10-Q

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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 10-Q

ý	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 2008
OR
o	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission File Number 001-33139

HERTZ GLOBAL HOLDINGS, INC.
(Exact name of Registrant as specified in its charter)

Delaware
(State or other jurisdiction of
incorporation or organization) 20-3530539
(I.R.S. Employer
Identification Number)

225 Brae Boulevard
Park Ridge, New Jersey 07656-0713
(201) 307-2000
(Address, including Zip Code, and telephone number,
including area code, of Registrant's principal executive offices)

Not Applicable
(Former name, former address and former fiscal year,
if changed since last report)

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ý    No o

Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of "large accelerated filer," "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer ý Accelerated filer o Non-accelerated filer o
(Do not check if a smaller reporting company) Smaller reporting company o

Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o    No ý

There were 322,970,012 shares of the Registrant's common stock, par value $0.01 per share, issued and outstanding as of November 6, 2008.

HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES

INDEX

			Page
PART I. FINANCIAL INFORMATION
	ITEM 1.	Condensed Consolidated Financial Statements (Unaudited)
		Report of Independent Registered Public Accounting Firm	1
		Condensed Consolidated Balance Sheets as of September 30, 2008 and December 31, 2007	2
		Consolidated Statements of Operations for the Three and Nine Months Ended September 30, 2008 and 2007	3
		Consolidated Statements of Cash Flows for the Nine Months Ended September 30, 2008 and 2007	4–5
		Notes to Condensed Consolidated Financial Statements	6–41
	ITEM 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	42–82
	ITEM 3.	Quantitative and Qualitative Disclosures About Market Risk	82
	ITEM 4.	Controls and Procedures	83
PART II. OTHER INFORMATION
	ITEM 1.	Legal Proceedings	84
	ITEM 1A.	Risk Factors	84–92
	ITEM 6.	Exhibits	93
SIGNATURE			94
EXHIBIT INDEX			95

PART I—FINANCIAL INFORMATION

ITEM 1.    Condensed Consolidated Financial Statements

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and
Stockholders of Hertz Global Holdings, Inc.:

We have reviewed the accompanying condensed consolidated balance sheet of Hertz Global Holdings, Inc. and its subsidiaries as of September 30, 2008 and the related consolidated statements of operations for each of the three-month and nine-month periods ended September 30, 2008 and September 30, 2007 and the consolidated statements of cash flows for the nine-month periods ended September 30, 2008 and September 30, 2007. These interim financial statements are the responsibility of the Company's management.

We conducted our review in accordance with the standards of the Public Company Accounting Oversight Board (United States). A review of interim financial information consists principally of applying analytical procedures and making inquiries of persons responsible for financial and accounting matters. It is substantially less in scope than an audit conducted in accordance with the standards of the Public Company Accounting Oversight Board (United States), the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Accordingly, we do not express such an opinion.

Based on our review, we are not aware of any material modifications that should be made to the accompanying condensed consolidated balance sheet and the related consolidated interim financial statements for them to be in conformity with accounting principles generally accepted in the United States of America.

We previously audited in accordance with the standards of the Public Company Accounting Oversight Board (United States), the consolidated balance sheet as of December 31, 2007 and the related consolidated statements of operations, of stockholders' equity and of cash flows for the year then ended (not presented herein), and in our report dated February 29, 2008 we expressed an unqualified opinion on those consolidated financial statements. In our opinion, the information set forth in the accompanying condensed consolidated balance sheet as of December 31, 2007 is fairly stated in all material respects in relation to the consolidated balance sheet from which it has been derived.

/s/ PricewaterhouseCoopers LLP
Florham Park, New Jersey
November 7, 2008

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HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(In Thousands of Dollars)

Unaudited

				September 30, 2008			December 31, 2007
ASSETS
Cash and equivalents				$	731,539		$	730,203
Restricted cash					514,048			661,025
Receivables, less allowance for doubtful accounts of $15,541 and $11,137					1,902,541			1,690,956
Inventories, at lower of cost or market					129,658			118,997
Prepaid expenses and other assets					348,260			317,613
Revenue earning equipment, at cost:
	Cars				9,564,781			8,572,387
		Less accumulated depreciation			(1,092,091	)		(962,054	)
	Other equipment				2,938,460			3,108,799
		Less accumulated depreciation			(526,893	)		(411,272	)
			Total revenue earning equipment		10,884,257			10,307,860
Property and equipment, at cost:
	Land, buildings and leasehold improvements				1,045,649			1,022,438
	Service equipment				757,345			685,579
					1,802,994			1,708,017
		Less accumulated depreciation			(482,380	)		(362,469	)
			Total property and equipment		1,320,614			1,345,548
Other intangible assets, net					3,089,387			3,123,467
Goodwill					974,655			959,993
			Total assets	$	19,894,959		$	19,255,662
LIABILITIES, MINORITY INTEREST AND STOCKHOLDERS' EQUITY
Accounts payable				$	860,190		$	1,064,878
Accrued liabilities					1,026,519			1,028,122
Accrued taxes					177,790			127,992
Debt					12,844,178			11,960,126
Public liability and property damage					325,628			343,028
Deferred taxes on income					1,772,076			1,797,099
			Total liabilities		17,006,381			16,321,245
Commitments and contingencies
Minority interest					24,224			21,028
Stockholders' equity:
	Common Stock, $0.01 par value, 2,000,000,000 shares authorized, 322,969,814 and 321,862,083 shares issued				3,230			3,219
	Preferred Stock, $0.01 par value, 200,000,000 shares authorized, no shares issued				—			—
	Additional paid-in capital				2,497,593			2,469,213
	Retained earnings				281,657			270,450
	Accumulated other comprehensive income				81,874			170,507
			Total stockholders' equity		2,864,354			2,913,389
			Total liabilities, minority interest and stockholders' equity	$	19,894,959		$	19,255,662

The accompanying notes are an integral part of these financial statements.

2

HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(In Thousands of Dollars, except per share data)

Unaudited

			Three Months Ended September 30,						Nine Months Ended September 30,
			2008			2007			2008			2007
Revenues:
	Car rental		$	1,946,136		$	1,944,499		$	5,339,955		$	5,161,230
	Equipment rental			432,885			464,716			1,286,836			1,287,350
	Other			42,853			40,397			109,521			98,228
		Total revenues		2,421,874			2,449,612			6,736,312			6,546,808
Expenses:
	Direct operating			1,351,790			1,216,114			3,801,827			3,495,152
	Depreciation of revenue earning equipment			595,016			535,039			1,658,715			1,498,893
	Selling, general and administrative			234,321			203,183			595,744			586,000
	Interest, net of interest income of $5,490, $6,707, $20,450 and $26,974			214,587			240,150			616,701			661,251
		Total expenses		2,395,714			2,194,486			6,672,987			6,241,296
Income before income taxes and minority interest				26,160			255,126			63,325			305,512
Provision for taxes on income				(2,855	)		(86,870	)		(35,972	)		(107,291	)
Minority interest				(5,641	)		(5,549	)		(16,146	)		(14,405	)
Net income			$	17,664		$	162,707		$	11,207		$	183,816
Weighted average shares outstanding (in thousands)
	Basic			322,886			321,487			322,599			321,004
	Diluted			322,886			327,507			322,599			325,256
Earnings per share
	Basic		$	0.05		$	0.51		$	0.03		$	0.57
	Diluted		$	0.05		$	0.50		$	0.03		$	0.57

The accompanying notes are an integral part of these financial statements.

3

HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In Thousands of Dollars)

Unaudited

				Nine Months Ended September 30,
				2008			2007
Cash flows from operating activities:
	Net income			$	11,207		$	183,816
	Adjustments to reconcile net income to net cash provided by operating activities:
		Depreciation of revenue earning equipment			1,658,715			1,498,893
		Depreciation of property and equipment			131,441			134,389
		Amortization of other intangible assets			49,747			46,560
		Amortization of deferred financing costs			36,777			36,787
		Amortization of debt discount			11,630			16,507
		Debt modification costs			—			16,177
		Stock-based employee compensation charges			20,303			24,269
		Unrealized (gain) loss on derivatives			12,058			(3,006	)
		Loss on ineffectiveness of interest rate swaps			7,791			17,712
		Provision for losses on doubtful accounts			21,693			10,375
		Asset writedowns			34,113			—
		Minority interest			16,146			14,405
		Deferred taxes on income			5,010			58,106
		Gain on sale of property and equipment			(9,370	)		(14,383	)
	Changes in assets and liabilities, net of effects of acquisition:
		Receivables			(272,085	)		(102,391	)
		Inventories, prepaid expenses and other assets			(61,860	)		(44,569	)
		Accounts payable			(97,931	)		284,063
		Accrued liabilities			(31,043	)		(46,066	)
		Accrued taxes			37,760			69,550
		Public liability and property damage			(7,307	)		7,275
			Net cash provided by operating activities	$	1,574,795		$	2,208,469

The accompanying notes are an integral part of these financial statements.

4

HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS (Continued)

(In Thousands of Dollars)

Unaudited

				Nine Months Ended September 30,
				2008			2007
Cash flows from investing activities:
	Net change in restricted cash			$	146,084		$	124,087
	Revenue earning equipment expenditures				(8,637,185	)		(9,569,217	)
	Proceeds from disposal of revenue earning equipment				6,135,741			6,574,011
	Property and equipment expenditures				(149,439	)		(144,128	)
	Proceeds from disposal of property and equipment				36,746			53,143
	Acquisitions, net of cash acquired				(68,864	)		(10,571	)
	Other investing activities				82			(190	)
			Net cash used in investing activities		(2,536,835	)		(2,972,865	)
Cash flows from financing activities:
	Proceeds from issuance of long-term debt				19,357			5,873
	Repayment of long-term debt				(362,776	)		(957,557	)
	Short-term borrowings:
		Proceeds			391,131			695,000
		Repayments			(302,856	)		(225,000	)
		Ninety day term or less, net			1,294,208			976,611
	Payment of financing costs				(33,839	)		(24,265	)
	Distributions to minority interest				(12,950	)		(5,775	)
	Exercise of stock options				6,753			4,287
	Proceeds from disgorgement of stockholder short-swing profits				135			4,745
			Net cash provided by financing activities		999,163			473,919
Effect of foreign exchange rate changes on cash and equivalents					(35,787	)		13,191
Net increase (decrease) in cash and equivalents during the period					1,336			(277,286	)
Cash and equivalents at beginning of period					730,203			674,549
Cash and equivalents at end of period				$	731,539		$	397,263
Supplemental disclosures of cash flow information:
	Cash paid during the period for:
		Interest (net of amounts capitalized)		$	626,934		$	662,167
		Income taxes			22,562			18,364

The accompanying notes are an integral part of these financial statements.

5

HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Unaudited

Note 1—Basis of Presentation

Hertz Global Holdings, Inc., or "Hertz Holdings," is our top-level holding company. The Hertz Corporation, or "Hertz," is our primary operating company and a direct wholly owned subsidiary of Hertz Investors, Inc., which is wholly owned by Hertz Holdings. "We," "us" and "our" mean Hertz Holdings and its consolidated subsidiaries, including Hertz.

We are a successor to corporations that have been engaged in the car and truck rental and leasing business since 1918 and the equipment rental business since 1965. Hertz was incorporated in Delaware in 1967. Ford Motor Company, or "Ford," acquired an ownership interest in Hertz in 1987. Prior to this, Hertz was a subsidiary of UAL Corporation (formerly Allegis Corporation), which acquired Hertz's outstanding capital stock from RCA Corporation in 1985. Hertz Holdings was incorporated in Delaware in 2005 and had no operations prior to the Acquisition (as defined below).

On December 21, 2005, or the "Closing Date," investment funds associated with or designated by Clayton, Dubilier & Rice, Inc., or "CD&R," The Carlyle Group, or "Carlyle," and Merrill Lynch Global Private Equity, or "MLGPE," or collectively the "Sponsors," through CCMG Acquisition Corporation, a wholly owned subsidiary of Hertz Holdings (previously known as CCMG Holdings, Inc.) acquired all of Hertz's common stock from Ford Holdings LLC for aggregate consideration of $4,379 million in cash, debt refinanced or assumed of $10,116 million and transaction fees and expenses of $447 million.

We refer to the acquisition of all of Hertz's common stock through CCMG Acquisition Corporation as the "Acquisition." We refer to the Acquisition, together with related transactions entered into to finance the cash consideration for the Acquisition, to refinance certain of our existing indebtedness and to pay related transaction fees and expenses, as the "Transactions."

In November 2006, we completed our initial public offering of 88,235,000 shares of our common stock at a per share price of $15.00, with proceeds to us before underwriting discounts and offering expenses of approximately $1.3 billion. The proceeds were used to repay borrowings that were outstanding under a $1.0 billion loan facility entered into by Hertz Holdings, or the "Hertz Holdings Loan Facility," and to pay related transaction fees and expenses. The Hertz Holdings Loan Facility was used primarily to pay a special cash dividend of $4.32 per share to our common stockholders on June 30, 2006. The proceeds of the offering were also used to pay special cash dividends of $1.12 per share on November 21, 2006 to stockholders of record of Hertz Holdings immediately prior to the initial public offering.

In June 2007, the Sponsors completed a secondary public offering of 51,750,000 shares of their Hertz Holdings common stock at a per share price of $22.25. We did not receive any of the proceeds from the sale of these shares. We paid all of the expenses of the offering, excluding underwriting discounts and commissions of the selling stockholders, pursuant to a registration rights agreement we entered into at the time of the Acquisition. These expenses aggregated to approximately $2.0 million. Immediately following the secondary public offering, the Sponsors' ownership percentage in us decreased to approximately 55%.

The significant accounting policies summarized in Note 1 to our audited consolidated financial statements contained in our Annual Report on Form 10-K for the fiscal year ended December 31, 2007, filed with the United States Securities and Exchange Commission, or "SEC," on February 29, 2008, or the "Form 10-K," have been followed in preparing the accompanying condensed consolidated financial statements.

6

HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Unaudited

In our opinion, all adjustments (which include only normal recurring adjustments) necessary for a fair statement of the results of operations for the interim periods have been made. Results for interim periods are not necessarily indicative of results for a full year.

The December 31, 2007 condensed consolidated balance sheet data was derived from our audited financial statements, but does not include all disclosures required by accounting principles generally accepted in the United States of America, or "GAAP."

Certain prior period amounts have been reclassified to conform with current reporting.

Note 2—Recent Accounting Pronouncements

In September 2006, the Financial Accounting Standards Board, or "FASB," issued Statement of Financial Accounting Standards, or "SFAS," No. 157, "Fair Value Measurements," or "SFAS No. 157." SFAS No. 157 defines fair value, establishes a framework for measuring fair value in accordance with GAAP and expands disclosures about fair value measurements. We adopted the provisions of SFAS No. 157 on January 1, 2008, except as they relate to non-financial assets and liabilities that are not recognized or disclosed at fair value in the financial statements on a recurring basis (at least annually), which provisions become effective for us beginning in January 2009. We are currently reviewing SFAS No. 157, as it relates to our non-financial assets and liabilities that are not recognized or disclosed at fair value in the financial statements on a recurring basis (at least annually), to determine its impact, if any, on our financial position or results of operations. See Note 14—Fair Value Measurements.

In February 2007, the FASB issued SFAS No. 159, "The Fair Value Option for Financial Assets and Financial Liabilities," or "SFAS No. 159." SFAS No. 159 permits entities to choose to measure many financial assets and liabilities and certain other items at fair value. The provisions of SFAS No. 159 were effective for us beginning in January 2008. We chose not to change the measurement of the pertinent assets and liabilities as a result of SFAS No. 159; therefore, SFAS No. 159 did not have any impact on our financial position or results of operations.

In December 2007, the FASB issued SFAS No. 141 (revised 2007), "Business Combinations," or "SFAS No. 141(R)." The new standard requires the acquiring entity that gains control in a business combination to recognize 100% of the fair value of the assets acquired and liabilities assumed in the transaction; establishes the acquisition-date fair value as the measurement objective for all assets acquired and liabilities assumed; requires that acquisition related costs be expensed; and requires the acquirer to disclose to investors and other users all of the information they need to evaluate and understand the nature and financial effect of the business combination. The provisions of SFAS No. 141(R) will be effective for us beginning in January 2009.

In December 2007, the FASB issued SFAS No. 160, "Noncontrolling Interests in Consolidated Financial Statements-an amendment of ARB No. 51," or "SFAS No. 160." SFAS No. 160 will change the accounting and reporting for minority interests, which will be recharacterized as noncontrolling interests and classified as a component of stockholders' equity. Additionally, the amount of consolidated net income attributable to the parent and to the noncontrolling interests must be clearly identified and presented on the face of the consolidated statement of operations. Finally, changes in a parent's ownership interest while the parent retains its controlling financial interest in its subsidiary will be accounted for consistently as equity transactions. The provisions of SFAS No. 160 will be effective for us beginning in January 2009.

In March 2008, the FASB issued SFAS No. 161, "Disclosures about Derivative Instruments and Hedging Activities—an amendment of FASB Statement No. 133," or "SFAS No. 161." SFAS No. 161 changes the

7

HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Unaudited

disclosure requirements for derivative instruments and hedging activities. Entities are required to provide enhanced disclosures about how and why an entity uses derivative instruments, how derivative instruments and related hedged items are accounted for under FASB Statement 133 and its related interpretations, and how derivative instruments and related hedged items affect an entity's financial position, financial performance, and cash flows. The provisions of SFAS No. 161 will be effective for us beginning with our quarterly report for the period ended March 31, 2009.

Note 3—Cash and Equivalents and Restricted Cash

We consider all highly liquid debt instruments purchased with an original maturity of three months or less to be cash equivalents.

Restricted cash includes cash and equivalents that are not readily available for our normal disbursements. Restricted cash and equivalents are restricted for the purchase of revenue earning vehicles and other specified uses under our Fleet Debt facilities (as defined in Note 7—Debt), for our like-kind exchange programs and to satisfy certain of our self insurance regulatory reserve requirements.

As of September 30, 2008 and December 31, 2007, the portion of total restricted cash that was associated with our Fleet Debt facilities was $288.2 million and $573.1 million, respectively. The decrease in restricted cash associated with our Fleet Debt of $284.9 million from December 31, 2007 to September 30, 2008, primarily related to the timing of purchases and sales of revenue earning vehicles.

Note 4—Goodwill and Other Intangible Assets

We account for our goodwill and indefinite-lived intangible assets under SFAS No. 142, "Goodwill and Other Intangible Assets," or "SFAS No. 142." Under SFAS No. 142, goodwill and indefinite-lived intangible assets must be tested for impairment at least annually. We conducted the impairment review during the fourth quarter of 2007 and no impairment was determined to exist.

We will perform our annual impairment review for goodwill and indefinite-lived intangible assets in the fourth quarter of this year. The valuation of goodwill and intangible assets requires assumptions and estimates of many critical factors, including revenue and market growth, operating cash flows, market multiples, and discount rates. We have experienced declines in our operating results for the nine months ended September 30, 2008 as compared to the prior year, as a result of the current economic conditions. In addition, our market capitalization has declined. Adverse changes in expected operating results and/or unfavorable changes in other economic factors used to estimate fair values could result in a non-cash impairment charge in the future under SFAS No. 142.

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HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Unaudited

The following summarizes the changes in our goodwill, by segment, for the period presented (in thousands of dollars):

	Car Rental			Equipment Rental			Total
Balance as of December 31, 2007	$	318,134		$	641,859		$	959,993
Acquisitions		5,030			23,223			28,253
Other changes(1)		(7,362	)		(6,229	)		(13,591	)
Balance as of September 30, 2008	$	315,802		$	658,853		$	974,655

(1)

Consists of changes resulting from the translation of foreign currencies at different exchange rates from the beginning of the period to the end of the period and pre-Acquisition tax adjustments.

Other intangible assets, net, consisted of the following major classes (in thousands of dollars):

				September 30, 2008							December 31, 2007
				Gross Carrying Amount		Accumulated Amortization			Net Carrying Value		Gross Carrying Amount		Accumulated Amortization			Net Carrying Value
Amortizable intangible assets:
	Customer-related			$	620,014	$	(172,082	)	$	447,932	$	617,012	$	(124,647	)	$	492,365
	Other				12,241		(3,817	)		8,424		5,898		(1,505	)		4,393
		Total			632,255		(175,899	)		456,356		622,910		(126,152	)		496,758
Indefinite-lived intangible assets:
	Trade name				2,624,000		—			2,624,000		2,624,000		—			2,624,000
	Other				9,031		—			9,031		2,709		—			2,709
		Total			2,633,031		—			2,633,031		2,626,709		—			2,626,709
			Total other intangible assets, net	$	3,265,286	$	(175,899	)	$	3,089,387	$	3,249,619	$	(126,152	)	$	3,123,467

Amortization of other intangible assets for the three months ended September 30, 2008 and 2007 was approximately $16.5 million and $15.8 million, respectively, and for the nine months ended September 30, 2008 and 2007 was approximately $49.7 million and $46.6 million, respectively. Based on our amortizable intangible assets as of September 30, 2008, we expect amortization expense to be approximately $16.6 million for the remainder of 2008 and range from $62.3 million to $66.7 million for each of the next five fiscal years.

During the nine months ended September 30, 2008, we added 66 locations by acquiring former franchisees in our domestic and international car rental operations, as well as four locations related to external acquisitions done within our domestic and international equipment rental operations. Total intangible assets acquired during the nine months ended September 30, 2008 were $17.4 million. We recognized $11.1 million in amortizable intangible assets and $6.3 million in indefinite-lived intangible assets during the nine months ended September 30, 2008. Each of these transactions has been accounted for using the purchase method of accounting in accordance with SFAS No. 142, and

9

HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Unaudited

operating results of the acquired entities from the dates of acquisition are included in our consolidated statements of operations. The allocation of the purchase price to the tangible and intangible net assets acquired is preliminary and subject to finalization. These acquisitions are not material, individually or collectively, to the consolidated amounts presented within our statement of operations for the nine months ended September 30, 2008.

