Exhibit 10.25


 


HERTZ
INTERNATIONAL TAX SHARING AGREEMENT


 


This Tax Sharing Agreement (the “Agreement”),
dated as of December21, 2005, is made and entered into by and among CCMG
Holdings, Inc., a Delaware corporation (“Holdings”), CCMG
Corporation, a Delaware corporation and wholly owned subsidiary of Holdings (“CCMG”),
The Hertz Corporation, Inc., a Delaware corporation and wholly owned
subsidiary of CCMG (“Hertz”) and Hertz International Ltd., a Delaware
corporation (the “Company”). This Agreement shall become effective and
binding upon the parties hereto immediately upon the effective time of the
Acquisition (as defined below) (the “Effective Time”).


 


W
I T N E S S E T H:


 


WHEREAS, the parties hereto
desire to provide for the allocation of liabilities, procedures to be followed,
and other matters with respect to Combined Taxes (as defined below);


 


WHEREAS, pursuant to a Stock Purchase
Agreement, dated as of September 12, 2005, by and among Holdings and Ford
Holdings LLC, a Delaware limited liability company and Ford Motor Company, a
Delaware corporation, Holdings will acquire all the shares of Hertz (the “Acquisition”);


 


WHEREAS, following the consummation of
the Acquisition and pursuant to an Agreement and Plan of Merger and Plan of
Reorganization, of even date herewith, between CCMG Acquisition Corporation, a
Delaware corporation (“CCMG Acquisition”) and Hertz, CCMG Acquisition
will merge with and into Hertz, with Hertz being the surviving company;


 


NOW, THEREFORE, in consideration of the
mutual covenants and promises contained herein and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
the parties agree as follows:


 


ARTICLE I


 


DEFINITIONS


 


1.                                       Definitions.


 


Code:  shall mean the Internal Revenue Code of 1986,
as amended.


 


Combined Tax:  shall mean any Tax in respect of a Combined
Tax Group. 


 

















 


Combined Tax Group: 
shall mean any affiliated group of which the Company or any of its
Subsidiaries was or is, or was or is required to be, a member for any Tax year
and of which Parent was or is, or was or is required to be, the common parent
for purposes of paying Taxes or filing a Tax Return.


 


Combined Tax Return: 
shall mean any Tax Return with respect to any Combined Tax.


 


Company Group:  shall mean, with respect to any Combined Tax,
a subgroup of the relevant Combined Tax Group, whose member or members shall
include each member of such Combined Tax Group that is either the Company or a
Subsidiary of the Company.


 


Due Date:  shall mean, with respect to the filing of any
Tax Return or the payment of Tax, the date on which such Tax Return is due to
be filed with, or such payment is due to be made to, the appropriate Taxing
Authority pursuant to applicable law, giving effect to any applicable
extensions of the time for such filing or payment.


 


Estimated Tax Sharing Payments:  shall mean the periodic tax sharing payments
required under Article III, Section 2 of this Agreement.


 


IRS: 
shall mean the United States Internal Revenue Service, including, but
not limited to, its authorized agents and representatives and, in the case of a
litigated controversy, the attorneys representing it.


 


Parent:  shall mean any of Holdings, CCMG, Hertz or
any Subsidiary of the foregoing other than the Company or any Subsidiary of the
Company, as the context may require.


 


Person:  shall mean any individual, corporation,
partnership, joint venture, association, joint-stock company, limited liability
company, trust, unincorporated organization, government or any agency or
political subdivision thereof or any other entity.


 


Pro Forma Company Return:  shall mean a pro forma Tax Return prepared
pursuant to Article III, Section 1 or 3.


 


Subsidiary: 
shall mean, with respect to any Person at any time, any corporation,
association, partnership or other business entity of which more than 50% of the
total voting power of shares of capital stock or other equity interests
(including partnership interests) entitled (without regard to the occurrence of
any contingency) to vote in the election of directors, managers or trustees
thereof is at


 


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the time owned or controlled, directly or
indirectly, by (a) such Person or (b) one or more Subsidiaries of
such Person.


 


Tax: 
shall mean any federal, state, local or foreign income, alternative
minimum, accumulated earnings, personal holding company, franchise, capital
stock, profits, windfall profits, gross receipts, sales, use, value added,
transfer, registration, stamp, premium, excise, customs duties, severance, environmental
(including taxes under section 59A of the Code), real property, personal
property, ad valorem, rent, occupancy, license, occupation, employment,
payroll, social security, disability, unemployment, workers’ compensation,
withholding, estimated or other similar tax, duty, fee, assessment or other
governmental charge or deficiencies thereof (including all interest and
penalties thereon and additions thereto).


 


Tax Return:  shall mean any federal, state, local or
foreign tax return, declaration, statement, report, schedule, form or
information return or any amendment to any of the foregoing relating to Taxes.


