budget Rental Car Funding, consisted of:


	Total Capacity (a)		Outstanding Borrowings (b)		Available Capacity
Americas - Debt due to Avis Budget Rental Car Funding	$	18,455	$	16,030	$	2,425
Americas - Debt borrowings	1,194		1,082		112
International - Debt borrowings	3,119		1,973		1,146
International - Finance leases	242		164		78
Other	40		40		—
Total	$	23,050	$	19,289	$	3,761

________

(a) Capacity is subject to maintaining sufficient assets to collateralize debt. The total capacity for Americas - Debt due to Avis Budget Rental Car Funding includes increases from an amendment and renewal of our asset-backed variable-funding financing facilities during March 2024.

(b) The outstanding debt is collateralized by vehicles and related assets of $18.3 billion for Americas - Debt due to Avis Budget Rental Car Funding; $1.5 billion for Americas - Debt borrowings; $2.6 billion for International - Debt borrowings; and $0.2 billion for International - Finance leases.

Debt Covenants

The agreements under our vehicle-backed funding programs contain restrictive covenants, including restrictions on dividends paid to us by certain of our 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, 2024, we are not aware of any instances of non-compliance with any of the financial or restrictive covenants contained in the debt agreements under our vehicle-backed funding programs.

12. Commitments and Contingencies

Contingencies

In 2006, we completed the spin-offs of our Realogy and Wyndham subsidiaries (now known as Anywhere Real Estate, Inc., and Wyndham Hotels and Resorts, Inc. and Travel + Leisure Co., respectively). We do not believe that the impact of any resolution of pre-existing contingent liabilities in connection with the spin-offs should result in a material liability to us in relation to our consolidated financial position or liquidity, as Anywhere Real Estate, Inc., Wyndham Hotels and Resorts, Inc. and Travel + Leisure Co. have agreed to assume responsibility for these liabilities.

In March 2023, the California Office of Tax Appeals (“OTA”) issued an opinion in a case involving notices of proposed assessment of California corporation franchise tax for tax year 1999 issued to us. The case involves whether (i) the notices of proposed assessment were barred by the statute of limitations; and (ii) a transaction undertaken by us in tax year 1999 constituted a tax-free reorganization under the Internal Revenue Code (“IRC”). The OTA concluded that the notices of proposed assessment were not barred by the statute of limitations and that the 1999 transaction was not a tax-free reorganization under the IRC. Anywhere Real Estate, Inc. has assumed 62.5%, and Wyndham Hotels and Resorts, Inc. and Travel + Leisure Co. have assumed 37.5% of the potential tax liability in this matter, respectively. We filed a petition for rehearing, which was denied in April 2024, and the tax assessment is expected to become payable, even if judicial relief is sought.

We are also named in litigation that is primarily related to the businesses of our former subsidiaries, including Realogy and Wyndham. We are entitled to indemnification from such entities for any liability resulting from such litigation.

In September 2014, Dawn Valli et al. v. Avis Budget Group Inc., et al. was filed in U.S. District Court for the District of New Jersey. The plaintiffs seek to represent a purported nationwide class of certain renters of vehicles from our Avis and Budget subsidiaries from September 30, 2008 through the present. The plaintiffs seek damages in connection with claims relating to alleged misrepresentations and omissions concerning charging customers for traffic infractions and related administrative fees. On October 10, 2023, plaintiffs’ motion for class certification was denied as to their proposed nationwide class and granted as to a subclass, created at the Court’s discretion, of Avis Preferred and Budget Fastbreak members. We have been named as a defendant in other purported consumer class action lawsuits, including two class actions filed against us in New Jersey, one seeking damages in connection with a breach of contract claim and another related to ancillary charges at our Payless subsidiary. However, the Company intends to vigorously defend them.

We are currently involved, and in the future may be involved, in claims and/or legal proceedings, including class actions, and governmental inquiries that are incidental to our vehicle rental and car sharing operations, including, among others, contract and licensee disputes, competition matters, employment and wage-and-hour claims, insurance and liability claims, intellectual property claims, business practice disputes and other regulatory, environmental, commercial and tax matters.

We are a defendant in a number of legal proceedings for personal injury arising from the operation of our vehicles. In June 2023, two of our subsidiaries were named as defendants in a lawsuit filed in Dallas, Texas alleging that one of our employees caused the death of an individual with one of our vehicles: Peggy Dawson Edwards, Individually and as Anticipated Representative of the Estate of Michael Edwards, Sr., et. al. v. Avis Budget Car Rental, LLC; PV Holding Corp.; and Kevin Barnes, Cause No. CC-23-03188-E, pending in County Court at Law No. 5 for Dallas County, Texas. The complaint alleges that our subsidiaries are responsible for Mr. Edwards’ death and seeks compensatory and punitive damages in an unspecified

amount exceeding $1 million. The court has set a trial date in November 2024 for this lawsuit. Given the early stages of the legal proceedings, it is not possible to predict the outcome of the claim. However, the Company intends to vigorously defend it.

Litigation is inherently unpredictable and, although we believe that our accruals are adequate and/or that we have valid defenses in these matters, unfavorable resolutions could occur. We estimate that the potential exposure resulting from adverse outcomes of current legal proceedings in which it is reasonably possible that a loss may be incurred could, in the aggregate, be up to approximately $40 million in excess of amounts accrued as of March 31, 2024. We do not believe that the impact should result in a material liability to us in relation to our consolidated financial condition or results of operations.

Commitments to Purchase Vehicles

We maintain agreements with vehicle manufacturers under which we have agreed to purchase approximately $4.1 billion of vehicles from manufacturers over the next 12 months, a $2.7 billion decrease compared to December 31, 2023, financed primarily through the issuance of vehicle-backed debt and cash received upon the disposition of vehicles. Certain of these commitments are subject to the vehicle manufacturers satisfying their obligations under their respective repurchase and guaranteed depreciation agreements.

Concentrations

Concentrations of credit risk as of March 31, 2024 include (i) risks related to our repurchase and guaranteed depreciation agreements with domestic and foreign car manufacturers and primarily with respect to receivables for program cars that have been disposed but for which we have not yet received payment from the manufacturers and (ii) risks related to Realogy and Wyndham, including receivables of $38 million and $23 million, respectively, related to certain contingent, income tax and other corporate liabilities assumed by Realogy and Wyndham in connection with their disposition.

13. Stockholders' Equity

Share Repurchases

Our Board of Directors has authorized the repurchase of up to approximately $8.1 billion of our common stock under a plan originally approved in 2013 and subsequently expanded, most recently in February 2023 (the “Stock Repurchase Program”). During the three months ended March 31, 2024 and 2023, we did not repurchase any shares of common stock under the program. As of March 31, 2024, approximately $802 million of authorization remained available to repurchase common stock under the program.

Common stock repurchases under the Stock Repurchase Program do not include shares withheld to satisfy employees’ income tax liabilities attributable to the vesting of restricted stock unit awards.

Total Comprehensive Income (Loss)

Comprehensive income (loss) consists of net income (loss) and other gains and losses affecting stockholders’ equity that, under GAAP, are excluded from net income (loss).

The components of other comprehensive income (loss) were as follows:


		Three Months Ended March 31,
			2024		2023
Net income (loss)			$	(113)	$	312
	Less: net income attributable to non-controlling interests		1		—
Net income (loss) attributable to Avis Budget Group, Inc.			(114)		312
Other comprehensive income (loss):
	Currency translation adjustments (net of tax of $(5) and $3, respectively)		(52)		(4)
	Net unrealized gain (loss) on cash flow hedges (net of tax of $(2) and $2, respectively)		7		(7)
	Minimum pension liability adjustment (net of tax of $0 in each period)		1		1
			(44)		(10)
Comprehensive income (loss) attributable to Avis Budget Group, Inc.			$	(158)	$	302

________

Currency translation adjustments exclude income taxes related to indefinite investments in foreign subsidiaries.

Accumulated Other Comprehensive Income (Loss)

The components of accumulated other comprehensive income (loss) were as follows:


		Currency Translation Adjustments		Net Unrealized Gains (Losses) on Cash Flow Hedges(a)		Minimum Pension Liability Adjustment(b)		Accumulated Other Comprehensive Income (Loss)
Balance, January 1, 2024		$	(3)	$	37	$	(130)	$	(96)
	Other comprehensive income (loss) before reclassifications	(52)		12		—		(40)
	Amounts reclassified from accumulated other comprehensive income (loss)	—		(5)		1		(4)
Net current-period other comprehensive income (loss)		(52)		7		1		(44)
Balance, March 31, 2024		$	(55)	$	44	$	(129)	$	(140)

Balance, January 1, 2023		$	(30)	$	45	$	(116)	$	(101)
	Other comprehensive income (loss) before reclassifications	(4)		(5)		—		(9)
	Amounts reclassified from accumulated other comprehensive income (loss)	—		(2)		1		(1)
Net current-period other comprehensive income (loss)		(4)		(7)		1		(10)
Balance, March 31, 2023		$	(34)	$	38	$	(115)	$	(111)

________

All components of accumulated other comprehensive income (loss) are net of tax, except currency translation adjustments, which exclude income taxes related to indefinite investments in foreign subsidiaries and include $108 million gain, net of tax, as of March 31, 2024 related to our hedge of our investment in euro-denominated foreign operations (see Note 16 – Financial Instruments).

(a)For the three months ended March 31, 2024 and 2023, the amounts reclassified from accumulated other comprehensive income (loss) into corporate interest expense were gains of $7 million ($5 million, net of tax) and gains of $3 million ($2 million, net of tax), respectively.

(b)For the three months ended March 31, 2024 and 2023, amounts reclassified from accumulated other comprehensive income (loss) into selling, general and administrative expenses were losses of $1 million ($1 million, net of tax), in each period.

14. Related Party Transactions

SRS Mobility Ventures, LLC

In 2021, SRS Mobility Ventures, LLC acquired a 33 1/3% Class A Membership Interest in one of our subsidiaries at fair value of $37.5 million. SRS Mobility Ventures, LLC is an affiliate of our largest shareholder, SRS Investment Management, LLC.

On September 1, 2022, through the issuance of Class B Preferred Voting Membership Interests, SRS Mobility Ventures, LLC increased their ownership in this subsidiary to 51% at a fair value of $62 million. As a result, we deconsolidated our former subsidiary, Avis Mobility Ventures LLC (“AMV”), from our financial statements and began to report our proportional share of the former subsidiary’s income or loss within other (income) expense, net in our Consolidated Condensed Statements of Comprehensive Income as we do not have the ability to direct the significant activities of the former subsidiary and are therefore no longer primary beneficiary of the VIE. In August and October 2023, SRS made capital contributions to AMV, increasing their ownership to approximately 65%.

In accordance with ASC Topic 810-10-40, we must deconsolidate a subsidiary as of the date we cease to have a controlling interest in that subsidiary and recognize the gain or loss in net income at that time. The fair value of our retained investment was determined utilizing a discounted cash flow methodology based on various assumptions, including projections of future cash flows, which include forecast of future revenue and EBITDA. Upon deconsolidation, our former subsidiary had a net asset carrying amount of $49 million resulting in a gain of $10 million.

We continue to provide vehicles, related fleet services, and certain administrative services to AMV to support their operations. For the three months ended March 31, 2024 and 2023, we recorded $2 million and $8 million of related income within other (income) expense, net, respectively. For the three months ended March 31, 2024 and 2023, we recorded losses of $3 million and $6 million within other (income) expense, net, related to our equity investment, respectively.

As of March 31, 2024 and December 31, 2023, receivables from AMV related to these services were $10 million and $2 million, respectively, and our net investment in vehicle finance lease with AMV, which is included in vehicles, net, was $36 million and $31 million, respectively. The carrying value of our equity investment in AMV as of March 31, 2024 and December 31, 2023 was approximately $21 million and $24 million, respectively, which is included in other non-current assets.

15. Stock-Based Compensation

We recorded stock-based compensation expense of $7 million and $8 million ($5 million and $6 million, net of tax) during the three months ended March 31, 2024 and 2023, respectively.

As part of our declaration and payment of a special cash dividend in December 2023, we granted additional restricted stock units (“RSUs”) to our award holders with unvested shares as a dividend equivalent, which has been deferred until, and will not be paid unless, the shares of stock underlying the award vest.

The activity related to RSUs consisted of (in thousands of shares):


			Number of Shares	Weighted Average Grant Date Fair Value		Weighted Average Remaining Contractual Term (years)	Aggregate Intrinsic Value (in millions)
Time-based RSUs
	Outstanding at January 1, 2024		290	$	161.87
		Granted (a)	120	113.10
		Vested (b)	(90)	125.57
		Forfeited	(1)	180.27
	Outstanding and expected to vest at March 31, 2024 (c)		319	$	153.71	1.6	$	39
Performance-based RSUs
	Outstanding at January 1, 2024		411	$	128.77
		Granted (a)	144	113.10
		Vested (b)	(222)	68.54
		Forfeited	(1)	154.07
	Outstanding at March 31, 2024		332	$	162.12	2.1	$	41
	Outstanding and expected to vest at March 31, 2024 (c)		199	$	156.64	2.1	$	24

________

(a)Reflects the maximum number of stock units assuming achievement of all performance- and time-vesting criteria and does not include those for non-employee directors. The weighted-average fair value of time-based RSUs and performance-based RSUs granted during the three months ended March 31, 2023 was $208.84.

(b)The total fair value of RSUs vested during the three months ended March 31, 2024 and 2023 was $27 million and $17 million, respectively.

(c)Aggregate unrecognized compensation expense related to time-based RSUs and performance-based RSUs amounted to $57 million and will be recognized over a weighted average vesting period of 1.8 years.

16. Financial Instruments

Derivative Instruments and Hedging Activities

Currency Risk. We use currency exchange contracts to manage our exposure to changes in currency exchange rates associated with certain of our non-U.S.-dollar denominated receivables and forecasted royalties, forecasted earnings of non-U.S. subsidiaries and forecasted non-U.S.-dollar denominated acquisitions. We primarily hedge a portion of our current-year currency exposure to the Australian, Canadian and New Zealand dollars, the euro and the British pound sterling. The majority of forward contracts do not qualify for hedge accounting treatment. The fluctuations in the value of these forward contracts do, however, largely offset the impact of changes in the value of the underlying risk they economically hedge. Forward contracts used to hedge forecasted third-party receipts and disbursements up to 12 months are designated and do qualify as cash flow hedges. We have designated our euro-denominated notes as a hedge of our investment in euro-denominated foreign operations.

The estimated net amount of existing gains or losses we expect to reclassify from accumulated other comprehensive income (loss) to earnings for cash flow and net investment hedges over the next 12 months is not material.

Interest Rate Risk. We use various hedging strategies including interest rate swaps and interest rate caps to create what we deem an appropriate mix of fixed and floating rate assets and liabilities. We use interest rate swaps and interest rate caps to manage the risk related to our floating rate corporate debt and our floating rate vehicle-backed debt. We record the changes in the fair value of our cash flow hedges to other comprehensive income (loss), net of tax, and subsequently reclassify these amounts into earnings in the period during which the hedged transaction affects earnings and is presented in the same income statement line item as the earnings effect of the hedged item. We record the gains or losses related to freestanding derivatives, which are not designated as a hedge for accounting purposes, currently in earnings and are presented in the same line of the income statement expected for the hedged item. We estimate that approximately $26 million of gain currently recorded in accumulated other comprehensive income (loss) will be recognized in earnings over the next 12 months.