Note 5—Taxes on Income

The effective tax rate for the three and nine months ended September 30, 2008 was 10.9% and 56.8%, respectively. The effective tax rate for the three and nine months ended September 30, 2007 was 34.0% and 35.1%, respectively. The provision for taxes on income of $2.9 million in the three months ended September 30, 2008 decreased by 96.7% from $86.9 million in the three months ended September 30, 2007, primarily due to the decline in 2008 annual projections based upon third quarter operating results, partly offset by the recording of a valuation allowance on certain deferred tax assets that we believe are no longer realizable. The provision for taxes on income of $36.0 million in the nine months ended September 30, 2008 decreased by 66.5% from $107.3 million in the nine months ended September 30, 2007, primarily due to the decline in 2008 annual projections based upon third quarter operating results, partly offset by the non-recognition of benefits for certain non-U.S. jurisdictions in loss positions and the recording of a valuation allowance on certain deferred tax assets that we believe are no longer realizable.

We adopted the provisions of FASB Interpretation No. 48, "Accounting for Uncertainty in Income Taxes—an Interpretation of FASB Statement No. 109," or "FIN 48," on January 1, 2007. As of December 31, 2007, we had total unrecognized tax benefits of $35.5 million, of which $8.2 million, if recognized, would favorably impact the effective tax rate in future periods. The $27.3 million remaining balance of our unrecognized tax benefits relates to pre-Acquisition items of $19.0 million and temporary difference items of $8.3 million. To the extent that these items reverse in the future, the pre-Acquisition items will affect goodwill and the temporary items will affect current and deferred income tax provision but will not have any effective rate impact.

We conduct business globally and, as a result, file one or more income tax returns in the U.S. federal jurisdiction and various state and non-U.S. jurisdictions. In the normal course of business we are subject to examination by taxing authorities throughout the world, including such major jurisdictions as Australia, Brazil, Canada, France, Germany, Ireland, Italy, the Netherlands, Spain, the United Kingdom and the United States. The open tax years for these jurisdictions span from 1997 to 2007. A tax indemnification agreement entered into with Ford on the Closing Date indemnifies Hertz from U.S. federal and unitary state, and certain combined non-U.S. income tax liabilities for all periods prior to December 21, 2005.

In many cases, our uncertain tax positions are related to tax years that remain subject to examination by the relevant taxing authorities. We are not currently under audit by the Internal Revenue Service but are under audit in several non-U.S. jurisdictions. It is reasonably possible that approximately $19.0 million of unrecognized tax benefits may reverse within the next twelve months due to their settlement with the relevant taxing authorities and/or the filing of amended income tax returns.

Net after-tax interest and penalties related to the liabilities for unrecognized tax benefits are classified as a component of "Provision for taxes on income" in our consolidated statement of operations. During the three and nine months ended September 30, 2008, we recognized approximately $0.3 million and $1.3 million, respectively, in net after-tax interest and penalties. We had approximately $13.3 million of net after-tax interest and penalties accrued in our condensed consolidated balance sheet at September 30, 2008.

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Unaudited

The results of operations for the nine months ended September 30, 2008 included $5.6 million, net, of out-of-period adjustments. The most significant adjustment primarily related to the three months ended December 31, 2007 in the amount of $6.5 million, which would have had a negative impact on our results of operations of $0.02 per share on a diluted basis. These adjustments had a negative impact on our results of operations for the nine months ended September 30, 2008 of $0.02 per share on a diluted basis.

Note 6—Depreciation of Revenue Earning Equipment

Depreciation of revenue earning equipment includes the following (in thousands of dollars):

		Three Months Ended September 30,
		2008		2007
Depreciation of revenue earning equipment		$	553,777	$	509,971
Adjustment of depreciation upon disposal of the equipment			20,758		3,810
Rents paid for vehicles leased			20,481		21,258
	Total	$	595,016	$	535,039

		Nine Months Ended September 30,
		2008		2007
Depreciation of revenue earning equipment		$	1,534,430	$	1,437,306
Adjustment of depreciation upon disposal of the equipment			53,774		8,906
Rents paid for vehicles leased			70,511		52,681
	Total	$	1,658,715	$	1,498,893

The adjustment of depreciation upon disposal of revenue earning equipment for the three months ended September 30, 2008 and 2007 included net losses of $9.5 million and $4.9 million, respectively, on the disposal of vehicles used in our car rental operations and a net loss of $11.3 million and a net gain of $1.1 million, respectively, on the disposal of industrial and construction equipment used in our equipment rental operations. The adjustment of depreciation upon disposal of revenue earning equipment for the nine months ended September 30, 2008 and 2007 included net losses of $39.7 million and $16.9 million, respectively, on the disposal of vehicles used in our car rental operations and a net loss of $14.1 million and a net gain of $8.0 million, respectively, on the disposal of industrial and construction equipment used in our equipment rental operations.

Depreciation rates are reviewed on an ongoing basis based on management's routine review of present and projected future market conditions and their effect on residual values at the time of disposal. During the nine months ended September 30, 2008, depreciation rates being used to compute the provision for depreciation of revenue earning equipment were adjusted on certain vehicles in our car rental operations to reflect changes in the estimated residual values to be realized when revenue earning equipment is sold. These depreciation rate changes resulted in net increases of $12.2 million and $22.4 million in depreciation expense for the three and nine months ended September 30, 2008, respectively. During the three and nine months ended September 30, 2008, depreciation rates in certain of our equipment rental operations were decreased and resulted in net decreases of $0.1 million and $3.9 million, respectively, in depreciation expense.

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Unaudited

For the three months ended September 30, 2008 and 2007, our worldwide car rental operations sold approximately 53,600 and 51,300 non-program cars, respectively, a 4.5% increase. For the nine months ended September 30, 2008 and 2007, our worldwide car rental operations sold approximately 171,300 and 139,500 non-program cars, respectively, a 22.8% increase.

Note 7—Debt

Our "Senior Term Facility" is a secured term loan facility entered into by Hertz in connection with the Acquisition consisting of (a) a maximum borrowing capacity of $2,000.0 million (which was decreased in February 2007 to $1,400.0 million), which included a delayed draw facility of $293.0 million (which was utilized during 2006) and (b) a prefunded synthetic letter of credit facility in an aggregate principal amount of $250.0 million. This term loan facility and the synthetic letter of credit facility mature in December 2012.

Our "Senior ABL Facility" is a senior asset-based revolving loan facility entered into by Hertz and certain of its U.S. and of its Canadian subsidiaries in connection with the Acquisition with a maximum borrowing capacity of $1,600.0 million (which was increased in February 2007 to $1,800.0 million and was decreased in September 2008 to $1,785.0 million). Up to $200.0 million of the revolving loan facility is available for the issuance of letters of credit. The Senior ABL Facility matures in February 2012. We refer to the Senior Term Facility and the Senior ABL Facility together as the "Senior Credit Facilities."

Our "Senior Dollar Notes" are the $1,800.0 million aggregate principal amount of 8.875% Senior Notes due January 2014 issued by Hertz in connection with the Acquisition. Our "Senior Euro Notes" are the €225 million aggregate principal amount of 7.875% Senior Notes due January 2014 issued by Hertz in connection with the Acquisition. We refer to the Senior Dollar Notes and the Senior Euro Notes together as the "Senior Notes." Our "Senior Subordinated Notes" refer to the $600.0 million aggregate principal amount of 10.5% Senior Subordinated Notes due January 2016 issued by Hertz in connection with the Acquisition.

Our "Promissory Notes" consist of the outstanding untendered senior notes issued under three separate indentures existing prior to the Acquisition. These senior notes have remaining maturities ranging from March 2009 to January 2028.

Our "U.S. Fleet Debt" consists of approximately $4,300.0 million of asset-backed securities issued on the Closing Date by Hertz Vehicle Financing LLC, or "HVF," a special purpose entity wholly-owned by us, backed by our U.S. car rental fleet, all of which we issued under our existing asset-backed notes program, or the "ABS Program." An additional $600.0 million of issued asset-backed medium term notes that were issued prior to the Closing Date, or "Pre-Acquisition ABS Notes," having maturities from May 2007 to May 2009 remained outstanding under the ABS Program following the Closing Date ($430.0 million of which have subsequently matured). We have also issued approximately $1,500 million of variable funding notes on the Closing Date in two series under these facilities, none of which were funded on the Closing Date. The current capacity is $1,450.0 million. We also issued $825.0 million of 2008-1 Variable Funding Rental Car Asset-Backed Notes, or the "Series 2008-1 Notes," on September 12, 2008, which as of September 30, 2008 had not been funded. The U.S. Fleet Debt facilities have maturities ranging from February 2009 to November 2010.

Our "International Fleet Debt" consists of the aggregate borrowings of our foreign subsidiaries under asset-based revolving loan facilities entered into by Hertz International Ltd, or "HIL," a Delaware corporation organized as a foreign subsidiary holding company and a direct subsidiary of Hertz, and certain of its subsidiaries (all of which are organized outside the United States), together with certain

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Unaudited

bankruptcy-remote special purpose entities, subject to borrowing bases comprised of rental vehicles, rental equipment, and related assets of certain of our foreign subsidiaries (substantially all of which are organized outside of the United States) or one or more special purpose entities, as the case may be. The subsidiaries conducting the car rental business in certain European jurisdictions may, at their option, continue to engage in capital lease financings relating to revenue earning equipment outside the International Fleet Debt facilities. In 2007 and 2008, additional borrowers consented to the senior bridge facility agreement under the International Fleet Debt facilities in connection with the expected take-out of the interim facilities entered into at the time of the Acquisition. The International Fleet Debt matures in December 2010.

Our "Fleet Financing Facility" is a credit agreement entered into by Hertz and its subsidiary, Puerto Ricancars, Inc., or "PR Cars," in September 2006, which provides for a commitment of up to $275.0 million to finance the acquisition of Hertz's and/or PR Cars fleet in Hawaii, Kansas, Puerto Rico and St. Thomas, the U.S. Virgin Islands. The Fleet Financing Facility matures in December 2011, but Hertz and PR Cars may terminate or reduce the commitments of the lenders thereunder at any time.

Our "Brazilian Fleet Financing Facility" refers to the agreement dated April 4, 2007 amending and restating our Brazilian subsidiary's credit facility (which was originally included under the International Fleet Debt facilities) to, among other things, increase the facility to R$130 million (or $67.8 million, calculated using exchange rates in effect on September 30, 2008) consisting of a R$70 million (or $36.5 million) term loan facility and a R$60 million (or $31.3 million) revolving credit facility. This facility matures in December 2010.

Our "Canadian Fleet Financing Facility" refers to a Note Purchase Agreement entered into by our indirect subsidiary, Hertz Canada Limited, and certain of its subsidiaries, on May 30, 2007, with CARE Trust, a third-party special purpose commercial paper conduit administered by Bank of Montreal, or "CARE Trust," which acts as conduit for the asset-backed borrowing facility, and certain related agreements and transactions, in order to establish an asset-backed borrowing facility to provide financing for our Canadian car rental fleet. The new facility refinanced the Canadian portion of the International Fleet Debt facilities. The maximum amount which may be borrowed under the new facility is CAN$400 million (or $382.0 million). The Canadian Fleet Facility matures in May 2012.

Our "Belgian Fleet Financing Facility" consists of a secured revolving credit facility entered into by our Belgian subsidiary, Hertz Belgium BVBA on June 21, 2007, with varying facility limits of up to €25.4 million (or $36.2 million). This facility refinanced the Belgian portion of our International Fleet Debt facilities. The facility is scheduled to mature in December 2010.

Our "U.K. Leveraged Financing" consists of an agreement for a sale and leaseback facility entered into with a financial institution in the United Kingdom, or the "U.K.," by our subsidiary in the U.K., Hertz (U.K.) Limited, on December 21, 2007, under which we may sell and lease back fleet up to the value of £175.0 million (or $316.5 million). The amount available under this facility increases over the term of the facility. This facility refinanced the U.K. portion of the International Fleet Debt facilities. The facility is scheduled to mature in December 2013.

Our "International ABS Fleet Financing Facility" consists of a multi jurisdictional fleet financing initially covering Australia, France and the Netherlands. The maximum commitment under (i) the Euro denominated financing is €632.0 million (or $901.0 million) and (ii) the Australian dollar denominated financing is A$325.0 million (or $262.0 million). The expected maturity date is in December 2010.

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Unaudited

Our debt consists of the following (in thousands of dollars):

				September 30, 2008		December 31, 2007
Corporate Debt
Senior Term Facility, average interest rate: 2008, 4.2%; 2007, 6.9% (effective average interest rate: 2008, 4.2%; 2007, 7.0%); net of unamortized discount: 2008, $19,819; 2007, $23,350				$	1,355,864	$	1,362,702
Senior ABL Facility, average interest rate: 2008, 4.8%; 2007, 6.0% (effective average interest rate: 2008, 4.9%; 2007, 6.6%); net of unamortized discount: 2008, $15,226; 2007, $19,086					575,352		191,803
Senior Notes, average interest rate: 2008, 8.7%; 2007, 8.7%					2,120,695		2,131,370
Senior Subordinated Notes, average interest rate: 2008, 10.5%; 2007, 10.5%					600,000		600,000
Promissory Notes, average interest rate: 2008, 7.2%; 2007, 7.1% (effective average interest rate: 2008, 7.3%; 2007, 7.2%); net of unamortized discount: 2008, $4,226; 2007, $5,102					461,112		509,443
Notes payable, average interest rate: 2008, 5.6%; 2007, 5.5%					9,709		1,942
Foreign subsidiaries' debt denominated in foreign currencies:
	Short-term bank borrowings, average interest rate: 2008, 3.8%; 2007, 13.2%				75,467		1,082
	Other borrowings, average interest rate: 2008, 4.9%; 2007, 6.0%				6,552		4,516
			Total Corporate Debt		5,204,751		4,802,858
Fleet Debt
U.S. Fleet Debt and pre-Acquisition ABS Notes, average interest rate: 2008, 4.4%; 2007, 4.5% (effective average interest rate: 2008, 4.4%; 2007, 4.5%); net of unamortized discount: 2008, $9,214; 2007, $3,991					4,745,786		4,603,509
International Fleet Debt, average interest rate: 2008, 6.7%; 2007, 6.1% (effective average interest rate: 2008, 6.7%; 2007, 6.1%); net of unamortized discount: 2008, $184; 2007, $279					1,377,664		1,912,386
Fleet Financing Facility, average interest rate: 2008, 4.1%; 2007, 6.3% (effective average interest rate: 2008, 4.2%; 2007, 6.3%); net of unamortized discount: 2008, $1,313; 2007, $1,641					154,187		170,359
Brazilian Fleet Financing Facility, average interest rate: 2008, 11.7%; 2007, 13.2%					66,169		62,907
Canadian Fleet Financing Facility, average interest rate: 2008, 3.8%; 2007, 5.8%					268,724		155,391
Belgian Fleet Financing Facility, average interest rate: 2008, 5.8%; 2007, 6.2%					36,203		30,044
U.K. Leveraged Financing, average interest rate: 2008, 5.9%; 2007, 4.0%					278,826		222,672
International ABS Fleet Financing Facility, average interest rate: 2008, 7.1%; 2007, N/A (effective average interest rate: 2008, 7.2%; 2007, N/A); net of unamortized discount: 2008, $3,788; 2007, N/A					711,868		—
			Total Fleet Debt		7,639,427		7,157,268
		Total Debt		$	12,844,178	$	11,960,126

The aggregate amounts of maturities of debt for each of the twelve-month periods ending September 30 (in millions of dollars) are as follows: 2009, $5,109.4 (including $3,967.6 of other short-term borrowings,

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Unaudited

of which $3,892.1 were under long-term committed credit facilities); 2010, $2,431.3; 2011, $1,035.3; 2012, $176.4; 2013, $1,375.8; after 2013, $2,769.8.

Our short-term borrowings as of September 30, 2008 includes, among other items, the amounts outstanding under our Senior ABL Facility, International Fleet Debt facility, International ABS Fleet Financing Facility, Fleet Financing Facility, Brazilian Fleet Financing Facility, Canadian Fleet Financing Facility, Belgian Fleet Financing Facility and our U.K. Leveraged Financing facility. These amounts are considered short term in nature since they have maturity dates of three months or less; however these facilities are revolving in nature and do not permanently expire at the time of the short term debt maturity. In addition, we include certain scheduled payments of principal under our ABS Program as short-term borrowings.

As of September 30, 2008, there were outstanding standby letters of credit totaling $548.9 million. Of this amount, $334.0 million has been issued for the benefit of the ABS Program ($200.0 million of which was issued by Ford and $134.0 million of which was used under the Senior Credit Facilities) and the remainder is primarily to support self-insurance programs (including insurance policies with respect to which we have indemnified the issuers for any losses) in the United States, Canada and Europe and to support airport concession obligations in the United States and Canada. As of September 30, 2008, none of these letters of credit have been drawn upon.

As of September 30, 2008, the aggregate principal amount of $168.7 million (net of $1.3 million discount) of pre-Acquisition ABS Notes was outstanding and the average interest rate was 3.2%.

As of September 30, 2008, there were $30.5 million of capital lease financings outstanding. These capital lease financings are included in the International Fleet Debt total and mature in August 2010.

International ABS Fleet Financing Facility

On July 24, 2008, HIL and certain of its subsidiaries entered into the "Amendment Agreement" to amend the International Fleet Debt facility. The Amendment Agreement, effective on July 24, 2008, reduced the borrowing margins on the Tranche A1 and Tranche A2 bridge loans of certain borrowers under the facility participating in the International ABS Fleet Financing Facility and provided an August 12, 2008 final maturity date for loans to HIL's Swiss subsidiary borrower. In August, we paid off the loan to HIL's Swiss subsidiary borrower and closed out the loan.

Also on July 24, 2008, HA Fleet Pty Ltd, RAC Finance SAS and Stuurgroep Fleet (Netherlands) B.V., special-purpose indirect subsidiaries of HIL, each a "FleetCo," closed on the International ABS Fleet Financing Facility, initially covering Australia, France and the Netherlands, respectively, or the "Relevant Jurisdictions."

The funds under the new fleet financing will be used to (i) initially repay in whole the FleetCos' portion of indebtedness under the International Fleet Debt facility and the FleetCos' existing inter-company borrowings related to the acquisition of vehicles and (ii) finance the acquisition of vehicles from time to time in the Relevant Jurisdictions.

International Fleet Financing No. 1 B.V, the issuer of the fleet financing, or the "Issuer," is a special purpose entity incorporated as a Dutch B.V. under the laws of the Netherlands. Of the shares of the

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Unaudited

Issuer, 75% are held by a charitable trust and 25% are owned by Hertz Holdings Netherlands B.V., an indirect wholly-owned subsidiary of HIL.

The expected maturity date is in December 2010 (when the FleetCos' obligations to the Issuer are scheduled to come due). The maximum commitment under (i) the Euro denominated financing is €632.0 million (or $901.0 million) and (ii) the Australian dollar denominated financing is A$325 million (or $262 million). On July 24, 2008, actual issuance to the French FleetCo, the Dutch FleetCo and the Australian FleetCo was €230.4 million (or $328.4 million), €35.9 million (or $51.2 million) and A$151.9 million (or $122.4 million), respectively.

Series 2008-1 Notes

On September 12, 2008, HVF completed the closing of a new variable funding note facility referred to as the Series 2008-1 Notes. This series is not subject to a financial guaranty, including from either MBIA or Ambac. The aggregate principal amount of such facility is not to exceed $825.0 million and such facility is available to HVF on a revolving basis. The Series 2008-1 Notes were not funded on the closing date.

The Series 2008-1 Notes are secured primarily by, among other things, a pledge in (i) collateral owned by HVF, including substantially all of the U.S. car rental fleet that Hertz uses in its daily rental operations, a portion of which is subject to repurchase programs with vehicle manufacturers, (ii) the related manufacturer receivables, (iii) all rights of HVF under a lease agreement between Hertz and HVF relating to such U.S. car rental fleet, and (iv) all monies on deposit from time to time in certain collection and cash collateral accounts and all proceeds thereof. The assets of HVF, including the U.S. car rental fleet owned by HVF, will not be available to satisfy the claims of our general creditors.

The expected final maturity date of the Series 2008-1 Notes is August 2010. The Series 2008-1 Notes bear interest at variable rates partially based upon their rating. The Series 2008-1 Notes are currently rated "A" by Standard & Poor's Ratings Services and "A2" by Moody's Investors Service and based on these ratings the borrowing spread is approximately 150 basis points higher than HVF's existing variable funding notes.

Pursuant to a note purchase agreement, HVF sold the Series 2008-1 Notes to each of Deutsche Bank AG, New York Branch, Nantucket Funding Corp. LLC, (an affiliate of Deutsche Bank AG, New York Branch), Sheffield Receivables Corporation (an affiliate of Barclays Bank PLC), and Merrill Lynch Mortgage Capital Inc. The Series 2008-1 Notes were issued pursuant to a series supplement to HVF's indenture, or the "Indenture," with The Bank of New York Mellon Trust Company, N.A., as trustee.

The Series 2008-1 Notes are subject to events of default and amortization events that are customary in nature for U.S. rental car asset-backed securitizations of this type, including non-payment of principal or interest, violation of covenants, material inaccuracy of representations or warranties, failure to maintain certain enhancement levels and insolvency or certain bankruptcy events. The occurrence of an amortization event or event of default could result in the acceleration of principal of the Series 2008-1 Notes and the liquidation of vehicles in the U.S. car rental fleet.

HVF is subject to numerous restrictive covenants under the Indenture and related agreements, including restrictive covenants with respect to liens, indebtedness, benefit plans, mergers, disposition of assets, acquisition of assets, dividends, officers compensation, investments, agreements, the types of business it may conduct and other customary covenants for a bankruptcy-remote special purpose entity.

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Unaudited

Certain of the purchasers of the Series 2008-1 Notes, the administrative agent and the trustee, and their respective affiliates, have performed, and may in the future perform, various investment banking, commercial banking, and other financial advisory services for us for which they have received and will receive, customary fees and expenses, and such parties are also participants in other of our credit facilities.

