v3.26.1
Debt
 6 Months Ended
Jun. 30, 2026
Debt Disclosure [Abstract]  
Debt Debt
The Company's debt, including its credit facilities, consists of the following ($ in millions) as of June 30, 2026 and December 31, 2025:
Facility
Weighted-Average Interest Rate
as of
June 30, 2026
Fixed or
Floating
Interest
Rate		MaturityJune 30,
2026		December 31,
2025
Non-Vehicle Debt
First Lien RCF7.23%Floating3/2028816 $395 
Term B Loan7.43%Floating6/20281,235 1,242 
Incremental Term B Loan7.41%Floating6/2028488 490 
Term C Loan7.43%Floating6/2028245 245 
First Lien Senior Notes12.63%Fixed7/20291,250 1,250 
Exchangeable First Lien Notes Due 2030(1)(2)
6.75%Fixed7/2030350 — 
Exchangeable Notes Due 2029(3)
8.00%Fixed7/2029282 271 
Exchangeable Notes Due 2030(4)
5.50%Fixed10/2030425 425 
Senior Notes Due 2026(5)
4.63%Fixed12/2026200 200 
Senior Notes Due 20295.00%Fixed12/20291,000 1,000 
Other Non-Vehicle Debt(6)(7)
7.47%FixedVarious12 6 
Fair Value of the Exchange Features 2029(8)
N/AN/AN/A26 78 
Facility
Weighted-Average Interest Rate
as of
June 30, 2026
Fixed or
Floating
Interest
Rate		MaturityJune 30,
2026		December 31,
2025
Fair Value of the Exchange Feature 2030(9)
N/AN/AN/A21 54 
Fair Value of the First Lien Exchangeable Feature 2030(10)
N/AN/AN/A110 — 
Unamortized Debt Issuance Costs(11) and Net (Discount) Premium(12)(13)
(338)(231)
Total Non-Vehicle Debt - Hertz6,122 5,425 
Unamortized Debt Issuance Cost - Share Lending Agreement(14)
(85)— 
Total Non-Vehicle Debt - Hertz Global6,037 5,425 
Vehicle Debt
HVF III U.S. ABS Program
HVF III U.S. Vehicle Variable Funding Notes
HVF III Series 2021-A Class A(15)
5.28%Floating5/20281,347 1,237 
HVF III Series 2021-A Class B(15)
9.28%Fixed8/2027300 300 
1,647 1,537 
HVF III U.S. Vehicle Medium Term Notes
HVF III Series 2021-2(15)
2.12%Fixed12/20262,000 2,000 
HVF III Series 2022-2(15)
2.78%Fixed6/2027750 750 
HVF III Series 2022-5(15)
4.67%Fixed9/2027382 364 
HVF III Series 2023-1(15)
N/AN/AN/A— 500 
HVF III Series 2023-2(15)
6.52%Fixed9/2028314 300 
HVF III Series 2023-3(15)
6.46%Fixed2/2027500 500 
HVF III Series 2023-4(15)
6.88%Fixed3/2029524 500 
HVF III Series 2024-1(15)
6.21%Fixed1/2028393 375 
HVF III Series 2024-2(15)
6.31%Fixed1/2030393 375 
HVF III Series 2025-1(15)
5.62%Fixed9/2028524 500 
HVF III Series 2025-2(15)
5.92%Fixed9/2030524 500 
HVF III Series 2025-3(15)
5.81%Fixed12/2028393 375 
HVF III Series 2025-4(15)
6.21%Fixed12/2030325 310 
HVF III Series 2025-5(15)
5.32%Fixed5/2029472 450 
HVF III Series 2025-6(15)
5.65%Fixed5/2031577 550 
HVF III Series 2026-1(15)
5.74%Fixed11/2029500 — 
HVF III Series 2026-2(15)
6.12%Fixed11/2031500 — 
9,071 8,349 
Vehicle Debt - Other
European ABS(15)
4.67%Floating4/20281,081 965 
Hertz Canadian Securitization(15)
4.07%Floating4/2028419 307 
Australian Securitization(15)
5.96%Floating6/2027226 228 
New Zealand RCF5.50%Floating8/202763 64 
U.K. ABS5.56%Floating3/2028119 109 
Other Vehicle Debt(16)
6.18%Floating7/2026 - 7/2028151 120 
2,059 1,793 
Facility
Weighted-Average Interest Rate
as of
June 30, 2026
Fixed or
Floating
Interest
Rate		MaturityJune 30,
2026		December 31,
2025
Unamortized Debt Issuance Costs and Net (Discount) Premium (67)(50)
Total Vehicle Debt - Hertz and Hertz Global12,710 11,629 
Total Debt - Hertz$18,832 $17,054 
Total Debt - Hertz Global$18,747 $17,054 
(1)    The effective interest rate of the Exchangeable First Lien Notes Due 2030, as defined and disclosed below, inclusive of the bifurcated First Lien Exchangeable Feature 2030, as defined and disclosed below, and PIK interest, was approximately 17.7% as of June 30, 2026.
