SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) November 26, 2019 (November 25, 2019)
HERTZ GLOBAL HOLDINGS, INC.
THE HERTZ CORPORATION
(Exact name of registrant as specified in its charter)
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| Delaware | | 001-37665 | | 61-1770902 |
| Delaware | | 001-07541 | | 13-1938568 |
(State or other jurisdiction of
incorporation) | | (Commission File Number) | | (I.R.S. Employer Identification No.) |
| | | | | | | |
| | | 8501 Williams Road | | |
| | | Estero, | Florida | 33928 | | |
| | | 239 | 301-7000 | | |
| | | (Address, including Zip Code, and telephone number, including area code, of registrant's principal executive offices) | | |
| | | | | | | |
| | | Not Applicable | | |
| | | Not Applicable | | |
| | | (Former name, former address and former fiscal year, if changed since last report.) | | |
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
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| Securities registered pursuant to Section 12(b) of the Act: |
| | | Title of Each Class | | Trading Symbol(s) | | Name of Each Exchange on which Registered |
| Hertz Global Holdings, Inc. | | Common Stock | par value $0.01 per share | | HTZ | | New York Stock Exchange |
| The Hertz Corporation | | None | | None | | None |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o
ITEM 1.01 ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT
On November 25, 2019 (the “Issue Date”), The Hertz Corporation (“Hertz”), a wholly owned subsidiary of Hertz Global Holdings, Inc., issued $900 million aggregate principal amount of 6.000% Senior Notes due 2028 (the “Notes”) under an indenture dated November 25, 2019 (as amended, supplemented (including pursuant to that certain supplemental indenture dated November 25, 2019), waived or otherwise modified, the “Indenture”), by and among Hertz, certain U.S. subsidiaries of Hertz as guarantors (the “Subsidiary Guarantors”) and Wells Fargo Bank, National Association, as trustee. The following is a brief description of the Indenture and the terms of the Notes issued thereunder.
Interest; Maturity
Interest on the Notes will be payable semi-annually in cash to holders of record at the close of business on the January 1 or July 1 immediately preceding the interest payment date on January 15 and July 15 of each year, respectively, commencing on July 15, 2020. Interest will be paid on the basis of a 360‑day year consisting of twelve 30‑day months. The Notes will mature on January 15, 2028.
Ranking; Guarantees
The Notes will be Hertz’s senior unsecured obligations and will be:
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| • | equal in right of payment to all of Hertz’s existing and future unsecured indebtedness and other obligations that are not, by their terms, expressly subordinated in right of payment to the Notes; |
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| • | senior in right of payment to any of Hertz’s existing or future indebtedness and other obligations that are, by their terms, expressly subordinated in right of payment to the Notes; |
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| • | effectively subordinated to all of Hertz’s secured indebtedness and other secured obligations, including Hertz’s senior secured term loan facility, senior secured revolving credit facility, secured letter of credit facility and senior secured second priority notes, to the extent of the value of the assets securing such secured indebtedness or other secured obligations; and |
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| • | structurally subordinated to all indebtedness and other obligations of Hertz’s subsidiaries (other than subsidiaries that are, or which become, Subsidiary Guarantors). |
The Notes are guaranteed by Dollar Rent A Car, Inc., Dollar Thrifty Automotive Group, Inc., Donlen Corporation, DTG Operations, Inc., DTG Supply, LLC, Firefly Rent A Car LLC, Hertz Car Sales LLC, Hertz Global Services Corporation, Hertz Local Edition Corp., Hertz Local Edition Transporting, Inc., Hertz System, Inc., Hertz Technologies, Inc., Hertz Transporting, Inc., Rental Car Group Company, LLC., Smartz Vehicle Rental Corporation, Thrifty Car Sales, Inc., Thrifty, LLC, Thrifty Insurance Agency, Inc., Thrifty Rent-A-Car System, LLC, and TRAC Asia Pacific, Inc.
