Exhibit 10.5


    Exhibit
      10.5

    PHH
      CORPORATION

    2005
      EQUITY AND INCENTIVE PLAN

    


    NON-QUALIFIED
      STOCK OPTION

    AWARD
      NOTICE

    


    Accelerated
      Vesting Schedule Modification

    


    On
      June 28, 2005, PHH Corporation (the “Company”) awarded you Non-Qualified Stock
      Options. A portion of those Non-Qualified Stock Options would be subject to
      accelerated vesting on June 28, 2006, June 28, 2007, June 28, 2008 and June
      28,
      2009, if the Company achieves certain targets for net income growth and return
      on equity for each fiscal year ending immediately prior to such vesting date.
      However, due to the changes in the Company’s business during fiscal year 2005,
      the Compensation Committee has modified the accelerated vesting targets for
      2005
      as set forth below. This document constitutes part of and is subject to the
      terms and provisions of the Award Notice, the PHH Corporation Non-Qualified
      Stock Option Award Agreement (the “Agreement”), and the PHH Corporation 2005
      Equity Incentive Plan (the “Plan”). The terms used but not defined in this
      modification shall have the meanings set forth in the Award Notice, the
      Agreement, or the Plan. 

     

    
      	
              Optionee:

            	
              [Name]

            
	 	
              [Address]

            
	 	 
	
              Social
                Security #:

            	
              [Social
                Security Number]

            
	 	 
	
              Grant
                Date:

            	
              June
                28, 2005

            
	 	 
	
              Number
                of Shares: 

            	
              [__________]

            
	 	 
	
              Exercise
                Price:

            	
              $24.99

            


    

    


    Expiration
      Date: The
      Options shall expire at 5:00 p.m. Eastern Time on the 10th
      anniversary
      of the Grant Date, unless fully exercised or terminated earlier. 

    


    Performance
      Goals for Accelerated Vesting: 

    


    Modified
      Vesting Schedule:    Accelerated
      Vesting Date: June 28, 2006

    25%
      of
      the Options shall become vested on June 28, 2006, if the Company achieves 100%
      of its target (Pre-Tax Income After Minority Interest, excluding spin-off
      related expenses, equal to [***]) for the 2005 fiscal year.

    


    Accelerated
      Vesting Date: June 28, 2007

    25%
      of
      the Options shall become vested on June 28, 2007, if the Company achieves 100%
      of its target (Pre-Tax
      Income After Minority Interest, excluding certain items that are one-time or
      unusual in nature as determined in the discretion of the Compensation
      Committee)
      for the
      fiscal year ended immediately prior to June 28, 2007.

    


    Accelerated
      Vesting Date: June 28, 2008

    25%
      of
      the Options shall become vested on June 28, 2008, if the Company achieves 100%
      of its target (Pre-Tax
      Income After Minority Interest, excluding certain items that are one-time or
      unusual in nature as determined in the discretion of the Compensation
      Committee)
      for the
      fiscal year ended immediately prior to June 28, 2008.

    


    Accelerated
      Vesting Date: June 28, 2009

    25%
      of
      the Options shall become vested on June 28, 2009, if the Company achieves 100%
      of its target (Pre-Tax
      Income After Minority Interest, excluding certain items that are one-time or
      unusual in nature as determined in the discretion of the Compensation
      Committee)
      for the
      fiscal year ended immediately prior to June 28, 2009.

    


    ______________

    [***]
      INDICATES MATERIAL THAT HAS BEEN OMITTED AND FOR WHICH CONFIDENTIAL TREATMENT
      HAS BEEN REQUESTED. ALL SUCH OMITTED MATERIAL HAS BEEN FILED WITH THE SECURITIES
      AND EXCHANGE COMMISSION PURSUANT TO RULE 24b-2 UNDER THE SECURITIES EXCHANGE
      ACT
      OF 1934, AS AMENDED.


    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    


    All
      of
      the terms and conditions of the Non-Qualified Stock Option Award Notice, except
      those modified above, remain in full force and effect. 

    


    PHH
      CORPORATION

    


    


    By:
      

    Name:

    Title:

    Date:
      December____, 2005

    


    RETAIN
      THIS MODIFICATION, YOUR NOTIFICATION, AND YOUR AWARD AGREEMENT WITH YOUR
      IMPORTANT DOCUMENTS AS A RECORD OF THIS AWARD.