Hertz 2007 Annual Report Download - page 48

us a contribution toward the cost of our advertising of Ford Vehicles equal to one-half of our total
expenditure on such advertising, up to a specified maximum amount. To be eligible for advertising cost
contribution under the Master Supply and Advertising Agreement, the advertising must meet certain
conditions, including the condition that we feature Ford Vehicles in a manner and with a prominence that
is reasonably satisfactory to Ford. It further provides that the amounts Ford will be obligated to pay to us
for our advertising costs will be increased or reduced according to the number of Ford Vehicles acquired
by us in any model year, provided Ford will not be required to pay any amount for our advertising costs
for any year if the number of Ford Vehicles acquired by us in the corresponding model year is less than a
specified minimum except to the extent that our failure to acquire the specified minimum number of Ford
Vehicles is attributable to the availability of Ford Vehicles or Ford vehicle production is disrupted for
reasons beyond the control of Ford. To the extent we acquire less than a specified minimum number of
Ford Vehicles in any model year, we have agreed to pay Ford a specified amount per vehicle below the
minimum.
The advertising contributions paid by Ford for the 2007 vehicle model year were lower than the
advertising contributions we received from Ford for the 2006 model year due to a decrease in the
number of Ford Vehicles acquired, partly offset by a slight increase in the per car contribution. We expect
that contributions in future years will be below levels for the 2007 model year based upon anticipated
reductions in the number of Ford Vehicles to be acquired. We do not expect that the reductions in Ford’s
advertising contributions will have a material adverse effect on our results of operations.
Under the terms of the Master Supply and Advertising Agreement, we are able to enter into vehicle
advertising and supply agreements with other automobile manufacturers in the United States and in
other countries, and we intend to explore those opportunities. However, we cannot offer assurance that
we will be able to obtain advertising contributions from other automobile manufacturers that will mitigate
reductions in Ford’s advertising contributions.
Ford subsidiaries and affiliates also supply other brands of cars, including Jaguar, Volvo, Mazda and
Land Rover cars, to us in the United States under arrangements separate from the Master Supply and
Advertising Agreement. In addition, Ford and its subsidiaries and affiliates are significant suppliers of
cars to our international operations.
Other Relationships and Transactions
We and Ford also engage in other transactions in the ordinary course of our respective businesses.
These transactions include HERC’s providing equipment rental services to Ford, our providing
insurance and insurance claim management services to Ford and our providing car rental services to
Ford. In addition, Ford subsidiaries are our car rental licensees in Scandinavia and Finland.
We may be exposed to liabilities for regulatory or tax contingencies of Ford arising from the period
during which we were a consolidated subsidiary of Ford. While Ford has agreed to indemnify us for
certain liabilities pursuant to the arrangements relating to our separation from Ford, we cannot offer
assurance that any payments in respect of these indemnification arrangements will be made available.
Available Information
We file annual, quarterly and current reports and other information with the United States Securities and
Exchange Commission, or the ‘‘SEC.’’ You may read and copy any documents that we file at the SEC’s
public reference room at 100 F Street, N.E., Washington, D.C. 20549. Please call the SEC at
1-800-SEC-0330 for further information about the public reference room. In addition, the SEC maintains
an Internet website (www.sec.gov) that contains reports and other information about issuers that file
electronically with the SEC, including Hertz Holdings. You may also access, free of charge, our reports
filed with the SEC (for example, our Annual Report on Form 10-K, our Quarterly Reports on Form 10-Q
and our Current Reports on Form 8-K and any amendments to those forms) indirectly through our
Internet website (www.hertz.com). Reports filed with or furnished to the SEC will be available as soon as
reasonably practicable after they are filed with or furnished to the SEC. The information found on our
website is not part of this or any other report filed with or furnished to the SEC.
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