Hertz 2014 Annual Report Download - page 136

Table of Contents
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In October 2012, HDTFS, Inc., a newly-formed, wholly-owned subsidiary of Hertz issued and sold $700 million aggregate principal amount of
5.875% Senior Notes due 2020 and $500 million aggregate principal amount of 6.250% Senior Notes due 2022 in a private offering. The gross
proceeds of the offering were held in an escrow account until the date of the completion of the acquisition of Dollar Thrifty, at which time the gross
proceeds of the offering were released from escrow and HDTFS, Inc. was merged into Hertz.
In March 2013, Hertz issued $250 million in aggregate principal amount of 4.25% Senior Notes due 2018. The proceeds of this March 2013 offering
were used by Hertz to replenish a portion of its liquidity, after having dividended $467 million in available liquidity to Hertz Holdings, which was
used to repurchase 23 million shares of Hertz Holdings common stock.
Hertz's obligations under the indentures for the Senior Notes are guaranteed by each of its direct and indirect U.S. subsidiaries that are guarantors
under the Senior Term Facility. The guarantees of all of the Subsidiary Guarantors may be released to the extent such subsidiaries no longer
guarantee the Company's Senior Credit Facilities in the U.S.
HERC may also be released from its guarantee under the outstanding Senior Notes at any time at which no event of default under the related
indenture has occurred and is continuing, notwithstanding that HERC may remain a subsidiary of Hertz. In February 2013 and March 2013, the
Company added Dollar Thrifty and certain of its subsidiaries as guarantors under certain of its debt instruments and credit facilities including the
Senior Notes and in February 2014, the Company added Firefly Rent A Car LLC as a guarantor under certain of its debt instruments and credit
facilities, including the Senior Notes.
The indentures for the Senior Notes contain covenants that, among other things, limit or restrict the ability of the Hertz credit group to incur
additional indebtedness, incur guarantee obligations, prepay certain indebtedness, make certain restricted payments (including paying dividends,
redeeming stock or making other distributions to parent entities of Hertz and other persons outside of the Hertz credit group), make investments,
create liens, transfer or sell assets, merge or consolidate, and enter into certain transactions with Hertz's affiliates that are not members of the
Hertz credit group. These covenants also restrict Hertz Holdings and certain of its subsidiaries from redeeming stock or making loans, advances,
dividends, distributions or other restricted payments to any entity that is not a member of the Hertz credit group, subject to certain exceptions.
The Company's failure to file certain quarterly and annual reports required under the Exchange Act resulted in the occurrence of various potential
defaults under the indentures for the Senior Notes. With respect to each such indenture, the Company has 60 days following its receipt of a notice
of default from the trustee or the requisite noteholders under such indenture to remedy such default, after which such failure would become an
event of default under such indenture.
See Note 20, "Subsequent Events" regarding waivers related to the Senior Notes.
Promissory Notes
References to the Company's “Promissory Notes” relate to its promissory notes issued under three separate indentures prior to the acquisition of
all of Hertz's common stock on December 21, 2005, by the Sponsors.
Convertible Senior Notes
References to the Company's “Convertible Senior Notes” are to Hertz Holdings' 5.25% Convertible Senior Notes due June 2014. The Company's
Convertible Senior Notes were convertible by holders into shares of its common stock, cash or a combination of cash and shares of its common
stock, as elected by the Company, initially at a conversion rate of 120.6637 shares per $1,000 principal amount of notes, subject to adjustment.
In January 2013, a conversion right was triggered because the Company's closing common stock price per share exceeded $10.77 for at least 20
trading days during the 30 consecutive trading day period ending on December 31, 2012.
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Source: HERTZ GLOBAL HOLDINGS INC, 10-K, July 16, 2015 Powered by Morningstar® Document Research℠
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