Hertz 2013 Annual Report Download - page 30

Table of Contents
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these events could have a material adverse effect on our consolidated financial position, results of operations or cash flows. See Note 6 to the
audited annual consolidated financial statements included in this Annual Report.
Environmental laws and regulations and the costs of complying with them, or any liability or obligation imposed under them,
could materially adversely affect our financial position, results of operations or cash flows.
We are subject to federal, state, local and foreign environmental laws and regulations in connection with our operations, including with
respect to the ownership and operation of tanks for the storage of petroleum products, such as gasoline, diesel fuel and motor and waste oils.
We cannot assure you that our tanks will at all times remain free from leaks or that the use of these tanks will not result in significant spills
or leakage. If leakage or a spill occurs, it is possible that the resulting costs of cleanup, investigation and remediation, as well as any resulting
fines, could be significant. We cannot assure you that compliance with existing or future environmental laws and regulations will not require
material expenditures by us or otherwise have a material adverse effect on our consolidated financial position, results of operations or cash
flows. See the section entitled ‘‘Business—Governmental Regulation and Environmental Matters’’ in this Annual Report.
The U.S. Congress and other legislative and regulatory authorities in the United States and internationally have considered, and will likely
continue to consider, numerous measures related to climate change and greenhouse gas emissions. Should rules establishing limitations
on greenhouse gas emissions or rules imposing fees on entities deemed to be responsible for greenhouse gas emissions become effective,
demand for our services could be affected, our fleet and/or other costs could increase, and our business could be adversely affected.
Changes in the U.S. legal and regulatory environment that affect our operations, including laws and regulations relating to
taxes, automobile-related liability, insurance rates, insurance products, consumer privacy, data security, employment matters,
cost and fee recovery and the banking and financing industry could disrupt our business, increase our expenses or otherwise
have a material adverse effect on our results of operations.
We are subject to a wide variety of U.S. laws and regulations and changes in the level of government regulation of our business have the
potential to materially alter our business practices and materially adversely affect our financial position and results of operations, including
our profitability. Those changes may come about through new laws and regulations or changes in the interpretation of existing laws and
regulations.
Any new, or change in existing, U.S. law and regulation with respect to optional insurance products or policies could increase our costs of
compliance or make it uneconomical to offer such products, which would lead to a reduction in revenue and profitability. For further
discussion regarding how changes in the regulation of insurance intermediaries may affect us, see the section entitled ‘‘Business—Risk
Management’’ in this Annual Report. If customers decline to purchase supplemental liability insurance products from us as a result of any
changes in these laws or otherwise, our results of operations could be materially adversely affected.
Changes in the U.S. legal and regulatory environment in the areas of customer privacy, data security and cross-border data flow could have a
material adverse effect on our business, primarily through the impairment of our marketing and transaction processing activities, and the
resulting costs of complying with such legal and regulatory requirements. It is also possible that we could face significant liability for failing to
comply with any such requirements.
In most places where we operate, we pass through various expenses, including the recovery of vehicle licensing costs and airport concession
fees, to our rental customers as separate charges. We believe that our expense pass-throughs, where imposed, are properly disclosed and
are lawful. However, we may in the future be subject to potential legislative, regulatory or administrative changes or actions which could
limit, restrict or prohibit our ability to separately state, charge and recover vehicle licensing costs and airport concession fees, which could
result in a material adverse effect on our results of operations.
Certain new or proposed laws and regulations with respect to the banking and finance industries, including the Dodd-Frank Wall Street
Reform and Consumer Protection Act and amendments to Regulation AB, could restrict our access to certain financing arrangements and
increase our financing costs, which could have a material adverse effect on our financial position, results of operations, liquidity and cash
flows.
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Our substantial level of indebtedness could materially adversely affect our results of operations, cash flows, liquidity and
ability to compete in our industry.
As of December 31, 2013, we had debt outstanding of $16,227.5 million. Our substantial indebtedness could materially adversely affect us.
For example, it could: (i) make it more difficult for us to satisfy our obligations to the holders of our
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Source: HERTZ CORP, 10-K, March 31, 2014 Powered by Morningstar® Document Research℠
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