 


Taxing Authority:  shall mean, with respect to any Tax, the
governmental entity or political subdivision thereof that imposes such Tax, and
the agency (if any) charged with the collection of such Tax for such entity or
subdivision.


 


Treasury Regulations:  shall mean the regulations prescribed under
the Code.


 


2.                                       Successors.



 


References
to the Company, Hertz, Holdings or CCMG shall include any successor thereto or
any Person with respect to which the Company, Hertz,  Holdings or CCMG, respectively, is the
successor.


 


ARTICLE II


 


PROCEDURAL
MATTERS


 


1.                                       Parent
shall have the sole and exclusive responsibility for the preparation and filing
of each Combined Tax Return for each Combined Tax with respect to which it is
the common parent, including any amended returns and any other returns,
documents or statements required to be filed with any Taxing Authority relating
to such Combined Tax Return. All such Combined Tax Returns shall be filed by
Parent, on a timely basis, taking into account extensions of the due date for
the filings of such returns.


 


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2.                                       The
Company shall, and shall cause each of its Subsidiaries that is eligible to be
a member of the relevant Combined Tax Group to join and continue to join in
filing a Combined Tax Return with respect to each jurisdiction for all Tax
years for which such Subsidiary is eligible to do so under the applicable Tax
law, unless Parent shall request otherwise.


 


3.                                       Parent
shall (a) make all payments to the applicable Taxing Authority of all
Combined Taxes that the relevant Combined Tax Group is required to pay,
including estimated payments relating thereto and (b) have the right to
exercise all powers of a common parent with respect to each Combined Tax Return
or Combined Tax.


 


4.                                       Parent
shall be the sole and exclusive agent of the Combined Tax Group of which it is
the common parent and of each member of such group in respect of any and all
matters relating to any Combined Tax of such group for all Combined Tax Return
years. In its sole discretion, Parent shall have the right with respect to each
such Combined Tax Return (a) to determine (i) the manner in which
such return shall be prepared and filed, including, without limitation, the
manner in which any item of income, gain, loss, deduction or credit shall be
reported and the adoption or change of any method of accounting, (ii) whether
any extensions may be requested and (iii) the elections that will be
made by each member of the Combined Tax Group for which such Combined Tax
Return is filed, (b) to contest, compromise or settle any adjustment or
deficiency proposed, asserted or assessed as a result of any audit of such
return by any Taxing Authority, (c) to file, prosecute, compromise or
settle any claim for refund and (d) to determine whether any refund to
which such Combined Tax Group may be entitled shall be paid by way of
refund or credited against the Combined Tax liability of such group. The
Company hereby irrevocably appoints, and shall cause each of its Subsidiaries
that is a member of each such Combined Tax Group to irrevocably appoint Parent
as its agent and attorney-in-fact to take such action (including the execution
of documents) as Parent may deem appropriate to effect the foregoing. 


 


5.                                       The
Company shall, and shall as appropriate cause each of its Subsidiaries that is
a member of a Combined Tax Group to, reimburse Parent for (a) any
outside legal and accounting expenses incurred by Parent in the course of the
conduct of any audit or contest regarding a Combined Tax liability of such
group, (b) any other expenses incurred by Parent in the course of any
litigation relating thereto and (c) the cost of preparing any Combined Tax
Return or otherwise administering this Agreement.


 


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6.                                       The
Company shall, and shall cause each of its Subsidiaries that is a member of
a Combined Tax Group to, furnish to Parent in a timely manner such
information, documents and other assistance, in each case as Parent may reasonably
request in connection with the filing of each Combined Tax Return with respect
to such group or any audit or examination by any Taxing Authority or any judicial
or administrative proceeding relating to a Combined Tax of such group or
otherwise with respect to this Agreement and the transactions contemplated
hereby.


 


ARTICLE III


 


TAX SHARING
PAYMENTS


 


1.                                       For
each Tax year for which Parent files, or is required to file, a Combined Tax
Return on or after the Effective Time, Parent shall timely prepare, or cause to
be prepared, a Pro Forma Company Return for the relevant Company Group for such
year (including, if necessary, preparing Pro Forma Company Returns for prior
years). Each such Pro Forma Company Return shall include only the items of
income, deduction, gain, loss and credit of the members of the Company Group
that join in the filing of such Combined Tax Return, and shall be prepared in
a manner consistent with the elections, methods of accounting, and
positions with respect to specific items made or used by Parent for purposes of
such Combined Tax Return. Each such Pro Forma Company Return shall reflect any
carryovers of net operating losses, net capital losses, excess tax credits or
other tax attributes from Pro Forma Company Returns with respect to the same
Combined Tax for prior years assuming that members of such Company Group had
not been in existence before the Effective Time, which carryovers could have
been utilized by the Company Group if such Company Group had never been
included in the relevant Combined Tax Group, but only to the extent Parent
utilizes such carryovers. For purposes of this Article III, Section 1,
(a) a carryover will be treated as utilized by Parent to the extent that
the Tax liability of the relevant Combined Tax Group determined taking into
account such carryover is less than the Tax liability of such Combined Tax
Group determined without giving effect to such carryover, (b) any
provision of the Code that requires consolidated computations, such as
sections 861 and 1231, and any similar provision with respect to any other
Combined Tax, shall be applied separately to the Company Group for purposes of
preparing the Pro Forma Company Return and (c) Treasury Regulations section 1.1502-13,
and any similar provisions with respect to any other Combined Tax, shall be
applied as if the Company Group (and each member thereof) were not members of a
combined tax group with other members of the relevant Combined Tax Group other
than members of the Company Group.