Commodity Risk. We periodically enter into derivative commodity contracts to manage our exposure to changes in the price of fuel. These instruments were designated as freestanding derivatives and the changes in fair value are recorded in earnings and are presented in the same line of the income statement expected for the hedged item.

We held derivative instruments with absolute notional values as follows:


	As of March 31, 2024
Foreign exchange contracts	$	2,062
Interest rate caps (a)	15,835
Interest rate swaps	750

________

(a)Represents $10.6 billion of interest rate caps sold, partially offset by approximately $5.3 billion of interest rate caps purchased. These amounts exclude $5.9 billion of interest rate caps purchased by our Avis Budget Rental Car Funding subsidiary as it is not consolidated by us.

Estimated fair values (Level 2) of derivative instruments are as follows:


		As of March 31, 2024				As of December 31, 2023
		Fair Value, Asset Derivatives		Fair Value, Derivative Liabilities		Fair Value, Derivative Assets		Fair Value, Derivative Liabilities
Derivatives designated as hedging instruments
	Interest rate swaps (a)	$	59	$	—	$	50	$	—

Derivatives not designated as hedging instruments
	Foreign exchange contracts (b)	4		6		5		4
	Interest rate caps (c)	7		48		19		74

	Total	$	70	$	54	$	74	$	78

________

Amounts in this table exclude derivatives issued by Avis Budget Rental Car Funding, as it is not consolidated by us; however, certain amounts related to the derivatives held by Avis Budget Rental Car Funding are included within accumulated other comprehensive income (loss), as discussed in Note 13 – Stockholders' Equity.

(a)Included in other non-current assets or other non-current liabilities.

(b)Included in other current assets or other current liabilities.

(c)Included in assets under vehicle programs or liabilities under vehicle programs.

The effects of derivatives recognized in our Consolidated Condensed Financial Statements are as follows:


		Three Months Ended March 31,
			2024		2023
Derivatives designated as hedging instruments (a)
	Interest rate swaps (b)		$	7	$	(7)
	Euro-denominated notes (c)		15		(9)
Derivatives not designated as hedging instruments (d)
	Foreign exchange contracts (e)		(13)		(7)


	Total		$	9	$	(23)

________

(a)Recognized, net of tax, as a component of accumulated other comprehensive income (loss) within stockholders’ equity.

(b)Classified as a net unrealized gain (loss) on cash flow hedges in accumulated other comprehensive income (loss). Refer to Note 13 – Stockholders' Equity for amounts reclassified from accumulated other comprehensive income (loss) into earnings.

(c)Classified as a net investment hedge within currency translation adjustment in accumulated other comprehensive income (loss).

(d)Gains (losses) related to derivative instruments are expected to be largely offset by (losses) gains on the underlying exposures being hedged.

(e)Included in interest expense.

Debt Instruments

The carrying amounts and estimated fair values (Level 2) of debt instruments are as follows:


		As of March 31, 2024				As of December 31, 2023
		Carrying Amount		Estimated Fair Value		Carrying Amount		Estimated Fair Value
Corporate debt
	Short-term debt and current portion of long-term debt	$	405	$	406	$	32	$	32
	Long-term debt	5,032		5,021		4,791		4,812

Debt under vehicle programs
	Vehicle-backed debt due to Avis Budget Rental Car Funding	$	15,949	$	15,817	$	15,441	$	15,238
	Vehicle-backed debt	3,193		3,215		3,422		3,435
	Interest rate swaps and interest rate caps (a)	48		48		74		74

________

(a) Derivatives in a liability position.

17. Segment Information

Our chief operating decision-maker assesses performance and allocates resources based upon the separate financial information of our operating segments. In identifying our reportable segments, we also consider the nature of services provided by our operating segments, the geographical areas in which the segments operate and other relevant factors. We aggregate certain of our operating segments into our reportable segments.

Management evaluates the operating results of each of our reportable segments based upon revenues and “Adjusted EBITDA,” which we define as income (loss) from continuing operations before non-vehicle related depreciation and amortization; any impairment charges; restructuring and other related charges; early extinguishment of debt costs; non-vehicle related interest; transaction-related costs, net; legal matters, which includes amounts recorded in excess of $5 million related to class action lawsuits and personal injury matters; non-operational charges related to shareholder activist activity, which includes third-party advisory, legal and other professional fees; COVID-19 charges, net; cloud computing costs; other (income) expense, net; and income taxes.

We believe Adjusted EBITDA is useful as a supplemental measure in evaluating the performance of our operating businesses and in comparing our results from period to period. We also believe that Adjusted EBITDA is useful to investors because it allows them to assess our results of operations and financial condition on the same basis that management uses internally. Our presentation of Adjusted EBITDA may not be comparable to similarly titled measures used by other companies.


			Three Months Ended March 31,
			2024				2023
			Revenues		Adjusted EBITDA		Revenues		Adjusted EBITDA
Americas			$	1,993	$	44	$	2,016	$	516
International			558		(15)		541		50
Corporate and Other (a)			—		(17)		—		(31)
	Total Company		$	2,551	$	12	$	2,557	$	535

Reconciliation of Adjusted EBITDA to income (loss) before income taxes:
					2024				2023
Adjusted EBITDA					$	12			$	535
Less:		Non-vehicle related depreciation and amortization			61				56

		Interest expense related to corporate debt, net			83				73

		Restructuring and other related charges			3				4
		Transaction-related costs, net			1				—
		Other (income) expense, net (b)			1				(2)
		Reported within operating expenses:
		Cloud computing costs			10				7

		Legal matters, net			(5)				—


Income (loss) before income taxes					$	(142)			$	397

________

(a)Includes unallocated corporate overhead which is not attributable to a particular segment.

(b)Primarily consists of gains or losses related to our equity investment in a former subsidiary, offset by fleet related and certain administrative services provided to the same former subsidiary.

Since December 31, 2023, there have been no significant changes in segment assets exclusive of assets under vehicle programs. As of March 31, 2024 and December 31, 2023, Americas’ segment assets under vehicle programs were approximately $20.2 billion and $19.3 billion, respectively. This increase in assets under vehicle programs is directly correlated to the increase in the size and cost of our vehicle fleet.

18. Subsequent Events

In April 2024, our Avis Budget Rental Car Funding (AESOP) LLC subsidiary amended and restated its asset-backed variable-funding financing facilities to extend its maturity through April 2025.

In April 2024, we redeemed all of our 4.750% euro-denominated Senior Notes due January 2026 with an aggregate outstanding balance of €350 million plus accrued interest.

* * * *

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following discussion should be read in conjunction with our Consolidated Condensed Financial Statements and accompanying Notes included in this Quarterly Report on Form 10-Q, and with our 2023 Form 10-K. Our actual results of operations may differ materially from those discussed in forward-looking statements as a result of various factors, including those discussed in “Forward-Looking Statements”. See “Forward-Looking Statements” and “Risk Factors” for additional information. Unless otherwise noted, all dollar amounts in tables are in millions.


OVERVIEW

Our Company

We operate three of the most globally recognized brands in mobility solutions, Avis, Budget and Zipcar, together with several other brands well recognized in their respective markets. We are a leading vehicle rental operator in North America, Europe, Australasia and certain other regions we serve, with an average rental fleet of approximately 667,000 vehicles in first quarter 2024. We also license the use of our trademarks to licensees in the areas in which we do not operate directly. We and our licensees operate our brands in approximately 180 countries throughout the world.

Our Segments

We categorize our operations into two reportable business segments: Americas, consisting primarily of our vehicle rental operations in North America, South America, Central America and the Caribbean, car sharing operations in certain of these markets, and licensees in certain areas in which we do not operate directly; and International, consisting primarily of our vehicle rental operations in Europe, the Middle East, Africa, Asia and Australasia, car sharing operations in certain of these markets, and licensees in certain areas in which we do not operate directly.

Business and Trends

Our strategy continues to primarily focus on customer experience and costs to strengthen our Company, maximize profitability, and deliver stakeholder value. During the three months ended March 31, 2024, we generated revenues of $2.6 billion, net loss of $113 million and Adjusted EBITDA of $12 million. These results were driven primarily by increased volume, offset by decreased revenue per day, increased fleet costs, and sustained inflationary pressures on costs.

We continue to be susceptible to a number of industry-specific and global macroeconomic factors that may cause our actual results of operations to differ from our historical results of operations or current expectations. The factors and trends that we currently believe are or will be most impactful to our results of operations and financial condition include the following: interest rates, inflationary impact on items such as commodity prices and wages, supply of new vehicles, used car values, and an economic downturn that may impact travel demand, all of which may be exacerbated by the ongoing military conflicts in the Middle East and Eastern Europe. We continue to monitor the potential favorable or unfavorable impacts of these and other factors on our business, operations, financial condition, and future results of operations.

RESULTS OF OPERATIONS

We measure performance principally using the following key metrics: (i) rental days, which represent the total number of days (or portion thereof) a vehicle was rented, (ii) revenue per day, which represents revenues divided by rental days, (iii) vehicle utilization, which represents rental days divided by available rental days, with available rental days being defined as average rental fleet times the number of days in the period, and (iv) per-unit fleet costs, which represent vehicle depreciation, lease charges and gain or loss on vehicle sales, divided by average rental fleet. Our rental days, revenue per day and vehicle utilization metrics are all calculated based on the actual rental of the vehicle during a 24-hour period. We believe that this methodology provides management with the most relevant metrics in order to effectively manage the performance of the business. Our calculation may not be comparable to the calculation of similarly titled metrics by other companies. We present currency exchange rate effects to provide a method of assessing how our business performed excluding the effects of foreign currency rate fluctuations. Currency exchange rate effects are calculated by translating the current period results at the prior period average exchange rate plus any related gains and losses on currency hedges.

We assess performance and allocate resources based upon the separate financial information of our operating segments. In identifying our reportable segments, we also consider the nature of services provided by our operating segments, the geographical areas in which our segments operate and other relevant factors. Management evaluates the operating results of each of our reportable segments based upon revenues and “Adjusted EBITDA,” which we define as income (loss) from continuing operations before non-vehicle related depreciation and amortization; any impairment charges; restructuring and other related charges; early extinguishment of debt costs; non-vehicle related interest; transaction-related costs, net; legal matters, which includes amounts recorded in excess of $5 million related to class action lawsuits and personal injury matters; non-operational charges related to shareholder activist activity, which includes third-party advisory, legal and other professional fees; COVID-19 charges, net; cloud computing costs; other (income) expense, net; and income taxes.

We believe Adjusted EBITDA is useful as a supplemental measure in evaluating the performance of our operating businesses and in comparing our results from period to period. We also believe that Adjusted EBITDA is useful to investors because it allows them to assess our results of operations and financial condition on the same basis that management uses internally. Adjusted EBITDA is a non-GAAP measure and should not be considered in isolation or as a substitute for net income or other income statement data prepared in accordance with U.S. GAAP. Our presentation of Adjusted EBITDA may not be comparable to similarly titled measures used by other companies.

During the three months ended March 31, 2024:

•Our revenues totaled $2.6 billion, consistent with the similar period in 2023.

•Our net loss was $114 million, representing a decrease of $426 million year-over-year, primarily due to increased fleet costs and sustained inflationary pressures on costs.

•Our Adjusted EBITDA was $12 million, representing a decrease of $523 million year-over-year.

Three Months Ended March 31, 2024 vs. Three Months Ended March 31, 2023

Our consolidated condensed results of operations comprised the following:


		Three Months Ended March 31,
		2024		2023		$ Change		% Change
Revenues		$	2,551	$	2,557	$	(6)	0	%

Expenses
	Operating	1,344		1,307		37		3	%
	Vehicle depreciation and lease charges, net	636		265		371		140	%
	Selling, general and administrative	325		324		1		0	%
	Vehicle interest, net	239		133		106		80	%
	Non-vehicle related depreciation and amortization	61		56		5		9	%

	Interest expense related to corporate debt, net	83		73		10		14	%

	Restructuring and other related charges	3		4		(1)		(25	%)
	Transaction-related costs, net	1		—		1		n/m
	Other (income) expense, net	1		(2)		3		n/m
Total expenses		2,693		2,160		533		25	%

Income (loss) before income taxes		(142)		397		(539)		(136	%)
Provision for (benefit from) income taxes		(29)		85		(114)		(134	%)
Net income (loss)		(113)		312		(425)		(136	%)
Less: net income attributable to non-controlling interests		1		—		1		n/m
Net income (loss) attributable to Avis Budget Group, Inc.		$	(114)	$	312	$	(426)	(137	%)

________

n/m - Not Meaningful

Revenues during the three months ended March 31, 2024 were consistent with the similar period in 2023, primarily due to a 5% increase in volume, offset by a 5% decrease in revenue per day, excluding exchange rate effects. Total expenses increased 25% during the three months ended March 31, 2024, compared to the similar period in 2023, primarily due to increased fleet costs and the impact of inflation. Our effective tax rates were a benefit of 20.4% and a provision of 21.4% for the three months ended March 31, 2024 and 2023, respectively. As a result of these items, our net income decreased by $426 million compared to the similar period in 2023. For the three months ended March 31, 2024 and 2023, we reported earnings (loss) per diluted share of $(3.21) and $7.72, respectively.

Operating expenses increased to 52.7% of revenue during the three months ended March 31, 2024 compared to 51.1% during the similar period in 2023, primarily due to an increase in volume; a decrease in revenue per day, excluding exchange rate effects; and cost inflation. Vehicle depreciation and lease charges increased to 24.9% of revenue during the three months ended March 31, 2024 compared to 10.3% during the similar period in 2023, primarily due to increased per unit fleet costs, excluding exchange rate effects, which was driven by increased fleet levels and a decrease in the gain on sale of vehicles. Selling, general and administrative costs were approximately 12.7% of revenue during the three months ended March 31, 2024, consistent with the similar period in 2023, primarily due to increased marketing costs and commissions, offset by a decrease in other selling, general and administrative costs. Vehicle interest costs increased to 9.4% of revenue during the three months ended March 31, 2024 compared to 5.2% during the similar period in 2023, primarily due to rising interest rates and additional funding for vehicles.

Following is a more detailed discussion of the results of each of our reportable segments and reconciliation of net income (loss) to Adjusted EBITDA:


			Three Months Ended March 31,
			2024				2023
			Revenues		Adjusted EBITDA		Revenues		Adjusted EBITDA
Americas			$	1,993	$	44	$	2,016	$	516
International			558		(15)		541		50
Corporate and Other (a)			—		(17)		—		(31)
	Total Company		$	2,551	$	12	$	2,557	$	535

							Reconciliation to Adjusted EBITDA
							2024		2023
Net income (loss)							$	(113)	$	312
Provision for (benefit from) income taxes							(29)		85
Income (loss) before income taxes							(142)		397

Add:		Non-vehicle related depreciation and amortization					61		56

		Interest expense related to corporate debt, net					83		73

		Restructuring and other related charges					3		4
		Transaction-related costs, net					1		—
		Other (income) expense, net (b)					1		(2)
		Reported within operating expenses:
		Cloud computing costs					10		7

		Legal matters, net					(5)		—
Adjusted EBITDA							$	12	$	535

________

(a)Includes unallocated corporate overhead which is not attributable to a particular segment.

(b)Primarily consists of gains or losses related to our equity investment in a former subsidiary, offset by fleet related and certain administrative services provided to the same former subsidiary.