(2)    In July 2026, Hertz issued an additional $30 million aggregate principal amount pursuant to the Greenshoe Option, as further defined and disclosed below.
(3)    The effective interest rate of the Exchangeable Notes Due 2029, inclusive of the bifurcated Exchange Features 2029, as defined and disclosed in Note 11, "Fair Value Measurements," and PIK interest, was approximately 16.9% and 16.4% as of June 30, 2026 and December 31, 2025, respectively.
(4)    The effective interest rate of the Exchangeable Notes Due 2030, inclusive of the bifurcated Exchange Feature 2030, as defined and disclosed in Note 11, "Fair Value Measurements," was approximately 12.0% as of June 30, 2026 and December 31, 2025.
(5)    In December 2025, Hertz redeemed $300 million aggregate amount of the principal outstanding.
(6)    Other non-vehicle debt is comprised of financial liabilities recognized from the sales of certain non-vehicle capital assets in the second quarters of 2026 and 2025, as disclosed in Note 3, "Divestitures."
(7)    Reflects the effective interest rate of other non-vehicle debt.
(8)    Reflects the fair value of the Exchange Features 2029, as defined and disclosed in Note 11, "Fair Value Measurements."
(9)    Reflects the fair value of the Exchange Feature 2030, as defined and disclosed in Note 11, "Fair Value Measurements."
(10)    Reflects the fair value of the First Lien Exchangeable Feature 2030, as disclosed in Note 11, "Fair Value Measurements."
(11)    Includes unamortized debt issuance costs of $7 million and $8 million associated with the Exchangeable Notes Due 2029 as of June 30, 2026 and December 31, 2025, respectively. Also, includes $18 million and $20 million of unamortized debt issuance costs associated with the Exchangeable Notes Due 2030 as of June 30, 2026 and December 31, 2025, respectively. Additionally, includes unamortized debt issuance costs, exclusive of the Share Lending Agreement, of $12 million associated with the Exchangeable First Lien Notes Due 2030 as of June 30, 2026.
(12)    Includes $83 million and $79 million as of June 30, 2026 and December 31, 2025, respectively, of unamortized debt discounts associated with the initial recognition of the Exchange Features 2029, as defined and disclosed in Note 11, "Fair Value Measurements." Also, includes $103 million as of June 30, 2026 and December 31, 2025, of unamortized debt discount associated with the initial recognition of the Exchange Feature 2030, as defined and disclosed in Note 11, "Fair Value Measurements." Additionally, includes $115 million as of June 30, 2026, of unamortized debt discount associated with the initial recognition of the First Lien Exchangeable Feature 2030, as disclosed in Note 11, "Fair Value Measurements."
(13)    Includes $3 million and $4 million of unamortized debt discount associated with the Exchangeable Notes Due 2029 as of June 30, 2026 and December 31, 2025, respectively.
(14)    Reflects the fair value of the Share Lending Agreement entered into concurrently with the Exchangeable First Lien Notes Due 2030.
(15)    Maturity reference is to the earlier "expected final maturity date" as opposed to the subsequent "legal final maturity date." The expected final maturity date is the date by which Hertz and investors in the relevant indebtedness originally expect the outstanding principal of the relevant indebtedness to be repaid in full. The legal final maturity date is the date on which the outstanding principal of the relevant indebtedness is legally due and payable in full.
(16)    Other vehicle debt is primarily comprised of $102 million and $105 million in finance lease obligations as of June 30, 2026 and December 31, 2025, respectively.

