THE BOARD DETERMINES THAT THE "FAIR
MARKET VALUE" PER SHARE OF COMMON STOCK FOR PURPOSES OF THE STOCK INCENTIVE PLAN
IS HIGHER THAN $5.68 PER SHARE (SUCH HIGHER VALUE, THE "REDETERMINED SHARE
VALUE"), THEN:
(A)
THE PURCHASE PRICE PER SHARE FOR THE SALE OF
SHARES CONTEMPLATED BY SECTION 3(C)(I) WILL NOT BE ADJUSTED BUT THE COMPANY WILL
PAY THE EXECUTIVE BY DECEMBER 31, 2006 AN AMOUNT EQUAL TO 80% OF THE PRODUCT OF
(1) THE NUMBER OF SHARES OF COMMON STOCK PURCHASED PURSUANT TO SUCH
SECTION 3(C)(I) MULTIPLIED BY (2) AND THE DIFFERENCE BETWEEN THE REDETERMINED
SHARE VALUE AND $5.68 (THE "INCREMENTAL SHARE VALUE");
(B)
THE EXERCISE PRICE PER SHARE OF THE OPTIONS
GRANTED PURSUANT TO SECTION 3(C)(II) SHALL EQUAL THE GREATER OF (1) THE
APPLICABLE PRICE SPECIFIED THEREIN (I.E., $5.68, $10.68 AND $15.68, AS THE CASE
MAY BE) AND (2) THE REDETERMINED SHARE VALUE; AND
(C)
THE EXECUTIVE SHALL BE GRANTED AN ADDITIONAL
NUMBER OF SUPPLEMENTAL OPTIONS EQUAL TO THE PRODUCT OF (1) THE INCREMENTAL SHARE
VALUE AND (2) 50,000.
(D)
SIGNING/REPLACEMENT AWARD.
IN ORDER TO
ADDRESS THE CERTAIN FORFEITURES THAT EXECUTIVE WILL FACE UPON TERMINATION OF HIS
EMPLOYMENT WITH HIS PRIOR EMPLOYER, THE EXECUTIVE SHALL BE PAID A SPECIAL CASH
BONUS OF $2 MILLION ON DECEMBER 31, 2006 AND $2 MILLION ON DECEMBER 31, 2007
(THE "REPLACEMENT AWARD"); PROVIDED THAT IF THE EXECUTIVE'S EMPLOYMENT
TERMINATES BEFORE AN APPLICABLE PAYMENT DATE, THE REPLACEMENT AWARD SHALL BE
PAYABLE IF AND TO THE EXTENT PROVIDED FOR IN SECTION 5(F).
4.
BENEFITS; PERQUISITES, ETC.
(A)
BENEFITS.
DURING THE EMPLOYMENT PERIOD,
ALL EMPLOYEE AND SENIOR EXECUTIVE BENEFITS (OTHER THAN SEVERANCE BENEFITS),
INCLUDING LIFE, MEDICAL, DENTAL AND DISABILITY INSURANCE, WILL BE PROVIDED TO
THE EXECUTIVE IN ACCORDANCE WITH THE PROGRAMS OF THE COMPANY THEN AVAILABLE TO
ITS SENIOR EXECUTIVES, AS THE SAME MAY BE AMENDED AND IN EFFECT FROM TIME TO
TIME.
DURING THE EMPLOYMENT PERIOD, SUBJECT TO GENERALLY APPLICABLE ELIGIBILITY
REQUIREMENTS, THE EXECUTIVE WILL ALSO BE ENTITLED TO PARTICIPATE IN ALL OF THE
COMPANY'S TAX-QUALIFIED AND NON-QUALIFIED PROFIT SHARING, PENSION, RETIREMENT,
SUPPLEMENTAL RETIREMENT (E.G., SERP, EXCESS AND RESTORATION PLANS), DEFERRED
COMPENSATION AND SAVINGS PLANS THEN AVAILABLE TO ITS SENIOR EXECUTIVES, AS THE
SAME MAY BE AMENDED AND IN EFFECT FROM TIME TO TIME, AT LEVELS AND HAVING
INTERESTS COMMENSURATE WITH THE EXECUTIVE'S THEN CURRENT PERIOD OF SERVICE,
COMPENSATION AND POSITION.
NOTWITHSTANDING THE FOREGOING, THE EXECUTIVE SHALL
NOT PARTICIPATE IN THE HERTZ CORPORATION LONG-TERM COMPENSATION PLAN, UNDER
WHICH THE COMPANY HAS CEASED TO MAKE ADDITIONAL GRANTS (AND ONLY PRE-EXISTING
AWARDS REMAIN OUTSTANDING).
(B)
PERQUISITES.
DURING THE EMPLOYMENT PERIOD,
THE EXECUTIVE WILL BE ENTITLED TO PARTICIPATE IN ALL PERQUISITE PROGRAMS
GENERALLY AVAILABLE FROM TIME TO TIME TO SENIOR EXECUTIVES OF THE COMPANY ON THE
TERMS AND CONDITIONS THEN PREVAILING UNDER SUCH PROGRAMS, A DESCRIPTION OF WHICH
HAS BEEN PROVIDED TO THE EXECUTIVE.
(C)
RELOCATION.
THE COMPANY WILL DIRECTLY PAY
OR, UPON PRESENTATION OF APPROPRIATE VOUCHERS OR OTHER EXPENSE STATEMENTS,
REIMBURSE THE EXECUTIVE FOR ALL REASONABLE EXPENSES INCURRED IN CONNECTION WITH
RELOCATION OF HIS PRINCIPAL