Americas


	Three Months Ended March 31,
	2024		2023		% Change
Revenues	$	1,993	$	2,016	(1	%)
Adjusted EBITDA	44		516		(91	%)

Revenues decreased during the three months ended March 31, 2024 compared to the similar period in 2023, primarily due to a 6% decrease in revenue per day, partially offset by a 5% increase in volume.

Operating expenses increased to 52.5% of revenue during the three months ended March 31, 2024 compared to 50.5% during the similar period in 2023, primarily due to an increase in volume, a decrease in revenue per day, and cost inflation. Vehicle depreciation and lease charges increased to 24.4% of revenue during the three months ended March 31, 2024 compared to 8.6% during the similar period in 2023, primarily due to increased per-unit fleet costs, which was driven by increased fleet levels and a decrease in the gain on sale of vehicles. Selling, general and administrative costs increased to 10.4% of revenue during the three months ended March 31, 2024 compared to 9.8% during the similar period in 2023, primarily due to increased marketing costs and commissions. Vehicle interest costs increased to 10.2% of revenue during the three months ended March 31, 2024 compared to 5.6% during the similar period in 2023, primarily due to rising interest rates and additional funding for vehicles.

Adjusted EBITDA decreased during the three months ended March 31, 2024 compared to the similar period in 2023, primarily due to higher per-unit fleet costs and inflationary pressures.

International


	Three Months Ended March 31,
	2024		2023		% Change
Revenues	$	558	$	541	3	%
Adjusted EBITDA	(15)		50		(130	%)

Revenues increased during the three months ended March 31, 2024 compared to the similar period in 2023, primarily due to a 4% increase in volume, partially offset by a 1% decrease in revenue per day, excluding exchange rate effects.

Operating expenses decreased to 51.9% of revenue during the three months ended March 31, 2024 compared to 52.6% during the similar period in 2023, primarily due to an increase in volume, partially offset by a decrease in revenue per day, excluding exchange rate effects. Vehicle depreciation and lease charges increased to 26.7% of revenue during the three months ended March 31, 2024 compared to 16.7% during the similar period in 2023, primarily due to increased per-unit fleet costs, excluding exchange rate effects, which was driven by increased fleet levels, increased depreciation rates, and a decrease in the gain on sale of vehicles. Selling, general and administrative costs were approximately 17.7% of revenue during the three months ended March 31, 2024, consistent with the similar period in 2023, primarily due to increased marketing costs and commissions, offset by a decrease in other selling, general and administrative costs. Vehicle interest costs increased to 6.5% of revenue during the three months ended March 31, 2024 compared to 3.8% during the similar period in 2023, primarily due to rising interest rates and additional funding for vehicles.

Adjusted EBITDA decreased during the three months ended March 31, 2024 compared to the similar period in 2023, primarily due to higher per-unit fleet and interest costs, inflationary pressures, and an approximately $3 million negative impact from currency exchange rate movements.

FINANCIAL CONDITION, LIQUIDITY AND CAPITAL RESOURCES

We present separately the financial data of our vehicle programs. These programs are distinct from our other activities as the assets under vehicle programs are generally funded through the issuance of debt that is collateralized by such assets. The income generated by these assets is used, in part, to repay the principal and interest associated with the debt. Cash inflows and outflows relating to the generation or acquisition of such assets and the principal debt repayment or financing of such assets are classified as activities of our vehicle programs. We believe it is appropriate to segregate the financial data of our vehicle programs because, ultimately, the source of repayment of such debt is the realization of such assets.

FINANCIAL CONDITION


	March 31, 2024		December 31, 2023		Change
Total assets exclusive of assets under vehicle programs	$	9,799	$	9,590	$	209
Total liabilities exclusive of liabilities under vehicle programs	10,849		10,095		754
Assets under vehicle programs	23,729		22,979		750
Liabilities under vehicle programs	23,187		22,817		370
Total stockholders’ equity	(508)		(343)		(165)

The increase in liabilities exclusive of liabilities under vehicle programs is primarily due to the increase in corporate indebtedness from the issuance of senior notes. See “Liquidity and Capital Resources,” and Note 10 – Long-term Corporate Debt and Borrowing Arrangements to our Consolidated Condensed Financial Statements.

The increases in assets and liabilities under vehicle programs are primarily due to the increase in the size and cost of our vehicle fleet.

The decrease in stockholders’ equity is primarily due to our comprehensive loss.

LIQUIDITY AND CAPITAL RESOURCES

Our principal sources of liquidity are cash on hand and our ability to generate cash through operations and financing activities, as well as available funding arrangements and committed credit facilities, each of which is discussed below.

In February 2024, we issued €600 million of 7.000% euro-denominated Senior Notes due February 2029, at par, with interest payable semi-annually. In April 2024, we used net proceeds from the offering to redeem all of our outstanding 4.750% euro-denominated Senior Notes due January 2026 plus accrued interest, with the remainder being used for general corporate purposes.

During 2024, our Avis Budget Rental Car Funding (AESOP) subsidiary issued approximately $2.4 billion of asset-backed notes with expected final payment dates ranging from April 2026 to December 2029, and a weighted average interest rate of 5.46%. In March and April 2024, AESOP amended and restated its asset-backed variable-funding financing facilities. The proceeds from these borrowings will be used to repay maturing vehicle-backed debt and the acquisition of rental cars in the United States. In February 2024, we amended our European rental fleet securitization program to increase its capacity to approximately €1.9 billion and extend its maturity to September 2026. We also added £200 million to our capacity under the program. The program is used to finance fleet purchases for certain of our European operations.

Our Board of Directors has authorized the repurchase of up to approximately $8.1 billion of our common stock under a plan originally approved in 2013 and subsequently expanded, most recently in February 2023. Our stock repurchases may occur through open market purchases, privately negotiated transactions or trading plans pursuant to Rule 10b5-1 of the Securities Exchange Act of 1934, as amended. The amount and timing of specific repurchases are subject to market conditions, applicable legal requirements, restricted payment capacity under our debt instruments and other factors. The repurchase program may be suspended, modified or discontinued at any time without prior notice. The repurchase program has no set expiration or termination date. During the three months ended March 31, 2024, no common stock repurchases were made under the program. As of March 31, 2024, approximately $802 million of authorization remained available to repurchase common stock under the program.

CASH FLOWS

The following table summarizes our cash flows:


		Three Months Ended March 31,
		2024		2023		Change
Cash provided by (used in):
	Operating activities	$	589	$	819	$	(230)
	Investing activities	(1,518)		(1,678)		160
	Financing activities	897		841		56
Effect of changes in exchange rates on cash and cash equivalents, program and restricted cash		(13)		5		(18)
Net decrease in cash and cash equivalents, program and restricted cash		(45)		(13)		(32)
Cash and cash equivalents, program and restricted cash, beginning of period		644		642		2
Cash and cash equivalents, program and restricted cash, end of period		$	599	$	629	$	(30)

The decrease in cash provided by operating activities during the three months ended March 31, 2024 compared with the similar period in 2023 is primarily due to the decrease in our net income.

The decrease in cash used in investing activities during the three months ended March 31, 2024 compared with the similar period in 2023 is primarily due to the increase in proceeds received on disposition of vehicles.

The increase in cash provided by financing activities during the three months ended March 31, 2024 compared with the similar period in 2023 is primarily due to the increase in our net corporate borrowings, offset by the decrease in our net borrowings under vehicle programs.

DEBT AND FINANCING ARRANGEMENTS

At March 31, 2024, we had approximately $24.6 billion of indebtedness, including corporate indebtedness of approximately $5.4 billion and debt under vehicle programs of approximately $19.2 billion. For information regarding our debt and borrowing arrangements, see Notes 1, 10 and 11 to our Consolidated Condensed Financial Statements.

LIQUIDITY RISK

Our primary liquidity needs include the procurement of rental vehicles to be used in our operations, servicing of corporate and vehicle-related debt and the payment of operating expenses. The present intention of management is to reinvest the undistributed earnings of our foreign subsidiaries indefinitely into our foreign operations. Our primary sources of funding are operating revenue, cash received upon the sale of vehicles, borrowings under our vehicle-backed borrowing arrangements and our senior revolving credit facility, and other financing activities.

Our liquidity has in the past been, and could in the future be, negatively affected by any financial market disruptions or the absence of a recovery or worsening of the United States and worldwide economies, or by continued increases in interest rates, which may result in unfavorable conditions in the mobility industry, in the asset-backed financing market and in the credit markets generally. We believe these factors have affected and could further affect the debt ratings assigned to us by credit rating agencies and the cost of our borrowings. Additionally, a worsening or prolonged downturn in the worldwide economy or a disruption in the credit markets could further impact our liquidity due to (i) decreased demand and pricing for vehicles in the used-vehicle market, (ii) increased costs associated with, and/or reduced capacity or increased collateral needs under, our financings, (iii) the adverse impact of vehicle manufacturers being unable or unwilling to honor their obligations to repurchase or guarantee the depreciation on the related program vehicles and (iv) disruption in our ability to obtain financing due to negative credit events specific to us or affecting the overall debt market.

As of March 31, 2024, we had $522 million of available cash and cash equivalents and access to available borrowings under our revolving credit facility of approximately $200 million, providing us with access to an approximate $722 million of total liquidity.

Our liquidity position could also be negatively impacted if we are unable to remain in compliance with the consolidated first lien leverage ratio requirement and other covenants associated with our senior credit facilities and other borrowings. As of March 31, 2024, we were in compliance with the financial covenants governing our indebtedness. For additional information regarding our liquidity risks, see Part I, Item 1A, “Risk Factors” of our 2023 Form 10-K.

CONTRACTUAL OBLIGATIONS

Our future contractual obligations have not changed significantly from the amounts reported within our 2023 Form 10-K with the exception of our commitment to purchase vehicles, which decreased by approximately $2.7 billion from December 31, 2023, to approximately $4.1 billion as of March 31, 2024 due to existing fleet levels. Changes to our obligations related to corporate indebtedness and debt under vehicle programs are presented above within the section titled “Liquidity and Capital Resources—Debt and Financing Arrangements” and also within Notes 10 and 11 to our Consolidated Condensed Financial Statements.

CRITICAL ACCOUNTING ESTIMATES

Accounting Policies

The results of the majority of our recurring operations are recorded in our financial statements using accounting policies that are not particularly subjective, nor complex. However, in presenting our financial statements in conformity with generally accepted accounting principles (GAAP), we are required to make estimates and assumptions that affect the amounts reported therein. Several of the estimates and assumptions we are required to make relate to matters that are inherently uncertain as they relate to future events and/or events that are outside of our control. If there is a significant unfavorable change to current conditions, it could result in a material adverse impact to our consolidated results of operations, financial position and liquidity. We believe that the estimates and assumptions we used when preparing our financial statements were the most appropriate at that time. Presented within the section titled “Critical Accounting Estimates” of our 2023 Form 10-K are the accounting

policies (related to goodwill and other indefinite-lived intangible assets, vehicles, income taxes and public liability, property damage and other insurance liabilities) that we believe require subjective and complex judgments that could potentially affect reported results. There have been no significant changes to those accounting policies or our assessment of which accounting policies we would consider to be critical accounting policies.

New Accounting Standards

For detailed information regarding new accounting standards and their impact on our business, see Note 1 to our Consolidated Condensed Financial Statements.

Item 3. Quantitative and Qualitative Disclosures about Market Risk

We are exposed to a variety of market risks, including changes in currency exchange rates, interest rates and fuel prices. We assess our market risks based on changes in interest and currency exchange rates utilizing a sensitivity analysis that measures the potential impact on earnings, fair values and cash flows based on a hypothetical 10% change (increase and decrease) in interest and foreign currency exchange rates. We used March 31, 2024 market rates to perform a sensitivity analysis separately for each of these market risk exposures. We have determined, through such analyses, that the impact of a 10% change in interest or currency exchange rates on our results of operations, balance sheet and cash flows would not be material. Additionally, we have commodity price exposure related to fluctuations in the price of unleaded fuel. We anticipate that such commodity risk will remain a market risk exposure for the foreseeable future. We determined that a 10% change in the price of unleaded fuel would not have a material impact on our earnings for the period ended March 31, 2024. For additional information regarding our long-term borrowings and financial instruments, see Notes 10, 11 and 16 to our Consolidated Condensed Financial Statements.

Item 4. Controls and Procedures

(a)Disclosure Controls and Procedures. Under the supervision and with the participation of our Chief Executive Officer and Chief Financial Officer, our management conducted an evaluation of the effectiveness of our disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)). Based on such evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that our disclosure controls and procedures were effective as of March 31, 2024.

(b)Changes in Internal Control Over Financial Reporting. During the first quarter of 2024, there was no change in our internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

PART II – OTHER INFORMATION

Item 1. Legal Proceedings

For information regarding our legal proceedings, see Note 12 – Commitments and Contingencies to our Consolidated Condensed Financial Statements and refer to our 2023 Form 10-K.

SEC regulations require us to disclose certain information about proceedings arising under federal, state or local environmental provisions if we reasonably believe that such proceedings may result in monetary sanctions above a stated threshold. In accordance with these regulations, we use a threshold of $1 million for purposes of determining whether disclosure of any such proceedings is required pursuant to this item.

Item 1A. Risk Factors

During the three months ended March 31, 2024, we had no material developments to report with respect to our risk factors. For additional information regarding our risk factors, please refer to our 2023 Form 10-K.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

Our Board of Directors has authorized the repurchase of up to approximately $8.1 billion of our common stock under a plan originally approved in 2013 and subsequently expanded, most recently in February 2023. Under our stock repurchase program, the Company may repurchase shares from time to time in open market transactions, and may also repurchase shares in accelerated share repurchases, tender offers, privately negotiated transactions or by other means. Repurchases may also be made under a plan pursuant to Rule 10b5-1 under the Securities Exchange Act of 1934, as amended. The timing and amount of repurchase transactions will be determined by the Company’s management based on its evaluation of market conditions, the Company’s share price, legal requirements, restricted payment capacity under its debt instruments and other factors. The stock repurchase program may be suspended, modified or discontinued without prior notice. During the first quarter of 2024, no common stock repurchases were made under the program. As of March 31, 2024, approximately $802 million of authorization remained available to repurchase common stock under this program.

Item 5. Other Information

During the three months ended March 31, 2024, no director or Section 16 officer of the Company adopted or terminated a "Rule 10b5-1 trading arrangement" or "non-Rule 10b5-1 trading arrangement," as each term is defined in Item 408(a) of Regulation S-K.

Item 6. Exhibits

See Exhibit Index.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

AVIS BUDGET GROUP, INC.