Non-Vehicle Debt
Exchangeable Notes Due 2029

In June 2024, Hertz issued $250 million in aggregate principal amount of 8.000% Exchangeable Senior Second-Lien Secured PIK Notes due 2029 (the "Exchangeable Notes Due 2029"). The Exchangeable Notes Due 2029 bear PIK interest payable semi-annually in arrears on January 15 and July 15 (the "Semi-annual PIK Event"), which began in January 2025, where PIK interest increases the principal amount of the Exchangeable Notes Due 2029 upon each Semi-annual PIK Event. In connection with the Semi-annual PIK Event in the first quarter of 2026, the Company increased the principal amount of the Exchangeable Notes Due 2029 by $11 million.
Additionally, for each Semi-annual PIK Event, the Company bifurcates an associated embedded derivative (the "Exchange Feature 2029 PIK") from the Exchangeable Notes Due 2029 for accounting purposes utilizing applicable guidance. As a result of the Semi-annual PIK Event in the first quarter of 2026, the Company recognized an additional debt discount of $4 million within Non-vehicle debt in the accompanying unaudited condensed consolidated balance sheet as of June 30, 2026, representing its initial fair value. Refer to Note 11, "Fair Value Measurements," for further details.

The net carrying amount of the Exchangeable Notes Due 2029 consists of the following as of:
(In millions)June 30, 2026December 31, 2025
Principal$250 $250 
Non-cash PIK interest32 21 
Unamortized debt discounts and issuance costs(1)
(10)(12)
Unamortized discounts associated with the Exchange Features 2029(2)
(64)(67)
Fair value of the Exchange Features 2029(3)
26 78 
Net carrying amount$234 $270 
(1)    Debt issuance costs are amortized to non-vehicle interest expense over the term of the Exchangeable Notes Due 2029 using the effective interest method.
(2)    Reflects the unamortized discount associated with the Exchange Features 2029, as defined and disclosed in Note 11, "Fair Value Measurements," net of accretive interest, which is amortized to non-vehicle interest expense over the term of the Exchangeable Notes Due 2029 using the effective interest method.
(3)    As defined and further disclosed in Note 11, "Fair Value Measurements."

Interest expense recognized for the Exchangeable Notes Due 2029 consists of the following:
Three Months Ended
June 30,		Six Months Ended
June 30,
(In millions)2026202520262025
Non-cash PIK interest$6 $5 $11 $10 
Amortization of debt discounts and debt issuance costs1 1 2 1 
Accretive interest4 2 7 4 
(Gain) loss on fair value of the Exchange Features 2029(1)
(37)105 (56)111 
Total$(26)$113 $(36)$126 
(1)    As defined and further disclosed in Note 11, "Fair Value Measurements."

Exchangeable Notes Due 2030

In September 2025, Hertz issued $425 million in aggregate principal amount of 5.500% Exchangeable Unsecured Senior Notes due 2030 (the "Exchangeable Notes Due 2030"). The Exchangeable Notes Due 2030 bear interest payable semi-annually in arrears on April 1 and October 1 of each year, beginning on April 1, 2026.
The net carrying amount of the Exchangeable Notes Due 2030 consists of the following as of:
(In millions)June 30, 2026December 31, 2025
Principal$425 $425 
Unamortized debt issuance costs(1)
(18)(20)
Unamortized discounts associated with the Exchange Feature 2030(2)
(91)(99)
Fair value of the Exchange Feature 2030(3)
21 54 
Net carrying amount$337 $360 
(1)    Debt issuance costs are amortized to non-vehicle interest expense over the term of the Exchangeable Notes Due 2030 using the effective interest method.
(2)    Reflects the unamortized discount associated with the Exchange Feature 2030, as defined and disclosed in Note 11, "Fair Value Measurements," net of accretive interest, which is amortized to non-vehicle interest expense over the term of the Exchangeable Notes Due 2030 using the effective interest method.
(3)    As defined and further disclosed in Note 11, "Fair Value Measurements."

Interest expense recognized for the Exchangeable Notes Due 2030 consists of the following:
Three Months Ended
June 30,		Six Months Ended
June 30,
(In millions)2026202520262025
Contractual interest expense$5 $— $12 $— 
Amortization of debt issuance costs1 — 2 — 
Accretive interest4 — 8 — 
(Gain) loss on fair value of the Exchange Feature 2030(1)
(19)— (33)— 
Total$(9)$— $(11)$— 
(1)    As defined and further disclosed in Note 11, "Fair Value Measurements."

