Hertz 2009 Annual Report Download - page 143

HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
Facility and the other loan documents, including, without limitation, its guarantee of PR Cars’ obligations
under the Fleet Financing Facility, are secured by security interests in Hertz’s rental car fleet in Hawaii
and by certain assets related to Hertz’s rental car fleet in Hawaii and Kansas, including, without
limitation, manufacturer repurchase program agreements. PR Cars’ obligations under the Fleet
Financing Facility and the other loan documents are secured by security interests in PR Cars’ rental car
fleet in Puerto Rico and St. Thomas, the U.S. Virgin Islands and by certain assets related thereto.
At the applicable borrower’s election, the interest rates per annum applicable to the loans under the
Fleet Financing Facility will be based on a fluctuating rate of interest measured by reference to either
(1) LIBOR plus a borrowing margin of 125 basis points or (2) an alternate base rate of the prime rate plus
a borrowing margin of 25 basis points.
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.
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 (the equivalent of $74.7 million as of December 31, 2009),
consisting of an R$70 million (or $40.2 million) term loan facility and an R$60 million (or $34.5 million)
revolving credit 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. That guarantee is secured equally and
ratably with borrowings under the Senior Term Facility. This facility will mature in December 2010. As of
December 31, 2009, the foreign currency equivalent of $69.3 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 was CAD$400 million (or
$381.3 million). This facility had an original maturity of May 2012.
In June 2009, subsidiaries of Hertz entered into a second omnibus amendment to our Canadian Fleet
Financing Facility, reducing the facility limit from CAD$400 million (or $381.3 million, calculated using
exchange rates in effect on December 31, 2009) to CAD$225 million (or $214.5 million), changing the
maturity date from May 2012 to May 2011 and adding an increase in the commitment fee. Also, among
other things, certain covenants pertaining to fleet composition were eliminated and certain limitations on
the number of vehicles supplied by a single manufacturer which may be included in the borrowing base
calculation were added. As of December 31, 2009, the foreign currency equivalent of $55.6 million in
borrowings were outstanding under this facility.
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