Date:

May 2, 2024

/s/ Cathleen DeGenova

Cathleen DeGenova

Vice President and

Chief Accounting Officer

Exhibit Index


Exhibit No.			Description
3.1			Amended and Restated Certificate of Incorporation of Avis Budget Group, Inc. (incorporated by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K dated September 5, 2006).
3.2			Amended and Restated Bylaws of Avis Budget Group, Inc., dated as of August 10, 2020 (incorporated by reference to Exhibit 3.2 to the Company’s Current Report on Form 8-K dated August 13, 2020).
4.1			Indenture, dated as of February 28, 2024, by and among Avis Budget Finance plc, as issuer, the guarantors party thereto, U.S. Bank Trust Company, National Association, as trustee, Elavon Financial Services DAC, as registrar and transfer agent, and Elavon Financial Services DAC, UK Branch, as paying agent (incorporated by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K dated February 29, 2024).
10.1			Series 2024-1 Supplement, dated as of January 12, 2024, between Avis Budget Rental Car Funding (AESOP) LLC and The Bank of New York Mellon Trust Company, N.A., as trustee and as Series 2024-1 Agent (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K dated January 18, 2024).
10.2			Fourth Amendment to Fifth Amended and Restated Series 2010-6 Supplement, dated as of January 12, 2024, by and among Avis Budget Rental Car Funding (AESOP) LLC, as Issuer, Avis Budget Car Rental, LLC, as Administrator, JPMorgan Chase Bank, N.A., as Administrative Agent, the Non-Conduit Purchasers, the CP Conduit Purchasers, the Committed Note Purchasers, the APA Banks and the Funding Agents named therein and The Bank of New York Mellon Trust Company, N.A., as trustee and as Series 2010-6 Agent (incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K dated January 18, 2024).
10.3			Fourth Amendment to Third Amended and Restated Series 2015-3 Supplement, dated as of January 12, 2024, by and among Avis Budget Rental Car Funding (AESOP) LLC, as Issuer, Avis Budget Car Rental, LLC, as Administrator, JPMorgan Chase Bank, N.A., as Administrative Agent, the Non-Conduit Purchasers, the CP Conduit Purchasers, the Committed Note Purchasers, the APA Banks and the Funding Agents named therein and The Bank of New York Mellon Trust Company, N.A., as trustee and as Series 2015-3 Agent (incorporated by reference to Exhibit 10.3 to the Company’s Current Report on Form 8-K dated January 18, 2024).
10.4			First Amendment to Series 2022-5 Supplement, dated as of February 5, 2024, between Avis Budget Rental Car Funding (AESOP) LLC and The Bank of New York Mellon Trust Company, N.A., as trustee and as Series 2022-5 Agent.
10.5			First Amendment to Series 2023-1 Supplement, dated as of February 5, 2024, between Avis Budget Rental Car Funding (AESOP) LLC and The Bank of New York Mellon Trust Company, N.A., as trustee and as Series 2023-1 Agent.
10.6			First Amendment to Series 2023-2 Supplement, dated as of February 5, 2024, between Avis Budget Rental Car Funding (AESOP) LLC and The Bank of New York Mellon Trust Company, N.A., as trustee and as Series 2023-2 Agent.
10.7			Sixth Amended and Restated Series 2010-6 Supplement, dated as of March 4, 2024, by and among Avis Budget Rental Car Funding (AESOP) LLC, as Issuer, Avis Budget Car Rental, LLC, as Administrator, JPMorgan Chase Bank, N.A., as Administrative Agent, the Non-Conduit Purchasers, the CP Conduit Purchasers, the Committed Note Purchasers, the APA Banks and the Funding Agents named therein and The Bank of New York Mellon Trust Company, N.A., as Trustee and as Series 2010-6 Agent (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K dated March 8, 2024).
10.8			Fourth Amended and Restated Series 2015-3 Supplement, dated as of March 4, 2024, by and among Avis Budget Rental Car Funding (AESOP) LLC, as Issuer, Avis Budget Car Rental, LLC, as Administrator, JPMorgan Chase Bank, N.A., as Administrative Agent, the Non-Conduit Purchasers, the CP Conduit Purchasers, the Committed Note Purchasers, the APA Banks and the Funding Agents named therein and The Bank of New York Mellon Trust Company, N.A., as Trustee and as Series 2015-3 Agent (incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K dated March 8, 2024).
10.9			Series 2024-2 Supplement, dated as of March 12, 2024, between Avis Budget Rental Car Funding (AESOP) LLC and The Bank of New York Mellon Trust Company, N.A., as trustee and as Series 2024-2 Agent (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K dated March 18, 2024).
10.10			Series 2024-3 Supplement, dated as of March 12, 2024, between Avis Budget Rental Car Funding (AESOP) LLC and The Bank of New York Mellon Trust Company, N.A., as trustee and as Series 2024-3 Agent (incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K dated March 18, 2024).
31.1			Certification of Chief Executive Officer pursuant to Rules 13(a)-14(a) and 15(d)-14(a) promulgated under the Securities Exchange Act of 1934, as amended.
31.2			Certification of Chief Financial Officer pursuant to Rules 13(a)-14(a) and 15(d)-14(a) promulgated under the Securities Exchange Act of 1934, as amended.
32			Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
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Document

EXHIBIT 10.4

EXECUTION VERSION

FIRST AMENDMENT TO

THE SERIES 2022-5 SUPPLEMENT

This FIRST AMENDMENT TO SERIES 2022-5 SUPPLEMENT (this “Amendment”), dated as of February 5, 2024 amends the Series 2022-5 Supplement (the “Series 2022-5 Supplement”), dated as of November 29, 2022, among AVIS BUDGET RENTAL CAR FUNDING (AESOP) LLC, a special purpose limited liability company established under the laws of Delaware (“ABRCF”) and THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A., a national banking association, as trustee (in such capacity, the “Trustee”) and as agent for the benefit of the Series 2022-5 Noteholders (in such capacity, the “Series 2022-5 Agent”), to the Second Amended and Restated Base Indenture, dated as of June 3, 2004, between ABRCF and the Trustee (as amended, modified or supplemented from time to time, exclusive of Supplements creating a new Series of Notes, the “Base Indenture”). All capitalized terms used herein and not otherwise defined herein shall have the respective meanings provided therefor in the Definitions List attached as Schedule I to the Base Indenture (as amended through the date hereof) or the Series 2022-5 Supplement, as applicable.

W I T N E S S E T H:

WHEREAS, pursuant to Section 12.2 of the Base Indenture, any Supplement thereto may be amended (i) with the consent of ABRCF, the Trustee, any applicable Enhancement Provider and in connection with certain amendments, either the Required Noteholders of a Series of Notes or each affected Noteholder, as applicable and (ii) upon satisfying the Rating Agency Consent Condition;

WHEREAS, pursuant to Section 5.7 of the Series 2022-5 Supplement, the Series 2022-5 Supplement may be amended in accordance with the terms of the Base Indenture;

WHEREAS, the parties desire to amend the Series 2022-5 Supplement to revise the definition of “Class C Note Rate” and to make conforming revisions in connection therewith;

WHEREAS, the Issuer has determined that the Class C Noteholders and the Class R Noteholders are the affected Noteholders with respect to the revisions contemplated hereby; and

WHEREAS, ABRCF has requested the Trustee, the Series 2022-5 Agent and the affected Noteholders to, and, upon the effectiveness of this Amendment, ABRCF, the Trustee, the Series 2022-5 Agent, the Class C Noteholders and the Class R Noteholders have agreed to, make the amendments described above as set forth herein.

NOW, THEREFORE, it is agreed:

1.Amendments. The Series 2022-5 Supplement is hereby amended by deleting the stricken text (indicated in the same manner as the following example: stricken text) and adding the inserted text (indicated in the same manner as the following example: inserted text) as set forth on the pages of the Series 2022-5 Supplement attached as Exhibit A hereto.

2.Direction. By their signatures hereto, each of the undersigned (excluding The Bank of New York Mellon Trust Company, N.A., in its capacity as Trustee and Series 2022-5 Agent) hereby authorize and direct the Trustee and Series 2022-5 Agent to execute this Amendment and take any and all further action necessary or appropriate to give effect to the transaction contemplated hereby.

3.This Amendment is limited as specified and, except as expressly stated herein, shall not constitute a modification, acceptance or waiver of any other provision of the Series 2022-5 Supplement.

4.This Amendment shall become effective on the date hereof upon satisfaction of the Rating Agency Consent Condition. From and after the date hereof, all references to the Series 2022-5 Supplement shall be deemed to be references to the Series 2022-5 Supplement as amended hereby.

5.This Amendment may be executed in any number of counterparts, each of which so executed shall be deemed to be an original, but all of such counterparts shall together constitute but one and the same instrument. Delivery of an executed counterpart of a signature page to this Amendment by facsimile or electronic mail in a “pdf” file shall be effective as delivery of a manually executed counterpart of this Amendment. The parties agree that this Amendment may be executed and delivered by electronic signatures and that the signatures appearing on this Amendment are the same as handwritten signatures for the purposes of validity, enforceability and admissibility. The words “execution,” “signed,” “signature,” “delivery,” and words of like import in or relating to this Amendment or any document to be signed in connection with this Amendment shall be deemed to include electronic signatures, deliveries or the keeping of records in electronic form. Any document accepted, executed or agreed to in conformity with such laws will be binding on all parties hereto to the same extent as if it were physically executed and each party hereby consents to the use of any third party electronic signature capture service providers as may be reasonably chosen by a signatory hereto.

6.THIS AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK.

IN WITNESS WHEREOF, each of the parties hereto have caused this Amendment to be duly executed by their respective duly authorized officers as of the date above first written.


			AVIS BUDGET RENTAL CAR FUNDING
						(AESOP) LLC, as Issuer

			By: /s/ David Calabria
						Name: David Calabria
						Title: Senior Vice President and Treasurer


			THE BANK OF NEW YORK MELLON TRUST
						COMPANY, N.A., as Trustee and
						Series 2022-5 Agent

			By: /s/ Mitchell L. Brumwell
						Name: Mitchell L. Brumwell
						Title: Vice President


AGREED, ACKNOWLEDGED AND CONSENTED:

AVIS BUDGET RENTAL CAR
			FUNDING (AESOP) LLC,
			as Class C Noteholder

By: /s/ David Calabria
			Name: David Calabria
			Title: Senior Vice President and Treasurer

AESOP LEASING L.P.,
			as Class R Noteholder

By: AESOP LEASING CORP., as its general partner

By: /s/ David Calabria
			Name: David Calabria
			Title: Senior Vice President and Treasurer

Exhibit A

Amendments to Series 2022-5 Supplement

Conformed through

EXECUTION VERSIONFirst Amendment

dated February 5, 2024

AVIS BUDGET RENTAL CAR FUNDING (AESOP) LLC,
as Issuer

and

THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A.,
as Trustee and Series 2022-5 Agent

_____________________

SERIES 2022-5 SUPPLEMENT
dated as of

November 29, 2022

SECOND AMENDED AND RESTATED BASE INDENTURE
dated as of June 3, 2004

_____________________

Series 2022-5 6.12% Rental Car Asset Backed Notes, Class A

Series 2022-5 7.09% Rental Car Asset Backed Notes, Class B

Series 2022-5 9.276.24% Rental Car Asset Backed Notes, Class C

Series 2022-5 11.162% Rental Car Asset Backed Notes, Class R

SERIES 2022-5 SUPPLEMENT, dated as of November 29, 2022 (this "Supplement"), among AVIS BUDGET RENTAL CAR FUNDING (AESOP) LLC, a special purpose limited liability company established under the laws of Delaware ("ABRCF"), THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A. (formerly known as The Bank of New York), a limited purpose national banking association with trust powers, as trustee (in such capacity, and together with its successors in trust thereunder as provided in the Base Indenture referred to below, the "Trustee"), and THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A. (formerly known as The Bank of New York), as agent (in such capacity, the "Series 2022-5 Agent") for the benefit of the Series 2022-5 Noteholders, to the Second Amended and Restated Base Indenture, dated as of June 3, 2004, between ABRCF and the Trustee (as amended, modified or supplemented from time to time, exclusive of Supplements creating a new Series of Notes, the "Base Indenture").

PRELIMINARY STATEMENT

WHEREAS, Sections 2.2 and 12.1 of the Base Indenture provide, among other things, that ABRCF and the Trustee may at any time and from time to time enter into a supplement to the Base Indenture for the purpose of authorizing the issuance of one or more Series of Notes;

NOW, THEREFORE, the parties hereto agree as follows:

DESIGNATION

There is hereby created a Series of Notes to be issued pursuant to the Base Indenture and this Supplement, and such Series of Notes shall be designated generally as the "Series 2022-5 Rental Car Asset Backed Notes". The Series 2022-5 Notes shall be issued in up to five Classes, the first of which shall be known as the "Class A Notes", the second of which shall be known as the "Class B Notes", the third of which shall be known as the "Class C Notes", the fourth of which shall be known as the "Class R Notes" and the fifth of which, if issued, shall be known as the "Class D Notes".

On the Series 2022-5 Closing Date, ABRCF shall issue (i) one tranche of Class A Notes, which shall be designated as the "Series 2022-5 6.12% Rental Car Asset Backed Notes, Class A", (ii) one tranche of Class B Notes, which shall be designated as the "Series 2022-5 7.09% Rental Car Asset Backed Notes, Class B", (iii) one tranche of Class C Notes, which shall be designated as the "Series 2022-5 9.276.24% Rental Car Asset Backed Notes, Class C" and (iv) one tranche of Class R Notes, which shall be designated the "Series 2022-5 11.162% Rental Car Asset Backed Notes, Class R".

Subsequent to the Series 2022-5 Closing Date, ABRCF may on any date during the Series 2022-5 Revolving Period offer and sell additional Series 2022-5 Notes subject to the conditions set forth in Section 5.15. Such additional Series 2022-5 Notes, if issued, shall be designated as the "Series 2022-5 Rental Car Asset Backed Notes, Class D" and shall be referred to herein as the "Class D Notes".

The Class A Notes, Class B Notes, Class C Notes, Class D Notes, if issued, and Class R Notes collectively, constitute the Series 2022-5 Notes. The Class B Notes shall be


			1

an amount equal to the product of (A) one-twelfth of the Class B Note Rate and (B) the Class B Invested Amount on the first day of such Series 2022-5 Interest Period, after giving effect to any principal payments made on such date.

"Class B Note" means any one of the Series 2022-5 7.09% Rental Car Asset Backed Notes, Class B, executed by ABRCF and authenticated by or on behalf of the Trustee, substantially in the form of Exhibit B-1, Exhibit B-2 or Exhibit B-3. Definitive Class B Notes shall have such insertions and deletions as are necessary to give effect to the provisions of Section 2.18 of the Base Indenture.

"Class B Note Rate" means 7.09% per annum.

"Class B Noteholder" means the Person in whose name a Class B Note is registered in the Note Register.

"Class B Shortfall" has the meaning set forth in Section 2.3(g)(ii).

"Class C Carryover Controlled Amortization Amount" means, with respect to any Related Month during the Series 2022-5 Controlled Amortization Period, the amount, if any, by which the portion of the Monthly Total Principal Allocation paid to the Class C Noteholders pursuant to Section 2.5(e)(iii) for the previous Related Month was less than the Class C Controlled Distribution Amount for the previous Related Month; provided, however, that for the first Related Month in the Series 2022-5 Controlled Amortization Period, the Class C Carryover Controlled Amortization Amount shall be zero.

"Class C Controlled Amortization Amount" means, (i) with respect to any Related Month during the Series 2022-5 Controlled Amortization Period other than the Related Month immediately preceding the Series 2022-5 Expected Final Distribution Date, $8,755,833.33 and (ii) with respect to the Related Month immediately preceding the Series 2022-5 Expected Final Distribution Date, $8,755,833.35.

"Class C Controlled Distribution Amount" means, with respect to any Related Month during the Series 2022-5 Controlled Amortization Period, an amount equal to the sum of the Class C Controlled Amortization Amount and any Class C Carryover Controlled Amortization Amount for such Related Month.

"Class C Initial Invested Amount" means the aggregate initial principal amount of the Class C Notes, which is $52,535,000.

