Pursuant to the Plan, Hertz is issuing one preferred share purchase right for each current share of common stock outstanding at the close of business on January 9, 2014. Initially, these rights will not be exercisable and will trade with the shares of Hertz's common stock.
Under the Rights Plan, the rights will generally become exercisable only if a person or group acquires beneficial ownership of 10 percent or more of the Company's common stock (15 percent or more in the case of passive institutional investors filing on Schedule 13G as described in the Rights Plan). In that situation, each holder of a right (other than such person or members of such group, whose rights will become void and will not be exercisable) will be entitled to purchase, at the then-current exercise price, additional shares of common stock having a value of twice the exercise price of the right.
In addition, if after a person or group acquires 10 percent or more of the Company's common stock (15 percent or more in the case of passive institutional investors filing on Schedule 13G as described in the Rights Plan), the Company merges into another company, an acquiring entity merges into the Company or the Company sells or transfers more than 50% of its consolidated assets or earning power, then each right will entitle its holder to purchase, for the exercise price, a number of shares of common stock of the person engaging in the transaction having a then-current market value of twice the exercise price.
In all cases, rights held by any person or group whose actions trigger the Rights Plan would become void and not be exercisable.The Company's board of directors may redeem the rights for $0.001 per right at any time before an event that causes the rights to become exercisable. Details about the Rights Plan will be contained in a Form 8-K to be filed by Hertz with the U.S. Securities and Exchange Commission.