Hertz Global Holdings, Inc. announced today that a newly-formed, wholly-owned subsidiary of the Company, HDTFS, Inc. (the "Escrow Issuer"), has entered into an agreement to sell $700,000,000 aggregate principal amount of 5.875% Senior Notes due 2020 (the "2020 Notes") and $500,000,000 aggregate principal amount of 6.250% Senior Notes due 2022 (the "2022 Notes" and, together with the 2020 Notes, the "Notes") in a private offering (the "Offering") exempt from the registration requirements of the Securities Act of 1933, as amended (the "Securities Act"). The closing of the Offering is expected to occur on or about October 16, 2012, subject to customary closing conditions. Each series of Notes will pay interest semi-annually in arrears.
Concurrently with the closing of the Offering, the gross proceeds of the Offering (plus an amount related to interest that would accrue on the Notes through a specified date) will be deposited into an escrow account until the date on which certain escrow conditions are satisfied, including the substantially concurrent (i) consummation of the previously announced cash tender offer (the "Tender Offer") to purchase all outstanding shares of common stock of Dollar Thrifty Automotive Group, Inc. (NYSE: DTG) ("Dollar Thrifty") and (ii) assumption of the Escrow Issuer's obligations under each series of Notes by The Hertz Corporation ("Hertz"), a wholly-owned subsidiary of the Company. From and after the release of the escrowed funds to Hertz, each series of Notes will be guaranteed on a senior unsecured basis by the domestic subsidiaries of Hertz that guarantee its senior credit facilities from time to time.
Following the release of proceeds of the Offering from escrow to Hertz upon satisfaction of the escrow conditions, Hertz intends to use the entire net proceeds from the Offering (i) to finance or refinance a portion of the consideration payable in the Tender Offer and subsequent merger (which is subject to the approval of Dollar Thrifty's shareholders if required by law) of a wholly-owned subsidiary of Hertz with and into Dollar Thrifty (the "Acquisition"), (ii) to refinance certain existing indebtedness of Dollar Thrifty (including by providing funds to Dollar Thrifty for such purpose) following the consummation of the Tender Offer, (iii) to pay fees and expenses incurred in connection with the foregoing transactions and/or (iv) to finance the working capital and business requirements, and for general corporate purposes, of Hertz and its subsidiaries.
If the escrow conditions are not satisfied on or prior to February 26, 2013, the Escrow Issuer delivers a notification that such conditions will not be satisfied or the merger agreement governing the Acquisition is terminated, the Escrow Issuer will be required to redeem each series of Notes in full at a price equal to 100% of the applicable initial issue price of such Notes, plus accrued and unpaid interest from the date of issuance of such Notes up to, but excluding, the payment date of such mandatory redemption.
This press release does not constitute an offer to sell or the solicitation of an offer to buy any of the Notes (and the guarantees of the Notes, which will apply from and after the escrow release) or any other securities, nor will there be any sale of the Notes or any other securities in any state in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state. The Notes (and the guarantees that will apply upon escrow release) will be issued in reliance on the exemption from the registration requirements provided by Rule 144A under the Securities Act and, outside of the United States, only to non-U.S. investors pursuant to Regulation S under the Securities Act. None of the Notes and such guarantees have been registered under the Securities Act or any state securities laws, and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of the Securities Act and applicable state securities laws.