Exchangeable First Lien Notes Due 2030

In June 2026, Hertz issued $350 million in aggregate principal amount of 6.75% Exchangeable Senior First-Lien Secured PIK Notes due 2030 (the "Exchangeable First Lien Notes Due 2030"). Hertz also granted the initial purchasers an option to purchase (the "Greenshoe Option"), for settlement within a limited period of time from the initial issuance of the Exchangeable First Lien Notes Due 2030, up to an additional $50 million aggregate principal amount of Exchangeable First Lien Notes Due 2030. In July 2026, Hertz issued an additional $30 million aggregate principal amount of Exchangeable First Lien Notes Due 2030 pursuant to the Greenshoe Option. The remainder of the Greenshoe Option has expired.

The Exchangeable First Lien Notes Due 2030 bear interest payable semi-annually in arrears on January 1 and July 1 of each year, beginning in January 2027. Each payment of interest will consist of 3.375% per annum of such interest to be paid in cash and 3.375% per annum of such interest to be paid in the form of PIK interest. The Exchangeable First Lien Notes Due 2030 will mature on July 1, 2030, unless earlier repurchased, redeemed or exchanged (the "First Lien Exchangeable Feature 2030") in accordance with their terms prior to maturity.

The Exchangeable First Lien Notes Due 2030 will be exchangeable at any time until the close of business on the second scheduled trading day immediately preceding the maturity date. The Exchangeable First Lien Notes Due 2030 will be exchangeable by holders into shares of Hertz Global common stock, cash or a combination of Hertz Global common stock and cash, at Hertz's election. The aggregate number of shares of Hertz Global common stock that may be issued upon exchange of the Exchangeable First Lien Notes Due 2030 may not exceed 63,457,320 shares, unless and until the shareholders of Hertz Global approve the issuance of the Exchangeable First Lien Notes Due 2030. The exchange rate will initially be 279.5248 shares per $1,000 principal amount of Exchangeable First Lien Notes Due 2030, corresponding to an initial exchange price of approximately $3.58 per share of Hertz
Global common stock. The exchange rate and exchange price will be subject to adjustment upon the occurrence of certain events.

Holders of the Exchangeable First Lien Notes Due 2030 will have the right to require Hertz to repurchase all or a portion of the Exchangeable First Lien Notes Due 2030 at 100% of their capitalized principal amount of the Exchangeable First Lien Notes Due 2030 plus accrued and unpaid cash interest up to, but excluding, the date of such repurchase, upon the occurrence of certain corporate events constituting a “fundamental change” as defined in the indenture governing the Exchangeable First Lien Notes Due 2030. Hertz may not redeem the Exchangeable First Lien Notes Due 2030 prior to January 6, 2029. On or after January 6, 2029 and on or prior to the 31st scheduled trading day immediately preceding the maturity date, if the last reported sale price per share of Hertz Global common stock has been at least 130% of the exchange price for the Exchangeable First Lien Notes Due 2030 for certain specified periods, and certain other conditions are satisfied, Hertz may redeem all or any portion (subject to certain limitations) of the Exchangeable First Lien Notes Due 2030. The redemption will be at a cash redemption price equal to the capitalized principal amount of the Exchangeable First Lien Notes Due 2030 to be redeemed plus accrued and unpaid cash interest to, but excluding, the date of such redemption.

Upon issuance, the Company bifurcated the First Lien Exchangeable Feature 2030 from the Exchangeable First Lien Notes Due 2030 for accounting purposes utilizing applicable guidance. As a result, the Company recognized a debt discount of $115 million within Non-vehicle debt in the accompanying unaudited condensed consolidated balance sheet as of June 30, 2026, representing the initial fair value of the First Lien Exchangeable Feature 2030. As of June 30, 2026, the fair value of the First Lien Exchangeable Feature 2030 was $110 million. Refer to Note 11, "Fair Value Measurements," for further details.