"Class C Invested Amount" means, when used with respect to any date, an amount equal to (a) the Class C Initial Invested Amount minus (b) the amount of principal payments made to Class C Noteholders on or prior to such date.

"Class C Monthly Interest" means, (A) for so long as ABRCF owns 100% of the Class C Notes, $0 and (B) if ABRCF owns less than 100% of the Class C Notes, with respect to (i) the initial Series 2022-5 Interest Period with respect to the Class C Notes, an amount equal to $284,083.01409,773.00 and (ii) any other Series 2022-5 Interest Period, an amount equal to the product of (A) one-twelfth of the Class C Note Rate and (B) the Class C Invested Amount on the


			5

first day of such Series 2022-5 Interest Period, after giving effect to any principal payments made on such date.

"Class C Note" means any one of the Series 2022-5 9.276.24% Rental Car Asset Backed Notes, Class C, executed by ABRCF and authenticated by or on behalf of the Trustee, substantially in the form of Exhibit C-1, Exhibit C-2 or Exhibit C-3. Definitive Class C Notes shall have such insertions and deletions as are necessary to give effect to the provisions of Section 2.18 of the Base Indenture.

"Class C Note Rate" means 9.276.24% per annum.

"Class C Noteholder" means the Person in whose name a Class C Note is registered in the Note Register.

"Class C Shortfall" has the meaning set forth in Section 2.3(g)(iii).

"Class D Noteholder" means the Person in whose name a Class D Note is registered in the Note Register.

"Class D Notes" has the meaning set forth in the preamble.

"Class R Controlled Amortization Amount" means, (i) with respect to any Related Month during the Series 2022-5 Controlled Amortization Period other than the Related Month immediately preceding the Series 2022-5 Expected Final Distribution Date, $0 and (ii) with respect to the Related Month immediately preceding the Series 2022-5 Expected Final Distribution Date, the sum of (x) $30,400,000 and (y) the aggregate principal amount of any Additional Class R Notes.

"Class R Initial Invested Amount" means the aggregate initial principal amount of the Class R Notes, which is $30,400,000.

"Class R Invested Amount" means, when used with respect to any date, an amount equal to (a) the Class R Initial Invested Amount plus (b) the aggregate principal amount of any Additional Class R Notes issued on or prior to such date minus (b) the amount of principal payments made to Class R Noteholders on or prior to such date.

"Class R Monthly Interest" means, with respect to (i) the initial Series 2022-5 Interest Period, an amount equal to $197,939.47 and (ii) any other Series 2022-5 Interest Period, an amount equal to the product of (A) one-twelfth of the Class R Note Rate and (B) the Class R Invested Amount on the first day of such Series 2022-5 Interest Period, after giving effect to any principal payments made on such date.

"Class R Note" means any one of the Series 2022-5 11.162% Rental Car Asset Backed Notes, Class R, executed by ABRCF and authenticated by or on behalf of the Trustee, substantially in the form of Exhibit D-1, Exhibit D-2 or Exhibit D-3. Definitive Class R Notes shall have such insertions and deletions as are necessary to give effect to the provisions of Section 2.18 of the Base Indenture.


			6

"Series 2022-5 Expected Final Distribution Date" means the April 2026 Distribution Date.

"Series 2022-5 Final Distribution Date" means the April 2027 Distribution Date.

"Series 2022-5 Interest Period" means a period commencing on and including a Distribution Date and ending on and including the day preceding the next succeeding Distribution Date; provided, however, that (x) the initial Series 2022-5 Interest Period for the Class A Notes and the Class B Notes shall commence on and include the Series 2022-5 Closing Date and end on and include December 19, 2022 and (y) the initial Series 2022-5 Interest Period for the Class C Notes shall commence on and include February 5, 2024 and end on and include March 19, 2024.

"Series 2022-5 Invested Amount" means, as of any date of determination, the sum of the Class A Invested Amount as of such date, the Class B Invested Amount as of such date, the Class C Invested Amount as of such date and the Class R Invested Amount as of such date.

"Series 2022-5 Invested Percentage" means as of any date of determination:

(1)when used with respect to Principal Collections, the percentage equivalent (which percentage shall never exceed 100%) of a fraction, the numerator of which shall be equal to the sum of the Series 2022-5 Invested Amount and the Series 2022-5 Overcollateralization Amount, determined during the Series 2022-5 Revolving Period as of the end of the Related Month (or, until the end of the initial Related Month, on the Series 2022-5 Closing Date), or, during the Series 2022-5 Controlled Amortization Period and the Series 2022-5 Rapid Amortization Period, as of the end of the Series 2022-5 Revolving Period, and the denominator of which shall be the greater of (I) the Aggregate Asset Amount as of the end of the Related Month or, until the end of the initial Related Month, as of the Series 2022-5 Closing Date, and (II) as of the same date as in clause (I), the sum of the numerators used to determine the invested percentages for allocations with respect to Principal Collections (for all Series of Notes and all classes of such Series of Notes); and

(2)when used with respect to Interest Collections, the percentage equivalent (which percentage shall never exceed 100%) of a fraction, the numerator of which shall be the Accrued Amounts with respect to the Series 2022-5 Notes on such date of determination, and the denominator of which shall be the aggregate Accrued Amounts with respect to all Series of Notes on such date of determination. For so long as ABRCF owns 100% of the Class C Notes, the accrued and unpaid interest with respect to the Class C Notes shall be $0 for purposes of calculating the Accrued Amounts with respect to the Series 2022-5 Notes.

"Series 2022-5 Lease Interest Payment Deficit" means, on any Distribution Date, an amount equal to the excess, if any, of (1) the excess, if any, of (a) the aggregate amount of Interest Collections which pursuant to Section 2.2(a), (b), (c) or (d) would have been allocated to the Series 2022-5 Accrued Interest Account if all payments of Monthly Base Rent required to have been made under the Leases from and excluding the preceding Distribution Date to and including such Distribution Date were made in full over (b) the aggregate amount of Interest Collections which pursuant to Section 2.2(a), (b), (c) or (d) have been allocated to the Series


			18

Exhibit C-1

Page 2

QUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

THE PRINCIPAL OF THIS CLASS C NOTE IS PAYABLE IN INSTALLMENTS AS SET FORTH HEREIN. ACCORDINGLY, THE OUTSTANDING PRINCIPAL AMOUNT OF THIS CLASS C NOTE AT ANY TIME MAY BE LESS THAN THE AMOUNT SHOWN ON THE FACE HEREOF.

AVIS BUDGET RENTAL CAR FUNDING (AESOP) LLC

SERIES 2022-5 9.276.24% RENTAL CAR ASSET
BACKED NOTES, CLASS C

AVIS BUDGET RENTAL CAR FUNDING (AESOP) LLC, a Delaware limited liability company (herein referred to as the "Company"), for value received, hereby promises to pay to Cede & Co., or registered assigns, the principal sum of

[ _____________________________] DOLLARS, which amount shall be payable in the amounts and at the times set forth in the Indenture; provided, however, that the entire unpaid principal amount of this Class C Note shall be due on the Series 2022-5 Final Distribution Date, which is the April 2027 Distribution Date. However, principal with respect to the Class C Notes may be paid earlier or later under certain limited circumstances described in the Indenture. The Company will pay interest on this Class C Note at the Class C Note Rate. Such interest shall be payable on each Distribution Date until the principal of this Class C Note is paid or made available for payment. Interest on this Class C Note will accrue for each Distribution Date from the most recent Distribution Date on which interest has been paid to but excluding such Distribution Date or, if no interest has yet been paid, from November 29, 2022February 5, 2024. Interest with respect to the Class C Notes will be calculated in the manner provided in the Indenture. Such principal of and interest on this Class C Note shall be paid in the manner specified on the reverse hereof.

The principal of and interest on this Class C Note are payable in such coin or currency of the United States of America as at the time of payment is legal tender for payment of public and private debts. All payments made by the Company with respect to this Class C Note shall be applied first to interest due and payable on this Class C Note as provided above and then to the unpaid principal of this Class C Note. This Class C Note does not represent an interest in, or an obligation of, Original AESOP, AESOP Leasing, AESOP Leasing II, ABCR, BRAC, ARAC or any affiliate of Original AESOP, AESOP Leasing, AESOP Leasing II, ABCR, BRAC or ARAC, other than the Company.

Interests in this Class C Note are exchangeable or transferable in whole or in part for interests in a Restricted Global Note if this Class C Note is a Temporary Global Note, or for interests in a Temporary Global Note or a Permanent Global Note if this Class C Note is a Restricted Global Note (each as defined in the Base Indenture), in each case of the same Class and Series, provided

Exhibit C-1

Page 5

[REVERSE OF CLASS C NOTE]

This Class C Note is one of a duly authorized issue of Class C Notes of the Company, designated as its Series 2022-5 9.276.24% Rental Car Asset Backed Notes, Class C (herein called the "Class C Notes"), all issued under (i) a Second Amended and Restated Base Indenture, dated as of June 3, 2004 (such Base Indenture, as may be further amended, restated, supplemented or modified in accordance with its terms (exclusive of any Supplements thereto creating a new Series of Notes), is herein called the "Base Indenture"), between the Company, as Issuer, and The Bank of New York Mellon Trust Company, N.A. (as successor in interest to The Bank of New York), as trustee (the "Trustee," which term includes any successor Trustee under the Base Indenture), and (ii) a Series 2022-5 Supplement, dated as of November 29, 2022 (such supplement, as may be amended or modified, is herein called the "Series 2022-5 Supplement"), among the Company, the Trustee and The Bank of New York Mellon Trust Company, N.A., as Series 2022-5 Agent. The Base Indenture and the Series 2022-5 Supplement are referred to herein as the "Indenture". The Class C Notes are subject to all terms of the Indenture. To the extent not defined herein, all terms used in this Class C Note that are defined in the Indenture shall have the meanings assigned to them in or pursuant to the Indenture.

The Class C Notes are and will be equally and ratably secured by the Series 2022-5 Collateral pledged as security therefor as provided in the Indenture.

Interest on the Class C Notes will be payable on each Distribution Date specified in and in the amounts described in the Indenture. "Distribution Date" means the 20th day of each month, or, if any such date is not a Business Day, the next succeeding Business Day, commencing on DecemberMarch 20, 20222024.

Commencing on the Distribution Date following the second Determination Date during the Series 2022-5 Controlled Amortization Period, payments with respect to principal will be made on the Class C Notes. In addition, beginning on the first Distribution Date during the Series 2022-5 Rapid Amortization Period on which the Class A Notes and the Class B Notes have been paid in full, payments with respect to principal will be made on the Class C Notes. As described above, the entire unpaid principal amount of this Class C Note shall be due and payable on the Series 2022-5 Final Distribution Date. Notwithstanding the foregoing, if an Amortization Event, Liquidation Event of Default, Waiver Event or Series 2022-5 Limited Liquidation Event of Default shall have occurred and be continuing then, in certain circumstances, principal on the Class C Notes may be paid earlier, as described in the Indenture. All payments of interest on, and principal of, the Class C Notes will be subordinated to the payment of interest on, and principal of, as applicable, the Class A Notes and the Class B Notes, as set forth in the Series 2022-5 Supplement. All principal payments on the Class C Notes shall be made pro rata to the Noteholders entitled thereto.

Payments of interest on this Class C Note due and payable on each Distribution Date, together with the installment of principal then due, if any, to the extent not in full payment of this Class C Note, shall be made by wire transfer for credit to the account designated by the Holder of record of this Class C Note (or one or more predecessor Class C Notes) on the Note Register as of the close of business on each Record Date, except that with respect to Class C Notes registered on the Record Date in the name of the nominee of the Clearing Agency (initially, such nominee to

Exhibit C-2

Page 2

CLEARING AGENCY OR TO A NOMINEE OF SUCH SUCCESSOR CLEARING AGENCY. UNLESS THIS CLASS C NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CLASS C NOTE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

INTERESTS IN THIS TEMPORARY GLOBAL NOTE MAY ONLY BE HELD BY NON-U.S. PERSONS AS SUCH TERM IS DEFINED IN REGULATION S OF THE SECURITIES ACT, AND MAY ONLY BE HELD IN BOOK-ENTRY FORM THROUGH EUROCLEAR OR CLEARSTREAM.

AVIS BUDGET RENTAL CAR FUNDING (AESOP) LLC

SERIES 2022-5 9.276.24% RENTAL CAR
ASSET BACKED NOTES, CLASS C

AVIS BUDGET RENTAL CAR FUNDING (AESOP) LLC, a Delaware limited liability company (herein referred to as the "Company"), for value received, hereby promises to pay to

Cede & Co., or registered assigns, the principal sum of [_______________________]
DOLLARS (or such lesser amount as shall be the outstanding principal amount of this Temporary Global Note shown in Schedule A hereto), which amount shall be payable in the amounts and at the times set forth in the Indenture; provided, however, that the entire unpaid principal amount of this Class C Note shall be due on the Series 2022-5 Final Distribution Date, which is the April 2027 Distribution Date. However, principal with respect to the Class C Notes may be paid earlier or later under certain limited circumstances described in the Indenture. The Company will pay interest on this Class C Note at the Class C Note Rate. Such interest shall be payable on each Distribution Date until the principal of this Class C Note is paid or made available for payment. Interest on this Class C Note will accrue for each Distribution Date from the most recent Distribution Date on which interest has been paid to but excluding such Distribution Date or, if no interest has yet been paid, from November 29, 2022February 5, 2024. Interest with respect to the Class C Notes will be calculated in the manner provided in the Indenture. Such principal of and interest on this Class C Note shall be paid in the manner specified on the reverse hereof.

Exhibit C-2

Page 5

[REVERSE OF CLASS C NOTE]

The Class C Notes are and will be equally and ratably secured by the Series 2022-5 Collateral pledged as security therefor as provided in the Indenture.

Exhibit C-3

Page 2

MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

AVIS BUDGET RENTAL CAR FUNDING (AESOP) LLC

SERIES 2022-5 9.276.24% RENTAL CAR
ASSET BACKED NOTES, CLASS C

AVIS BUDGET RENTAL CAR FUNDING (AESOP) LLC, a Delaware limited liability company (herein referred to as the "Company"), for value received, hereby promises to pay to

Cede & Co., or registered assigns, the principal sum of [________________________]
DOLLARS, which amount shall be payable in the amounts and at the times set forth in the Indenture; provided, however, that the entire unpaid principal amount of this Class C Note shall be due on the Series 2022-5 Final Distribution Date, which is the April 2027 Distribution Date. However, principal with respect to the Class C Notes may be paid earlier or later under certain limited circumstances described in the Indenture. The Company will pay interest on this Class C Note at the Class C Note Rate. Such interest shall be payable on each Distribution Date until the principal of this Class C Note is paid or made available for payment. Interest on this Class C Note will accrue for each Distribution Date from the most recent Distribution Date on which interest has been paid to but excluding such Distribution Date or, if no interest has yet been paid, from November 29, 2022February 5, 2024. Interest with respect to the Class C Notes will be calculated in the manner provided in the Indenture. Such principal of and interest on this Class C Note shall be paid in the manner specified on the reverse hereof.

Reference is made to the further provisions of this Class C Note set forth on the reverse hereof, which shall have the same effect as though fully set forth on the face of this Class C Note. Although a summary of certain provisions of the Indenture is set forth below and on the reverse hereof and made a part hereof, this Class C Note does not purport to summarize the Indenture and reference is made to the Indenture for information with respect to the interests, rights, benefits, obligations, proceeds and duties evidenced hereby and the rights, duties and obligations

Exhibit C-3

Page 5

[REVERSE OF CLASS C NOTE]

The Class C Notes are and will be equally and ratably secured by the Series 2022-5 Collateral pledged as security therefor as provided in the Indenture.