 


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The
Pro Forma Company Return shall be provided to the Company no later than 10 days
before the Due Date
for filing the relevant Combined Tax Return.


 


2.                                       For
each Tax year in which a Combined Tax Return is, or is required to be, filed by
Parent, the Company shall, and shall as appropriate cause each of its
Subsidiaries that is a member of the relevant Combined Tax Group to, make
periodic payments (“Estimated Tax Sharing Payments”) to Parent in such amounts
as, and no later than the dates on which, payments of estimated tax with
respect to such Combined Tax would be due on or after the Effective Time from
the Company Group under section 6655 of the Code, and any similar
provisions with respect to any other Combined Tax, if it were not included in
the relevant Combined Tax Group (computed with respect to the period for which
an Estimated Tax Sharing Payment is to be made on a basis consistent with the
relevant Pro Forma Company Return). The balance, if any, of the Estimated Tax
Sharing Payments due on or after the Effective Time for such Tax year shall be
paid to Parent no later than December 15 of such year. The Company shall,
and shall as appropriate cause each of its Subsidiaries that is a member of the
relevant Combined Tax Group to, pay to Parent no later than the Due  Date (for this
purpose, determined without regard to extensions) on which each Combined Tax
Return for each Tax year is, or is required to be, filed by Parent on or after
the Effective Time, an amount equal to the excess of (a) the sum of (i) the
Tax liability shown on the relevant Pro Forma Company Return prepared for such
Tax year and (ii) the additions to tax, if any, under section 6655 of
the Code, and any similar provisions with respect to any other Combined Tax,
that would have been imposed upon the Company Group (treating the amount due to
Parent under clause (i) above as the Company Group’s Tax liability and
treating any Estimated Tax Sharing Payments as estimated Tax payments with
respect to such liability) over (b) the Estimated Tax Sharing Payments
made relating thereto. 


 


3.                                       To
the extent that, after the Effective Time, any audit, litigation, claim or
refund with respect to a Combined Tax Return results in an increase in Tax
liability relating to the treatment of a Company Group item, a corresponding
adjustment shall be made to such item and to the Company Group’s Tax liability
reflected on the applicable Pro Forma Company Return. Within 5 days after any
such adjustment, the Company shall, and shall as appropriate cause each of its
Subsidiaries that is a member of the relevant Combined Tax Group to, make
additional Tax sharing payments, including interest and penalties consistent
with such adjustment, to Parent. 


 


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4.                                       All
calculations required to be made by Parent under this Agreement shall be
binding upon the parties hereto absent manifest error.


 


ARTICLE IV


 


INTEREST


 


1.                                       With
respect to any federal income Tax, any amount relating thereto which is
required to be paid by the Company or any of its Subsidiaries pursuant to this
Agreement and which has not been timely paid to Parent shall be subject to an
interest charge at the rate and in the manner provided in the Code for interest
on underpayments of federal income Tax for the relevant period.


 


2.                                       With
respect to any Combined Tax other than federal income Tax, any amount relating
thereto which is required to be paid by the Company or any of its Subsidiaries
pursuant to this Agreement and which has not been timely paid to Parent shall
be subject to an interest charge at the rate and in the manner provided under
the applicable state or local statute for interest on underpayments of such Tax
for the relevant period.


 


ARTICLE V


 


MISCELLANEOUS
PROVISIONS


 


1.                                       Any
information or documents furnished by one party to another pursuant to this
Agreement shall be treated as confidential and, except as, and to the extent,
required during the course of an audit or litigation or otherwise required by
law, shall not be disclosed to another Person without the consent, which shall
not be unreasonably withheld, of the first party.


 


2.             All payments to be made by any party under this
Agreement shall, except to the extent otherwise specifically provided herein,
be made without setoff, counterclaim or withholding, all of which are expressly
waived. With the consent of Parent, payments under this Agreement by the
Company or any Subsidiary thereof may be made by way of intercompany loan
bearing market rates of interest.