Concurrently with the issuance of the Exchangeable First Lien Notes Due 2030, Hertz Global agreed to lend a financial institution (the "Share Borrower"), acting as an underwriter of a public offering, a total of 37,037,037 shares of Hertz Global common stock (the "Borrowed Shares") pursuant to a share lending agreement (the "Share Lending Agreement") to help facilitate the successful completion of the Exchangeable First Lien Notes Due 2030 offering. Hertz Global received a one-time nominal lending fee for the Borrowed Shares equal to the par value of Hertz Global's common stock. The Share Borrower was obligated to furnish collateral equal in value to the market value of the Borrowed Shares as of the closing date of the Share Lending Agreement. The share loan under the Share Lending Agreement will terminate, and the Borrowed Shares must be returned to Hertz Global within five business days of such termination (subject to the Share Borrower's right to extend the settlement due date of the Borrowed Shares in certain circumstances), under the following circumstances: (i) the Share Borrower may terminate all or any portion of the loan at any time and (ii) on the earliest to occur of (a) October 1, 2030; (b) the date that is three months after the first date following the closing date of the Exchangeable First Lien Notes Due 2030 offering when none of the Exchangeable First Lien Notes Due 2030 remains outstanding; and (c) the date, if any, on which the Share Lending Agreement is terminated by the parties upon mutual agreement or by one party upon a default with respect to the other party. Cash repayment is not required by the Share Lending Agreement; however, it may be elected in certain instances involving default, legal prohibitions or a court order.

The Share Lending Agreement qualified for equity classification, and, as such, Hertz Global recognized a debt issuance cost of $85 million, representing the initial fair value of the Share Lending Agreement, as determined by the market value of the Borrowed Shares as of the closing date of the Share Lending Agreement. As of June 30, 2026, the fair value of the Borrowed Shares was $84 million, as determined by the market value of the Borrowed Shares at June 30, 2026. The shares borrowed under the Share Lending Agreement are excluded from the calculation of basic and diluted earnings (loss) per share. Refer to Note 8, "Public Warrants, Equity and Earnings (Loss) Per Common Share – Hertz Global," for further details.
The net carrying amount of the Exchangeable First Lien Notes Due 2030 consists of the following as of:
(In millions)June 30, 2026
Principal$350 
Unamortized debt discounts and issuance costs(1)
(12)
Unamortized discounts associated with the First Lien Exchangeable Feature 20302)
(115)
Fair value of the First Lien Exchangeable Feature 2030(3)
110 
Net carrying amount - Hertz333 
Unamortized debt issuance cost - Share Lending Agreement(4)
(85)
Net carrying amount - Hertz Global$248 
(1)    Debt issuance costs, exclusive of the Share Lending Agreement, are amortized to non-vehicle interest expense over the term of the Exchangeable First Lien Notes Due 2030 using the effective interest method.
(2)    Reflects the unamortized discount associated with the First Lien Exchangeable Feature 2030, net of accretive interest, which is amortized to non-vehicle interest expense over the term of the Exchangeable First Lien Notes Due 2030 using the effective interest method.
(3)    As further disclosed in Note 11, "Fair Value Measurements."
(4)    The fair value of the Share Lending Agreement is recognized by Hertz Global as a debt issuance cost of the Exchangeable First Lien Notes Due 2030 and is amortized to non-vehicle interest expense over the term of the Exchangeable First Lien Notes Due 2030 using the effective interest method.

During the three and six months ended June 30, 2026, the Company recognized a gain of $5 million from the change in fair value of the First Lien Exchangeable Feature 2030. Refer to Note 11, "Fair Value Measurements," for further details.

Vehicle Debt

HVF III U.S. Vehicle Variable Funding Notes

In April 2026, Hertz Vehicle Financing III LLC ("HVF III"), a wholly owned, special-purpose and bankruptcy-remote subsidiary of Hertz, amended the HVF III Series 2021-A Notes to extend the maturity date of the Class A Notes to May 2028. The maximum principal of the Class A Notes is $3.2 billion until May 2027 and thereafter is $3.0 billion until May 2028, after giving effect to the terms of the amendment.
HVF III U.S. Vehicle Medium Term Notes ("MTN")

In April 2026, HVF III issued Class E notes for certain of the outstanding series of notes under the HVF III MTN program (the "Class E Notes") in an aggregate principal amount of $221 million as detailed in the table below.
($ in millions)PrincipalInterest RateMaturity
Class E Notes
HVF III Series 2022-5$17 10.67 %9/2027
HVF III Series 2023-214 10.99 %9/2028
HVF III Series 2023-424 11.48 %3/2029
HVF III Series 2024-118 10.95 %1/2028
HVF III Series 2024-218 11.99 %1/2030
HVF III Series 2025-124 10.99 %9/2028
HVF III Series 2025-224 12.26 %9/2030
HVF III Series 2025-318 11.47 %12/2028
HVF III Series 2025-415 12.28 %12/2030
HVF III Series 2025-522 11.72 %5/2029
HVF III Series 2025-627 12.54 %5/2031
Total Class E Notes$221 

In May 2026, HVF III issued the Series 2026-1 Notes (Class A, Class B, Class C, Class D and Class E) and Series 2026-2 Notes (Class A, Class B, Class C, Class D and Class E) each in aggregate principal amount of $500 million with maturity dates of November 2029 and November 2031, respectively.