Document

EXHIBIT 10.5

EXECUTION VERSION

FIRST AMENDMENT TO

THE SERIES 2023-1 SUPPLEMENT

This FIRST AMENDMENT TO SERIES 2023-1 SUPPLEMENT (this “Amendment”), dated as of February 5, 2024 amends the Series 2023-1 Supplement (the “Series 2023-1 Supplement”), dated as of January 17, 2023, among AVIS BUDGET RENTAL CAR FUNDING (AESOP) LLC, a special purpose limited liability company established under the laws of Delaware (“ABRCF”) and THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A., a national banking association, as trustee (in such capacity, the “Trustee”) and as agent for the benefit of the Series 2023-1 Noteholders (in such capacity, the “Series 2023-1 Agent”), to the Second Amended and Restated Base Indenture, dated as of June 3, 2004, between ABRCF and the Trustee (as amended, modified or supplemented from time to time, exclusive of Supplements creating a new Series of Notes, the “Base Indenture”). All capitalized terms used herein and not otherwise defined herein shall have the respective meanings provided therefor in the Definitions List attached as Schedule I to the Base Indenture (as amended through the date hereof) or the Series 2023-1 Supplement, as applicable.

W I T N E S S E T H:

WHEREAS, pursuant to Section 5.7 of the Series 2023-1 Supplement, the Series 2023-1 Supplement may be amended in accordance with the terms of the Base Indenture;

WHEREAS, the parties desire to amend the Series 2023-1 Supplement to revise the definition of “Class C Note Rate” and to make conforming revisions in connection therewith;

WHEREAS, the Issuer has determined that the Class C Noteholders and the Class R Noteholders are the affected Noteholders with respect to the revisions contemplated hereby; and

WHEREAS, ABRCF has requested the Trustee, the Series 2023-1 Agent and the affected Noteholders to, and, upon the effectiveness of this Amendment, ABRCF, the Trustee, the Series 2023-1 Agent, the Class C Noteholders and the Class R Noteholders have agreed to, make the amendments described above as set forth herein.

NOW, THEREFORE, it is agreed:

1.Amendments. The Series 2023-1 Supplement is hereby amended by deleting the stricken text (indicated in the same manner as the following example: stricken text) and adding the inserted text (indicated in the same manner as the following example: inserted text) as set forth on the pages of the Series 2023-1 Supplement attached as Exhibit A hereto.

2.Direction. By their signatures hereto, each of the undersigned (excluding The Bank of New York Mellon Trust Company, N.A., in its capacity as Trustee and Series 2023-1 Agent) hereby authorize and direct the Trustee and Series 2023-1 Agent to execute this Amendment and take any and all further action necessary or appropriate to give effect to the transaction contemplated hereby.

3.This Amendment is limited as specified and, except as expressly stated herein, shall not constitute a modification, acceptance or waiver of any other provision of the Series 2023-1 Supplement.

4.This Amendment shall become effective on the date hereof upon satisfaction of the Rating Agency Consent Condition. From and after the date hereof, all references to the Series 2023-1 Supplement shall be deemed to be references to the Series 2023-1 Supplement as amended hereby.

6.THIS AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK.

IN WITNESS WHEREOF, each of the parties hereto have caused this Amendment to be duly executed by their respective duly authorized officers as of the date above first written.


			AVIS BUDGET RENTAL CAR FUNDING
						(AESOP) LLC, as Issuer

			By: /s/ David Calabria
						Name: David Calabria
						Title: Senior Vice President and Treasurer


			THE BANK OF NEW YORK MELLON
						TRUST COMPANY, N.A., as Trustee and
						Series 2023-1 Agent

			By: /s/ Mitchell L. Brumwell
						Name: Mitchell L. Brumwell
						Title: Vice President


AGREED, ACKNOWLEDGED AND CONSENTED:

AVIS BUDGET RENTAL CAR
			FUNDING (AESOP) LLC,
			as Class C Noteholder

By: /s/ David Calabria
			Name: David Calabria
			Title: Senior Vice President and Treasurer

AESOP LEASING L.P.,
			as Class R Noteholder

By: AESOP LEASING CORP., as its general partner

By: /s/ David Calabria
			Name: David Calabria
			Title: Senior Vice President and Treasurer

Exhibit A

Amendments to Series 2023-1 Supplement

Conformed through

First Amendment dated February 5, 2024

Execution Version

AVIS BUDGET RENTAL CAR FUNDING (AESOP) LLC,
as Issuer

and

THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A.,
as Trustee and Series 2023-1 Agent

_____________________

SERIES 2023-1 SUPPLEMENT
dated as of

January 17, 2023

SECOND AMENDED AND RESTATED BASE INDENTURE
dated as of June 3, 2004

_____________________

Series 2023-1 5.25% Rental Car Asset Backed Notes, Class A

Series 2023-1 6.08% Rental Car Asset Backed Notes, Class B

Series 2023-1 8.706.23% Rental Car Asset Backed Notes, Class C

Series 2023-1 10.623% Rental Car Asset Backed Notes, Class R

SERIES 2023-1 SUPPLEMENT, dated as of January 17, 2023 (this "Supplement"), among AVIS BUDGET RENTAL CAR FUNDING (AESOP) LLC, a special purpose limited liability company established under the laws of Delaware ("ABRCF"), THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A. (formerly known as The Bank of New York), a limited purpose national banking association with trust powers, as trustee (in such capacity, and together with its successors in trust thereunder as provided in the Base Indenture referred to below, the "Trustee"), and THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A. (formerly known as The Bank of New York), as agent (in such capacity, the "Series 2023-1 Agent") for the benefit of the Series 2023-1 Noteholders, to the Second Amended and Restated Base Indenture, dated as of June 3, 2004, between ABRCF and the Trustee (as amended, modified or supplemented from time to time, exclusive of Supplements creating a new Series of Notes, the "Base Indenture").

PRELIMINARY STATEMENT

NOW, THEREFORE, the parties hereto agree as follows:

DESIGNATION

There is hereby created a Series of Notes to be issued pursuant to the Base Indenture and this Supplement, and such Series of Notes shall be designated generally as the "Series 2023-1 Rental Car Asset Backed Notes". The Series 2023-1 Notes shall be issued in up to five Classes, the first of which shall be known as the "Class A Notes", the second of which shall be known as the "Class B Notes", the third of which shall be known as the "Class C Notes", the fourth of which shall be known as the "Class R Notes" and the fifth of which, if issued, shall be known as the "Class D Notes".

On the Series 2023-1 Closing Date, ABRCF shall issue (i) one tranche of Class A Notes, which shall be designated as the "Series 2023-1 5.25% Rental Car Asset Backed Notes, Class A", (ii) one tranche of Class B Notes, which shall be designated as the "Series 2023-1 6.08% Rental Car Asset Backed Notes, Class B", (iii) one tranche of Class C Notes, which shall be designated as the "Series 2023-1 8.706.23% Rental Car Asset Backed Notes, Class C" and (iv) one tranche of Class R Notes, which shall be designated the "Series 2023-1 10.623% Rental Car Asset Backed Notes, Class R".

Subsequent to the Series 2023-1 Closing Date, ABRCF may on any date during the Series 2023-1 Revolving Period offer and sell additional Series 2023-1 Notes subject to the conditions set forth in Section 5.15. Such additional Series 2023-1 Notes, if issued, shall be designated as the "Series 2023-1 Rental Car Asset Backed Notes, Class D" and shall be referred to herein as the "Class D Notes".

The Class A Notes, Class B Notes, Class C Notes, Class D Notes, if issued, and Class R Notes collectively, constitute the Series 2023-1 Notes. The Class B Notes shall be


			1

an amount equal to the product of (A) one-twelfth of the Class B Note Rate and (B) the Class B Invested Amount on the first day of such Series 2023-1 Interest Period, after giving effect to any principal payments made on such date.

"Class B Note" means any one of the Series 2023-1 6.08% Rental Car Asset Backed Notes, Class B, executed by ABRCF and authenticated by or on behalf of the Trustee, substantially in the form of Exhibit B-1, Exhibit B-2 or Exhibit B-3. Definitive Class B Notes shall have such insertions and deletions as are necessary to give effect to the provisions of Section 2.18 of the Base Indenture.

"Class B Note Rate" means 6.08% per annum.

"Class B Noteholder" means the Person in whose name a Class B Note is registered in the Note Register.

"Class B Shortfall" has the meaning set forth in Section 2.3(g)(ii).

"Class C Carryover Controlled Amortization Amount" means, with respect to any Related Month during the Series 2023-1 Controlled Amortization Period, the amount, if any, by which the portion of the Monthly Total Principal Allocation paid to the Class C Noteholders pursuant to Section 2.5(e)(iii) for the previous Related Month was less than the Class C Controlled Distribution Amount for the previous Related Month; provided, however, that for the first Related Month in the Series 2023-1 Controlled Amortization Period, the Class C Carryover Controlled Amortization Amount shall be zero.

"Class C Controlled Amortization Amount" means, (i) with respect to any Related Month during the Series 2023-1 Controlled Amortization Period other than the Related Month immediately preceding the Series 2023-1 Expected Final Distribution Date, $8,748,333.33 and (ii) with respect to the Related Month immediately preceding the Series 2023-1 Expected Final Distribution Date, $8,748,333.35.

"Class C Controlled Distribution Amount" means, with respect to any Related Month during the Series 2023-1 Controlled Amortization Period, an amount equal to the sum of the Class C Controlled Amortization Amount and any Class C Carryover Controlled Amortization Amount for such Related Month.

"Class C Initial Invested Amount" means the aggregate initial principal amount of the Class C Notes, which is $52,490,000.

"Class C Monthly Interest" means, (A) for so long as ABRCF owns 100% of the Class C Notes, $0 and (B) if ABRCF owns less than 100% of the Class C Notes, with respect to (i) the initial Series 2023-1 Interest Period with respect to the Class C Notes, an amount equal to $418,607.75408,765.88 and (ii) any other Series 2023-1 Interest Period, an amount equal to the product of (A) one-twelfth of the Class C Note Rate and (B) the Class C Invested Amount on the


			5

first day of such Series 2023-1 Interest Period, after giving effect to any principal payments made on such date.

"Class C Note" means any one of the Series 2023-1 8.706.23% Rental Car Asset Backed Notes, Class C, executed by ABRCF and authenticated by or on behalf of the Trustee, substantially in the form of Exhibit C-1, Exhibit C-2 or Exhibit C-3. Definitive Class C Notes shall have such insertions and deletions as are necessary to give effect to the provisions of Section 2.18 of the Base Indenture.

"Class C Note Rate" means 8.706.23% per annum.

"Class C Noteholder" means the Person in whose name a Class C Note is registered in the Note Register.

"Class C Shortfall" has the meaning set forth in Section 2.3(g)(iii).

"Class D Noteholder" means the Person in whose name a Class D Note is registered in the Note Register.

"Class D Notes" has the meaning set forth in the preamble.

"Class R Controlled Amortization Amount" means, (i) with respect to any Related Month during the Series 2023-1 Controlled Amortization Period other than the Related Month immediately preceding the Series 2023-1 Expected Final Distribution Date, $0 and (ii) with respect to the Related Month immediately preceding the Series 2023-1 Expected Final Distribution Date, the sum of (x) $30,400,000 and (y) the aggregate principal amount of any Additional Class R Notes.

"Class R Initial Invested Amount" means the aggregate initial principal amount of the Class R Notes, which is $30,400,000.

"Class R Monthly Interest" means, with respect to (i) the initial Series 2023-1 Interest Period, an amount equal to $296,033.40 and (ii) any other Series 2023-1 Interest Period, an amount equal to the product of (A) one-twelfth of the Class R Note Rate and (B) the Class R Invested Amount on the first day of such Series 2023-1 Interest Period, after giving effect to any principal payments made on such date.

"Class R Note" means any one of the Series 2023-1 10.623% Rental Car Asset Backed Notes, Class R, executed by ABRCF and authenticated by or on behalf of the Trustee, substantially in the form of Exhibit D-1, Exhibit D-2 or Exhibit D-3. Definitive Class R Notes shall have such insertions and deletions as are necessary to give effect to the provisions of Section 2.18 of the Base Indenture.


			6

"Series 2023-1 Expected Final Distribution Date" means the April 2028 Distribution Date.

"Series 2023-1 Final Distribution Date" means the April 2029 Distribution Date.

"Series 2023-1 Interest Period" means a period commencing on and including a Distribution Date and ending on and including the day preceding the next succeeding Distribution Date; provided, however, that (x) the initial Series 2023-1 Interest Period for the Class A Notes and the Class B Notes shall commence on and include the Series 2023-1 Closing Date and end on and include February 20, 2023 and (y) the initial Series 2023-1 Interest Period for the Class C Notes shall commence on and include February 5, 2024 and end on and include March 19, 2024.

"Series 2023-1 Invested Amount" means, as of any date of determination, the sum of the Class A Invested Amount as of such date, the Class B Invested Amount as of such date, the Class C Invested Amount as of such date and the Class R Invested Amount as of such date.

"Series 2023-1 Invested Percentage" means as of any date of determination:

(1)when used with respect to Principal Collections, the percentage equivalent (which percentage shall never exceed 100%) of a fraction, the numerator of which shall be equal to the sum of the Series 2023-1 Invested Amount and the Series 2023-1 Overcollateralization Amount, determined during the Series 2023-1 Revolving Period as of the end of the Related Month (or, until the end of the initial Related Month, on the Series 2023-1 Closing Date), or, during the Series 2023-1 Controlled Amortization Period and the Series 2023-1 Rapid Amortization Period, as of the end of the Series 2023-1 Revolving Period, and the denominator of which shall be the greater of (I) the Aggregate Asset Amount as of the end of the Related Month or, until the end of the initial Related Month, as of the Series 2023-1 Closing Date, and (II) as of the same date as in clause (I), the sum of the numerators used to determine the invested percentages for allocations with respect to Principal Collections (for all Series of Notes and all classes of such Series of Notes); and

(2)when used with respect to Interest Collections, the percentage equivalent (which percentage shall never exceed 100%) of a fraction, the numerator of which shall be the Accrued Amounts with respect to the Series 2023-1 Notes on such date of determination, and the denominator of which shall be the aggregate Accrued Amounts with respect to all Series of Notes on such date of determination. For so long as ABRCF owns 100% of the Class C Notes, the accrued and unpaid interest with respect to the Class C Notes shall be $0 for purposes of calculating the Accrued Amounts with respect to the Series 2023-1 Notes.