Guarantees and Security

Hertz's obligations under the Senior Term Facility and the Senior ABL Facility are guaranteed by Hertz Investors, Inc., its immediate parent and most of its direct and indirect domestic subsidiaries (subject to certain exceptions, including for subsidiaries involved in the U.S. Fleet Debt facility and similar special purpose financings), though Hertz Equipment Rental Corporation, or "HERC," does not guarantee Hertz's obligations under the Senior ABL Facility because it is a borrower under that facility. In addition, the obligations of the Canadian borrowers under the Senior ABL Facility are guaranteed by their respective subsidiaries, if any, subject to limited exceptions. The lenders under each of the Senior Term Facility and the Senior ABL Facility have received a security interest in substantially all of the tangible and intangible assets of the borrowers and guarantors under those facilities, including pledges of the stock of certain of their respective subsidiaries, subject in each case to certain exceptions (including in respect of the U.S. Fleet Debt, the International Fleet Debt and, in the case of the Senior ABL Facility, other secured fleet financing). Consequently, these assets will not be available to satisfy the claims of Hertz's general creditors.

Hertz's obligations under the Senior Notes and Senior Subordinated Notes are guaranteed by each of its direct and indirect domestic subsidiaries that is a guarantor under the Senior Term Facility.

The U.S. Fleet Debt issued on the Closing Date has the benefit of financial guaranty insurance policies under which either MBIA Insurance Corporation or Ambac Assurance Corporation guarantee the timely payment of interest on and ultimate payment of principal of such notes. See Note 14—Fair Value Measurements.

The obligations of the borrowers under the International Fleet Debt facilities are guaranteed by HIL, and by the other borrowers and certain related entities under the applicable tranche, in each case subject to certain legal, tax, cost and other structuring considerations. The obligations and the guarantees of the obligations of the Tranche A borrowers under the Tranche A2 loans are subordinated to the obligations and the guarantees of the obligations of such borrowers under the Tranche A1 loans. Subject to legal, tax, cost and other structuring considerations and to certain exceptions, the International Fleet Debt facilities are secured by a material part of the assets of each borrower, certain related entities and each guarantor, including pledges of the capital stock of each borrower and certain related entities. The obligations of the Tranche A borrowers under the Tranche A2 loans and the guarantees thereof are secured on a junior second priority basis by any assets securing the obligations of the Tranche A borrowers under the Tranche A1 loans and the guarantees thereof. The assets that collateralize the International Fleet Debt facilities will not be available to satisfy the claims of Hertz's general creditors.

The obligations of each of the borrowers under the Fleet Financing Facility are guaranteed by each of Hertz's direct and indirect domestic subsidiaries (other than subsidiaries whose only material assets consist of securities and debt of foreign subsidiaries and related assets, subsidiaries involved in the U.S. ABS Program or other similar special purpose financings, subsidiaries with minority ownership

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positions, certain subsidiaries of foreign subsidiaries and certain immaterial subsidiaries). In addition, the obligations of PR Cars are guaranteed by Hertz. The obligations of Hertz under the Fleet Financing Facility and the other loan documents, including, without limitation, its guarantee of PR Cars' obligations under the Fleet Financing Facility, are secured by security interests in Hertz's rental car fleet in Hawaii and by certain assets related to Hertz's rental car fleet in Hawaii and Kansas, including, without limitation, manufacturer repurchase program agreements. PR Cars' obligations under the Fleet Financing Facility and the other loan documents are secured by security interests in PR Cars' rental car fleet in Puerto Rico and St. Thomas, the U.S. Virgin Islands and by certain assets related thereto.

The Brazilian Fleet Financing Facility is secured by our Brazilian subsidiary's fleet of vehicles and backed by a $63.5 million Hertz guarantee.

The Canadian Fleet Financing Facility is secured by the fleet vehicles used in the Canadian operations.

The Belgian Fleet Financing Facility is guaranteed by HIL and the fleet assets used in the Belgian operations are pledged as collateral.

The U.K. Leveraged Financing facility is guaranteed by HIL.

The International ABS Fleet Financing Facility is secured by our fleet in each of the Relevant Jurisdictions. Each of the Fleetcos' portion of the facility is guaranteed by its respective Hertz vehicle rental company in each of the Relevant Jurisdictions. In certain cases, the International ABS Fleet Financing Facility is guaranteed by HIL or its subsidiary Hertz Europe Limited.

Also, substantially all of our revenue earning equipment and certain related assets are owned by special purpose entities, or are subject to liens in favor of our lenders under the Senior ABL Facility, the ABS Program, the International Fleet Debt facilities, the Fleet Financing Facility, the Brazilian Fleet Financing Facility, the Canadian Fleet Financing Facility, the Belgian Fleet Financing Facility, the U.K. Leveraged Financing and the International ABS Fleet Financing Facility. Substantially all our other assets in the United States are also subject to liens in favor of our lenders under the Senior Credit Facilities, and substantially all of our other assets outside the United States are (with certain limited exceptions) subject to liens in favor of our lenders under the International Fleet Debt facilities or (in the case of our Canadian HERC business) the Senior ABL Facility. None of such assets will be available to satisfy the claims of our general creditors.

Covenants

Certain of our debt instruments and credit facilities contain a number of covenants that, among other things, limit or restrict the ability of the borrowers and the guarantors to dispose of assets, incur additional indebtedness, incur guarantee obligations, prepay other indebtedness, make dividends and other restricted payments, create liens, make investments, make acquisitions, engage in mergers, change the nature of their business, make capital expenditures, or engage in certain transactions with affiliates. Some of these agreements also require the maintenance of certain financial covenants. As of September 30, 2008, we were in compliance with all of these financial covenants.

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Unaudited

Derivatives

We utilize certain derivative instruments to enhance our ability to manage risk relating to cash flow and interest rate exposure. See Note 14—Fair Value Measurements.

Credit Facilities

As of September 30, 2008, the following credit facilities were available for the use of Hertz and its subsidiaries:

•

The Senior Term Facility had approximately $25.4 million available under the letter of credit facility.



•

The Senior ABL Facility had the foreign currency equivalent of approximately $1,076.9 million of remaining capacity, all of which was available under the borrowing base limitation and $82.4 million of which was available under the letter of credit facility sublimit.



•

The U.S. Fleet Debt had approximately $1,843.7 million of remaining capacity, of which $28.8 million was available under the borrowing base limitation. No additional amounts were available under the letter of credit facility.



•

The International Fleet Debt facilities had the foreign currency equivalent of approximately $515.2 million of remaining capacity, of which $115.1 million was available under the borrowing base limitation.



•

The Fleet Financing Facility had approximately $120.8 million of remaining capacity, of which none was available under the borrowing base limitation.



•

The Brazilian Fleet Financing Facility had the foreign currency equivalent of approximately $1.0 million of remaining capacity, of which none was available under the borrowing base limitation.



•

The Canadian Fleet Financing Facility had the foreign currency equivalent of approximately $113.3 million of remaining capacity, of which none was available under the borrowing base limitation.



•

The Belgian Fleet Financing Facility had no remaining capacity.



•

The U.K. Leveraged Financing facility had the foreign currency equivalent of approximately $1.5 million of remaining capacity, of which none was available under the borrowing base limitation.



•

The International ABS Fleet Financing Facility had the foreign currency equivalent of approximately $183.7 million of remaining capacity, of which $132.9 million was available under the borrowing base limitation.

As noted above, subject to borrowing base limitations, we had $2,779.2 million available under our various fleet financing facilities and $1,076.9 million available under our various corporate debt facilities.

As of September 30, 2008, substantially all of our assets were pledged under one or more of the facilities noted above. As of September 30, 2008 and December 31, 2007, accrued interest was $84.2 million and

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$138.3 million, respectively, which is reflected in our condensed consolidated balance sheet in "Accrued liabilities."

Note 8—Employee Retirement Benefits

The following table sets forth the net periodic pension and post-retirement (including health care, life insurance and auto) expense (in millions of dollars):

		Three Months Ended September 30,
		Pension Benefits
														Post-retirement Benefits (U.S.)
		U.S.						Non-U.S.
		2008			2007			2008			2007			2008			2007
Components of Net Periodic Benefit Cost:
	Service cost	$	5.0		$	5.8		$	1.6		$	2.9		$	—		$	0.1
	Interest cost		6.6			6.5			2.1			2.7			0.1			0.2
	Expected return on plan assets		(6.2	)		(6.5	)		(2.3	)		(2.9	)		—			—
	Net amortizations		(0.3	)		0.1			(0.1	)		—			(2.6	)		—
	Settlement/curtailment (gain) loss		0.2			1.5			—			—			—			(0.1	)
	Net pension/postretirement expense	$	5.3		$	7.4		$	1.3		$	2.7		$	(2.5	)	$	0.2

		Nine Months Ended September 30,
		Pension Benefits
														Post-retirement Benefits (U.S.)
		U.S.						Non-U.S.
		2008			2007			2008			2007			2008			2007
Components of Net Periodic Benefit Cost:
	Service cost	$	18.0		$	19.4		$	5.9		$	8.2		$	0.1		$	0.3
	Interest cost		20.3			18.9			7.5			7.7			0.5			0.7
	Expected return on plan assets		(18.5	)		(19.3	)		(8.3	)		(8.2	)		—			—
	Net amortizations		0.2			0.2			(0.5	)		—			(2.8	)		(0.1	)
	Settlement/curtailment (gain) loss		2.5			1.2			—			(0.1	)		—			0.1
	Net pension/postretirement expense	$	22.5		$	20.4		$	4.6		$	7.6		$	(2.2	)	$	1.0

Our policy for funded plans is to contribute annually, at a minimum, amounts required by applicable laws, regulations and union agreements. From time to time, we make contributions beyond those legally required. In the three months ended September 30, 2008, a contribution of $1.5 million was made to the Cash Balance Plan for the 2007 plan year. For the three and nine months ended September 30, 2008, we contributed $9.7 million and $29.6 million, respectively, to our funded worldwide pension plans, including discretionary contributions of $4.9 million and $7.2 million, respectively, to our U.K. defined benefit pension plan and benefit payments made through unfunded plans.

We participate in various "multiemployer" pension plans administered by labor unions representing some of our employees. We make periodic contributions to these plans to allow them to meet their pension benefit obligations to their participants. In the event that we withdraw from participation in one of these plans, applicable law could require us to make an additional lump-sum contribution to the plan, and we would have to reflect that as an expense in our consolidated statement of operations and as a liability on our condensed consolidated balance sheet. Our withdrawal liability for any multiemployer

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plan would depend on the extent of the plan's funding of vested benefits. In the ordinary course of our renegotiation of collective bargaining agreements with labor unions that maintain these plans, we could decide to discontinue participation in a plan, and in that event we could face a withdrawal liability. Some multiemployer plans, including one in which we participate, are reported to have significant underfunded liabilities. Such underfunding could increase the size of our potential withdrawal liability.

Note 9—Stock-based Compensation

In February 2008, we granted options to acquire 2,481,440 shares of our common stock to key executives, employees and non-management directors at exercise prices ranging from $12.74 to $12.97 under the Hertz Global Holdings Inc. Stock Incentive Plan, or the "Stock Incentive Plan," and the Hertz Global Holdings Inc. Director Stock Incentive Plan, or the "Director Plan." These options are subject to and governed by the terms of the Stock Incentive Plan and the Director Plan.

On February 28, 2008, our Board of Directors adopted the Hertz Global Holdings, Inc. 2008 Omnibus Incentive Plan, or the "Omnibus Plan", which was approved by our stockholders at the annual meeting of stockholders held on May 15, 2008. The Omnibus Plan provides for grants of both equity and cash awards, including non-qualified stock options, incentive stock options, stock appreciation rights, performance awards (shares and units), restricted stock, restricted stock units and deferred stock units to key executives, employees and non-management directors.

The Omnibus Plan provides that no further awards will be granted pursuant to the Stock Incentive Plan and the Director Plan, or the "Prior Plans." However, awards that had been previously granted pursuant to the Prior Plans will continue to be subject to and governed by the terms of the Prior Plans. As of September 30, 2008, there were 15.2 million shares of our common stock underlying such outstanding awards.

In addition to the 15.2 million shares underlying outstanding awards as of September 30, 2008, we had 16.6 million shares of our common stock available for issuance under the Omnibus Plan. The shares of common stock to be delivered under the Omnibus Plan may consist, in whole or in part, of common stock held in treasury or authorized but unissued shares of common stock, not reserved for any other purpose.

Shares subject to any award granted under the Omnibus Plan that for any reason are canceled, terminated, forfeited, settled in cash or otherwise settled without the issuance of common stock after the effective date of the Omnibus Plan will generally be available for grant under the Omnibus Plan.

All stock options and stock appreciation rights granted under the Omnibus Plan will have a per-share exercise price no less than fair market value of one share of Hertz Holdings common stock on the grant date. Stock options and stock appreciation rights will vest based on a minimum period of service or the occurrence of events (such as a change in control, as defined in the Omnibus Plan) specified by the compensation committee. No stock options or stock appreciation rights will be exercisable after ten years from the grant date. The compensation committee may accelerate the vesting of an option or stock appreciation right at any time. In addition, vesting of options and stock appreciation rights will be accelerated if Hertz Holdings experiences a change in control (as defined in the Omnibus Plan) unless options or stock appreciation rights with substantially equivalent terms and economic value are substituted for existing options and stock appreciation rights in place of accelerated vesting. Vesting of options and stock appreciation rights will also be accelerated in the event of an employee's death or disability (as defined in the Omnibus Plan). Upon a termination for cause (as defined in the Omnibus

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Plan), all options and stock appreciation rights held by the employee are immediately cancelled. Following a termination without cause, vested options and stock appreciation rights will generally remain exercisable through the earliest of the expiration of their term or 30 days following termination of employment (one year in the case of death or disability).

Performance stock, performance stock units and performance units granted under the Omnibus Plan will vest based on the achievement of pre-determined performance goals over performance periods determined by the compensation committee. In the event of an employee's death or disability, a pro rata portion of the employee's performance stock, performance stock units and performance units will vest to the extent performance goals are achieved at the end of the performance period. Upon a termination of employment or for any other reason, all outstanding performance stock, performance stock units and performance units held by the employee are immediately canceled.

Restricted stock and restricted stock units granted under the Omnibus Plan will vest based on a minimum period of service or the occurrence of events (such as a change in control, as defined in the Omnibus Plan) specified by the compensation committee. Upon a termination of employment for any reason, any unvested restricted stock or restricted stock units of the employee will be canceled.

Each deferred stock unit granted under the Omnibus Plan represents the right to receive one share of Hertz Holdings' common stock on a specified future date. Generally, upon a participant's termination of employment other than for cause, Hertz Holdings will issue one share of common stock to the participant for each deferred stock unit the participant then holds.

In May 2008, we granted options to acquire 209,748 shares of our common stock to non-management directors or their assignees at an exercise price of $14.21. These options are subject to and governed by the terms of the Omnibus Plan.

In August 2008, we granted options to acquire 861,300 shares of our common stock to key executives, employees and non-management directors at an exercise price of $8.61 under the Omnibus Plan.

We have accounted for our employee stock-based compensation awards in accordance with SFAS No. 123R, "Share-Based Payment." The options are being accounted for as equity-classified awards.

For the three and nine months ended September 30, 2008, we recognized compensation cost of approximately $6.8 million ($4.2 million, net of tax) and $20.3 million ($12.5 million, net of tax), respectively for options granted pursuant to our Prior Plans and the Omnibus Plan. As of September 30, 2008, there was approximately $72.0 million of total unrecognized compensation cost related to non-vested stock options granted by Hertz Holdings under the Prior Plans and Omnibus Plan, including costs related to modifying the exercise prices of certain option grants in order to preserve the intrinsic value of the options, consistent with applicable tax law, to reflect special cash dividends of $4.32 per share paid on June 30, 2006 and $1.12 per share paid on November 21, 2006. These remaining costs are expected to be recognized over the remaining 1.8 years, on a weighted average basis, of the requisite service period that began on the grant dates.

Note 10—Segment Information

We follow SFAS No. 131, "Disclosures about Segments of an Enterprise and Related Information," which requires companies to disclose segment data based on how management makes decisions about allocating resources to segments and measuring their performance.

Our operating segments are aggregated into reportable business segments based primarily upon similar economic characteristics, products, services, customers, and delivery methods. We have identified two reportable segments: rental of cars and light trucks, or "car rental," and rental of industrial, construction and material handling equipment, or "equipment rental."

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Adjusted pre-tax income (loss) is the measure utilized by management in making decisions about allocating resources to segments and measuring their performance. We believe this measure best reflects the financial results from ongoing operations. Adjusted pre-tax income (loss) is calculated as income (loss) before income taxes and minority interest plus other reconciling items, non-cash purchase accounting charges, non-cash debt charges relating to the amortization of deferred debt financing costs and debt discounts and certain one-time charges and non-operational items. The contribution of our reportable segments to revenues and adjusted pre-tax income and the reconciliation to consolidated amounts for the three and nine months ended September 30, 2008 and 2007 are summarized below (in millions of dollars).

			Three Months Ended September 30,
			Revenues				Adjusted Pre-Tax Income
			2008		2007		2008			2007
Car rental			$	1,986.5	$	1,982.2	$	167.1		$	301.1
Equipment rental				433.1		464.9		81.1			109.2
		Total reportable segments		2,419.6		2,447.1		248.2			410.3
Other				2.3		2.5
		Total	$	2,421.9	$	2,449.6
Adjustments:
	Other reconciling items(a)							(79.1	)		(75.4	)
	Purchase accounting(b)							(25.2	)		(23.3	)
	Non-cash debt charges(c)							(20.2	)		(34.8	)
	Restructuring charges							(74.9	)		(16.1	)
	Restructuring related charges(d)							(10.1	)		—
	Management transition costs							—			(7.8	)
	Unrealized loss on derivatives(e)							(15.0	)		(7.0	)
	Vacation accrual adjustment(f)							2.5			9.2
		Income before income taxes and minority interest					$	26.2		$	255.1

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			Nine Months Ended September 30,
			Revenues				Adjusted Pre-Tax Income
			2008		2007		2008			2007
Car rental			$	5,442.8	$	5,252.2	$	355.8		$	480.9
Equipment rental				1,287.4		1,287.8		225.9			271.5
		Total reportable segments		6,730.2		6,540.0		581.7			752.4
Other				6.1		6.8
		Total	$	6,736.3	$	6,546.8
Adjustments:
	Other reconciling items(a)							(240.9	)		(244.2	)
	Purchase accounting(b)							(74.4	)		(69.0	)
	Non-cash debt charges(c)							(56.4	)		(87.3	)
	Restructuring charges							(127.2	)		(65.4	)
	Restructuring related charges(d)							(21.0	)		—
	Management transition costs							(1.3	)		(11.0	)
	Unrealized gain (loss) on derivatives(e)							(12.0	)		3.2
	Realized gain on derivatives(e)							14.8			—
	Vacation accrual adjustment(f)							—			28.8
	Secondary offering costs							—			(2.0	)
		Income before income taxes and minority interest					$	63.3		$	305.5

(a)

Represents general corporate expenses, certain interest expense (including net interest on corporate debt), as well as other business activities such as our third-party claim management services.

(b)

Represents the purchase accounting effects of the Acquisition and any subsequent acquisitions on our results of operations relating to increased depreciation and amortization of tangible and intangible assets and accretion of revalued workers' compensation and public liability and property damage liabilities.

(c)

Represents non-cash debt charges relating to the amortization of deferred debt financing costs and debt discounts. For the three and nine months ended September 30, 2008, also includes $2.8 million and $7.8 million, respectively, associated with the ineffectiveness of the HVF swaps. For the three and nine months ended September 30, 2007, also includes $17.7 million associated with the ineffectiveness of the HVF swaps. Additionally, in the nine months ended September 30, 2007, includes the write off of $16.2 million of unamortized debt costs associated with a debt modification.

(d)

Represents incremental, one-time costs incurred directly supporting our business transformation initiatives. Such costs include transition costs incurred in connection with our business process outsourcing arrangements and incremental costs incurred to facilitate business process re-engineering initiatives that involve significant organization redesign and extensive operational process changes.

(e)

Represents unrealized gains and losses and a realized gain on interest rate swaptions.

(f)

Represents increases and decreases in the employee vacation accrual relating to a change in our U.S. vacation policy in 2007 which provides for vacation entitlement to be earned ratably throughout the year versus the previous policy which provided for full vesting on January 1 of each year.

The increase in total assets from December 31, 2007 to September 30, 2008 in our condensed consolidated balance sheet was primarily due to increases in revenue earning vehicles in our car rental segment and receivables, partly offset by decreases in revenue earning equipment in our equipment rental segment and restricted cash.

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Note 11—Comprehensive Income (Loss)

Accumulated other comprehensive income as of September 30, 2008 and December 31, 2007 primarily includes accumulated translation gains of $147.8 million and $217.9 million, respectively, changes in unrecognized net periodic pension and postretirement costs of $6.8 million and $26.1 million, respectively, partly offset by unrealized losses on cash flow hedges of $51.4 million and $45.6 million, respectively, and unrealized losses on our Euro-denominated debt of $21.3 million and $27.8 million, respectively.

Comprehensive income (loss) for the three and nine months ended September 30, 2008 and 2007 was as follows (in thousands of dollars):

			Three Months Ended September 30,
			2008			2007
Net income			$	17,664		$	162,707
Other comprehensive income (loss), net of tax:
	Foreign currency translation adjustments			(134,108	)		56,535
	Unrealized gain on available-for-sale securities			67			32
	Unrealized gain (loss) on Euro-denominated debt			20,773			(9,371	)
	Change in unrecognized net periodic pension and postretirement cost			(19,056	)		(2	)
	Change in fair value of cash flow hedges			(4,835	)		(27,414	)
		Total other comprehensive income (loss)		(137,159	)		19,780
Comprehensive income (loss)			$	(119,495	)	$	182,487

			Nine Months Ended September 30,
			2008			2007
Net income			$	11,207		$	183,816
Other comprehensive income (loss), net of tax:
	Foreign currency translation adjustments			(70,103	)		94,022
	Unrealized gain (loss) on available-for-sale securities			9			(41	)
	Unrealized gain (loss) on Euro-denominated debt			6,485			(13,484	)
	Change in unrecognized net periodic pension and postretirement cost			(19,241	)		15,736
	Change in fair value of cash flow hedges			(5,783	)		(16,368	)
		Total other comprehensive income (loss)		(88,633	)		79,865
Comprehensive income (loss)			$	(77,426	)	$	263,681

Note 12—Earnings Per Share

Basic earnings per share is computed based upon the weighted average number of common shares outstanding. Diluted earnings per share is computed based upon the weighted average number of common shares outstanding plus the effect of all potentially dilutive common stock equivalents, except when the effect would be anti-dilutive.