Vehicle Debt—Other

European ABS

In April 2026, International Fleet Financing No. 2 BV ("IFF No. 2"), an indirect, special-purpose subsidiary of Hertz, amended the European ABS, inclusive of Class A Notes, Class B Notes and Class C Notes, to extend the maturity date to April 2028. The aggregate maximum principal of the European ABS is €1.4 billion until April 2027 and thereafter is €1.1 billion until April 2028, after giving effect to terms of the amendment.

Hertz Canadian Securitization

In April 2026, TCL Funding Limited Partnership, a bankruptcy-remote, indirect, wholly owned and special-purpose subsidiary of Hertz, amended the Hertz Canadian Securitization to increase the aggregate maximum borrowings from CAD$475 million to CAD$625 million until November 2026, reverting to CAD$475 million thereafter until the extended maturity date of April 2028.

Australian Securitization

In July 2026, HA Fleet Pty Limited, an indirect wholly-owned subsidiary of Hertz, amended the Australian Securitization to provide for aggregate maximum borrowings of AUD$400 million and to extend the maturity date to September 2028.
Maturities

The table below reflects the nominal amounts of the Company's debt maturities for each of the years ending December 31 as of June 30, 2026.
(In millions)Total20262027202820292030After 2030
Other Non-Vehicle Debt$5,246 $209 $18 $2,757 $2,251 $— $11 
Exchangeable Notes Due 2029
282 — — — 282 — — 
Exchangeable Notes Due 2030
425 — — — — 425 — 
Exchangeable First Lien Notes Due 2030
350 — — — — 350 — 
Total Non-Vehicle Debt6,303 209 18 2,757 2,533 775 11 
Vehicle Debt12,777 2,383 2,299 4,621 1,482 1,011 981 
Total$19,080 $2,592 $2,317 $7,378 $4,015 $1,786 $992 

Borrowing Capacity and Availability

Borrowing capacity and availability comes from the Company's revolving credit facilities, which are a combination of variable funding asset-backed securitization facilities, cash-flow based revolving credit facilities and the First Lien RCF. Creditors under each such asset-backed securitization facility have a claim on a specific pool of assets as collateral. With respect to each such asset-backed securitization facility, the Company refers to the amount of debt it can borrow given a certain pool of assets as the borrowing base.

The Company refers to "Remaining Capacity" as the maximum principal amount of debt permitted to be outstanding under the respective facility (i.e., with respect to a variable funding asset-backed securitization facility, the amount of debt the Company could borrow, assuming it possessed sufficient assets as collateral) less the principal amount of debt then-outstanding under such facility and, in the case of the First Lien RCF, less any issued standby letters of credit. With respect to a variable funding asset-backed securitization facility, the Company refers to "Availability Under Borrowing Base Limitation" as the lower of Remaining Capacity or the borrowing base less the principal amount of debt then-outstanding under such facility (i.e., the amount of debt that can be borrowed given the collateral possessed at such time).
The following facilities were available to the Company as of June 30, 2026 and are presented net of any outstanding letters of credit:
(In millions)Remaining
Capacity		Availability Under
Borrowing Base
Limitation
Non-Vehicle Debt
First Lien RCF$356 $356 
Total Non-Vehicle Debt356 356 
Vehicle Debt
HVF III Series 2021-A1,893 — 
European ABS538 — 
Hertz Canadian Securitization21 — 
Australian Securitization9 — 
New Zealand RCF5 — 
U.K. ABS164 — 
Other Vehicle Debt6 — 
Total Vehicle Debt2,636 — 
Total$2,992 $356 
Letters of Credit

As of June 30, 2026, there were outstanding letters of credit totaling $1.1 billion comprised primarily of $493 million issued under the First Lien RCF, $326 million of various unsecured letter of credit facilities ("Standby LCs") and $245 million issued under the Term C Loan. As of June 30, 2026, no capacity remained to issue additional letters of credit under the Term C Loan. Such letters of credit have been issued primarily to provide credit enhancement for the Company's asset-backed securitization facilities and to support the Company's insurance programs, as well as to support the Company's vehicle rental concessions and leaseholds. As of June 30, 2026, none of the issued letters of credit have been drawn upon.