"Series 2023-1 Lease Interest Payment Deficit" means, on any Distribution Date, an amount equal to the excess, if any, of (1) the excess, if any, of (a) the aggregate amount of Interest Collections which pursuant to Section 2.2(a), (b), (c) or (d) would have been allocated to the Series 2023-1 Accrued Interest Account if all payments of Monthly Base Rent required to have been made under the Leases from and excluding the preceding Distribution Date to and including such Distribution Date were made in full over (b) the aggregate amount of Interest Collections which pursuant to Section 2.2(a), (b), (c) or (d) have been allocated to the Series


			18

Exhibit C-1

Page 2

AVIS BUDGET RENTAL CAR FUNDING (AESOP) LLC

SERIES 2023-1 8.706.23% RENTAL CAR ASSET
BACKED NOTES, CLASS C

[_______________________________] DOLLARS, which amount shall be payable in the amounts and at the times set forth in the Indenture; provided, however, that the entire unpaid principal amount of this Class C Note shall be due on the Series 2023-1 Final Distribution Date, which is the April 2029 Distribution Date. However, principal with respect to the Class C Notes may be paid earlier or later under certain limited circumstances described in the Indenture. The Company will pay interest on this Class C Note at the Class C Note Rate. Such interest shall be payable on each Distribution Date until the principal of this Class C Note is paid or made available for payment. Interest on this Class C Note will accrue for each Distribution Date from the most recent Distribution Date on which interest has been paid to but excluding such Distribution Date or, if no interest has yet been paid, from January 17February 5, 20232024. Interest with respect to the Class C Notes will be calculated in the manner provided in the Indenture. Such principal of and interest on this Class C Note shall be paid in the manner specified on the reverse hereof.

Exhibit C-1

Page 5

[REVERSE OF CLASS C NOTE]

This Class C Note is one of a duly authorized issue of Class C Notes of the Company, designated as its Series 2023-1 8.706.23% Rental Car Asset Backed Notes, Class C (herein called the "Class C Notes"), all issued under (i) a Second Amended and Restated Base Indenture, dated as of June 3, 2004 (such Base Indenture, as may be further amended, restated, supplemented or modified in accordance with its terms (exclusive of any Supplements thereto creating a new Series of Notes), is herein called the "Base Indenture"), between the Company, as Issuer, and The Bank of New York Mellon Trust Company, N.A. (as successor in interest to The Bank of New York), as trustee (the "Trustee," which term includes any successor Trustee under the Base Indenture), and (ii) a Series 2023-1 Supplement, dated as of January 17, 2023 (such supplement, as may be amended or modified, is herein called the "Series 2023-1 Supplement"), among the Company, the Trustee and The Bank of New York Mellon Trust Company, N.A., as Series 2023-1 Agent. The Base Indenture and the Series 2023-1 Supplement are referred to herein as the "Indenture". The Class C Notes are subject to all terms of the Indenture. To the extent not defined herein, all terms used in this Class C Note that are defined in the Indenture shall have the meanings assigned to them in or pursuant to the Indenture.

The Class C Notes are and will be equally and ratably secured by the Series 2023-1 Collateral pledged as security therefor as provided in the Indenture.

Commencing on the Distribution Date following the second Determination Date during the Series 2023-1 Controlled Amortization Period, payments with respect to principal will be made on the Class C Notes. In addition, beginning on the first Distribution Date during the Series 2023-1 Rapid Amortization Period on which the Class A Notes and the Class B Notes have been paid in full, payments with respect to principal will be made on the Class C Notes. As described above, the entire unpaid principal amount of this Class C Note shall be due and payable on the Series 2023-1 Final Distribution Date. Notwithstanding the foregoing, if an Amortization Event, Liquidation Event of Default, Waiver Event or Series 2023-1 Limited Liquidation Event of Default shall have occurred and be continuing then, in certain circumstances, principal on the Class C Notes may be paid earlier, as described in the Indenture. All payments of interest on, and principal of, the Class C Notes will be subordinated to the payment of interest on, and principal of, as applicable, the Class A Notes and the Class B Notes, as set forth in the Series 2023-1 Supplement. All principal payments on the Class C Notes shall be made pro rata to the Noteholders entitled thereto.

Exhibit C-2

Page 2

AVIS BUDGET RENTAL CAR FUNDING (AESOP) LLC

SERIES 2023-1 8.706.23% RENTAL CAR
ASSET BACKED NOTES, CLASS C

AVIS BUDGET RENTAL CAR FUNDING (AESOP) LLC, a Delaware limited liability company (herein referred to as the "Company"), for value received, hereby promises to pay to

Cede & Co., or registered assigns, the principal sum of [_______________________________] DOLLARS (or such lesser amount as shall be the outstanding principal amount of this Temporary Global Note shown in Schedule A hereto), which amount shall be payable in the amounts and at the times set forth in the Indenture; provided, however, that the entire unpaid principal amount of this Class C Note shall be due on the Series 2023-1 Final Distribution Date, which is the April 2029 Distribution Date. However, principal with respect to the Class C Notes may be paid earlier or later under certain limited circumstances described in the Indenture. The Company will pay interest on this Class C Note at the Class C Note Rate. Such interest shall be payable on each Distribution Date until the principal of this Class C Note is paid or made available for payment. Interest on this Class C Note will accrue for each Distribution Date from the most recent Distribution Date on which interest has been paid to but excluding such Distribution Date or, if no interest has yet been paid, from January 17February 5, 20232024. Interest with respect to the Class C Notes will be calculated in the manner provided in the Indenture. Such principal of and interest on this Class C Note shall be paid in the manner specified on the reverse hereof.

Exhibit C-2

Page 5

[REVERSE OF CLASS C NOTE]

The Class C Notes are and will be equally and ratably secured by the Series 2023-1 Collateral pledged as security therefor as provided in the Indenture.

Exhibit C-3

Page 2

AVIS BUDGET RENTAL CAR FUNDING (AESOP) LLC

SERIES 2023-1 8.706.23% RENTAL CAR
ASSET BACKED NOTES, CLASS C

AVIS BUDGET RENTAL CAR FUNDING (AESOP) LLC, a Delaware limited liability company (herein referred to as the "Company"), for value received, hereby promises to pay to

Cede & Co., or registered assigns, the principal sum of [_____________________________]
DOLLARS, which amount shall be payable in the amounts and at the times set forth in the Indenture; provided, however, that the entire unpaid principal amount of this Class C Note shall be due on the Series 2023-1 Final Distribution Date, which is the April 2029 Distribution Date. However, principal with respect to the Class C Notes may be paid earlier or later under certain limited circumstances described in the Indenture. The Company will pay interest on this Class C Note at the Class C Note Rate. Such interest shall be payable on each Distribution Date until the principal of this Class C Note is paid or made available for payment. Interest on this Class C Note will accrue for each Distribution Date from the most recent Distribution Date on which interest has been paid to but excluding such Distribution Date or, if no interest has yet been paid, from January 17February 5, 20232024. Interest with respect to the Class C Notes will be calculated in the manner provided in the Indenture. Such principal of and interest on this Class C Note shall be paid in the manner specified on the reverse hereof.

Exhibit C-3

Page 5

[REVERSE OF CLASS C NOTE]

The Class C Notes are and will be equally and ratably secured by the Series 2023-1 Collateral pledged as security therefor as provided in the Indenture.

Document

EXHIBIT 10.6

EXECUTION VERSION

FIRST AMENDMENT TO

THE SERIES 2023-2 SUPPLEMENT

This FIRST AMENDMENT TO SERIES 2023-2 SUPPLEMENT (this “Amendment”), dated as of February 5, 2024 amends the Series 2023-2 Supplement (the “Series 2023-2 Supplement”), dated as of January 17, 2023, among AVIS BUDGET RENTAL CAR FUNDING (AESOP) LLC, a special purpose limited liability company established under the laws of Delaware (“ABRCF”) and THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A., a national banking association, as trustee (in such capacity, the “Trustee”) and as agent for the benefit of the Series 2023-2 Noteholders (in such capacity, the “Series 2023-2 Agent”), to the Second Amended and Restated Base Indenture, dated as of June 3, 2004, between ABRCF and the Trustee (as amended, modified or supplemented from time to time, exclusive of Supplements creating a new Series of Notes, the “Base Indenture”). All capitalized terms used herein and not otherwise defined herein shall have the respective meanings provided therefor in the Definitions List attached as Schedule I to the Base Indenture (as amended through the date hereof) or the Series 2023-2 Supplement, as applicable.

W I T N E S S E T H:

WHEREAS, pursuant to Section 5.7 of the Series 2023-2 Supplement, the Series 2023-2 Supplement may be amended in accordance the terms of the Base Indenture;

WHEREAS, the parties desire to amend the Series 2023-2 Supplement to revise the definition of “Class C Note Rate” and to make conforming revisions in connection therewith;

WHEREAS, the Issuer has determined that the Class C Noteholders and the Class R Noteholders are the affected Noteholders with respect to the revisions contemplated hereby; and

WHEREAS, ABRCF has requested the Trustee, the Series 2023-2 Agent and the affected Noteholders to, and, upon the effectiveness of this Amendment, ABRCF, the Trustee, the Series 2023-2 Agent, the Class C Noteholders and the Class R Noteholders have agreed to, make the amendments described above as set forth herein.

NOW, THEREFORE, it is agreed:

1.Amendments. The Series 2023-2 Supplement is hereby amended by deleting the stricken text (indicated in the same manner as the following example: stricken text) and adding the inserted text (indicated in the same manner as the following example: inserted text) as set forth on the pages of the Series 2023-2 Supplement attached as Exhibit A hereto.

2.Direction. By their signatures hereto, each of the undersigned (excluding The Bank of New York Mellon Trust Company, N.A., in its capacity as Trustee and Series 2023-2 Agent) hereby authorize and direct the Trustee and Series 2023-2 Agent to execute this Amendment and take any and all further action necessary or appropriate to give effect to the transaction contemplated hereby.

3.This Amendment is limited as specified and, except as expressly stated herein, shall not constitute a modification, acceptance or waiver of any other provision of the Series 2023-2 Supplement.

4.This Amendment shall become effective on the date hereof upon satisfaction of the Rating Agency Consent Condition. From and after the date hereof, all references to the Series 2023-2 Supplement shall be deemed to be references to the Series 2023-2 Supplement as amended hereby.

6.THIS AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK.

IN WITNESS WHEREOF, each of the parties hereto have caused this Amendment to be duly executed by their respective duly authorized officers as of the date above first written.


			AVIS BUDGET RENTAL CAR FUNDING
						(AESOP) LLC, as Issuer

			By: /s/ David Calabria
						Name: David Calabria
						Title: Senior Vice President and Treasurer


			THE BANK OF NEW YORK MELLON
						TRUST COMPANY, N.A., as Trustee and
						Series 2023-2 Agent

			By: /s/ Mitchell L. Brumwell
						Name: Mitchell L. Brumwell
						Title: Vice President


AGREED, ACKNOWLEDGED AND CONSENTED:

AVIS BUDGET RENTAL CAR
			FUNDING (AESOP) LLC,
			as Class C Noteholder

By: /s/ David Calabria
			Name: David Calabria
			Title: Senior Vice President and Treasurer

AESOP LEASING L.P.,
			as Class R Noteholder

By: AESOP LEASING CORP., as its general partner

By: /s/ David Calabria
			Name: David Calabria
			Title: Senior Vice President and Treasurer

Exhibit A

Amendments to Series 2023-2 Supplement

Conformed through

First Amendment dated February 5, 2024

Execution Version

AVIS BUDGET RENTAL CAR FUNDING (AESOP) LLC,
as Issuer

and

THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A.,
as Trustee and Series 2023-2 Agent

_____________________

SERIES 2023-2 SUPPLEMENT
dated as of

January 17, 2023

SECOND AMENDED AND RESTATED BASE INDENTURE
dated as of June 3, 2004

_____________________

Series 2023-2 5.20% Rental Car Asset Backed Notes, Class A

Series 2023-2 6.03% Rental Car Asset Backed Notes, Class B

Series 2023-2 8.556.18% Rental Car Asset Backed Notes, Class C

Series 2023-2 10.476% Rental Car Asset Backed Notes, Class R

SERIES 2023-2 SUPPLEMENT, dated as of January 17, 2023 (this "Supplement"), among AVIS BUDGET RENTAL CAR FUNDING (AESOP) LLC, a special purpose limited liability company established under the laws of Delaware ("ABRCF"), THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A. (formerly known as The Bank of New York), a limited purpose national banking association with trust powers, as trustee (in such capacity, and together with its successors in trust thereunder as provided in the Base Indenture referred to below, the "Trustee"), and THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A. (formerly known as The Bank of New York), as agent (in such capacity, the "Series 2023-2 Agent") for the benefit of the Series 2023-2 Noteholders, to the Second Amended and Restated Base Indenture, dated as of June 3, 2004, between ABRCF and the Trustee (as amended, modified or supplemented from time to time, exclusive of Supplements creating a new Series of Notes, the "Base Indenture").

PRELIMINARY STATEMENT

NOW, THEREFORE, the parties hereto agree as follows:

DESIGNATION

There is hereby created a Series of Notes to be issued pursuant to the Base Indenture and this Supplement, and such Series of Notes shall be designated generally as the "Series 2023-2 Rental Car Asset Backed Notes". The Series 2023-2 Notes shall be issued in up to five Classes, the first of which shall be known as the "Class A Notes", the second of which shall be known as the "Class B Notes", the third of which shall be known as the "Class C Notes", the fourth of which shall be known as the "Class R Notes" and the fifth of which, if issued, shall be known as the "Class D Notes".

On the Series 2023-2 Closing Date, ABRCF shall issue (i) one tranche of Class A Notes, which shall be designated as the "Series 2023-2 5.20% Rental Car Asset Backed Notes, Class A", (ii) one tranche of Class B Notes, which shall be designated as the "Series 2023-2 6.03% Rental Car Asset Backed Notes, Class B", (iii) one tranche of Class C Notes, which shall be designated as the "Series 2023-2 8.556.18% Rental Car Asset Backed Notes, Class C" and (iv) one tranche of Class R Notes, which shall be designated the "Series 2023-2 10.476% Rental Car Asset Backed Notes, Class R".

Subsequent to the Series 2023-2 Closing Date, ABRCF may on any date during the Series 2023-2 Revolving Period offer and sell additional Series 2023-2 Notes subject to the conditions set forth in Section 5.15. Such additional Series 2023-2 Notes, if issued, shall be designated as the "Series 2023-2 Rental Car Asset Backed Notes, Class D" and shall be referred to herein as the "Class D Notes".

The Class A Notes, Class B Notes, Class C Notes, Class D Notes, if issued, and Class R Notes collectively, constitute the Series 2023-2 Notes. The Class B Notes shall be


			1

an amount equal to the product of (A) one-twelfth of the Class B Note Rate and (B) the Class B Invested Amount on the first day of such Series 2023-2 Interest Period, after giving effect to any principal payments made on such date.

"Class B Note" means any one of the Series 2023-2 6.03% Rental Car Asset Backed Notes, Class B, executed by ABRCF and authenticated by or on behalf of the Trustee, substantially in the form of Exhibit B-1, Exhibit B-2 or Exhibit B-3. Definitive Class B Notes shall have such insertions and deletions as are necessary to give effect to the provisions of Section 2.18 of the Base Indenture.

"Class B Note Rate" means 6.03% per annum.

"Class B Noteholder" means the Person in whose name a Class B Note is registered in the Note Register.

"Class B Shortfall" has the meaning set forth in Section 2.3(g)(ii).

"Class C Carryover Controlled Amortization Amount" means, with respect to any Related Month during the Series 2023-2 Controlled Amortization Period, the amount, if any, by which the portion of the Monthly Total Principal Allocation paid to the Class C Noteholders pursuant to Section 2.5(e)(iii) for the previous Related Month was less than the Class C Controlled Distribution Amount for the previous Related Month; provided, however, that for the first Related Month in the Series 2023-2 Controlled Amortization Period, the Class C Carryover Controlled Amortization Amount shall be zero.