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The following table sets forth the computation of basic and diluted earnings per share (in thousands of dollars, except share and per share amounts):

		Three Months Ended September 30,
		2008		2007
Basic and diluted earnings per share:
Numerator:
	Net income	$	17,664	$	162,707
Denominator (in thousands):
	Weighted average shares used in basic computation		322,886		321,487
	Add: Stock options		—		6,020
	Weighted average shares used in diluted computation		322,886		327,507
Earnings per share, basic		$	0.05	$	0.51
Earnings per share, diluted		$	0.05	$	0.50

		Nine Months Ended September 30,
		2008		2007
Basic and diluted earnings per share:
Numerator:
	Net income	$	11,207	$	183,816
Denominator (in thousands):
	Weighted average shares used in basic computation		322,599		321,004
	Add: Stock options		—		4,252
	Weighted average shares used in diluted computation		322,599		325,256
Earnings per share, basic		$	0.03	$	0.57
Earnings per share, diluted		$	0.03	$	0.57

Diluted earnings per share computations for the three and nine months ended September 30, 2008 excluded the weighted average impact of the assumed exercise of approximately 16.4 million stock options because such impact would be antidilutive. Diluted earnings per share computations for the three and nine months ended September 30, 2007 excluded the weighted average impact of the assumed exercise of approximately 0.4 million stock options, because such impact would be antidilutive.

Note 13—Restructuring

As part of our ongoing effort to implement our strategy of reducing operating costs, we are evaluating our workforce and operations and making adjustments, including headcount reductions and business process reengineering to optimize work flow at rental locations and maintenance facilities as well as streamlining our back-office operations and evaluating outsourcing opportunities. When we make adjustments to our workforce and operations, we may incur incremental expenses that delay the benefit of a more efficient workforce and operating structure, but we believe that increasing our operating

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efficiency and reducing the costs associated with the operation of our business are important to our long-term competitiveness.

On January 5, 2007, we announced the first in a series of initiatives to further improve our competitiveness through targeted job reductions affecting approximately 200 employees primarily at our corporate headquarters in Park Ridge, New Jersey and our U.S. service center in Oklahoma City, Oklahoma.

On February 28, 2007, we announced the second initiative to further improve our competitiveness and industry leadership through targeted job reductions affecting approximately 1,350 employees primarily in our U.S. car rental operations, with much smaller reductions occurring in our U.S. equipment rental operations, the corporate headquarters in Park Ridge, New Jersey, and the U.S. service center in Oklahoma City, Oklahoma, as well as in Canada, Puerto Rico, Brazil, Australia and New Zealand.

On June 1, 2007, we announced the third initiative to further improve our operational efficiency through targeted reductions affecting approximately 480 positions in our U.S. car and equipment rental operations, as well as financial and reservations-related positions in our U.S. service center in Oklahoma City, Oklahoma.

During 2007, we began to implement cost saving initiatives in our European operations, and we are continuing implementation of these measures in 2008. Additionally, during the fourth quarter of 2007, we finalized or substantially completed contract terms with industry leading service providers to outsource select functions globally, relating to real estate facilities management and construction, procurement and information technology. The contracts related to these outsourced functions were completed during the first quarter of 2008. Substantially all of the selected functions in these areas have been transitioned to the third-party service providers by the end of the third quarter of 2008.

In the first quarter of 2008, to continue improving our competitiveness and industry position, we initiated job reductions affecting approximately 950 employees in our U.S. and European car rental operations with much smaller reductions occurring in our U.S. equipment rental operations, the corporate headquarters in Park Ridge, New Jersey, and the U.S. service center in Oklahoma City, Oklahoma.

In late May and June 2008, our U.S. equipment rental business initiated the closure of 22 branch operations across the U.S. to gain further operating efficiencies. This initiative resulted in severance costs for approximately 180 employees whose positions were eliminated, asset impairment charges for surplus equipment identified for disposal, recognition of future facility lease obligations and the impairment of related leasehold improvements. Additionally, in the second quarter of 2008, we implemented other cost containment and efficiency initiatives resulting in approximately 220 employee reductions.

During the third quarter of 2008, our equipment rental business incurred charges for asset impairments, losses on disposal of surplus equipment and recognition of future facility lease obligations related to branch closings in the U.S. and Europe. Our U.S. car rental business, in order to streamline operations and reduce costs, initiated the closure of 48 off-airport locations and incurred a charge related to facility lease obligations. Additionally, to address the challenging economic environment, we introduced a voluntary employment separation program in our U.S. operations as well as initiating involuntary employee severance actions globally. The third quarter restructuring charges included employee termination liabilities covering approximately 1,400 employees.

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For the three months ended September 30, 2008, our consolidated statement of operations includes restructuring charges relating to the initiatives discussed above of $74.9 million, which is composed of $38.5 million of termination benefits, $23.5 million in asset impairment charges, $7.9 million in facility lease obligations, $2.2 million in consulting costs, $0.2 million in pension settlement losses and $2.6 million of other restructuring charges. The after-tax effect of the restructuring charges reduced diluted earnings per share by $0.16 for the three months ended September 30, 2008.

For the nine months ended September 30, 2008, our consolidated statement of operations includes restructuring charges relating to the initiatives discussed above of $127.2 million, which is composed of $62.5 million of termination benefits, $34.1 million in asset impairment charges, $11.6 million in facility lease obligations, $9.6 million in consulting costs, $1.2 million in pension settlement losses and $8.2 million of other restructuring charges. The after-tax effect of the restructuring charges reduced diluted earnings per share by $0.27 for the nine months ended September 30, 2008.

Additional efficiency and cost saving initiatives may be developed during the fourth quarter of 2008. However, we presently do not have firm plans or estimates of any related expenses.

Restructuring charges in our consolidated statement of operations can be summarized as follows (in thousands of dollars):

			Three Months Ended September 30,
			2008		2007
By Caption:
	Direct operating		$	55,746	$	5,462
	Selling, general and administrative			19,112		10,648
		Total	$	74,858	$	16,110

			Nine Months Ended September 30,
			2008		2007
By Caption:
	Direct operating		$	87,117	$	30,356
	Selling, general and administrative			39,995		35,039
		Total	$	127,112	$	65,395

			Three Months Ended September 30,
			2008		2007
By Segment:
	Car rental		$	36,318	$	11,868
	Equipment rental			36,563		449
	Other reconciling items			1,977		3,793
		Total	$	74,858	$	16,110

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			Nine Months Ended September 30,
			2008		2007
By Segment:
	Car rental		$	64,567	$	46,279
	Equipment rental			54,971		3,383
	Other reconciling items			7,574		15,733
		Total	$	127,112	$	65,395

Our condensed consolidated balance sheet as of September 30, 2008, included accruals of $52.4 million relating to the restructuring program. We expect to pay substantially all of the remaining restructuring obligations by the end of the second quarter 2009. The following table sets forth the activity affecting the accrual during the nine months ended September 30, 2008 (in thousands of dollars):

		Termination Benefits			Pension and Post Retirement Expense			Consultant Costs			Other			Total
Balance as of January 1, 2008		$	15,190		$	105		$	2,105		$	788		$	18,188
	Charges incurred		62,459			1,183			9,608			53,862			127,112
	Cash payments		(31,319	)		(11	)		(11,133	)		(9,514	)		(51,977	)
	Other(1)		(1,891	)		(1,175	)		(7	)		(37,885	)		(40,958	)
Balance as of September 30, 2008		$	44,439		$	102		$	573		$	7,251		$	52,365

(1)

Consists of an increase of $31.2 million for the impairment of revenue earning equipment, $6.4 million in facility lease obligations, $2.9 million for the impairment of fixed assets, $1.1 million in pension and post retirement liabilities and $0.5 million for health benefits, partly offset by $(1.1) million loss in foreign currency translation, which have been included within "Accumulated other comprehensive income" on our condensed consolidated balance sheet.

Note 14—Fair Value Measurements

Effective January 1, 2008, we adopted the provisions of SFAS No. 157 except as they relate to our non-financial assets and liabilities that are not recognized or disclosed at fair value in the financial statements on a recurring basis (at least annually), which provisions become effective for us beginning in January 2009. SFAS No. 157 defines fair value, establishes a framework for measuring fair value in accordance with GAAP and expands disclosures about fair value measurements. SFAS No. 157 establishes a three-tier value hierarchy, which prioritizes the inputs used in measuring fair value as follows: (Level 1) observable inputs such as quoted prices in active markets; (Level 2) inputs other than the quoted prices in active markets that are observable either directly or indirectly; and (Level 3) unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions.

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The following table summarizes our financial assets and liabilities measured at fair value on a recurring basis as of September 30, 2008 (in thousands of dollars):

			September 30, 2008(1)
Assets:
	HIL swaptions		$	7,614
	Foreign currency options			674
	Interest rate caps			394
		Total assets	$	8,682
Liabilities:
	HVF swaps(2)		$	67,584
	Interest rate caps			394
		Total liabilities	$	67,978

(1)

All fair value measurements were based upon significant observable (Level 2) inputs.

(2)

As the HVF swaps are in a liability position, the measurement of fair value reflects the nonperformance risk associated with the liability, as required by SFAS No. 157.

Derivative Instruments and Hedging Activities

In connection with the Acquisition and the issuance of $3,550.0 million of floating rate U.S. Fleet Debt, HVF entered into certain interest rate swap agreements, or the "HVF Swaps," effective December 21, 2005, which qualify as cash flow hedging instruments in accordance with SFAS No. 133, "Accounting for Derivative Instruments and Hedging Activities." These agreements mature at various terms, in connection with the scheduled maturity of the associated debt obligations, through November 2010. Under these agreements, HVF pays monthly interest at a fixed rate of 4.5% per annum in exchange for monthly amounts at one-month LIBOR, effectively transforming the floating rate U.S. Fleet Debt to fixed rate obligations. HVF paid $44.8 million to reduce the fixed interest rate on the HVF Swaps from the prevailing market rates to 4.5%. Ultimately, this amount will be recognized as additional interest expense over the remaining terms of the HVF Swaps, which range from approximately 1 to 3 years. For the three and nine months ended September 30, 2008, we recorded an expense of $2.8 million and $7.8 million, respectively, and for the three and nine months ended September 30, 2007, we recorded an expense of $17.7 million in our consolidated statement of operations, in "Interest, net of interest income," associated with the ineffectiveness of the HVF Swaps. The ineffectiveness resulted from a decline in the value of the HVF Swaps due to a decrease in forward interest rates along with a decrease in the time value component as we continue to approach the maturity dates of the HVF Swaps. The effective portion of the change in fair value of the HVF Swaps is recorded in "Accumulated other comprehensive income." As of September 30, 2008 and December 31, 2007, the balance reflected in "Accumulated other comprehensive income" was a loss of $51.4 million (net of tax of $32.8 million) and $45.6 million (net of tax of $29.0 million), respectively. As of September 30, 2008 and December 31, 2007, the fair value of the HVF Swaps was a liability of $67.6 million and $50.2 million, respectively, which is reflected in our condensed consolidated balance sheet in "Accrued liabilities." The fair value of the HVF Swaps was calculated using a discounted cash flow method and applying observable market data (i.e. the 1-month LIBOR yield curve and credit default swap spreads).

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In connection with the entrance into the HVF Swaps, Hertz entered into seven differential interest rate swap agreements, or the "differential swaps." These differential swaps were required to be put in place to protect the counterparties to the HVF Swaps in the event of an "amortization event" under the asset-backed notes agreements. In the event of an "amortization event," the amount by which the principal balance on the floating rate portion of the U.S. Fleet Debt is reduced, exclusive of the originally scheduled amortization, becomes the notional amount of the differential swaps and is transferred to Hertz. There was no payment associated with these differential swaps and their notional amounts are and will continue to be zero unless (1) there is an amortization event, which causes the amortization of the loan balance, or (2) the debt is prepaid.

An "event of bankruptcy" (as defined in the indentures governing the U.S. Fleet Debt) with respect to MBIA Insurance Corporation or Ambac Assurance Corporation would constitute an "amortization event" under the portion of the U.S. Fleet Debt facilities guaranteed by the affected insurer. In that event, we would also be required to apply a proportional amount, or substantially all in the case of insolvency of both insurers, of all rental payments by Hertz to its special purpose leasing subsidiary and all car disposal proceeds under the applicable facility or series, or under substantially all U.S. Fleet Debt facilities in the case of insolvency of both insurers, to pay down the amounts owed under the affected facility or series, instead of applying those proceeds to purchase additional cars and/or for working capital purposes. An insurer "event of bankruptcy" could lead to consequences that have a material adverse effect on our liquidity if we were unable to negotiate mutually acceptable new terms with our U.S. Fleet Debt lenders or if alternate funding were not available to us.

In May 2006, in connection with the forecasted issuance of the permanent take-out international asset-based facilities, HIL purchased two swaptions for €3.3 million, to protect itself from interest rate increases. These swaptions gave HIL the right, but not the obligation, to enter into three year interest rate swaps, based on a total notional amount of €600 million at an interest rate of 4.155%. The swaptions were renewed twice in 2007, prior to their scheduled expiration dates of March 15, 2007 and September 5, 2007, at a total cost of €2.7 million and were due to expire on June 5, 2008. On June 4, 2008, these swaptions were sold for a realized gain of €9.4 million (or $14.8 million). Additionally, on June 4, 2008, HIL purchased two new swaptions for €8.6 million, to protect itself from interest rate increases associated with the International ABS Fleet Financing Facility, which closed on July 24, 2008. These swaptions were based on an underlying transaction with a notional amount of €600 million at an interest rate of 4.25%. As of September 30, 2008 and December 31, 2007, the fair value of the swaptions was €5.3 million (or $7.6 million) and €6.2 million (or $9.2 million), respectively, which is reflected in our condensed consolidated balance sheet in "Prepaid expenses and other assets." The fair value of the HIL swaptions was calculated using a discounted cash flow method and applying observable market data. During the three and nine months ended September 30, 2008, the fair value adjustments related to these swaptions were a loss of $15.0 million (unrealized loss on the new swaptions) and a gain $2.8 million ($14.8 million realized gain on sale of the old swaptions and a net $12.0 million unrealized loss on the old and new swaptions), respectively, which were recorded in our consolidated statement of operations in "Selling, general and administrative" expenses. During the three and nine months ended September 30, 2007, the fair value adjustments related to these swaptions was a loss of $6.9 million and a gain of $3.0 million, respectively, which was recorded in our consolidated statement of operations in "Selling, general and administrative" expenses. On October 10, 2008, the outstanding swaptions were terminated and Hertz received a €1.9 million payment from counterparties.

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We have purchased foreign currency option contracts to manage exposure to fluctuations in foreign exchange rates for selected marketing programs. The effect of exchange rate changes on these financial instruments would not materially affect our consolidated financial position, results of operations or cash flows. Our risks with respect to foreign currency option contracts are limited to the premium paid for the right to exercise the option and the future performance of the option's counterparty. Premiums paid for options outstanding as of September 30, 2008, were approximately $0.5 million, and we limit counterparties to financial institutions that have strong credit ratings. As of September 30, 2008 and December 31, 2007, the fair value of all outstanding foreign currency option contracts was approximately $0.7 million and $0.1 million, respectively, which was recorded in our condensed consolidated balance sheet in "Prepaid expenses and other assets." The fair value of the foreign currency option contracts was calculated using a discounted cash flow method and applying observable market data. Gains and losses resulting from changes in the fair value of these options are included in our results of operations in the periods incurred.

On September 12, 2008, a supplement was signed to the Indenture, dated as of August 1, 2006, between HVF and the Bank of New York Mellon Trust Company, N.A. This supplement created the Series 2008-1 Notes for issuance by HVF. In order to satisfy rating agency requirements related to its bankruptcy-remote status, HVF acquired an interest rate cap in an amount equal to the Series 2008-1 maximum principal amount of $825.0 million with a strike rate of 7% and a term until August 15, 2011. HVF bought the cap on the date the supplement was signed for $0.4 million. In connection with this interest rate cap, Hertz sold an equal and opposite cap for $0.3 million. The fair value of these interest rate caps on September 30, 2008 were an asset of $0.4 million and a liability of $0.4 million. The fair value of these interest rate caps was calculated using a discounted cash flow method and applying observable market data. Gains and losses resulting from changes in the fair value of these interest rate caps are included in our results of operations in the periods incurred.

Note 15—Related Party Transactions

Relationship with Ford

Prior to the Acquisition, we were an indirect, wholly-owned subsidiary of Ford. While we were a subsidiary of Ford, we and certain of our subsidiaries had entered into contracts, or other transactions or relationships, with Ford or subsidiaries of Ford, the most significant of which are described below.

Car purchases/repurchases and advertising arrangements

On July 5, 2005, Hertz, one of its wholly-owned subsidiaries and Ford signed a Master Supply and Advertising Agreement, effective July 5, 2005 and expiring August 31, 2010, that covers the 2005 through 2010 vehicle model years.

During the nine months ended September 30, 2008, we purchased cars from Ford and its subsidiaries at a cost of approximately $2,304.6 million and sold cars to Ford and its subsidiaries under various repurchase programs for approximately $809.9 million.

Taxes

Prior to the Acquisition, Hertz and its domestic subsidiaries filed a consolidated federal income tax return with Ford. Pursuant to a tax sharing agreement, or the "Agreement," with Ford, current and deferred taxes were reported, and paid to Ford, as if Hertz had filed its own consolidated tax returns with its domestic subsidiaries. The Agreement provided that Hertz was reimbursed for foreign tax credits in accordance with the utilization of those credits by the Ford consolidated tax group.

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On December 21, 2005, in connection with the Acquisition, the Agreement with Ford was terminated. Upon termination, all tax payables and receivables with Ford were cancelled and neither Hertz nor Ford has any future rights or obligations under the Agreement. Hertz may be exposed to tax liabilities attributable to periods it was a consolidated subsidiary of Ford. While Ford has agreed to indemnify Hertz for certain tax liabilities pursuant to the arrangements relating to our separation from Ford, we cannot offer assurance that payments in respect of the indemnification agreement will be available.

Other relationships and transactions

We and Ford also engage in other transactions in the ordinary course of our respective businesses. These transactions include providing car and equipment rental services to Ford and providing insurance and insurance claim management services to Ford. In addition, Ford subsidiaries are our car rental licensees in Scandinavia and Finland.

Relationship with Hertz Investors, Inc. and the Sponsors

Stockholders Agreement

In connection with the Acquisition, we entered into a stockholders agreement, or, as amended, the "Stockholders Agreement," with investment funds associated with or designated by the Sponsors. The Stockholders Agreement contains agreements that entitle investment funds associated with or designated by the Sponsors to nominate all of our directors. The director nominees are to include three nominees of an investment fund associated with CD&R (one of whom shall serve as the chairman or, if the chief executive officer is the chairman, the lead director), two nominees of investment funds associated with Carlyle, two nominees of an investment fund associated with MLGPE (collectively, the "Sponsor Designees") and up to six independent directors (subject to unanimous consent of the Sponsor Designees, for so long as Hertz Holdings remains a "controlled company" within the meaning of the New York Stock Exchange rules), subject to adjustment in the case that the applicable investment fund sells more than a specified amount of its shareholdings in us. In addition, upon Hertz Holdings ceasing to be a "controlled company" within the meaning of the New York Stock Exchange rules, if necessary to comply with the New York Stock Exchange rules, the director nominees of the Sponsors shall be reduced to two nominees of an investment fund associated with CD&R (one of whom shall serve as the chairman or, if the chief executive officer is the chairman, the lead director), one nominee of investment funds associated with Carlyle, and one nominee of an investment fund associated with MLGPE, and additional independent directors will be elected by our Board of Directors to fill the resulting director vacancies. The Stockholders Agreement also provides that our chief executive officer shall be designated as a director, unless otherwise approved by a majority of the Sponsor Designees. In addition, the Stockholders Agreement provides that one of the nominees of an investment fund associated with CD&R shall serve as the chairman of the executive and governance committee and, unless otherwise agreed by this fund, as Chairman of our Board of Directors. On October 12, 2006, our Board elected four independent directors, effective from the date of the completion of the initial public offering of our common stock. In order to comply with New York Stock Exchange rules, we will be required to have a majority of independent directors on our Board of Directors within one year of our ceasing to be a "controlled company" within the meaning of the New York Stock Exchange rules.

The Stockholders Agreement also grants to the investment funds associated with CD&R or to the majority of the Sponsor Designees the right to remove our chief executive officer. Any replacement chief executive officer requires the consent of investment funds associated with CD&R as well as investment funds associated with at least one other Sponsor. It also contains restrictions on the transfer of our

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Unaudited

shares, and provides for tag-along and drag-along rights, in certain circumstances. The rights described above apply only for so long as the investment funds associated with the applicable Sponsor maintain certain specified minimum levels of shareholdings in us.

In addition, the Stockholders Agreement limits the rights of the investment funds associated with or designated by the Sponsors that have invested in our common stock and our affiliates, subject to several exceptions, to own, manage, operate or control any of our "competitors" (as defined in the Stockholders Agreement). The Stockholders Agreement may be amended from time to time in the future to eliminate or modify these restrictions without our consent.

Registration Rights Agreement

On the Closing Date, we entered into a registration rights agreement, or, as amended, the "Registration Rights Agreement," with investment funds associated with or designated by the Sponsors. The Registration Rights Agreement grants to certain of these investment funds the right, to cause us, at our own expense, to use our best efforts to register such securities held by the investment funds for public resale, subject to certain limitations. The exercise of this right is limited to three requests by the group of investment funds associated with each Sponsor, except for registrations effected pursuant to Form S-3, which are unlimited, subject to certain limitations, if we are eligible to use Form S-3. The secondary offering of our common stock in June 2007 was effected pursuant to this Registration Rights Agreement. In the event we register any of our common stock, these investment funds also have the right to require us to use our best efforts to include shares of our common stock held by them, subject to certain limitations, including as determined by the underwriters. The Registration Rights Agreement also provides for us to indemnify the investment funds party to that agreement and their affiliates in connection with the registration of our securities.