The guarantee of each Subsidiary Guarantor in respect of the Notes will be:
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| • | equal in right of payment to all existing and future indebtedness and other obligations of that Subsidiary Guarantor that are not, by their terms, expressly subordinated in right of payment to the such guarantee; |
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| • | senior in right of payment to any existing and future indebtedness and other obligations of that Subsidiary Guarantor that are, by their terms, expressly subordinated in right of payment to such guarantee; |
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| • | effectively subordinated to all secured indebtedness and other secured obligations of that Subsidiary Guarantor, including any amounts owed pursuant to Hertz’s senior secured term loan facility, senior secured revolving credit facility, secured letter of credit facility and senior secured second priority notes, to the extent of the value of the assets securing such secured indebtedness and other secured obligations; and |
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| • | structurally subordinated to all indebtedness and other obligations of the subsidiaries of that Subsidiary Guarantor (other than subsidiaries that are, or which become, Subsidiary Guarantors). |
Optional Redemption
Prior to January 15, 2023, Hertz will be entitled at its option to redeem all or a portion of the Notes at a redemption price equal to 100% of the principal amount of the Notes plus an applicable “make whole” premium and accrued and unpaid interest to but not including the redemption date.
On or after January 15, 2023, Hertz will be entitled at its option to redeem all or a portion of the Notes at the applicable redemption price set forth below (expressed as a percentage of principal amount), if redeemed during the 12‑month period commencing on January 15 of the years set forth below, plus accrued and unpaid interest, if any, to but not including the relevant redemption date.
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| Redemption Period | Price |
| 2023 | 103.000% |
| 2024 | 101.500% |
| 2025 and thereafter | 100.000% |
On or prior to January 15, 2023, Hertz will be entitled at its option at any time and from time to time to redeem up to 40% of the original aggregate principal amount of the Notes (including the principal amount of any additional Notes), with the proceeds from certain equity offerings at a redemption price equal to 106.000%, plus accrued and unpaid interest, if any, to but not including the redemption date.
In connection with any tender offer pursuant to which not less than 90% in aggregate principal amount of the outstanding Notes are validly tendered and not withdrawn, all of the holders of the Notes will be deemed to have consented to such tender offer and, accordingly, Hertz may, subject to additional conditions discussed herein, redeem all of the remaining Notes outstanding following such tender offer at a price in cash equal to the price offered to each holder in such tender offer, plus, to the extent not included in the tender offer payment, accrued and unpaid interest, if any, to but not including the date of redemption.
Change of Control
Upon the occurrence of a Change of Control Triggering Event (as defined in the Indenture), each holder of Notes will have the right to require Hertz to repurchase all or any part of the Notes at a purchase price in cash equal to 101% of the principal amount thereof, plus accrued and unpaid interest, if any, to the date of purchase.
Covenants
The Indenture contains covenants that, among other things, will limit the ability of Hertz and its restricted subsidiaries, described in the Indenture, to make certain restricted payments; create encumbrances or restrictions on the ability of Hertz’s subsidiaries to pay dividends or make other payments to it; lease, transfer or sell certain assets; create or incur liens; and merge or consolidate with other entities. These covenants are subject to important exceptions and qualifications, which are described in the Indenture.
Events of Default
The Indenture also provides for events of default, which, if any of them occurs, would permit or require the principal, premium, if any, interest and other monetary obligations on all the then outstanding Notes issued under the Indenture to be due and payable immediately.
ITEM 2.03 CREATION OF A DIRECT FINANCIAL OBLIGATION OR AN OBLIGATION UNDER AN OFF BALANCE SHEET ARRANGEMENT OF A REGISTRANT
The information required by Item 2.03 relating to the Notes and the Indenture is contained in Item 1.01 of this Current Report and incorporated herein by reference.
ITEM 8.01 OTHER EVENTS
Senior Secured Second Priority Notes
On November 25, 2019, Hertz completed the redemption of $900 million aggregate principal amount of its outstanding $1.25 billion of 7.625% Senior Secured Second Priority Notes due 2022 using proceeds received from the issuance of the Notes, together with available cash, to fund the redemption.
HVF II U.S. Vehicle Medium Term Notes
On November 26, 2019, Hertz Vehicle Financing II LP (“HVF II”), an indirect, wholly owned special purpose subsidiary of Hertz, issued the Series 2019-3 Rental Car Asset Backed Notes, Class A, Class B, Class C and Class D in an aggregate principal amount of approximately $800 million. An affiliate of HVF II purchased the Class D Notes of such series at the time of issuance and then sold such Class D notes to third parties. There is subordination within the HVF II Series 2019-3 Notes based on class.
ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS.
(d) Exhibits.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, each registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
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| | HERTZ GLOBAL HOLDINGS, INC. THE HERTZ CORPORATION |
| | (each, a Registrant) |
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| | By: | /s/ JAMERE JACKSON |
| | Name: | Jamere Jackson |
| | Title: | Executive Vice President and Chief Financial Officer |
Date: November 26, 2019