"Class C Controlled Amortization Amount" means, (i) with respect to any Related Month during the Series 2023-2 Controlled Amortization Period other than the Related Month immediately preceding the Series 2023-2 Expected Final Distribution Date, $6,123,333.33 and (ii) with respect to the Related Month immediately preceding the Series 2023-2 Expected Final Distribution Date, $6,123,333.35.

"Class C Controlled Distribution Amount" means, with respect to any Related Month during the Series 2023-2 Controlled Amortization Period, an amount equal to the sum of the Class C Controlled Amortization Amount and any Class C Carryover Controlled Amortization Amount for such Related Month.

"Class C Initial Invested Amount" means the aggregate initial principal amount of the Class C Notes, which is $36,740,000.

"Class C Monthly Interest" means, (A) for so long as ABRCF owns 100% of the Class C Notes, $0 and (B) if ABRCF owns less than 100% of the Class C Notes, with respect to (i) the initial Series 2023-2 Interest Period with respect to the Class C Notes, an amount equal to $287,949.75283,816.50 and (ii) any other Series 2023-2 Interest Period, an amount equal to the product of (A) one-twelfth of the Class C Note Rate and (B) the Class C Invested Amount on the


			5

first day of such Series 2023-2 Interest Period, after giving effect to any principal payments made on such date.

"Class C Note" means any one of the Series 2023-2 8.556.18% Rental Car Asset Backed Notes, Class C, executed by ABRCF and authenticated by or on behalf of the Trustee, substantially in the form of Exhibit C-1, Exhibit C-2 or Exhibit C-3. Definitive Class C Notes shall have such insertions and deletions as are necessary to give effect to the provisions of Section 2.18 of the Base Indenture.

"Class C Note Rate" means 8.556.18% per annum.

"Class C Noteholder" means the Person in whose name a Class C Note is registered in the Note Register.

"Class C Shortfall" has the meaning set forth in Section 2.3(g)(iii).

"Class D Noteholder" means the Person in whose name a Class D Note is registered in the Note Register.

"Class D Notes" has the meaning set forth in the preamble.

"Class R Controlled Amortization Amount" means, (i) with respect to any Related Month during the Series 2023-2 Controlled Amortization Period other than the Related Month immediately preceding the Series 2023-2 Expected Final Distribution Date, $0 and (ii) with respect to the Related Month immediately preceding the Series 2023-2 Expected Final Distribution Date, the sum of (x) $21,300,000 and (y) the aggregate principal amount of any Additional Class R Notes.

"Class R Initial Invested Amount" means the aggregate initial principal amount of the Class R Notes, which is $21,300,000.

"Class R Monthly Interest" means, with respect to (i) the initial Series 2023-2 Interest Period, an amount equal to $204,540.58 and (ii) any other Series 2023-2 Interest Period, an amount equal to the product of (A) one-twelfth of the Class R Note Rate and (B) the Class R Invested Amount on the first day of such Series 2023-2 Interest Period, after giving effect to any principal payments made on such date.

"Class R Note" means any one of the Series 2023-2 10.476% Rental Car Asset Backed Notes, Class R, executed by ABRCF and authenticated by or on behalf of the Trustee, substantially in the form of Exhibit D-1, Exhibit D-2 or Exhibit D-3. Definitive Class R Notes shall have such insertions and deletions as are necessary to give effect to the provisions of Section 2.18 of the Base Indenture.


			6

equal to the aggregate Net Book Value of all Vehicles manufactured by Tesla and leased under the Leases divided by the aggregate Net Book Value of all Vehicles leased under the Leases minus (y) 15 percentage points.

"Series 2023-2 Expected Final Distribution Date" means the October 2026 Distribution Date.

"Series 2023-2 Final Distribution Date" means the October 2027 Distribution Date.

"Series 2023-2 Interest Period" means a period commencing on and including a Distribution Date and ending on and including the day preceding the next succeeding Distribution Date; provided, however, that (x) the initial Series 2023-2 Interest Period for the Class A Notes and the Class B Notes shall commence on and include the Series 2023-2 Closing Date and end on and include February 20, 2023 and (y) the initial Series 2023-2 Interest Period for the Class C Notes shall commence on and include February 5, 2024 and end on and include March 19, 2024.

"Series 2023-2 Invested Amount" means, as of any date of determination, the sum of the Class A Invested Amount as of such date, the Class B Invested Amount as of such date, the Class C Invested Amount as of such date and the Class R Invested Amount as of such date.

"Series 2023-2 Invested Percentage" means as of any date of determination:

(1)when used with respect to Principal Collections, the percentage equivalent (which percentage shall never exceed 100%) of a fraction, the numerator of which shall be equal to the sum of the Series 2023-2 Invested Amount and the Series 2023-2 Overcollateralization Amount, determined during the Series 2023-2 Revolving Period as of the end of the Related Month (or, until the end of the initial Related Month, on the Series 2023-2 Closing Date), or, during the Series 2023-2 Controlled Amortization Period and the Series 2023-2 Rapid Amortization Period, as of the end of the Series 2023-2 Revolving Period, and the denominator of which shall be the greater of (I) the Aggregate Asset Amount as of the end of the Related Month or, until the end of the initial Related Month, as of the Series 2023-2 Closing Date, and (II) as of the same date as in clause (I), the sum of the numerators used to determine the invested percentages for allocations with respect to Principal Collections (for all Series of Notes and all classes of such Series of Notes); and

(2)when used with respect to Interest Collections, the percentage equivalent (which percentage shall never exceed 100%) of a fraction, the numerator of which shall be the Accrued Amounts with respect to the Series 2023-2 Notes on such date of determination, and the denominator of which shall be the aggregate Accrued Amounts with respect to all Series of Notes on such date of determination. For so long as ABRCF owns 100% of the Class C Notes, the accrued and unpaid interest with respect to the Class C Notes shall be $0 for purposes of calculating the Accrued Amounts with respect to the Series 2023-2 Notes.

"Series 2023-2 Lease Interest Payment Deficit" means, on any Distribution Date, an amount equal to the excess, if any, of (1) the excess, if any, of (a) the aggregate amount of Interest Collections which pursuant to Section 2.2(a), (b), (c) or (d) would have been allocated to


			18

Exhibit C-1

Page 2

AVIS BUDGET RENTAL CAR FUNDING (AESOP) LLC

SERIES 2023-2 8.556.18% RENTAL CAR ASSET
BACKED NOTES, CLASS C

AVIS BUDGET RENTAL CAR FUNDING (AESOP) LLC, a Delaware limited liability company (herein referred to as the "Company"), for value received, hereby promises to pay to

Cede & Co., or registered assigns, the principal sum of

[________________________________] DOLLARS, which amount shall be payable in the amounts and at the times set forth in the Indenture; provided, however, that the entire unpaid principal amount of this Class C Note shall be due on the Series 2023-2 Final Distribution Date, which is the October 2027 Distribution Date. However, principal with respect to the Class C Notes may be paid earlier or later under certain limited circumstances described in the Indenture. The Company will pay interest on this Class C Note at the Class C Note Rate. Such interest shall be payable on each Distribution Date until the principal of this Class C Note is paid or made available for payment. Interest on this Class C Note will accrue for each Distribution Date from the most recent Distribution Date on which interest has been paid to but excluding such Distribution Date or, if no interest has yet been paid, from January 17February 5, 20232024. Interest with respect to the Class C Notes will be calculated in the manner provided in the Indenture. Such principal of and interest on this Class C Note shall be paid in the manner specified on the reverse hereof.

Exhibit C-1

Page 5

[REVERSE OF CLASS C NOTE]

This Class C Note is one of a duly authorized issue of Class C Notes of the Company, designated as its Series 2023-2 8.556.18% Rental Car Asset Backed Notes, Class C (herein called the "Class C Notes"), all issued under (i) a Second Amended and Restated Base Indenture, dated as of June 3, 2004 (such Base Indenture, as may be further amended, restated, supplemented or modified in accordance with its terms (exclusive of any Supplements thereto creating a new Series of Notes), is herein called the "Base Indenture"), between the Company, as Issuer, and The Bank of New York Mellon Trust Company, N.A. (as successor in interest to The Bank of New York), as trustee (the "Trustee," which term includes any successor Trustee under the Base Indenture), and (ii) a Series 2023-2 Supplement, dated as of January 17, 2023 (such supplement, as may be amended or modified, is herein called the "Series 2023-2 Supplement"), among the Company, the Trustee and The Bank of New York Mellon Trust Company, N.A., as Series 2023-2 Agent. The Base Indenture and the Series 2023-2 Supplement are referred to herein as the "Indenture". The Class C Notes are subject to all terms of the Indenture. To the extent not defined herein, all terms used in this Class C Note that are defined in the Indenture shall have the meanings assigned to them in or pursuant to the Indenture.

The Class C Notes are and will be equally and ratably secured by the Series 2023-2 Collateral pledged as security therefor as provided in the Indenture.

Commencing on the Distribution Date following the second Determination Date during the Series 2023-2 Controlled Amortization Period, payments with respect to principal will be made on the Class C Notes. In addition, beginning on the first Distribution Date during the Series 2023-2 Rapid Amortization Period on which the Class A Notes and the Class B Notes have been paid in full, payments with respect to principal will be made on the Class C Notes. As described above, the entire unpaid principal amount of this Class C Note shall be due and payable on the Series 2023-2 Final Distribution Date. Notwithstanding the foregoing, if an Amortization Event, Liquidation Event of Default, Waiver Event or Series 2023-2 Limited Liquidation Event of Default shall have occurred and be continuing then, in certain circumstances, principal on the Class C Notes may be paid earlier, as described in the Indenture. All payments of interest on, and principal of, the Class C Notes will be subordinated to the payment of interest on, and principal of, as applicable, the Class A Notes and the Class B Notes, as set forth in the Series 2023-2 Supplement. All principal payments on the Class C Notes shall be made pro rata to the Noteholders entitled thereto.

Exhibit C-2

Page 2

AVIS BUDGET RENTAL CAR FUNDING (AESOP) LLC

SERIES 2023-2 8.556.18% RENTAL CAR
ASSET BACKED NOTES, CLASS C

AVIS BUDGET RENTAL CAR FUNDING (AESOP) LLC, a Delaware limited liability company (herein referred to as the "Company"), for value received, hereby promises to pay to

Cede & Co., or registered assigns, the principal sum of [_____________________________] DOLLARS (or such lesser amount as shall be the outstanding principal amount of this Temporary Global Note shown in Schedule A hereto), which amount shall be payable in the amounts and at the times set forth in the Indenture; provided, however, that the entire unpaid principal amount of this Class C Note shall be due on the Series 2023-2 Final Distribution Date, which is the October 2027 Distribution Date. However, principal with respect to the Class C Notes may be paid earlier or later under certain limited circumstances described in the Indenture. The Company will pay interest on this Class C Note at the Class C Note Rate. Such interest shall be payable on each Distribution Date until the principal of this Class C Note is paid or made available for payment. Interest on this Class C Note will accrue for each Distribution Date from the most recent Distribution Date on which interest has been paid to but excluding such Distribution Date or, if no interest has yet been paid, from January 17February 5, 20232024. Interest with respect to the Class C Notes will be calculated in the manner provided in the Indenture. Such principal of and interest on this Class C Note shall be paid in the manner specified on the reverse hereof.

Exhibit C-2

Page 5

[REVERSE OF CLASS C NOTE]

The Class C Notes are and will be equally and ratably secured by the Series 2023-2 Collateral pledged as security therefor as provided in the Indenture.

Exhibit C-3

Page 2

AVIS BUDGET RENTAL CAR FUNDING (AESOP) LLC

SERIES 2023-2 8.556.18% RENTAL CAR
ASSET BACKED NOTES, CLASS C

AVIS BUDGET RENTAL CAR FUNDING (AESOP) LLC, a Delaware limited liability company (herein referred to as the "Company"), for value received, hereby promises to pay to

Cede & Co., or registered assigns, the principal sum of [____________________________]
DOLLARS, which amount shall be payable in the amounts and at the times set forth in the Indenture; provided, however, that the entire unpaid principal amount of this Class C Note shall be due on the Series 2023-2 Final Distribution Date, which is the October 2027 Distribution Date. However, principal with respect to the Class C Notes may be paid earlier or later under certain limited circumstances described in the Indenture. The Company will pay interest on this Class C Note at the Class C Note Rate. Such interest shall be payable on each Distribution Date until the principal of this Class C Note is paid or made available for payment. Interest on this Class C Note will accrue for each Distribution Date from the most recent Distribution Date on which interest has been paid to but excluding such Distribution Date or, if no interest has yet been paid, from January 17February 5, 20232024. Interest with respect to the Class C Notes will be calculated in the manner provided in the Indenture. Such principal of and interest on this Class C Note shall be paid in the manner specified on the reverse hereof.

Exhibit C-3

Page 5

[REVERSE OF CLASS C NOTE]

This Class C Note is one of a duly authorized issue of Class C Notes of the Company, designated as its Series-2023-2 8.556.18% Rental Car Asset Backed Notes, Class C (herein called the "Class C Notes"), all issued under (i) a Second Amended and Restated Base Indenture, dated as of June 3, 2004 (such Base Indenture, as may be further amended, restated, supplemented or modified in accordance with its terms (exclusive of any Supplements thereto creating a new Series of Notes), is herein called the "Base Indenture"), between the Company, as Issuer, and The Bank of New York Mellon Trust Company, N.A. (as successor in interest to The Bank of New York), as trustee (the "Trustee," which term includes any successor Trustee under the Base Indenture), and (ii) a Series 2023-2 Supplement, dated as of January 17, 2023 (such supplement, as may be amended or modified, is herein called the "Series 2023-2 Supplement"), among the Company, the Trustee and The Bank of New York Mellon Trust Company, N.A., as Series 2023-2 Agent. The Base Indenture and the Series 2023-2 Supplement are referred to herein as the "Indenture". The Class C Notes are subject to all terms of the Indenture. To the extent not defined herein, all terms used in this Class C Note that are defined in the Indenture shall have the meanings assigned to them in or pursuant to the Indenture.

The Class C Notes are and will be equally and ratably secured by the Series 2023-2 Collateral pledged as security therefor as provided in the Indenture.

Document

Exhibit 31.1

SECTION 302 CERTIFICATION

I, Joseph A. Ferraro, certify that:

1.I have reviewed this quarterly report on Form 10-Q of Avis Budget Group, Inc.;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c)Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d)Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: May 2, 2024


/s/ Joseph A. Ferraro
President and Chief Executive Officer

Document

Exhibit 31.2

SECTION 302 CERTIFICATION

I, Izilda P. Martins, certify that:

1.I have reviewed this quarterly report on Form 10-Q of Avis Budget Group, Inc.;

b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: May 2, 2024


/s/ Izilda P. Martins
Executive Vice President and Chief Financial Officer

Document

Exhibit 32

CERTIFICATION OF CEO AND CFO PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Avis Budget Group, Inc. (the “Company”) on Form 10-Q for the period ended March 31, 2024, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), Joseph A. Ferraro, as Chief Executive Officer of the Company, and Izilda P. Martins, as Chief Financial Officer of the Company, each hereby certifies, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to the best of his knowledge:

(1)The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2)The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.


/s/ JOSEPH A. FERRARO
Joseph A. Ferraro
President and Chief Executive Officer
May 2, 2024

/s/ IZILDA P. MARTINS
Izilda P. Martins
Executive Vice President and Chief Financial Officer
May 2, 2024