47129--4/5/2006--HERTZ

related topics

{debt, indebtedness, cash}

{cost, regulation, environmental}

{operation, natural, condition}

{gas, price, oil}

{tax, income, asset}

{system, service, information}

{loss, insurance, financial}

{product, liability, claim}

{interest, director, officer}

{cost, contract, operation}

{condition, economic, financial}

{acquisition, growth, future}

{stock, price, operating}

{provision, law, control}

Risks Related to Our Capital Structure We have substantial debt which could adversely affect our financial health and our ability to obtain financing in the future, react to changes in our business and make payments on our debt. Despite our current indebtedness levels, we, Hertz Holdings and our subsidiaries may be able to incur substantially more debt. This could further exacerbate the risks associated with our substantial indebtedness. The agreements and instruments governing our debt contain restrictions and limitations that could significantly impact our ability to operate our business. Our ability to generate the significant amount of cash needed to service our debt and our ability to refinance all or a portion of our indebtedness or obtain additional financing depends on many factors beyond our control. We may be unable to raise funds necessary to finance the change of control repurchase offers required by the indentures governing the Notes. An increase in interest rates would increase the cost of servicing our debt and could reduce our profitability. The Sponsors control us and may have conflicts of interest with us in the future. Risks Related to Our Business An economic downturn could result in a decline in business and leisure travel and non-residential capital investment, which could harm our business. We face intense competition that may lead to downward pricing, or an inability to increase prices, which could have a material adverse impact on our results of operations. Our car rental business is dependent on the air travel industry, and disruptions in air travel patterns could harm our business. Our business is highly seasonal, and a disruption in rental activity during our peak season could materially adversely affect our results of operations. We may not be successful in our business strategy to expand into the off-airport rental market, including marketing to replacement renters and insurance companies that reimburse or pay for such rentals. We face risks of increased costs of cars and equipment and of decreased profitability, including as a result of limited supplies of competitively priced cars or equipment. We face risks related to decreased acquisition or disposition of cars through repurchase and guaranteed depreciation programs. We could be harmed by a decline in the results of operations or financial conditions of the manufacturers of our cars, particularly if they are unable to repurchase program cars from us. Our reliance on asset-backed financing to purchase cars subjects us to a number of risks, many of which are beyond our control. Fluctuations in fuel costs or reduced supplies could harm our business. Manufacturer safety recalls could create risks to our business. We face risks arising from our heavy reliance on communications networks and centralized information systems. The concentration of our reservations, accounting and information technology functions at a limited number of facilities in Oklahoma, Alabama and Ireland creates risks for us. Claims that the software products and information systems that we rely on are infringing on the intellectual property rights of others could increase our expenses or inhibit us from offering certain services, which could adversely affect our results of operations. If we acquire any businesses in the future, they could prove difficult to integrate, disrupt our business, or have an adverse effect on our results of operations. We face risks related to changes in our ownership. We face risks related to liabilities and insurance. We could face significant withdrawal liability if we withdraw from participation in one or more multiemployer pension plans in which we participate. We have received an informal request from the SEC to provide information about car rental services that we provide to our auditor in the ordinary course of business. Environmental laws and regulations and the costs of complying with them, or any liability or obligation imposed under them, could adversely affect our financial position, results of operations or cash flow. Changes in the U.S. and foreign legal and regulatory environment that impact our operations, including laws and regulations relating to the insurance products we sell, customer privacy, data security, insurance rates and expenses we pass through to customers by means of separate charges, could disrupt our business, increase our expenses or otherwise could have a material adverse effect on our results of operations.

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47129--4/5/2006--HERTZ_CORP