Hertz 2007 Annual Report Download - page 134

HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
approximately e7.6 million, or the ‘‘Euro Medium Term Notes,’’ remained outstanding following
the Transactions;
• the repayment of a $1,185 million intercompany note issued by Hertz to Ford Holdings on
June 10, 2005 that would have matured in June 2010;
• the repayment of approximately $1,935 million under an interim credit facility that would have
matured on February 28, 2006;
• the repayment of commercial paper, notes payable and other bank debt of approximately
$1,212 million; and
• the settlement of all accrued interest and unamortized debt discounts relating to the above
existing indebtedness.
The term ‘‘Successor’’ refers to us following the Acquisition. The term ‘‘Predecessor’’ refers to us prior to
the Acquisition. The ‘‘Successor period ended December 31, 2005’’ refers to the period from
December 21, 2005 to December 31, 2005 and the ‘‘Predecessor period ended December 20, 2005’’
refers to the period from January 1, 2005 to December 20, 2005.
Initial and Secondary Public Offering
In November 2006, we completed our initial public offering of 88,235,000 shares of common stock at a
per share price of $15.00, with proceeds to us before underwriting discounts and offering expenses of
approximately $1.3 billion. The proceeds were used to repay borrowings that were outstanding under a
$1.0 billion loan facility entered into by Hertz Holdings, or the ‘‘Hertz Holdings Loan Facility,’’ and to pay
related transaction fees and expenses. The proceeds were also used to pay special cash dividends of
$1.12 per share on November 21, 2006 to stockholders of record of Hertz Holdings immediately prior to
the initial public offering.
In June 2007, the Sponsors completed a secondary public offering of 51,750,000 shares of their Hertz
Holdings common stock at a per share price of $22.25. We did not receive any of the proceeds from the
sale of these shares. We paid all of the expenses of the offering, excluding underwriting discounts and
commissions of the selling stockholders, pursuant to a registration rights agreement we entered into at
the time of the Acquisition. These expenses aggregated to approximately $2.0 million. Immediately
following the secondary public offering, the Sponsors’ ownership percentage in us decreased to
approximately 55%.
Principles of Consolidation
The consolidated financial statements include the accounts of Hertz Holdings and our wholly-owned
and majority-owned domestic and foreign subsidiaries. All significant intercompany transactions have
been eliminated.
Revenue Recognition
Rental and rental-related revenue (including cost reimbursements from customers where we consider
ourselves to be the principal versus an agent) are recognized over the period the revenue earning
equipment is rented based on the terms of the rental or leasing contract. Revenue related to new
equipment sales and consumables is recognized at the time of delivery to, or pick-up by, the customer
and when collectability is reasonably assured. Fees from our licensees are recognized over the period
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