Indemnification Agreements

On the Closing Date, Hertz entered into customary indemnification agreements with us, the Sponsors and our stockholders affiliated with the Sponsors, pursuant to which Hertz Holdings and Hertz indemnify the Sponsors, our stockholders affiliated with the Sponsors and their respective affiliates, directors, officers, partners, members, employees, agents, representatives and controlling persons, against certain liabilities arising out of the performance of a consulting agreement with Hertz Holdings and each of the Sponsors and certain other claims and liabilities, including liabilities arising out of financing arrangements or securities offerings.

We have entered into indemnification agreements with each of our directors in connection with our initial public offering in November 2006. The indemnification agreements provide the directors with contractual rights to the indemnification and expense advancement rights provided under our by-laws, as well as contractual rights to additional indemnification as provided in the indemnification agreements.

We have not recorded any liability relating to these indemnification agreements because these liabilities are not considered to be material.

Director Compensation Policy

On October 12, 2006, our Board of Directors approved our Director Compensation Policy. Pursuant to the policy our directors who are not also our employees each receive a $150,000 annual retainer fee, of which 40% (i.e., $60,000) is payable in cash and 60% (i.e., $90,000) is payable in the form of stock options and having a Black-Scholes value equal to such dollar amount.

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Unaudited

The chairperson of our Audit Committee is paid an additional annual cash fee of $25,000 and each other member of our Audit Committee is paid an additional annual cash fee of $10,000. The chairperson of our Compensation Committee is paid an additional annual cash fee of $15,000 and each other member of our Compensation Committee receives an additional annual cash fee of $10,000.

We also reimburse our directors for reasonable and necessary expenses they incur in performing their duties as directors, and our directors are entitled to free worldwide Hertz car rentals upon completion of evaluation forms. In the case of a member of our Board who is also one of our employees, no additional compensation is paid for serving as a director. Each of our directors who is employed by or affiliated with one of our Sponsors may assign all or any portion of the compensation the director receives for his services as a director to that Sponsor or its affiliates.

Stock options are granted annually in arrears, and cash fees are payable quarterly in arrears, although a director may generally elect to receive all or a portion of fees that would otherwise be payable in cash in the form of shares of our common stock having a fair market value at such time equal to the amount of such fees. Any such shares are paid to the director when cash fees would otherwise be payable, although, if a director so chooses, these shares may be payable on a tax-deferred basis in phantom shares if the requirements regarding such deferral are met in accordance with applicable tax law, in which case the actual shares of our common stock are paid to the director promptly following the date on which he or she ceases to serve as a director (or, if earlier, upon a change in control as defined in the Director Plan or the Omnibus Plan).

Options granted under the Director Compensation Policy must be granted at an exercise price no less than fair market value of such shares on the date of grant. Options granted as part of a director's annual retainer fee will be fully vested at the time of grant and will generally have a 10-year term.

A director recognizes ordinary income upon exercising options granted in an amount equal to the fair market value of the shares acquired on the date of exercise, less the exercise price, and we have a corresponding tax deduction at that time. In the case of shares issued in lieu of cash fees, a director who is an individual generally recognizes ordinary income equal to the fair market value of such shares on the date such shares are paid to the director and we have a corresponding tax deduction at that time. For the three and nine months ended September 30, 2008, we recognized $0.5 million and $1.4 million, respectively, of expense relating to the Director Compensation Policy in our consolidated statement of operations in "Selling, general and administrative" expenses. For the three and nine months ended September 30, 2007, we recognized $0.4 million and $1.3 million, respectively, of expense relating to the Director Compensation Policy in our consolidated statement of operations in "Selling, general and administrative" expenses.

All equity awards granted to our directors prior to May 15, 2008 pursuant to the Director Compensation Policy were granted pursuant the Director Plan, which was approved by our stockholders on October 20, 2006. On February 28, 2008, our Board of Directors adopted the Omnibus Plan, which was approved by our stockholders at the annual meeting of stockholders held on May 15, 2008. The Omnibus Plan provides that no further equity awards will be granted pursuant to the Director Plan. However, awards that had been previously granted pursuant to the Director Plan prior to May 15, 2008 will continue to be subject to and governed by the terms of the Director Plan. Accordingly, all equity awards granted to our directors on May 15, 2008 as part of our Director Compensation Policy were (and those that are granted in the future pursuant to the Director Compensation Policy will be) granted pursuant to the Omnibus Plan.

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Financing Arrangements with Related Parties

Affiliates of ML Global Private Equity, L.P. and its related funds (which are stockholders of Hertz Holdings) and of Merrill Lynch & Co., or "ML," one of the underwriters in the initial public offering of our common stock and the June 2007 secondary offering by the Sponsors, were lenders under the Hertz Holdings Loan Facility (which was repaid with the proceeds of our initial public offering); are lenders under the original and amended Senior Term Facility, the original and amended Senior ABL Facility and the Fleet Financing Facility; acted as initial purchasers with respect to the offerings of the Senior Notes, the Senior Subordinated Notes and the Series 2008-1 Notes; acted as structuring advisors and agents under our ABS Program; and acted as dealer managers and solicitation agents for Hertz's tender offers for its existing debt securities in connection with the Acquisition.

Guarantees

Hertz's obligations under the Senior Term Facility and Senior ABL Facility are guaranteed by Hertz's immediate parent, Hertz Investors, Inc. (previously known as CCMG Corporation). Hertz Holdings is not a guarantor of these facilities. See Note 7—Debt.

Other Sponsor Relationships

Merrill Lynch, Pierce, Fenner & Smith Incorporated acted as an underwriter with respect to a secondary public offering of our common stock in June 2007, for which they received customary fees and expenses. In addition, Merrill Lynch, Pierce, Fenner & Smith Incorporated acts as the administrator of the Stock Incentive Plan and receives customary fees and expenses for these services.

In connection with our car and equipment rental businesses, we enter into millions of rental transactions every year involving millions of customers. In order to conduct those businesses, we also procure goods and services from thousands of vendors. Some of those customers and vendors may be affiliated with the Sponsors or members of our Board of Directors. We believe that all such rental and procurement transactions have been conducted on an arms-length basis and involved terms no less favorable to us than those that we believe we would have obtained in the absence of such affiliation. It is our management's practice to bring to the attention of our Board of Directors any transaction, even if it arises in the ordinary course of business, in which our management believes that the terms being sought by transaction participants affiliated with the Sponsors or our Board of Directors would be less favorable to us than those to which we would agree absent such affiliation.

In the second quarter of 2007, we were advised by ML, an affiliate of one of our Sponsors, that between November 17, 2006, and April 19, 2007, ML engaged in principal trading activity in our common stock. Some of those purchases and sales of our common stock should have been reported to the SEC on Form 4, but were not so reported. ML and certain of its affiliates have engaged in additional principal trading activity since that time. ML and certain of its affiliates have since filed amended or additional reports on Form 4 disclosing the current number of shares of our common stock held by ML and its affiliates. To date, ML has paid to us approximately $4.9 million for its "short-swing" profit liability resulting from its principal trading activity that is subject to recovery by us under Section 16 of the Securities Exchange Act of 1934, as amended. In the event that ML or its affiliates (including private investment funds managed by certain private equity-arm affiliates of ML) sell additional shares of our common stock in the future, this amount may change. In 2008 and 2007, we recorded $0.1 million (net of tax) and $2.9 million (net of tax of $1.9 million), respectively, in our condensed consolidated balance sheet in "Additional paid-in capital." In addition, because ML may be deemed to be an affiliate of Hertz Holdings and there was no registration statement in effect with respect to its sale of shares during this

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Unaudited

period, certain of these sales may have been made in violation of Section 5 of the Securities Act of 1933, as amended.

Note 16—Commitments and Contingencies

Off-Balance Sheet Commitments

As of September 30, 2008 and December 31, 2007, the following guarantees (including indemnification commitments) were issued and outstanding:

Indemnifications

In the ordinary course of business, we execute contracts involving indemnifications standard in the relevant industry and indemnifications specific to a transaction such as the sale of a business. These indemnifications might include claims relating to the following: environmental matters; intellectual property rights; governmental regulations and employment-related matters; customer, supplier and other commercial contractual relationships; and financial matters. Performance under these indemnities would generally be triggered by a breach of terms of the contract or by a third party claim. We regularly evaluate the probability of having to incur costs associated with these indemnifications and have accrued for expected losses that are probable and estimable. The types of indemnifications for which payments are possible include the following:

Sponsors; Directors

On the Closing Date, Hertz entered into customary indemnification agreements with us, the Sponsors and our stockholders affiliated with the Sponsors, pursuant to which Hertz Holdings and Hertz indemnify the Sponsors, our stockholders affiliated with the Sponsors and their respective affiliates, directors, officers, partners, members, employees, agents, representatives and controlling persons, against certain liabilities arising out of performance of a consulting agreement with Hertz Holdings and each of the Sponsors and certain other claims and liabilities, including liabilities arising out of financing arrangements or securities offerings. We do not believe that these indemnifications are reasonably likely to have a material impact on us. We also entered into indemnification agreements with each of our directors in connection with the initial public offering of our common stock in November 2006.

Environmental

We have indemnified various parties for the costs associated with remediating numerous hazardous substance storage, recycling or disposal sites in many states and, in some instances, for natural resource damages. The amount of any such expenses or related natural resource damages for which we may be held responsible could be substantial. The probable expenses that we expect to incur for such matters have been accrued, and those expenses are reflected in our condensed consolidated financial statements. As of September 30, 2008 and December 31, 2007, the aggregate amounts accrued for environmental liabilities, including liability for environmental indemnities, reflected in our condensed consolidated balance sheet in "Accrued liabilities" were $2.6 million and $2.7 million, respectively. The accrual generally represents the estimated cost to study potential environmental issues at sites deemed to require investigation or clean-up activities, and the estimated cost to implement remediation actions, including on-going maintenance, as required. Cost estimates are developed by site. Initial cost estimates are based on historical experience at similar sites and are refined over time on the basis of in-depth studies of the sites. For many sites, the remediation costs and other damages for which we ultimately may be responsible cannot be reasonably estimated because of uncertainties with respect to

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factors such as our connection to the site, the materials there, the involvement of other potentially responsible parties, the application of laws and other standards or regulations, site conditions, and the nature and scope of investigations, studies, and remediation to be undertaken (including the technologies to be required and the extent, duration, and success of remediation).

Legal Proceedings

Consumer or Supplier Class Actions

1.

Fuel and Service Charge

On March 15, 2004, Jose M. Gomez, individually and on behalf of all other similarly situated persons, v. The Hertz Corporation was commenced in the 214th Judicial District Court of Nueces County, Texas. Gomez purports to be a class action filed alternatively on behalf of all persons who were charged a Fuel and Service Charge, or "FSC," by us or all Texas residents who were charged a FSC by us. The petition alleged that the FSC is an unlawful penalty and that, therefore, it is void and unenforceable. The plaintiff seeks an unspecified amount of compensatory damages, with the return of all FSC paid or the difference between the FSC and our actual costs, disgorgement of unearned profits, attorneys' fees and costs. In response to various motions by us, the plaintiff filed two amended petitions, which scaled back the putative class from a nationwide class to a class of all Texas residents who were charged a FSC by us or by our Corpus Christi licensee. A new cause of action was also added for conversion for which the plaintiff is seeking punitive damages. After some limited discovery, we filed a motion for summary judgment in December 2004. That motion was denied in January 2005. The parties then engaged in more extensive discovery. In April 2006, the plaintiff further amended his petition by adding a cause of action for fraudulent misrepresentation and, at the plaintiff's request, a hearing on the plaintiff's motion for class certification was scheduled for August 2006. In May 2006, the plaintiff filed a fourth amended petition which deleted the cause of action for conversion and the plaintiff also filed a first amended motion for class certification in anticipation of the August 2006 hearing on class certification. After the hearing, the plaintiff filed a fifth amended petition seeking to further refine the putative class as including all Texas residents who were charged a FSC in Texas after February 6, 2000. In October 2006, the judge entered a class certification order which certified a class of all Texas residents who were charged an FSC in Texas after February 6, 2000. We then filed an interlocutory appeal of the class certification order with the Court of Appeals, Thirteenth District of Texas. After briefing and oral argument, the appellate court, in July 2008, reversed the trial court's order, decertified the class and remanded the case to the trial court for further proceedings. The case was then settled and a "take nothing judgment" was entered at the trial court in September of 2008 indicating that the plaintiff took nothing on his claims against the defendants with a final judgment being entered with prejudice.

2.

HERC Loss Damage Waiver

On August 15, 2006, Davis Landscape, Ltd., individually and on behalf of all others similarly situated, v. Hertz Equipment Rental Corporation, was filed in the United States District Court for the District of New Jersey. Davis Landscape, Ltd., purports to be a nationwide class action on behalf of all persons and business entities who rented equipment from HERC and who paid a Loss Damage Waiver, or "LDW," charge. The complaint alleges that the LDW is deceptive and unconscionable as a matter of law under pertinent sections of New Jersey law, including the New Jersey Consumer Fraud Act and the New Jersey Uniform Commercial Code. The plaintiff

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seeks an unspecified amount of statutory damages under the New Jersey Consumer Fraud Act, an unspecified amount of compensatory damages with the return of all LDW charges paid, declaratory relief and an injunction prohibiting HERC from engaging in acts with respect to the LDW charge that violate the New Jersey Consumer Fraud Act. The complaint also asks for attorneys' fees and costs. In October 2006, we filed an answer to the complaint. In November 2006, the plaintiff filed an amended complaint adding an additional plaintiff, Miguel V. Pro, an individual residing in Texas, and new claims relating to HERC's charging of an "Environmental Recovery Fee." Causes of action for breach of contract and breach of implied covenant of good faith and fair dealing were also added. After extensive discovery, the plaintiffs filed a motion to certify the class in May 2008. In June 2008, HERC filed its opposition to class certification, as well as a motion for summary judgment.

3.

Concession Fee Recoveries

On October 13, 2006, Janet Sobel, Daniel Dugan, PhD. and Lydia Lee, individually and on behalf of all others similarly situated v. The Hertz Corporation and Enterprise Rent-A-Car Company was filed in the United States District Court for the District of Nevada. Sobel purports to be a nationwide class action on behalf of all persons who rented cars from Hertz or Enterprise Rent-A-Car Company, or "Enterprise," at airports in Nevada and whom Hertz or Enterprise charged airport concession recovery fees. The complaint alleged that the airport concession recovery fees violate certain provisions of Nevada law, including Nevada's Deceptive Trade Practices Act. The plaintiffs seek an unspecified amount of compensatory damages, restitution of any charges found to be improper and an injunction prohibiting Hertz and Enterprise from quoting or charging any of the fees prohibited by Nevada law. The complaint also asks for attorneys' fees and costs. In November 2006, the plaintiffs and Enterprise stipulated and agreed that claims against Enterprise would be dismissed without prejudice. In January 2007, we filed a motion to dismiss. In September 2007, the court denied our motion to dismiss. We thereafter filed a motion for certification seeking to have the interpretation of Nevada Revised Statutes Section 482.31575 certified to the Nevada Supreme Court or, in the alternative, to the United States Court of Appeals for the Ninth Circuit. In October 2007, we answered the complaint. In February 2008, the United States Court of Appeals for the Ninth Circuit denied our motion for certification. Discovery commenced in Spring 2008.

4.

Telephone Consumer Protection Act

On May 3, 2007, Fun Services of Kansas City, Inc., individually and as the representative of a class of similarly-situated persons, v. Hertz Equipment Rental Corporation was commenced in the District Court of Wyandotte County, Kansas. Fun Services purports to be a class action on behalf of all persons in Kansas and throughout the United States who on or after four years prior to the filing of the action were sent facsimile messages of advertising materials relating to the availability of property, goods or services by HERC and who did not provide express permission for sending such faxes. The plaintiff asserts violations of the Telephone Consumer Protection Act, 47 U.S.C. Section 227, and common law conversion and the plaintiff is seeking damages and costs of suit. In June 2007, we removed this action to the United States District Court for the District of Kansas. In February 2008, the case was remanded to the District Court of Wyandotte County, Kansas. In April 2008, the court granted our motion to transfer venue and the case was subsequently transferred to the District Court of Johnson County, Kansas. In October 2008, the plaintiff voluntarily dismissed its conversion claim, without prejudice.

39

HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Unaudited

5.

California Tourism Assessments

On November 14, 2007, Michael Shames, Gary Gramkow, on behalf of themselves and on behalf of all persons similarly situated v. The Hertz Corporation, Dollar Thrifty Automotive Group, Inc., Avis Budget Group, Inc., Vanguard Car Rental USA, Inc., Enterprise Rent-A-Car Company, Fox Rent A Car, Inc., Coast Leasing Corp., The California Travel and Tourism Commission, and Caroline Beteta was commenced in the United States District Court for the Southern District of California. Shames purports to be a class action brought on behalf of all individuals or entities that purchased rental car services from a defendant at a California situs airport after January 1, 2007. The complaint alleges that the defendants agreed to charge consumers a 2.5% assessment and not to compete with respect to this assessment, while misrepresenting that this assessment is owed by consumers, rather than the rental car defendants, to the California Travel and Tourism Commission, or the "CTTC." The complaint also alleges that defendants agreed to pass through to consumers a fee known as the Airport Concession Fee, which fee had previously been required to be included in the rental car defendants' individual base rates, without reducing their base rates. Based on these allegations, the complaint asserts violations of 15 U.S.C. § 1, California's Unfair Competition Law and California's False Advertising Law, and seeks treble damages, disgorgement, injunctive relief, interest, attorneys' fees, and costs. The complaint also asserts separately against the CTTC and Caroline Beteta, the Commission's Executive Director, alleged violations of The California Bagley-Keene Open Meeting Act. In January 2008, we filed a motion to dismiss. In April 2008, the court granted—with leave to amend—the separate motions to dismiss of the rental car defendants, the CTTC and Caroline Beteta. In May 2008, the plaintiffs filed an amended complaint which added a claim for alleged violations of the California Consumers Legal Remedies Act. The rental car defendants and the CTTC subsequently filed separate motions to dismiss the amended complaint and in July 2008 the court dismissed all claims related to the CTTC. Also in July 2008 the court dismissed all claims, except for the federal antitrust claim, related to the rental car defendants.

On December 13, 2007, Thomas J. Comiskey, on behalf of himself and all others similarly situated v. Avis Budget Group, Inc., Vanguard Car Rental USA, Inc., Dollar Thrifty Automotive Group, Inc., Advantage Rent-A-Car, Inc., Avalon Global Group, Hertz Corporation, Enterprise Rent-A-Car Company, Fox Rent A Car, Inc., Beverly Hills Rent-A-Car, Inc., Rent4Less, Inc., Autorent Car Rental, Inc., Pacific Rent-A-Car, Inc., ABC Rent-A-Car, Inc., The California Travel and Tourism Commission, and Dale E. Bonner was commenced in the United States District Court for the Central District of California. Comiskey purports to be a class action brought on behalf of all persons and entities that have paid an assessment since the inception of the Passenger Car Rental Industry Tourism Assessment Program in California on January 1, 2007. The complaint alleges that California's Passenger Car Rental Industry Tourism Assessment Program, as included in the California Tourism Marketing Act, violates the United States Constitution's Commerce Clause and First Amendment, both directly and in violation of 42 U.S.C. § 1983, Article I, §§ 2 and 3 of the California Constitution, and Article XIX, § 2 of the California Constitution. The complaint seeks injunctive and declaratory relief, that all unspent assessments collected and to be collected be held in trust, damages, interest, attorneys' fees, and costs. On December 14, 2007, Isabel S. Cohen filed in the United States District Court for the Central District of California a complaint virtually identical to that filed in Comiskey. In February 2008, the court consolidated Comiskey and Cohen, captioned the consolidated action "In re Tourism Assessment Fee Litigation," and ordered the plaintiffs to serve a single

40

HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Unaudited

consolidated class action complaint. In April 2008, we filed a motion to dismiss the consolidated complaint and we also filed a motion to transfer the case to the United States District Court for the Southern District of California for potential consolidation with the Shames case. In September 2008, the United States District Court for the Central District of California granted the rental car defendants' motion to transfer the In re Tourism Assessment Fee Litigation to the United States District Court for the Southern District of California.

We believe that we have meritorious defenses in the foregoing matters and will defend ourselves vigorously.

In addition, we are currently a defendant in numerous actions and have received numerous claims on which actions have not yet been commenced for public liability and property damage arising from the operation of motor vehicles and equipment rented from us and our licensees. In the aggregate, we can be expected to expend material sums to defend and settle public liability and property damage actions and claims or to pay judgments resulting from them.

On February 19, 2007, The Hertz Corporation and TSD Rental LLC v. Enterprise Rent-A-Car Company and The Crawford Group, Inc. was filed in the United States District Court for the District of Massachusetts. In this action, we and our co-plaintiff seek damages and injunctive relief based upon allegations that Enterprise and its corporate parent, The Crawford Group, Inc., or "Crawford," unlawfully engaged in anticompetitive and unfair and deceptive business practices by claiming to customers of Hertz that once Enterprise obtains a patent that it has applied for relating to its insurance replacement reservation system, Hertz will be prevented from using the co-plaintiff's EDiCAR system, which Hertz currently uses in its insurance replacement business. The complaint alleges, among other things, that Enterprise's threats are improper because the Enterprise patent, once issued, should be invalid and unenforceable. In April 2007, Enterprise and Crawford filed a motion to dismiss and Hertz and TSD Rental LLC, or "TSD," filed opposition papers in May 2007. After a hearing on Enterprise's motion in September 2007, Hertz and TSD filed an amended complaint in October 2007. In February 2008, Enterprise and Crawford filed a motion to dismiss the amended complaint and Hertz and TSD filed opposition papers in March of 2008. In June 2008, the court denied the motion to dismiss that had been filed by Enterprise and Crawford. Discovery will now commence.

