Hertz 2012 Annual Report Download - page 65

ITEM 1A. RISK FACTORS (Continued)
transaction costs related to the Dollar Thrifty acquisition, facilities, fleet and systems consolidation costs
and employment-related costs. We also incurred transaction fees and costs related to formulating
integration plans. Although we expect that the elimination of duplicative costs, as well as the realization
of other efficiencies related to the integration of the businesses, should allow us to offset the previously-
incurred incremental transaction and acquisition-related costs over time, this net benefit may not be
achieved in the near term, or at all.
Future results of the combined company may differ materially from the Unaudited Pro Forma
Financial Information of Hertz and Dollar Thrifty presented in this annual report.
The future results of Hertz, as the combined company following the Dollar Thrifty acquisition, may be
materially different from those shown in the pro forma financial information presented in Note 4 to the
Notes to our consolidated financial statements included in this Annual Report under the caption
‘‘Item 8—Financial Statements and Supplementary Data’’ that reflect such results on a pro forma basis
after giving effect only to: (i) the acquisition of Donlen by Hertz in September 2011, (ii) the Dollar Thrifty
acquisition in November 2012, (iii) the divestiture of Advantage, (iv) the divestitures of the Initial airport
locations and the Secondary airport locations (as defined herein), (v) the issuance of the 2020 Notes and
the 2022 Notes and (vi) the incurrence of $750.0 million in Incremental Term Loans; in each case of
(i) through (vi) above, as if they had occurred on January 1, 2011 for the pro forma financial information
for the year ended December 31, 2011 and for the year ended December 31, 2012; and in each case
(ii) through (vi) above, as if they had occurred on December 31, 2012 for the pro forma financial
information as of December 31, 2012.
The pro forma financial information presented in this Annual Report reflects the acquisition method of
accounting under accounting principles generally accepted in the United States of America, and is
subject to change and interpretation. Accordingly, the pro forma financial information presented in this
Annual Report has been presented for informational purposes only. The pro forma financial information
is not necessarily indicative of what the combined company’s financial position or results of operations
actually would have been had the applicable transactions been completed as of the dates indicated. In
addition, the pro forma financial information does not purport to project the future financial position or
operating results of the combined company.
Certain existing indebtedness of Dollar Thrifty and its subsidiaries, if not refinanced, amended or
repaid, may decrease Hertz’s business flexibility, reduce its ability to incur additional
indebtedness, affect its existing debt covenants, increase its borrowing costs or result in
repayment or collateralization obligations.
Certain of Dollar Thrifty’s existing indebtedness remains outstanding after the closing of the Dollar Thrifty
acquisition, including most of Dollar Thrifty’s existing fleet financing. As of December 31, 2012, Dollar
Thrifty’s indebtedness was approximately $1.5 billion. For a description of Dollar Thrifty’s indebtedness
and other obligations as of December 31, 2012, see Note 5 to the Notes to our consolidated financial
statements included in this Annual Report under the caption ‘‘Item 8—Financial Statements and
Supplementary Data.’’ See ‘‘—Risks Related to Our Substantial Indebtedness—Our substantial level of
indebtedness could adversely affect our results of operations, cash flows, liquidity and ability to compete
in our industry.’’ To service our indebtedness, we will require a significant amount of cash which we may
not be able to raise or generate.
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