The Standby LCs provide that, at Hertz's option and under the terms of the facilities, Hertz may request letters of credit be issued for itself and on behalf of certain of its subsidiaries up to the committed amounts of the facilities. In the first half of 2026, Hertz increased the amounts committed under its Standby LCs by approximately $300 million, in which approximately $200 million occurred in February 2026.

Pledges Related to Vehicle Financing

Substantially all of the Company's revenue earning vehicles and certain related assets are owned by special purpose entities or are encumbered in favor of the lenders under the various credit facilities, other secured financings or asset-backed securities programs. None of the value of such assets (including the assets owned by Hertz Vehicle Financing III LLC, TCL Funding LP and each of the domestic and international subsidiaries that pledge vehicle and vehicle related assets as part of the Company's securitization programs) will be available to satisfy the claims of non-vehicle secured or unsecured creditors, unless the vehicle related secured creditors under the securitization programs are paid in full.

The Company has a 25% ownership interest in IFF No. 2, whose sole purpose is to provide commitments to lend under the European ABS in various currencies, subject to borrowing bases comprised of revenue earning vehicles and related assets of certain of Hertz International, Ltd.'s subsidiaries. IFF No. 2 is a VIE, and the Company is the primary beneficiary; therefore, the assets, liabilities and results of operations of IFF No. 2 are included in the accompanying unaudited condensed consolidated financial statements. As of June 30, 2026 and December 31,
2025, IFF No. 2 had total assets of $1.3 billion and $1.1 billion, respectively, comprised primarily of intercompany receivables, and total liabilities of $1.3 billion and $1.1 billion, respectively, comprised primarily of debt.

The Company incorporates HFF as a special-purpose orphan entity. HFF provides a vehicle financing facility for the Company's vehicle rental fleet in the U.K. through the U.K. ABS. HFF is a VIE, and the Company is the primary beneficiary; therefore, the assets, liabilities and results of operations of HFF are included in the accompanying unaudited condensed consolidated financial statements. As of June 30, 2026 and December 31, 2025, HFF had total assets of $147 million and $135 million, respectively, comprised primarily of intercompany receivables, and total liabilities of $147 million and $135 million, respectively, comprised primarily of debt.

Covenant Compliance

The First Lien Credit Agreement requires Hertz to comply with the following financial covenant: a First Lien Ratio, which requires a ratio of less than or equal to 3.0x in the first and last quarters of the calendar year and 3.5x in the second and third quarters of the calendar year. Hertz is also subject to a minimum liquidity covenant, which requires $400 million for each month ending in the second and third quarters of the calendar year and $500 million for each month ending in the first and fourth quarter of the calendar year. As of June 30, 2026, Hertz was in compliance with the First Lien Ratio and the minimum liquidity covenant.

Additionally, the First Lien Credit Agreement, the First Lien Senior Notes, the Exchangeable Notes Due 2029, the Exchangeable Notes Due 2030, the Exchangeable First Lien Notes Due 2030, the Senior Notes Due 2026 and the Senior Notes Due 2029 (collectively, the "Corporate Indebtedness") contain customary affirmative covenants, including, among other things, the delivery of quarterly and annual financial statements and/or compliance certificates, and covenants related to conduct of business, maintenance of property and insurance, compliance with environmental laws and, where applicable, the granting of security interests for the benefit of the secured parties under the applicable agreements on after-acquired real property, fixtures and future subsidiaries.

The terms of the Corporate Indebtedness contain covenants limiting the ability of Hertz and its restricted subsidiaries to: incur or guarantee additional indebtedness; incur or guarantee secured indebtedness; pay dividends or distributions on, or redeem or repurchase, Hertz Global capital stock; make certain investments or other restricted payments; sell certain assets; transfer intellectual property to unrestricted subsidiaries; merge, consolidate or sell all or substantially all of its assets; and create restrictions on the ability of Hertz’s restricted subsidiaries to pay dividends or other amounts to Hertz. As per the terms of the Corporate Indebtedness, these covenants are subject to a number of important and significant limitations, qualifications and exceptions.

As of June 30, 2026, the Company was in compliance with all covenants under the terms of the agreements governing the respective Corporate Indebtedness.