On September 25, 2007, we filed a second lawsuit, also captioned The Hertz Corporation and TSD Rental LLC v. Enterprise Rent-A-Car Company and The Crawford Group, Inc. in the United States District Court for the District of Massachusetts. In this second lawsuit—the patent action—we seek a declaratory judgment that a newly issued patent to Crawford is not infringed by Hertz and is invalid and unenforceable. In October 2007, we filed a motion to consolidate the antitrust action and the patent action and, in November 2007, the court granted our motion to consolidate the two actions. Enterprise and Crawford filed a motion to dismiss the patent action in December 2007 and Hertz and TSD filed opposition papers in January 2008. In June 2008, the court denied the motion to dismiss that had been filed by Enterprise and Crawford. Discovery will now commence. See "Item 1A—Risk Factors" included in our Form 10-K.

In addition to the foregoing, various legal actions, claims and governmental inquiries and proceedings are pending or may be instituted or asserted in the future against us and our subsidiaries. Litigation is subject to many uncertainties, and the outcome of the individual litigated matters is not predictable with assurance. It is possible that certain of the actions, claims, inquiries or proceedings, including those discussed above, could be decided unfavorably to us or any of our subsidiaries involved. Although the amount of liability with respect to these matters cannot be ascertained, potential liability in excess of related accruals is not expected to materially affect our consolidated financial position, results of operations or cash flows, but it could be material in the period in which it is recorded.

41

ITEM 2.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion and analysis provides information that management believes to be relevant to understanding our consolidated financial condition and results of operations. This discussion should be read in conjunction with the financial statements and the related notes thereto contained elsewhere in this Form 10-Q, or this "Report."

Cautionary Note Regarding Forward-Looking Statements

Certain statements contained or incorporated by reference in this Report including, without limitation, those concerning our liquidity and capital resources, contain "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 concerning our results of operations; economic performance; financial condition; management forecasts; efficiencies, cost savings and opportunities to increase productivity and profitability; income and margins; liquidity and availability to us of additional or continued sources of financing for our revenue earning equipment and financial instability of insurance companies providing financial guarantees for asset-backed securities; anticipated growth; economies of scale; the economy; future economic performance; our ability to maintain profitability during adverse economic cycles and unfavorable external events; fuel costs; future acquisitions and dispositions; litigation; potential and contingent liabilities; management's plans; taxes; tangible and intangible asset impairment charges; and refinancing of existing debt. Because such statements involve risks and uncertainties, actual results may differ materially from those expressed or implied by such forward-looking statements. These statements often include words such as "believes," "expects," "projects," "anticipates," "intends," "plans," "estimates," "seeks," "will," "may," "should," "forecasts" or similar expressions.

Forward-looking statements are not guarantees of performance or results and by their nature are subject to inherent risks and uncertainties. We caution you therefore that you should not rely on these forward-looking statements. You should understand that the risks and uncertainties discussed in "Item 1A—Risk Factors" included in Hertz Global Holdings, Inc.'s Annual Report on Form 10-K for the fiscal year ended December 31, 2007, filed with the United States Securities and Exchange Commission, or the "SEC," on February 29, 2008, or our "Form 10-K," could affect our future results and could cause those results or other outcomes to differ materially from those expressed or implied in our forward-looking statements.

Any forward-looking information contained in this Report speaks only as of the date of this Report. We undertake no obligation to update or revise any forward-looking statements to reflect new information, changed circumstances or unanticipated events.

Unless the context otherwise requires, in this Report, (i) "we," "us," "our," the "Registrant" and the "Company" mean Hertz Global Holdings, Inc. (previously known as CCMG Holdings, Inc.), or "Hertz Holdings," and its consolidated subsidiaries, (ii) "Hertz" means The Hertz Corporation, (iii) "HERC" means Hertz Equipment Rental Corporation, our wholly owned subsidiary, and our various other wholly owned international subsidiaries that conduct our industrial, construction and material handling equipment rental business, (iv) "cars" means cars and light trucks (including sport utility vehicles and, outside North America, light commercial vehicles), (v) "program cars" mean cars purchased by car rental companies under repurchase or guaranteed depreciation programs, (vi) "non-program cars" mean cars not purchased under repurchase or guaranteed depreciation programs for which the car rental company is exposed to residual risk and (vii) "equipment" means industrial, construction and material handling equipment.

We are a successor to corporations that have been engaged in the car and truck rental and leasing business since 1918 and the equipment rental business since 1965. Hertz was incorporated in Delaware in 1967. Ford Motor Company, or "Ford," acquired an ownership interest in Hertz in 1987.

42

ITEM 2.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)

Prior to this, Hertz was a subsidiary of UAL Corporation (formerly Allegis Corporation), which acquired Hertz's outstanding capital stock from RCA Corporation in 1985. Hertz Holdings was incorporated in Delaware in 2005 and had no operations prior to the Acquisition (as defined below).

On December 21, 2005, or the "Closing Date," investment funds associated with or designated by Clayton, Dubilier & Rice, Inc., or "CD&R," The Carlyle Group, or "Carlyle," and Merrill Lynch Global Private Equity, or "MLGPE," or collectively the "Sponsors," through CCMG Acquisition Corporation, a wholly owned subsidiary of Hertz Holdings acquired all of Hertz's common stock from Ford Holdings LLC for aggregate consideration of $4,379 million in cash, debt refinanced or assumed of $10,116 million and transaction fees and expenses of $447 million.

We refer to the acquisition of all of Hertz's common stock through CCMG Acquisition Corporation as the "Acquisition." We refer to the Acquisition, together with related transactions entered into to finance the cash consideration for the Acquisition, to refinance certain of our existing indebtedness and to pay related transaction fees and expenses, as the "Transactions."

In November 2006, we completed our initial public offering of 88,235,000 shares of our common stock at a per share price of $15.00, with proceeds to us before underwriting discounts and offering expenses of approximately $1.3 billion. The proceeds were used to repay borrowings that were outstanding under a $1.0 billion loan facility entered into by Hertz Holdings, or the "Hertz Holdings Loan Facility," and to pay related transaction fees and expenses. The Hertz Holdings Loan Facility was used primarily to pay a special cash dividend of $4.32 per share to our common stockholders on June 30, 2006. The proceeds of the offering were also used to pay special cash dividends of $1.12 per share on November 21, 2006 to stockholders of record of Hertz Holdings immediately prior to the initial public offering.

In June 2007, the Sponsors completed a secondary public offering of 51,750,000 shares of their Hertz Holdings common stock at a per share price of $22.25. We did not receive any of the proceeds from the sale of these shares. We paid all of the expenses of the offering, excluding underwriting discounts and commissions of the selling stockholders, pursuant to a registration rights agreement we entered into at the time of the Acquisition. These expenses aggregated to approximately $2.0 million. Immediately following the secondary public offering, the Sponsors' ownership percentage in us decreased to approximately 55%.

In September 2008, Bank of America Corporation announced it was acquiring the parent company of MLGPE, Merrill Lynch & Co., Inc. Once this acquisition closes it will indirectly alter the ownership of our capital stock. As a consequence, when combined with prior ownership changes we had during the previous three years, this event will likely constitute an "ownership change" for U.S. income tax purposes. An ownership change will result in an annual limitation on the utilization of tax net operating losses and credits generated prior to the ownership change. Based on preliminary analysis, the limitation is not expected to have a material impact on cash taxes and will not result in a permanent loss of net operating losses, only deferred utilization of the losses.

Overview of Our Business

We are engaged principally in the business of renting cars and renting equipment.

Our revenues primarily are derived from rental and related charges and consist of:

•

Car rental revenues (revenues from all company-operated car rental operations, including charges to customers for the reimbursement of costs incurred relating to airport concession fees

43

ITEM 2.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)

and vehicle license fees, the fueling of vehicles and the sale of loss or collision damage waivers, liability insurance coverage and other products);



•

Equipment rental revenues (revenues from all company-operated equipment rental operations, including amounts charged to customers for the fueling and delivery of equipment and sale of loss damage waivers); and



•

Other revenues (fees and certain cost reimbursements from our licensees and revenues from our car leasing operations and our third-party claim management services).

Our equipment rental business also derives revenues from the sale of new equipment and consumables.

Our expenses primarily consist of:

•

Direct operating expenses (primarily wages and related benefits; commissions and concession fees paid to airport authorities, travel agents and others; facility, self-insurance and reservation costs; the cost of new equipment and consumables purchased for resale; and other costs relating to the operation and rental of revenue earning equipment, such as damage, maintenance and fuel costs);



•

Depreciation expense relating to revenue earning equipment (including net gains or losses on the disposal of such equipment). Revenue earning equipment includes cars and rental equipment;



•

Selling, general and administrative expenses (including advertising); and



•

Interest expense, net of interest income.

The car and equipment rental industries are significantly influenced by general economic conditions. The car rental industry is also significantly influenced by developments in the travel industry, and, particularly, in airline passenger traffic. The United States and intentional markets are currently experiencing a significant decline in economic activities, including a tightening of credit markets, reduced airline passenger traffic, reduced consumer spending and volatile fuel prices. During the three months ended September 30, 2008, this resulted in a rapid decline in the volume of car rental transactions, an increase in depreciation and fleet related costs as a percentage of revenue, lower industry pricing and lower residual values for the non-program cars that we sold. See "Item 1A—Risk Factors—Risks Related to Our Business" in this Report.

In response to this economic downturn, we implemented aggressive strategic actions to reduce costs and improve liquidity. These actions include:

•

Further reducing wage and benefit costs—headcount has been reduced by almost 7,100 full-time employees, or 22%, since August 2006. This includes a program we initiated in September to reduce headcount by about 1,400 employees.



•

Accelerating vehicle and equipment deletions and at least temporarily delaying additions to right-size the fleet to current demand levels. In the three months ended September 30, 2008, we sold approximately 4,500 more cars in the U.S. than during the same period in 2007 which contributed to a 4.5% decrease in the average U.S. fleet as compared to the prior year.



•

Rationalizing our location footprint, closing 80 net locations while adding others, primarily in the U.S. off-airport market, to accommodate new business.



•

Implementing recent, significant price increases in our major businesses.

44

ITEM 2.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)

We believe these actions will enhance our liquidity going forward and especially in the fourth quarter when we traditionally generate most of our cash flow. As of September 30, 2008, we had approximately $4.6 billion of liquidity, comprised of $0.7 billion in unrestricted cash, $1.1 billion in unfunded corporate debt capacity and $2.8 billion in unfunded fleet debt capacity (including an $825 million variable note facility closed in September 2008), both subject to borrowing base availability. See "Liquidity and Capital Resources" in this Item 2.

Our profitability is primarily a function of the volume, mix and pricing of rental transactions and the utilization of cars and equipment. Significant changes in the purchase price or residual values of cars and equipment or interest rates can also have a significant effect on our profitability depending on our ability to adjust pricing for these changes. In the United States, 2007 model year program vehicle depreciation costs rose approximately 15% and per-car depreciation costs for 2007 model year U.S. non-program cars declined as compared to 2006. As a consequence of those changes in per-car costs, as well as the larger proportion of our U.S. fleet we purchased as non-program cars and other actions we took to mitigate program car cost increases, our net per-car depreciation costs for 2007 model year cars in the United States have increased by less than 3% from our net per-car depreciation costs for 2006 model year U.S. cars. We continue to have an overall strategy of increasing the proportion of non-program cars we have in our worldwide fleet. However, given the recent economic downturn described above, we sold a higher proportion of non-program cars during the third quarter, when the used car market is traditionally stronger, to reduce exposure to residual value declines in the fourth quarter. Accordingly, as of September 30, 2008, the percentage of non-program cars in the U.S. fleet decreased slightly from 63% to 59% as compared to September 30, 2007. Internationally, as of September 30, 2008, the percentage of non-program cars was 55%, compared to 46% as of September 30, 2008.

We expect 2008 vehicle depreciation costs year over year to increase in the mid single digits in the United States and by approximately 15% in Europe. Our business requires significant expenditures for cars and equipment, and consequently we require substantial liquidity to finance such expenditures. See "Liquidity and Capital Resources" below.

Our car rental and equipment rental operations are seasonal businesses, with decreased levels of business in the winter months and heightened activity during the spring and summer. We have the ability to dynamically manage fleet capacity, the most significant portion of our cost structure, to meet market demand. For instance, to accommodate increased demand, we increase our available fleet and staff during the second and third quarters of the year. As business demand declines, fleet and staff are decreased accordingly. A number of our other major operating costs, including airport concession fees, commissions and vehicle liability expenses, are directly related to revenues or transaction volumes. In addition, our management expects to utilize enhanced process improvements, including efficiency initiatives and the use of our information systems, to help manage our variable costs. Approximately two-thirds of our typical annual operating costs represent variable costs, while the remaining one-third is fixed or semi-fixed. We also maintain a flexible workforce, with a significant number of part time and seasonal workers. However, certain operating expenses, including minimum concession fees, rent, insurance, and administrative overhead, remain fixed and cannot be adjusted for seasonal demand.

As part of our ongoing effort to implement our strategy of reducing operating costs, we are evaluating our workforce and operations and making adjustments, including headcount reductions and business process reengineering to optimize work flow at rental locations and maintenance facilities as well as streamlining our back-office operations and evaluating outsourcing opportunities. When we make adjustments to our workforce and operations, we may incur incremental expenses that delay the benefit

45

ITEM 2.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)

of a more efficient workforce and operating structure, but we believe that increasing our operating efficiency and reducing the costs associated with the operation of our business are important to our long-term competitiveness.

On January 5, 2007, we announced the first in a series of initiatives to further improve our competitiveness through targeted job reductions affecting approximately 200 employees primarily at our corporate headquarters in Park Ridge, New Jersey and our U.S. service center in Oklahoma City, Oklahoma.

On February 28, 2007, we announced the second initiative to further improve our competitiveness and industry leadership through targeted job reductions affecting approximately 1,350 employees primarily in our U.S. car rental operations, with much smaller reductions occurring in our U.S. equipment rental operations, the corporate headquarters in Park Ridge, New Jersey, and the U.S. service center in Oklahoma City, Oklahoma, as well as in Canada, Puerto Rico, Brazil, Australia and New Zealand.

On June 1, 2007, we announced the third initiative to further improve our operational efficiency through targeted reductions affecting approximately 480 positions in our U.S. car and equipment rental operations, as well as financial and reservations-related positions in our U.S. service center in Oklahoma City, Oklahoma.

During 2007, we began to implement cost saving initiatives in our European operations, and we are continuing implementation of these measures in 2008. Additionally, during the fourth quarter of 2007, we finalized or substantially completed contract terms with industry leading service providers to outsource select functions globally, relating to real estate facilities management and construction, procurement and information technology. The contracts related to these outsourced functions were completed during the first quarter of 2008. Substantially all of the selected functions in these areas have been transitioned to the third-party service providers by the end of the third quarter of 2008.

In the first quarter of 2008, to continue improving our competitiveness and industry position, we initiated job reductions affecting approximately 950 employees in our U.S. and European car rental operations with much smaller reductions occurring in our U.S. equipment rental operations, the corporate headquarters in Park Ridge, New Jersey, and the U.S. service center in Oklahoma City, Oklahoma.

In late May and June 2008, our U.S. equipment rental business initiated the closure of 22 branch operations across the U.S. to gain further operating efficiencies. This initiative resulted in severance costs for approximately 180 employees whose positions were eliminated, asset impairment charges for surplus equipment identified for disposal, recognition of future facility lease obligations and the impairment of related leasehold improvements. Additionally, in the second quarter of 2008, we implemented other cost containment and efficiency initiatives resulting in approximately 220 employee reductions.

During the third quarter of 2008, our equipment rental business incurred charges for asset impairments, losses on disposal of surplus equipment and recognition of future facility lease obligations related to branch closings in the U.S. and Europe. Our U.S. car rental business, in order to streamline operations and reduce costs, initiated the closure of 48 off-airport locations and incurred a charge related to facility lease obligations. Additionally, to address the challenging economic environment, we introduced a voluntary employment separation program in our U.S. operations as well as initiating involuntary employee severance actions globally. The third quarter restructuring charges included employee termination liabilities covering approximately 1,400 employees.

46

ITEM 2.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)

For the three and nine months ended September 30, 2008, our consolidated statement of operations includes restructuring charges relating to the initiatives discussed above of $74.9 million and $127.2 million, respectively. For the three and nine months ended September 30, 2007, our consolidated statement of operations includes restructuring charges relating to the initiatives discussed above of $16.1 million and $65.4 million, respectively.

Additional efficiency and cost saving initiatives may be developed during the fourth quarter of 2008. However, we presently do not have firm plans or estimates of any related expenses. See Note 13 to the Notes to our condensed consolidated financial statements included in this Report.

For the year ended December 31, 2007, based on publicly available information, we believe some U.S. car rental brands experienced transaction day growth and rental rate revenue per transaction day, or "RPD," increases compared to the year ended December 31, 2006. For the year ended December 31, 2007, in the U.S., we experienced low to mid single digit transaction day growth versus the prior period, while RPD was down less than one percentage point. During the year ended December 31, 2007, in our European operations, we experienced mid to high single digit transaction day growth and our car rental RPD was above the level of our RPD during the year ended December 31, 2006.

For the nine months ended September 30, 2008, based on publicly available information, we believe some U.S. car rental brands experienced a decline in transaction days and RPD compared to the nine months ended September 30, 2007. For the nine months ended September 30, 2008, we experienced a 2.1% decline in car rental transaction days and car rental RPD was down 1.1% versus the prior period in the United States. During the nine months ended September 30, 2008, we experienced single digit transaction day growth and our car rental RPD was below the level of our RPD during the nine months ended September 30, 2007 in our European operations.

In the three years ended December 31, 2007, we increased the number of our off-airport rental locations in the United States by approximately 27% to approximately 1,580 locations. Revenues from our U.S. off-airport operations grew during the same period, representing $963.8 million, $890.1 million and $845.8 million of our total car rental revenues in the years ended December 31, 2007, 2006 and 2005, respectively. Our expanding U.S. off-airport operations represented $755.0 million and $733.7 million of our total car rental revenues in the nine months ended September 30, 2008 and 2007, respectively. As of September 30, 2008, we had approximately 1,655 off-airport locations. In the balance of 2008 and subsequent years, our strategy will include selected openings of new off-airport locations, the disciplined evaluation of existing locations and the pursuit of same-store sales growth. Our strategy includes increasing penetration in the off-airport market and growing the online leisure market, particularly in the longer length weekly sector, which is characterized by lower vehicle costs and lower transaction costs at a lower RPD. Increasing our penetration in these sectors is consistent with our long-term strategy to generate profitable growth. When we open a new off-airport location, we incur a number of costs, including those relating to site selection, lease negotiation, recruitment of employees, selection and development of managers, initial sales activities and integration of our systems with those of the companies who will reimburse the location's replacement renters for their rentals. A new off-airport location, once opened, takes time to generate its full potential revenues and as a result revenues at new locations do not initially cover their start-up costs and often do not, for some time, cover the costs of their ongoing operations.

For the year ended December 31, 2007, based on publicly available information, we believe the U.S. equipment rental industry experienced downward pricing, measured by the rental rates charged by equipment rental companies. HERC experienced higher equipment rental pricing and volumes worldwide for the year ended December 31, 2007, with pricing increases attributable to higher price

47

ITEM 2.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)

activity in Canada and Europe offset by lower price activity in the U.S. During the year ended December 31, 2007, HERC had a net increase of six U.S. locations, one Canadian location and seven European locations. For the nine months ended September 30, 2008, based on publicly available information, we believe the majority of the U.S. equipment rental industry experienced reduced or decreased volumes and downward pricing. HERC experienced lower equipment rental volumes and pricing worldwide for the nine months ended September 30, 2008 compared to the prior year period. During the nine months ended September 30, 2008, HERC had a net reduction of 22 U.S. locations and a net increase of two Canadian locations, a net reduction of six European locations and one location opening in China. In connection with new location openings in the U.S., we expect HERC will incur non-fleet start-up costs of approximately $0.9 million per location and additional fleet acquisition costs, excluding equipment transferred from other branches, over an initial twelve-month period of approximately $2 to $4 million per location. In connection with new location openings in Europe, we expect HERC will incur lower start-up costs per location as compared with the United States.

Three Months Ended September 30, 2008 Compared with Three Months Ended September 30, 2007

Summary

The following table sets forth the percentage of total revenues represented by the various line items set forth in our consolidated statements of operations for the three months ended September 30, 2008 and 2007 (in millions of dollars):

									Percentage of Revenues
			Three Months Ended September 30,						Three Months Ended September 30,
			2008			2007			2008			2007
Revenues:
	Car rental		$	1,946.1		$	1,944.4			80.3	%		79.4	%
	Equipment rental			432.9			464.8			17.9			19.0
	Other			42.9			40.4			1.8			1.6
		Total revenues		2,421.9			2,449.6			100.0			100.0
Expenses:
	Direct operating			1,351.8			1,216.1			55.8			49.7
	Depreciation of revenue earning equipment			595.0			535.0			24.5			21.8
	Selling, general and administrative			234.3			203.2			9.7			8.3
	Interest, net of interest income			214.6			240.2			8.9			9.8
		Total expenses		2,395.7			2,194.5			98.9			89.6
Income before income taxes and minority interest				26.2			255.1			1.1			10.4
Provision for taxes on income				(2.9	)		(86.9	)		(0.2	)		(3.6	)
Minority interest				(5.6	)		(5.5	)		(0.2	)		(0.2	)
Net income			$	17.7		$	162.7			0.7	%		6.6	%

48

ITEM 2.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)

The following table sets forth certain of our selected car rental, equipment rental and other operating data for the three months ended or as of September 30, 2008 and 2007:

			Three Months Ended or as of September 30,
			2008			2007
Selected Car Rental Operating Data:
	Worldwide number of transactions (in thousands)			7,133			7,667
		Domestic		5,052			5,578
		International		2,081			2,089
	Worldwide transaction days (in thousands)(a)			35,525			36,626
		Domestic		22,613			23,957
		International		12,912			12,669
	Worldwide rental rate revenue per transaction day(b)		$	46.73		$	47.12
		Domestic	$	45.01		$	44.85
		International	$	49.74		$	51.43
	Worldwide average number of company-operated cars during the period			490,700			504,400
		Domestic		312,400			327,200
		International		178,300			177,200
	Adjusted pre-tax income (in millions of dollars)(c)		$	167.1		$	301.1
	Worldwide revenue earning equipment, net (in millions of dollars)		$	8,472.7		$	8,869.1
Selected Worldwide Equipment Rental Operating Data:
	Rental and rental related revenue (in millions of dollars)(d)		$	384.8		$	422.8
	Same store revenue growth, including growth initiatives(e)			(5.5	)%		0.5	%
	Average acquisition cost of rental equipment operated during the period (in millions of dollars)		$	3,405.0		$	3,396.6
	Adjusted pre-tax income (in millions of dollars)(c)		$	81.1		$	109.2
	Revenue earning equipment, net (in millions of dollars)		$	2,411.6		$	2,720.0
Other Operating Data:
	EBITDA (in millions of dollars)(f)		$	889.4		$	1,083.9
	Corporate EBITDA (in millions of dollars)(f)		$	386.7		$	555.1

(a)

Transaction days represents the total number of days that vehicles were on rent in a given period.

