Hertz 2007 Annual Report Download - page 151

HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
a borrowing margin of 25 basis points. As of December 31, 2007, the average interest rate was 6.3%
(LIBOR based).
The Fleet Financing Facility contains a number of covenants that, among other things, limit or restrict the
ability of the borrowers and their subsidiaries to create liens, dispose of assets, engage in mergers, enter
into agreements which restrict liens on the Fleet Financing Facility collateral or Hertz’s rental car fleet in
Kansas or change the nature of their business.
During the fourth quarter of 2006, certain of the documents relating to the Fleet Financing Facility were
amended to make certain technical and administrative changes.
Brazilian Fleet Financing Facility. On April 4, 2007, our Brazilian subsidiary, Car Rental Systems Do
Brasil Locacao De Veiculos Ltda., or ‘‘Hertz Brazil,’’ entered into an agreement amending and restating
its credit facility to, among other things, increase the facility to R$130 million (or $73.2 million), consisting
of an R$70 million (or $39.4 million) term loan facility and an R$60 million (or $33.8 million) revolving
credit facility (the ‘‘Brazilian Fleet Financing Facility’’). The borrowing margin was reduced from 300
basis points over CDI (Brazil’s interbank deposit rate) to 225 basis points over CDI. The amendment also
increased the borrowing base advance rate from 80% to 85% of the value of the fleet. The credit facility is
secured by Hertz Brazil’s fleet of vehicles and backed by a $63.5 million Hertz guarantee. This facility will
mature in December 2010. As of December 31, 2007, the foreign currency equivalent of $62.9 million in
borrowings were outstanding under this facility.
Canadian Fleet Financing Facility. On May 30, 2007, our indirect subsidiary, Hertz Canada Limited, and
certain of its subsidiaries, entered into a Note Purchase Agreement with CARE Trust, a third-party special
purpose commercial paper conduit administered by Bank of Montreal, or ‘‘CARE Trust,’’ which acts as
conduit for the asset-backed borrowing facility, and certain related agreements and transactions, in
order to establish an asset-backed borrowing facility to provide financing for our Canadian rental car
fleet (the ‘‘Canadian Fleet Financing Facility’’). The new facility refinanced the Canadian portion of the
International Fleet Debt facilities. The maximum amount which may be borrowed under the new facility is
CAN$400 million (or $392.1 million). This facility matures in May 2012. As of December 31, 2007, the
foreign currency equivalent of $155.4 million in borrowings were outstanding under this facility.
On December 24, 2007, Hertz Canada Limited, an indirect subsidiary of Hertz, and certain subsidiaries
of Hertz Canada Limited, entered into a waiver and agreement with CARE Trust (the ‘‘waiver and
agreement’’). The waiver and agreement allows the borrowers to designate certain vehicles as
‘‘unfunded risk vehicles’’ during a waiver period, which began on December 24, 2007 and will end on
March 31, 2008. During the waiver period, vehicles designated as unfunded risk vehicles are excluded
from the calculation of the borrowing base and are also excluded for purposes of determining whether
certain covenants regarding the composition of the vehicle pool are satisfied.
Belgian Fleet Financing Facility. On June 21, 2007, our Belgian subsidiary, Hertz Belgium BVBA,
entered into a secured revolving credit facility with varying facility limits of up to e27.4 million (or
$40.4 million) maturing in December 2010 (the ‘‘Belgian Fleet Financing Facility’’). The new facility
refinanced the Belgian portion of the International Fleet Debt facilities. This facility is guaranteed by HIL
and the fleet assets used in the Belgian operations are pledged as collateral for this debt. Interest is
charged at a spread over the Euribor. This facility contains a number of covenants typical for this type of
facility, including restrictions on additional indebtedness, creation of liens, engaging in mergers and
change of business. As of December 31, 2007, the foreign currency equivalent of $30.0 million in
borrowings were outstanding under this facility.
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