 


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3.             Nothing in this Agreement shall be construed to require
a party hereto to pay any liability or obligation arising under this Agreement
more than once. 


 


4.             If due to any change in applicable law, regulations, or
interpretation thereof after the date of this Agreement, performance of any
provision of this Agreement or any transaction contemplated thereby shall
become impracticable or impossible, the parties hereto shall use their best
efforts to find and employ an alternative means to achieve the same or
substantially the same result as that contemplated by such provision.


 


5.                                       This
Agreement shall be binding upon and inure to the benefit of any successor to
each of the parties, by merger, acquisition of assets or otherwise, to the same
extent as if the successor had been an original party to this Agreement.


 


6.                                       This
Agreement shall be governed by and construed in accordance with the laws of the
State of New York without giving effect to the rules or principles of
conflict of laws thereof, to the extent the same are not mandatorily applicable
by statute and would permit or require the application of the laws of another
jurisdiction.


 


7.                                       This
Agreement may be executed simultaneously in one or more counterparts, each
of which will be deemed an original, but all of which when taken together shall
constitute one and the same instrument.


 


8.                                       The
headings in this Agreement are for convenience only and shall not be deemed for
any purpose to constitute a part or to affect the interpretation of this
Agreement.


 


9.                                       This
Agreement may be amended from time to time by agreement in writing
executed by all the parties hereto or all of the parties then bound thereby. This
Agreement constitutes the entire agreement with respect to the subject matter
hereof and supersedes all prior written and oral understandings with respect
thereto.


 


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10.                                 Any
notice, request or other communication required or permitted in this Agreement
shall be in writing and shall be sufficiently given if personally delivered or
if sent by registered or certified mail, postage prepaid, addressed as follows:


 


If to the Company:


 


Hertz International Limited

c/o The Hertz Corporation


225
Brae Boulevard


Park Ridge, New Jersey 07656-0713

Attention:  Senior Vice President,
General Counsel & Secretary

Telecopy:  201-307-2748                                                                                                                 


 


If to Holdings:                   


 


CCMG
Holdings, Inc.,

c/o M&C Corporate Services Limited (on behalf
of Clayton,

Dubilier & Rice Fund VII, L.P.)

P.O. Box 309GT


Ugland
House


South
Church Street


George
Town, Grand Cayman


Cayman
Islands, British West Indies


Telecopy:  345-949-8080


 


If to CCMG:


 


CCMG
Corporation


c/o M&C
Corporate Services Limited (on behalf of Clayton,

Dubilier & Rice Fund VII, L.P.)


P.O. Box
309GT


Ugland
House


South
Church Street


George
Town, Grand Cayman


Cayman
Islands, British West Indies


Telecopy:  345-949-8080


 


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If to Hertz:             


 


The Hertz
Corporation

225 Brae Boulevard

Park Ridge, New Jersey 07656-0713

Attention:  Senior Vice President,
General Counsel & Secretary

Telecopy:  201-307-2748                 


 


In
each case, with a copy to (which shall not constitute notice):


 


Clayton,
Dubilier & Rice, Inc.

375 Park Avenue

18th Floor

New York, New York  10152

Attention:  David H. Wasserman

Telecopy:  212-893-7061


 


The
Carlyle Group

1001 Pennsylvania Avenue, NW

Suite 220 South

Washington, DC 2004-2505

Attention:  Gregory S. Ledford

Telecopy:  202-347-1818


 


Merrill Lynch Global Private Equity

4 World Financial Center, 23rd Floor

New York, New York  10080

Attention: George Bitar

                                                           Robert
End

Telecopy:  212-449-1119


 


Debevoise &
Plimpton LLP

919 Third Avenue

New York, New York  10022


Attn:  David A. Brittenham, Esq.


 


or to such other address as set forth in writing by either
party to the other in accordance with this section.


 


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IN WITNESS WHEREOF, the parties hereto
have caused this Agreement to be duly executed by their authorized
representatives.


 


	
   

  	
  CCMG HOLDINGS, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
  /s/ David H. Wasserman

  
	
   

  	
  Name:

  	
  David H. Wasserman

  
	
   

  	
  Title:

  	
  President

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  CCMG CORPORATION

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
  /s/ Nathan K. Sleeper

  
	
   

  	
  Name:

  	
  Nathan K. Sleeper

  
	
   

  	
  Title:

  	
  Vice President and Treasurer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  THE HERTZ CORPORATION

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
  /s/ Harold E. Rolfe

  
	
   

  	
  Name:

  	
  Harold E. Rolfe

  
	
   

  	
  Title:

  	
  Senior Vice President, General Counsel and Secretary

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  HERTZ INTERNATIONAL LTD.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
  /s/ Harold E. Rolfe

  
	
   

  	
  Name:

  	
  Harold E. Rolfe

  
	
   

  	
  Title:

  	
  Vice President & Secretary