(b)

Car rental rate revenue consists of all revenue, net of discounts, associated with the rental of cars including charges for optional insurance products, but excluding revenue derived from fueling and concession and other expense pass-throughs, NeverLost units in the U.S. and certain ancillary revenue. Rental rate revenue per transaction day is calculated as total rental rate revenue, divided by the total number of transaction days, with all periods adjusted to eliminate the effect of fluctuations in foreign currency. Our management believes eliminating the effect of fluctuations in foreign currency is appropriate so as not to affect the comparability of underlying trends. This statistic is important to management as it represents the best measurement of the changes in underlying pricing in the car rental business and encompasses the elements in car rental pricing that management has the ability to control. The optional insurance products are packaged within certain negotiated corporate, government and membership programs and within certain retail rates being charged. Based upon these existing programs and rate packages, management believes that these optional insurance products should be consistently included in the daily pricing of car rental transactions. On the other hand, non-rental rate revenue items such as refueling and concession pass-through expense items are driven by factors beyond the control of management (i.e. the price of fuel and the concession fees charged by airports). Additionally, NeverLost units are an optional revenue product which management does not consider to be part of their daily pricing of car rental transactions. The following table reconciles our car rental

49

ITEM 2.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)

revenue to our rental rate revenue and rental rate revenue per transaction day (based on December 31, 2007 foreign exchange rates) for the three months ended September 30, 2008 and 2007 (in millions of dollars, except as noted):

	Three Months Ended September 30,
	2008			2007
Car rental revenue per statement of operations	$	1,946.1		$	1,944.4
Non-rental rate revenue		(276.0	)		(260.5	)
Foreign currency adjustment		(10.1	)		42.0
Rental rate revenue	$	1,660.0		$	1,725.9
Transaction days (in thousands)		35,525			36,626
Rental rate revenue per transaction day (in whole dollars)	$	46.73		$	47.12

(c)

Adjusted pre-tax income (loss) is calculated as income (loss) before income taxes and minority interest plus non-cash purchase accounting charges, non-cash debt charges relating to the amortization of deferred debt financing costs and debt discounts and certain one-time charges and non-operational items. Adjusted pre-tax income (loss) is the measure utilized by management in making decisions about allocating resources to segments and measuring their performance. Management believes this measure best reflects the financial results from ongoing operations. The following table reconciles income before income taxes and minority interest by segment to adjusted pre-tax income by segment for the three months ended September 30, 2008 and 2007 (in millions of dollars):

		Three Months Ended September 30, 2008
		Car Rental			Equipment Rental
Income before income taxes and minority interest		$	85.8		$	26.9
Adjustments:
	Purchase accounting(1)		9.9			14.8
	Non-cash debt charges(2)		13.5			2.6
	Unrealized loss on derivative(3)		15.0			—
	Restructuring charges		36.4			36.6
	Restructuring related charges(4)		8.3			0.8
	Vacation accrual adjustment(5)		(1.8	)		(0.6	)
Adjusted pre-tax income		$	167.1		$	81.1

		Three Months Ended September 30, 2007
		Car Rental			Equipment Rental
Income before income taxes and minority interest		$	250.5		$	94.4
Adjustments:
	Purchase accounting(1)		9.1			13.8
	Non-cash debt charges(2)		29.1			2.8
	Unrealized loss on derivative(3)		7.0			—
	Restructuring charges		11.9			0.4
	Vacation accrual adjustment(5)		(6.5	)		(2.2	)
Adjusted pre-tax income		$	301.1		$	109.2

(1)

Represents the purchase accounting effects of the Acquisition and any subsequent acquisitions on our results of operations relating to increased depreciation and amortization of tangible and intangible assets and accretion of revalued workers' compensation and public liability and property damage liabilities.



(2)

Represents non-cash debt charges relating to the amortization of deferred debt financing costs and debt discounts. For the three months ended September 30, 2008 and 2007, also includes $2.8 million and $17.7 million, respectively, associated with the ineffectiveness of the HVF swaps (as defined below).

50

ITEM 2.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)

(3)

Represents unrealized losses on interest rate swaptions.



(4)

Represents incremental, one-time costs incurred directly supporting our business transformation initiatives. Such costs include transition costs incurred in connection with our business process outsourcing arrangements and incremental costs incurred to facilitate business process re-engineering initiatives that involve significant organization redesign and extensive operational process changes.



(5)

Represents decreases in the employee vacation accrual relating to a change in our U.S. vacation policy in 2007 which provides for vacation entitlement to be earned ratably throughout the year versus the previous policy which provided for full vesting on January 1 each year.

(d)

Equipment rental and rental related revenue consists of all revenue, net of discounts, associated with the rental of equipment including charges for delivery, loss damage waivers and fueling, but excluding revenue arising from the sale of equipment, parts and supplies and certain other ancillary revenue. Rental and rental related revenue is adjusted in all periods to eliminate the effect of fluctuations in foreign currency. Our management believes eliminating the effect of fluctuations in foreign currency is appropriate so as not to affect the comparability of underlying trends. This statistic is important to our management as it is utilized in the measurement of rental revenue generated per dollar invested in fleet on an annualized basis and is comparable with the reporting of other industry participants. The following table reconciles our equipment rental revenue to our equipment rental and rental related revenue (based on December 31, 2007 foreign exchange rates) for the three months ended September 30, 2008 and 2007 (in millions of dollars):

	Three Months Ended September 30,
	2008			2007
Equipment rental revenue per statement of operations	$	432.9		$	464.8
Equipment sales and other revenue		(44.8	)		(49.3	)
Foreign currency adjustment		(3.3	)		7.3
Rental and rental related revenue	$	384.8		$	422.8

(e)

Same store revenue growth represents the change in the current period total same store revenue over the prior period total same store revenue as a percentage of the prior period. The same store revenue amounts are adjusted in all periods to eliminate the effect of fluctuations in foreign currency. Our management believes eliminating the effect of fluctuations in foreign currency is appropriate so as not to affect the comparability of underlying trends.

(f)

We present EBITDA and Corporate EBITDA to provide investors with supplemental measures of our operating performance and liquidity and, in the case of Corporate EBITDA, information utilized in the calculation of the financial covenants under our senior credit facilities. EBITDA, as used in this Report, is defined as consolidated net income before net interest expense, consolidated income taxes and consolidated depreciation and amortization. Corporate EBITDA differs from the term "EBITDA" as it is commonly used. Corporate EBITDA, as used in this Report, means "EBITDA" as that term is defined under our senior credit facilities, which is generally consolidated net income before net interest expense (other than interest expense relating to certain car rental fleet financing), consolidated income taxes, consolidated depreciation (other than depreciation related to the car rental fleet) and amortization and before certain other items, in each case as more fully defined in the agreements governing our senior credit facilities. The other items excluded in this calculation include, but are not limited to: non-cash expenses and charges; extraordinary, unusual or non-recurring gains or losses; gains or losses associated with the sale or write-down of assets not in the ordinary course of business; and earnings to the extent of cash dividends or distributions paid from non-controlled affiliates. Further, the covenants in our senior credit facilities are calculated using Corporate EBITDA for the most recent four fiscal quarters as a whole. As a result, the measure can be disproportionately affected by a particularly strong or weak quarter. Further, it may not be comparable to the measure for any subsequent four-quarter period or for any complete fiscal year.

Management uses EBITDA and Corporate EBITDA as performance and cash flow metrics for internal monitoring and planning purposes, including the preparation of our annual operating budget and monthly operating reviews, as well as to facilitate analysis of investment decisions. In addition, both metrics are important to allow us to evaluate profitability and make performance trend comparisons between us and our competitors. Further, we believe EBITDA and Corporate EBITDA are frequently used by securities analysts, investors and other interested parties in the evaluation of companies in our industries.

51

ITEM 2.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)

EBITDA is also used by management and investors to evaluate our operating performance exclusive of financing costs and depreciation policies. Further, because we have two business segments that are financed differently and have different underlying depreciation characteristics, EBITDA enables investors to isolate the effects on the profitability of operating metrics such as revenue, operating expenses and selling, general and administrative expenses. In addition to its use to monitor performance trends, EBITDA provides a comparative metric to management and investors that is consistent across companies with different capital structures and depreciation policies. This enables management and investors to compare our performance on a consolidated basis and on a segment basis to that of our peers. In addition, our management uses consolidated EBITDA as a proxy for cash flow available to finance fleet expenditures and the costs of our capital structure on a day-to-day basis so that we can more easily monitor our cash flows when a full statement of cash flows is not available.


Corporate EBITDA also serves as an important measure of our performance. Corporate EBITDA for our car rental segment enables us to assess our operating performance inclusive of fleet management performance, depreciation assumptions and the cost of financing our fleet. In addition, Corporate EBITDA for our car rental segment allows us to compare our performance, inclusive of fleet mix and financing decisions, to the performance of our competitors. Since most of our competitors utilize asset-backed fleet debt to finance fleet acquisitions, this measure is relevant for evaluating our operating efficiency inclusive of our fleet acquisition and utilization. For our equipment rental segment, Corporate EBITDA provides an appropriate measure of performance because the investment in our equipment fleet is longer-term in nature than for our car rental segment and, therefore, Corporate EBITDA allows management to assess operating performance exclusive of interim changes in depreciation assumptions. Further, unlike our car rental segment, our equipment rental fleet is not financed through separate securitization-based fleet financing facilities, but rather through our corporate debt. Corporate EBITDA for our equipment rental segment is a key measure used to make investment decisions because it enables us to evaluate return on investments. For both segments, Corporate EBITDA provides a relevant profitability metric for use in comparison of our performance against our public peers, many of whom publicly disclose a comparable metric. In addition, we believe that investors, analysts and rating agencies consider EBITDA and Corporate EBITDA useful in measuring our ability to meet our debt service obligations and make capital expenditures. Several of our material debt covenants are based on financial ratios utilizing Corporate EBITDA and non-compliance with those covenants could result in the requirement to immediately repay all amounts outstanding under those agreements, which could have a material adverse effect on our results of operations, financial position and cash flows.


EBITDA and Corporate EBITDA are not recognized measurements under accounting principles generally accepted in the United States of America, or "GAAP." When evaluating our operating performance or liquidity, investors should not consider EBITDA and Corporate EBITDA in isolation of, or as a substitute for, measures of our financial performance and liquidity as determined in accordance with GAAP, such as net income, operating income or net cash provided by operating activities. EBITDA and Corporate EBITDA may have material limitations as performance measures because they exclude items that are necessary elements of our costs and operations.


Because other companies may calculate EBITDA and Corporate EBITDA differently than we do, EBITDA may not be, and Corporate EBITDA as presented in this Report is not, comparable to similarly titled measures reported by other companies.


Borrowings under our senior credit facilities are a key source of our liquidity. Our ability to borrow under these senior credit facilities depends upon, among other things, the maintenance of a sufficient borrowing base and compliance with the financial ratio covenants based on Corporate EBITDA set forth in the credit agreements for our senior credit facilities. Our senior term loan facility requires us to maintain a specified consolidated leverage ratio and consolidated interest expense coverage ratio based on Corporate EBITDA, while our senior asset-based loan facility requires that a specified consolidated leverage ratio and consolidated fixed charge coverage ratio be maintained for periods during which there is less than $200 million of available borrowing capacity under the senior asset-based loan facility. These financial covenants became applicable to us beginning September 30, 2006, reflecting the four quarter period ending thereon. Failure to comply with these financial ratio covenants would result in a default under the credit agreements for our senior credit facilities and, absent a waiver or an amendment from the lenders, permit the acceleration of all outstanding borrowings under the senior credit facilities. As of September 30, 2008, we performed the calculations associated with the above noted financial covenants and determined that we are in compliance with such covenants.

As of September 30, 2008, we had an aggregate principal amount outstanding of $1,375.7 million and $590.6 million pursuant to our senior term loan facility and our senior asset-based loan facility, respectively. As of September 30, 2008, Hertz is required under the senior term loan facility to have a consolidated leverage ratio of not more than 5.75:1 and a consolidated interest expense coverage ratio of not less than 1.75:1. In addition, under our senior asset-based loan facility, if there is less than $200 million of available borrowing capacity under that facility as of September 30, 2008, Hertz is required to have a consolidated leverage ratio of not more than 5.75:1 and a consolidated fixed charge coverage ratio of not less than 1:1 for the quarter then ended. Under the senior term loan facility, as of September 30, 2008, we had a consolidated leverage

52

ITEM 2.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)

ratio of 3.51:1 and a consolidated interest expense coverage ratio of 3.73:1. Since we have maintained sufficient borrowing capacity under our senior asset-based loan facility as of September 30, 2008, and expect to maintain such capacity in the future, the consolidated fixed charge coverage ratio was not deemed relevant for presentation. For further information on the terms of our senior credit facilities, see Note 7 to the Notes to our condensed consolidated financial statements included in this Report as well as Note 3 of the Notes to our audited annual consolidated financial statements included in our Form 10-K under the caption "Item 8—Financial Statements and Supplementary Data." We have a significant amount of debt. For a discussion of the risks associated with our significant leverage, see "Item 1A—Risk Factors—Risks Relating to Our Substantial Indebtedness" in our Form 10-K.


The following table reconciles net income to EBITDA and Corporate EBITDA for the three months ended September 30, 2008 and 2007 (in millions of dollars):

		Three Months Ended September 30,
		2008			2007
Net income(1)		$	17.7		$	162.7
	Depreciation and amortization(2)		654.2			594.1
	Interest, net of interest income(3)		214.6			240.2
	Provision for taxes on income		2.9			86.9
EBITDA(4)			889.4			1,083.9
Adjustments:
	Car rental fleet interest		(119.9	)		(132.5	)
	Car rental fleet depreciation		(504.2	)		(456.9	)
	Non-cash expenses and charges(5)		38.9			45.9
	Extraordinary, unusual or non-recurring gains or losses(6)		82.5			14.7
Corporate EBITDA		$	386.7		$	555.1

(1)

For the three months ended September 30, 2008 and 2007, net income includes corporate minority interest of $5.6 million and $5.5 million, respectively.



(2)

For the three months ended September 30, 2008 and 2007, depreciation and amortization was $542.6 million and $496.3 million, respectively, in our car rental segment and $110.1 million and $96.2 million, respectively, in our equipment rental segment.



(3)

For the three months ended September 30, 2008 and 2007, interest, net of interest income, was $117.3 million and $135.4 million, respectively, in our car rental segment and $25.9 million and $37.8 million, respectively, in our equipment rental segment.



(4)

The following table reconciles net cash (used in) provided by operating activities to EBITDA for the three months ended September 30, 2008 and 2007 (in millions of dollars):

		Three Months Ended September 30,
		2008			2007
Net cash (used in) provided by operating activities		$	(261.7	)	$	9.0
	Amortization of debt and debt modification costs		(17.2	)		(17.1	)
	Provision for losses on doubtful accounts		(8.4	)		(4.1	)
	Unrealized loss on derivatives		(15.0	)		(7.0	)
	Gain on sale of property and equipment		1.8			11.4
	Loss on ineffectiveness of interest rate swaps		(2.8	)		(17.7	)
	Stock-based employee compensation charges		(6.8	)		(10.5	)
	Asset writedowns		(23.5	)		—
	Minority interest		(5.6	)		(5.5	)
	Deferred taxes on income		15.8			(42.2	)
	Provision for taxes on income		2.9			86.9
	Interest expense, net of interest income		214.6			240.2
	Net changes in assets and liabilities		995.3			840.5
EBITDA		$	889.4		$	1,083.9

53

ITEM 2.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)

(5)

For the three months ended September 30, 2008 and 2007, non-cash expenses and charges were $28.7 million and $35.5 million, respectively, in our car rental segment.



As defined in the credit agreements governing our senior credit facilities, Corporate EBITDA excludes the impact of certain non-cash expenses and charges. The adjustments reflect the following (in millions of dollars):

		Three Months Ended September 30,
		2008		2007
Non-cash amortization of debt costs included in car rental fleet interest		$	13.7	$	28.5
Corporate non-cash stock-based employee compensation charges			6.8		7.0
Corporate non-cash charges for public liability and property damage			3.4		2.1
Corporate non-cash charges for pension			—		1.3
Unrealized loss on derivatives			15.0		7.0
	Total	$	38.9	$	45.9

(6)

For the three months ended September 30, 2008 and 2007, extraordinary, unusual or non-recurring gains or losses were $42.9 million and $5.4 million, respectively, in our car rental segment and $36.8 million and $(1.8) million, respectively, in our equipment rental segment.



As defined in the credit agreements governing our senior credit facilities, Corporate EBITDA excludes the impact of extraordinary, unusual or non-recurring gains or losses or charges or credits. The adjustments reflect the following (in millions of dollars):

		Three Months Ended September 30,
		2008			2007
Restructuring charges		$	74.9		$	16.1
Restructuring related charges			10.1			—
Management transition costs			—			7.8
Vacation accrual adjustment			(2.5	)		(9.2	)
	Total	$	82.5		$	14.7

Revenues

			Three Months Ended September 30,
(in millions of dollars)			2008		2007		$ Change			% Change
Revenues:
	Car rental		$	1,946.1	$	1,944.4	$	1.7			0.1	%
	Equipment rental			432.9		464.8		(31.9	)		(6.8	)%
	Other			42.9		40.4		2.5			6.1	%
		Total revenues	$	2,421.9	$	2,449.6	$	(27.7	)		(1.1	)%

Total revenues decreased 1.1% (3.5% in constant currency) for the three months ended September 30, 2008 compared to the three months ended September 30, 2007.

Revenues from our car rental operations increased 0.1%, primarily due to the effects of foreign currency translation of approximately $50.9 million, partly offset by a 3.0% decrease in car rental transaction days worldwide and by lower RPD.

54

ITEM 2.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)

RPD for worldwide car rental declined 0.8% from the three months ended September 30, 2007, due to a decline in international RPD of 3.3%, partly offset by an increase in U.S. RPD of 0.4%. U.S. airport RPD increased 0.7% and U.S. off-airport RPD increased 0.6%. Our strategy includes increasing penetration in the off-airport market and growing the online leisure market, particularly in the longer length weekly sector, which is characterized by lower vehicle costs and lower transaction costs at lower RPD. Increasing our penetration in these sectors is consistent with our long-term strategy to generate profitable growth.

Revenues from our equipment rental operations decreased 6.8%, primarily due to an 8.3% decrease in equipment rental volume and a decline of 1.6% in pricing, partly offset by the effects of foreign currency translation of approximately $5.9 million.

Revenues from all other sources increased 6.1%, primarily due to increases in international car leasing revenues of $1.8 million and car rental licensee revenues of $1.1 million.

Expenses

			Three Months Ended September 30,
(in millions of dollars)			2008		2007		$ Change			% Change
Expenses:
	Direct operating		$	1,351.8	$	1,216.1	$	135.7			11.2%
	Depreciation of revenue earning equipment			595.0		535.0		60.0			11.2%
	Selling, general and administrative			234.3		203.2		31.1			15.3%
	Interest, net of interest income			214.6		240.2		(25.6	)		(10.6)%
		Total expenses	$	2,395.7	$	2,194.5	$	201.2			9.2%

Total expenses increased 9.2% and total expenses as a percentage of revenues increased from 89.6% for the three months ended September 30, 2007 to 98.9% for the three months ended September 30, 2008.

Direct operating expenses increased 11.2% as a result of increases in other direct operating expenses and fleet related expenses, partly offset by a decrease in personnel related expenses.

Other direct operating expenses increased $97.0 million, or 19.0%. The increase was primarily related to increases in restructuring and restructuring related charges of $54.8 million, facility expenses of $18.5 million, commission fees of $8.0 million, concession fees in our car rental operations of $7.3 million and customer service costs of $5.3 million, including the effects of foreign currency translation of approximately $14.0 million.

Fleet related expenses increased $52.3 million, or 17.5%. The increase was primarily related to increases in gasoline costs of $31.3 million and vehicle damage and maintenance costs of $17.3 million, as well as the effects of foreign currency translation of approximately $11.0 million.

Personnel related expenses decreased $13.6 million, or 3.3%. The decrease was primarily related to decreases in U.S. wages of $10.6 million, management incentive compensation costs of $7.6 million and information technology costs of $2.9 million, partly offset by an increase in international wages and benefits resulting from the effects of foreign currency translation of approximately $7.5 million.

Depreciation of revenue earning equipment for our car rental operations of $504.2 million for the three months ended September 30, 2008 increased 10.4% from $456.9 million for the three months ended September 30, 2007. The increase was primarily due to a $12.2 million net increase in depreciation in

55

ITEM 2.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)

certain of our car rental operations resulting from changes in depreciation rates to reflect changes in the estimated residual value of vehicles, lower net proceeds received in excess of book value on the disposal of used vehicles and the effects of foreign currency translation, partly offset by a 2.7% decrease in average fleet size. Depreciation of revenue earning equipment in our equipment rental operations of $90.8 million for the three months ended September 30, 2008 increased 16.3% from $78.1 million for the three months ended September 30, 2007. The increase was primarily due to lower net proceeds received in excess of book value on the disposal of used equipment.

