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United States securities and exchange commission logo
June 23, 2020
Kathryn V. Marinello
Chief Executive Officer
Hertz Global Holdings, Inc.
8501 Williams Road
Estero , Florida 33928
Re: Hertz Global
Holdings, Inc.
Supplement to
Prospectus dated June 12, 2019
Filed June 15, 2020
File No. 333-231878
Dear Ms. Marinello:
We have reviewed your prospectus supplement and have the
following comments.
Although you have terminated your offering and have represented that you
will not use the
registration statement for any future offerings without first notifying
us, given that shares were
sold with this prospectus, we believe that investors may benefit from
revised disclosure in
response to our comments. Please update your disclosure, as appropriate,
in response to these
comments in your ongoing Exchange Act filings and Securities Act
offering materials.
Supplement to Prospectus dated June 12, 2019, filed June 15, 2020
General, page 1
1. In a prominent place in
your prospectus supplement, describe the goals of the Chapter 11
bankruptcy process,
specifically the impact of a Chapter 11 reorganization plan on equity
holders compared to
creditors. Include a discussion of the concepts of prioritizing claims
and maintaining the
operating assets of the company. Please also disclose
that obtaining
financing through an equity offering, rather than a debtor in possession
loan, is a novel way to
obtain financing in a Chapter 11 bankruptcy. Discuss the
differences between
financing a Chapter 11 bankruptcy with equity rather than debt,
including, if true,
that debtor in possession loan creditors would typically receive
preference in a
bankruptcy, while your equity holders would not. Provide a balanced
discussion of the
positive and negative implications of arranging financing with an equity
offering.
Kathryn V. Marinello
FirstName LastNameKathryn V. Marinello
Hertz Global Holdings, Inc.
Comapany NameHertz Global Holdings, Inc.
June 23, 2020
Page 2
June 23, 2020 Page 2
FirstName LastName
Prospectus Supplement Cover Page, page 1
2. We note the disclosure on your cover page that "Jefferies may be
deemed to be an
'underwriter' within the meaning of the Securities Act." However, you
disclose on page S-
14 that "[i]n connection with the sale of [y]our shares of common
stock on [y]our behalf,
Jefferies will be deemed to be an 'underwriter' within the meaning of
the Securities Act."
Please state on your cover page that Jefferies will be deemed to be an
"underwriter" within
the meaning of the Securities Act, and make conforming changes, where
appropriate, to
your filing.
Prospectus Supplement Summary
Recent Developments, page S-2
3. Please clarify the consequences to you if you do not receive final
approval of the "first day
motions" at the hearing on June 25, 2020. Please also disclose whether
the "customary
relief" currently in place will be changed in any material way as a
result of the June 25
hearing. If so, please describe these changes.
4. We note your disclosure that "[t]he filing of the Petitions
constituted an event of default
that accelerated the Debtors' obligations under certain debt
instruments and triggered
defaults, termination events and amortization events under certain
obligations of the Non-
Debtor Financing Subsidiaries and other indebtedness, and such events
caused defaults,
amortization events and accelerations, as applicable, under certain
other debt instruments,
including under certain debt instruments of certain of the Debtors'
International
Subsidiaries." Please quantify the extent of your current obligations
and liabilities under
these debt instruments, and provide any other additional context that
offers investors the
reasons behind your determination to file the Petitions.
5. We note your disclosure that the NYSE has determined to commence
proceedings to delist
your common stock, and that you have appealed the determination and
requested a
hearing before the NYSE. Please disclose, if known, when this hearing
will occur, and
when you expect a final determination regarding your appeal. Also,
disclose when you
expect your common stock to be delisted if the outcome of the appeal
is adverse to you.
Finally, tell us whether the shares you will issue in this offering
will be listed pending
your appeal. Make corresponding changes to your risk factor on page
S-4.
Risk Factors, page S-4
6. Please provide separate and detailed risk factor disclosure related to
the impact of
COVID-19 on your financial condition and operations. In this regard,
it appears that the
ability of common stock holders to receive any recovery in the Chapter
11 bankruptcy
process, or any return on investment in your common shares, will
depend upon a
significant and rapid increase in business, which has been
significantly impeded because
of COVID-19.
Kathryn V. Marinello
FirstName LastNameKathryn V. Marinello
Hertz Global Holdings, Inc.
Comapany NameHertz Global Holdings, Inc.
June 23, 2020
Page 3
June 23, 2020 Page 3
FirstName LastName
"We are in the process of Chapter 11 reorganization cases . . .", page S-4
7. We note your disclosure that "[a]lthough we cannot predict how our
common stock will
be treated under a plan, we expect that common stock holders would not
receive a
recovery through any plan unless the holders of more senior claims and
interests, such as
secured and unsecured indebtedness (which is currently trading at a
significant discount),
are paid in full. . . ." Revise to clarify the likelihood that the
holders of more senior claims
and interests would be paid in full, and clarify what is meant by
"recovery," including
whether you reasonably expect your common stock to survive your
bankruptcy
proceedings, or whether shares will be cancelled and current and
future equity holders will
"recover" only from a future liquidation of assets, if at all.
"We may be subject to claims that will not be discharged in the Chapter 11
cases . . .", page S-6
8. Please briefly describe any known, specific claims to which you or
your subsidiaries are a
party that will not be discharged in the Chapter 11 cases. Disclose
the extent of your
liability under any such claims, if estimable or known.
"Operating in bankruptcy for a long period of time may harm our business.",
page S-7
9. Please provide an estimate of the duration of your bankruptcy case,
including when you
expect to confirm a reorganization plan.
"There is no certainty as to amount of vehicle lease payments . . .", page S-7
10. You disclose that "[you] failed to make the April 2020 rent payment
under the Operating
Lease, and the lessor has a prepetition claim for the unpaid April
rent." Please quantify
your potential liability for this prepetition claim. Please also
disclose whether and to what
extent you expect to experience any material adverse effect on your
financial condition by
assuming full lease payments in July 2020. Finally, amend your
disclosure to explain any
material conditions or other terms to the relief provided by the
Bankruptcy Court allowing
Hertz to continue to operate under the fleet leases, and any risks
related to these
conditions or terms.
Use of Proceeds, page S-11
11. We note your disclosure here and in your "Prospectus Supplement
Summary" section that
you intend to use proceeds from this offering for "general corporate
purposes." Please clearly disclose that the use of proceeds for
general corporate purposes
was under permission granted by the Bankruptcy Court and will not be
disbursed beyond
Hertz Global absent further authorization of the court. Describe any
limitations imposed
upon you in terms of how you may use these proceeds and the extent to
which the
Bankruptcy Court will influence your use of proceeds throughout your
Chapter 11
proceeding. In this regard, we note your disclosure on page S-6 that
your use of proceeds
from this offering is "[s]ubject to the requirements of the Bankruptcy
Code and any orders
that the Bankruptcy Court may enter."
Kathryn V. Marinello
Hertz Global Holdings, Inc.
June 23, 2020
Page 4
We remind you that the company and its management are responsible for
the accuracy
and adequacy of their disclosures, notwithstanding any review, comments, action
or absence of
action by the staff.
Please contact Katherine Bagley at (202) 551-2545 or Mara Ransom at (202)
551-
3264 with any questions.
FirstName LastNameKathryn V. Marinello Sincerely,
Comapany NameHertz Global Holdings, Inc.
Division of
Corporation Finance
June 23, 2020 Page 4 Office of Trade &
Services
FirstName LastName