Hertz 2011 Annual Report Download - page 171

HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
Financing Arrangements with Related Parties
Affiliates of BAMLCP (which is one of the Sponsors), including Merrill Lynch & Co., Inc., Bank of America,
N.A. and certain of their affiliates (which are stockholders of Hertz Holdings), have provided various
investment and commercial banking and financial advisory services to us for which they have received
customary fees and commissions. In addition, these parties have acted as agents, lenders, purchasers
and/or underwriters to us under our respective financing arrangements, for which they have received
customary fees, commissions, expenses and/or other compensation. More specifically, these parties
have acted in the following capacities, or similar capacities, with respect to our financing arrangements:
lenders and/or agents under the Senior Credit Facilities, the U.S. Fleet Financing Facility and certain of
the U.S. Fleet Variable Funding Notes; purchasers and/or underwriters under the Senior Notes, the
Senior Subordinated Notes and certain of the U.S. Fleet Medium Term Notes; and structuring advisors
and/or agents under the ABS Program.
As of December 31, 2011 and December 31, 2010, approximately $174 million and $255 million,
respectively, of our outstanding debt was with related parties.
See Note 4—Debt.
Other Sponsor Relationships
In May and June 2009, Merrill Lynch & Co., Inc., or ‘‘ML,’’ an affiliate of one of our Sponsors, BAMLCP,
acted as an underwriter in the common stock follow-on public offering and in the public offering of the
Convertible Senior Notes, for which they received customary fees and expenses.
In May 2009 we entered into subscription agreements with investment funds affiliated with CD&R and
Carlyle to purchase an additional 32,101,182 shares of our common stock at a price of $6.23 per share
(the same price per share paid to us by the underwriters in the common stock public offering) with
proceeds to us of approximately $200.0 million. This closed on July 7, 2009 and the 32,101,182 shares of
our common stock were issued to CD&R and Carlyle affiliated investment funds on the same date. In
March 2011, the Sponsors sold 50,000,000 shares of their Hertz Holdings common stock to Goldman,
Sachs & Co. as the sole underwriter in the registered public offering of those shares. Giving effect to
these offerings, the Sponsors’ ownership percentage in us is approximately 38%.
To date, Bank of America Corporation, and certain of its affiliates, collectively, ‘‘B of A,’’ (which are
affiliates of BAMLCP and are stockholders of Hertz Holdings) has paid to us approximately $5.0 million
for ‘‘short-swing’’ profit liability resulting from principal trading activity in our common stock, which is
subject to recovery by us under Section 16 of the Securities Exchange Act of 1934, as amended. In the
event that B of A continues principal trading activity in our common stock, this amount may change.
Note 15—Earnings (Loss) Per Share
Basic earnings (loss) per share has been computed based upon the weighted average number of
common shares outstanding. Diluted earnings (loss) per share has been computed based upon the
weighted average number of common shares outstanding plus the effect of all potentially dilutive
common stock equivalents, except when the effect would be anti-dilutive.
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