Selling, general and administrative expenses increased 15.3%, primarily due to increases in administrative and advertising expenses, partly offset by a decrease in sales promotion expenses. Administrative expenses increased $19.0 million, or 16.5%, primarily due to increases in restructuring and restructuring related charges of $14.1 million, the unrealized losses on our interest rate swaptions of $8.1 million, consultant fees of $4.2 million and the effects of foreign currency translation of approximately $3.6 million, partly offset by a decrease in management incentive compensation costs of $9.6 million. Advertising expenses increased $14.3 million, or 32.0%, primarily due to a concerted effort to increase media spending during the third quarter. Sales promotion expenses decreased $2.2 million, or 5.2%, primarily related to a decrease in sales commissions.

Interest expense, net of interest income, decreased 10.6%, primarily due to the decrease in the ineffectiveness of the HVF swaps of $15.0 million, the write off in 2007 of $16.2 million in unamortized debt costs associated with the debt modification and a decrease in the weighted average interest rate.

Adjusted Pre-Tax Income

Adjusted pre-tax income for our car rental segment of $167.1 million decreased 44.5% from $301.1 million for the three months ended September 30, 2007. The decrease was primarily due to the decrease in car rental transaction days worldwide, lower RPD, higher fleet related costs, increases in other operating costs and lower net proceeds received in excess of book value on the disposal of used vehicles. Adjustments to our car rental segment GAAP pre-tax amount for the three months ended September 30, 2008 and 2007, totaled $81.3 million and $50.6 million, respectively. See footnote c to the table under "Three Months Ended September 30, 2008 Compared with Three Months Ended September 30, 2007" for a summary and description of these adjustments. Adjusted pre-tax income for our car rental segment as a percent of its revenues decreased from 15.2% to 8.4%.

Adjusted pre-tax income for our equipment rental segment of $81.1 million decreased 25.7% from $109.2 million for the three months ended September 30, 2007. The decrease was primarily due a decrease in volume and pricing and lower net proceeds received in excess of book value on the disposal of used equipment. Adjustments to our equipment rental segment GAAP pre-tax amount for the three months ended September 30, 2008 and 2007, totaled $54.2 million and $14.8 million, respectively. See footnote c to the table under "Three Months Ended September 30, 2008 Compared with Three Months Ended September 30, 2007" for a summary and description of these adjustments. Adjusted pre-tax income for our equipment rental segment as a percent of its revenues decreased from 23.5% to 18.7%.

The ratio of adjusted pre-tax income to revenues for our two segments reflects the different environments in which they operate. Our infrastructure costs are higher within our car rental segment due to the number and type of locations in which it operates and the corresponding headcount. Within our equipment rental segment, our revenue earning equipment generates lower depreciation expense due to its longer estimated useful life.

56

ITEM 2.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)

Provision for Taxes on Income, Minority Interest and Net Income

	Three Months Ended September 30,
(in millions of dollars)	2008			2007			$ Change			% Change
Income before income taxes and minority interest	$	26.2		$	255.1		$	(228.9	)		(89.7)%
Provision for taxes on income		(2.9	)		(86.9	)		84.0			(96.7)%
Minority interest		(5.6	)		(5.5	)		(0.1	)		1.7%
Net income	$	17.7		$	162.7		$	(145.0	)		(89.1)%

The effective tax rate for the three months ended September 30, 2008 decreased to 10.9% from 34.0% in the three months ended September 30, 2007. The provision for taxes on income decreased 96.7%, primarily due to the decline in 2008 annual projections based upon third quarter operating results, partly offset by the recording of a valuation allowance on certain deferred tax assets that we believe are no longer realizable.

Minority interest increased 1.7% due to an increase in our majority-owned subsidiary Navigation Solutions, L.L.C.'s net income in the three months ended September 30, 2008 as compared to the three months ended September 30, 2007.

Net income decreased 89.1% primarily due to lower pricing and volume in our worldwide car and equipment rental segments and higher fleet and operating costs, as well as the net effect of other contributing factors noted above. The impact of changes in exchange rates on net income was mitigated by the fact that not only foreign revenues but also most foreign expenses were incurred in local currencies.

Effects of the Acquisition

The following table summarizes the purchase accounting effects of the Acquisition on our results of operations for the three months ended September 30, 2008 and 2007 (in millions of dollars):

		Three Months Ended September 30,
		2008		2007
Depreciation and amortization of tangible and intangible assets:
	Other intangible assets	$	15.3	$	15.3
	Revenue earning equipment		6.1		4.6
	Property and equipment		1.3		2.1
Accretion of revalued liabilities:
	Discount on debt		0.9		1.6
	Workers' compensation and public liability and property damage		1.4		1.3
		$	25.0	$	24.9

57

ITEM 2.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)

Nine Months Ended September 30, 2008 Compared with Nine Months Ended September 30, 2007

Summary

The following table sets forth the percentage of total revenues represented by the various line items set forth in our consolidated statement of operations for the nine months ended September 30, 2008 and 2007 (in millions of dollars):

									Percentage of Revenues
			Nine Months Ended September 30,						Nine Months Ended September 30,
			2008			2007			2008			2007
Revenues:
	Car rental		$	5,340.0		$	5,161.2			79.3	%		78.8	%
	Equipment rental			1,286.8			1,287.4			19.1			19.7
	Other			109.5			98.2			1.6			1.5
		Total revenues		6,736.3			6,546.8			100.0			100.0
Expenses:
	Direct operating			3,801.8			3,495.1			56.4			53.4
	Depreciation of revenue earning equipment			1,658.7			1,498.9			24.6			22.9
	Selling, general and administrative			595.8			586.0			8.9			8.9
	Interest, net of interest income			616.7			661.3			9.2			10.1
		Total expenses		6,673.0			6,241.3			99.1			95.3
Income before income taxes and minority interest				63.3			305.5			0.9			4.7
Provision for taxes on income				(36.0	)		(107.3	)		(0.5	)		(1.7	)
Minority interest				(16.1	)		(14.4	)		(0.2	)		(0.2	)
Net income			$	11.2		$	183.8			0.2	%		2.8	%

58

ITEM 2.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)

The following table sets forth certain of our selected car rental, equipment rental and other operating data for the nine months ended or as of September 30, 2008 and 2007:

			Nine Months Ended or as of September 30,
			2008			2007
Selected Car Rental Operating Data:
	Worldwide number of transactions (in thousands)			21,158			21,975
		Domestic		15,368			16,395
		International		5,790			5,580
	Worldwide transaction days (in thousands)(a)			99,042			98,355
		Domestic		66,353			67,793
		International		32,689			30,562
	Worldwide rental rate revenue per transaction day(a)(b)		$	45.58		$	46.41
		Domestic	$	43.41		$	43.91
		International	$	49.99		$	51.95
	Worldwide average number of company-operated cars during the period			467,700			466,800
		Domestic		311,000			318,600
		International		156,700			148,200
	Adjusted pre-tax income (in millions of dollars)(a)(c)		$	355.8		$	480.9
	Worldwide revenue earning equipment, net (in millions of dollars)		$	8,472.7		$	8,869.1
Selected Worldwide Equipment Rental Operating Data:
	Rental and rental related revenue (in millions of dollars)(a)(d)		$	1,139.8		$	1,177.1
	Same store revenue growth, including growth initiatives(a)			(2.9	)%		2.3	%
	Average acquisition cost of rental equipment operated during the period (in millions of dollars)		$	3,448.9		$	3,237.6
	Adjusted pre-tax income (in millions of dollars)(a)(c)		$	225.9		$	271.5
	Revenue earning equipment, net (in millions of dollars)		$	2,411.6		$	2,720.0
Other Operating Data:
	EBITDA (in millions of dollars)(a)(e)		$	2,503.8		$	2,623.2
	Corporate EBITDA (in millions of dollars)(a)(e)		$	986.2		$	1,163.5

(a)

For further details relating to car rental transaction days, car rental rate revenue per transaction day, adjusted pre-tax income, equipment rental and rental related revenue, equipment rental same store revenue growth and a discussion of our use and presentation of EBITDA and Corporate EBITDA, see "Three Months Ended September 30, 2008 Compared with Three Months Ended September 30, 2007—Summary."

59

ITEM 2.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)

(b)

The following table reconciles our car rental revenue to our rental rate revenue and rental rate revenue per transaction day (based on December 31, 2007 foreign exchange rates) for the nine months ended September 30, 2008 and 2007 (in millions of dollars, except as noted):

	Nine Months Ended September 30,
	2008			2007
Car rental revenue per statement of operations	$	5,340.0		$	5,161.2
Non-rental rate revenue		(775.0	)		(731.5	)
Foreign currency adjustment		(50.6	)		134.7
Rental rate revenue	$	4,514.4		$	4,564.4
Transaction days (in thousands)		99,042			98,355
Rental rate revenue per transaction day (in whole dollars)	$	45.58		$	46.41

(c)

The following table reconciles income before income taxes and minority interest by segment to adjusted pre-tax income by segment for the nine months ended September 30, 2008 and 2007 (in millions of dollars):

		Nine Months Ended September 30, 2008
		Car Rental			Equipment Rental
Income before income taxes and minority interest		$	209.4		$	118.5
Adjustments:
	Purchase accounting(1)		30.5			42.4
	Non-cash debt charges(2)		37.9			8.0
	Unrealized loss on derivative(3)		12.0			—
	Realized gain on derivative(3)		(14.8	)		—
	Restructuring charges		64.7			55.0
	Restructuring related charges(4)		16.1			2.0
Adjusted pre-tax income		$	355.8		$	225.9

		Nine Months Ended September 30, 2007
		Car Rental			Equipment Rental
Income before income taxes and minority interest		$	379.2		$	224.2
Adjustments:
	Purchase accounting(1)		25.1			42.6
	Non-cash debt charges(2)		53.9			8.3
	Unrealized gain on derivative(3)		(3.2	)		—
	Restructuring charges		46.3			3.4
	Vacation accrual adjustment(5)		(20.4	)		(7.0	)
Adjusted pre-tax income		$	480.9		$	271.5

(1)

Represents the purchase accounting effects of the Acquisition and any subsequent acquisitions on our results of operations relating to increased depreciation and amortization of tangible and intangible assets and accretion of revalued workers' compensation and public liability and property damage liabilities.



(2)

Represents non-cash debt charges relating to the amortization of deferred debt financing costs and debt discounts. For the nine months ended September 30, 2008 and 2007, also includes $7.8 million and $17.7 million, respectively, associated with the ineffectiveness of the HVF swaps. For the nine months ended September 30, 2007, also includes the write off of $16.2 million of unamortized debt costs associated with a debt modification.



(3)

Represents unrealized gains and losses and a realized gain on interest rate swaptions.

60

ITEM 2.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)

(4)

Represents incremental, one-time costs incurred directly supporting our business transformation initiatives. Such costs include transition costs incurred in connection with our business process outsourcing arrangements and incremental costs incurred to facilitate business process re-engineering initiatives that involve significant organization redesign and extensive operational process changes.



(5)

Represents increases and decreases in the employee vacation accrual relating to a change in our U.S. vacation policy in 2007 which provides for vacation entitlement to be earned ratably throughout the year versus the previous policy which provided for full vesting on January 1 each year.

(d)

The following table reconciles our equipment rental revenue to our equipment rental and rental related revenue (based on December 31, 2007 foreign exchange rates) for the nine months ended September 30, 2008 and 2007 (in millions of dollars):

	Nine Months Ended September 30,
	2008			2007
Equipment rental revenue per statement of operations	$	1,286.8		$	1,287.4
Equipment sales and other revenue		(137.4	)		(140.6	)
Foreign currency adjustment		(9.6	)		30.3
Rental and rental related revenue	$	1,139.8		$	1,177.1

(e)

The following table reconciles net income to EBITDA and Corporate EBITDA for the nine months ended September 30, 2008 and 2007 (in millions of dollars):

		Nine Months Ended September 30,
		2008			2007
Net income(1)		$	11.2		$	183.8
	Depreciation and amortization(2)		1,839.9			1,679.8
	Interest, net of interest income(3)		616.7			661.3
	Provision for taxes on income		36.0			107.3
EBITDA(4)			2,503.8			2,632.2
Adjustments:
	Car rental fleet interest		(322.2	)		(320.7	)
	Car rental fleet depreciation		(1,399.7	)		(1,279.7	)
	Non-cash expenses and charges(5)		69.6			82.1
	Extraordinary, unusual or non-recurring gains or losses(6)		134.7			49.6
Corporate EBITDA		$	986.2		$	1,163.5

(1)

For the nine months ended September 30, 2008 and 2007, net income includes corporate minority interest of $16.1 million and $14.4 million, respectively.



(2)

For the nine months ended September 30, 2008 and 2007, depreciation and amortization was $1,519.7 million and $1,401.7 million, respectively, in our car rental segment and $315.6 million and $273.3 million, respectively, in our equipment rental segment.



(3)

For the nine months ended September 30, 2008 and 2007, interest, net of interest income, was $316.9 million and $328.6 million, respectively, in our car rental segment and $87.4 million and $107.4 million, respectively, in our equipment rental segment.

61

ITEM 2.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)

(4)

The following table reconciles net cash provided by operating activities to EBITDA for the nine months ended September 30, 2008 and 2007 (in millions of dollars):

		Nine Months Ended September 30,
		2008			2007
Net cash provided by operating activities		$	1,574.8		$	2,208.5
	Amortization of debt and debt modification costs		(48.4	)		(69.5	)
	Provision for losses on doubtful accounts		(21.7	)		(10.4	)
	Unrealized gain (loss) on derivatives		(12.0	)		3.0
	Gain on sale of property and equipment		9.4			14.4
	Loss on ineffectiveness of interest rate swaps		(7.8	)		(17.7	)
	Stock-based employee compensation charges		(20.3	)		(24.3	)
	Asset writedowns		(34.1	)		—
	Minority interest		(16.1	)		(14.4	)
	Deferred taxes on income		(5.0	)		(58.1	)
	Provision for taxes on income		36.0			107.3
	Interest expense, net of interest income		616.7			661.3
	Net changes in assets and liabilities		432.3			(167.9	)
EBITDA		$	2,503.8		$	2,632.2

(5)

For the nine months ended September 30, 2008 and 2007, non-cash expenses and charges (income) were $49.3 million and $48.5 million, respectively, in our car rental segment and $0.0 million and $2.5 million, respectively, in our equipment rental segment.






As defined in the credit agreements governing our senior credit facilities, Corporate EBITDA excludes the impact of certain non-cash expenses and charges. The adjustments reflect the following (in millions of dollars):

		Nine Months Ended September 30,
		2008		2007
Non-cash amortization of debt costs included in car rental fleet interest		$	37.3	$	52.2
Corporate non-cash stock-based employee compensation charges			20.3		20.8
Non-cash charges for workers' compensation			—		1.8
Corporate non-cash charges for public liability and property damage			—		7.2
Corporate non-cash charges for pension			—		3.0
Unrealized loss (gain) on derivatives			12.0		(2.9	)
	Total	$	69.6	$	82.1

(6)

For the nine months ended September 30, 2008 and 2007, extraordinary, unusual or non-recurring gains or losses were $66.0 million and $25.9 million, respectively, in our car rental segment and $57.0 million and $(3.6) million, respectively, in our equipment rental segment.

62

ITEM 2.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)

As defined in the credit agreements governing our senior credit facilities, Corporate EBITDA excludes the impact of extraordinary, unusual or non-recurring gains or losses or charges or credits. The adjustments reflect the following (in millions of dollars):

		Nine Months Ended September 30,
		2008			2007
Restructuring charges		$	127.2		$	65.4
Restructuring related charges			21.0			—
Management transition costs			1.3			11.0
Secondary offering costs			—			2.0
Realized gain on derivatives			(14.8	)		—
Vacation accrual adjustment			—			(28.8	)
	Total	$	134.7		$	49.6

Revenues

			Nine Months Ended September 30,
(in millions of dollars)			2008		2007		$ Change			% Change
Revenues:
	Car rental		$	5,340.0	$	5,161.2	$	178.8			3.5	%
	Equipment rental			1,286.8		1,287.4		(0.6	)		—	%
	Other			109.5		98.2		11.3			11.5	%
		Total revenues	$	6,736.3	$	6,546.8	$	189.5			2.9	%

Total revenues increased 2.9% (decreased 0.6% in constant currency) for the nine months ended September 30, 2008 compared to the nine months ended September 30, 2007.

Revenues from our car rental operations increased 3.5%, primarily as a result of the effects of foreign currency translation of approximately $186.7 million and a 0.7% increase in car rental transaction days worldwide, partly offset by lower RPD.

RPD for worldwide car rental declined 1.8% from nine months ended September 30, 2007, due to declines in U.S. and International RPD of 1.1% and 3.8%, respectively. U.S. airport RPD decreased 0.8% and U.S. off-airport RPD declined by 0.9%. Our strategy includes increasing penetration in the off-airport market and growing the online leisure market, particularly in the longer length weekly sector, which is characterized by lower vehicle costs and lower transaction costs at lower RPD. Increasing our penetration in these sectors is consistent with our long term strategy to generate profitable growth.

Revenues from our equipment rental operations decreased $0.6 million, primarily due a 2.6% decrease in equipment rental volume and a decline of 1.3% in pricing, partly offset by the effects of foreign currency translation of approximately $39.1 million.

Revenues from all other sources increased 11.5%, primarily due to increases in car rental licensee revenues of $7.9 million and international car leasing revenues of $4.2 million, including the effects of foreign currency translation of approximately $2.2 million.

63

ITEM 2.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)

Expenses

			Nine Months Ended September 30,
(in millions of dollars)			2008		2007		$ Change			% Change
Expenses:
	Direct operating		$	3,801.8	$	3,495.1	$	306.7			8.8	%
	Depreciation of revenue earning equipment			1,658.7		1,498.9		159.8			10.7	%
	Selling, general and administrative			595.8		586.0		9.8			1.7	%
	Interest, net of interest income			616.7		661.3		(44.6	)		(6.7	)%
		Total expenses	$	6,673.0	$	6,241.3	$	431.7			6.9	%

Total expenses increased 6.9% and total expenses as a percentage of revenues increased from 95.3% for the nine months ended September 30, 2007 to 99.1% for the nine months ended September 30, 2008.

Direct operating expenses increased 8.8%, as a result of increases in other direct operating expenses, fleet related expenses and personnel related expenses.

Other direct operating expenses increased $174.2 million, or 11.9%. The increase was primarily related to increases in restructuring and restructuring related charges of $68.4 million, facility expenses of $37.0 million, concession fees in our car rental operations of $24.4 million, commission fees of $18.2 million and customer service costs of $12.3 million, including the effects of foreign currency translation of approximately $55.8 million.

Fleet related expenses increased $125.5 million, or 15.1%. The increase was primarily related to increases in gasoline costs of $63.1 million and vehicle damage and maintenance costs of $56.8 million, including the effects of foreign currency translation of approximately $43.8 million.

Personnel related expenses increased $7.0 million, or 0.6%. The increase was primarily related to increases in International wages and benefits resulting from the effects of foreign currency translation of approximately $36.1 million and an increase in U.S. benefits of 12.7 million primarily relating to the decrease in the employee vacation accrual resulting from a change in our U.S. vacation policy in 2007, partly offset by decreases in U.S. wages of $22.8 million, management incentive compensation costs of $12.2 million and information technology costs of $8.3 million.

Depreciation of revenue earning equipment for our car rental operations of $1,399.7 million for the nine months ended September 30, 2008 increased 9.4% from $1,279.7 million for the nine months ended September 30, 2007. The increase was primarily due to a $22.4 million net increase in depreciation in certain of our car rental operations resulting from changes in depreciation rates to reflect changes in the estimated residual value of vehicles, lower net proceeds received in excess of book value on the disposal of used vehicles and the effects of foreign currency translation. Depreciation of revenue earning equipment in our equipment rental operations of $259.0 million for the nine months ended September 30, 2008 increased 18.2% from $219.2 million for the nine months ended September 30, 2007. The increase was primarily due to an increase of 6.5% in the average acquisition cost of rental equipment operated during the period, as well as lower net proceeds received in excess of book value on the disposal of used equipment, partly offset by a $3.9 million net decrease in depreciation in certain of our equipment rental operations resulting from changes in depreciation rates to reflect changes in the estimated residual value of equipment.

64

ITEM 2.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)

Selling, general and administrative expenses increased 1.7%, primarily due to increases in administrative and sales promotion expenses and the effects of foreign currency translation of approximately $26.4 million, partly offset by a decrease in advertising expenses. Administrative expenses increased $9.9 million, or 3.0%, primarily due to increases in restructuring and restructuring related charges of $13.8 million and consultant fees of $3.8 million, as well as the effects of foreign currency translation of approximately $15.4 million, partly offset by a decrease in management incentive compensation costs of $20.9 million. Sales promotion expenses increased $1.4 million, or 1.1%, primarily related to the effects of foreign currency translation of $3.6 million. Advertising expenses decreased $1.6 million, or 1.2%, primarily due to a decrease in media spending, partly offset by the effects of foreign currency translation of $7.4 million.

Interest expense, net of interest income, decreased 6.7%, primarily due to the write-off in 2007 of $16.2 million in unamortized debt costs associated with the debt modification and a decrease in the weighted average interest rate, partly offset by an increase in the ineffectiveness of the HVF swaps of $9.9 million, an increase in interest income of $6.5 million and the effects of foreign currency translation of approximately $15.5 million.

Adjusted Pre-Tax Income

Adjusted pre-tax income for our car rental segment of $355.8 million decreased 26.0% from $480.9 million for the nine months ended September 30, 2007. The decrease was primarily due to higher fleet related costs, increases in other operating costs and a decrease in RPD. Adjustments to our car rental segment GAAP pre-tax amount for the nine months ended September 30, 2008 and 2007, totaled $146.4 million and $101.7 million, respectively. See footnote c to the table under "Nine Months Ended September 30, 2008 Compared with Nine Months Ended September 30, 2007" for a summary and description of these adjustments. Adjusted pre-tax income for our car rental segment as a percent of its revenues decreased from 9.2% to 6.5%.

Adjusted pre-tax income for our equipment rental segment of $225.9 million decreased 16.8% from $271.5 million for the nine months ended September 30, 2007. The decrease was primarily due to higher fleet related costs, increases in other operating costs and decreases in volume and pricing. Adjustments to our equipment rental segment GAAP pre-tax amount for the nine months ended September 30, 2008 and 2007, totaled $107.4 million and $47.3 million, respectively. See footnote c to the table under "Nine Months Ended September 30, 2008 Compared with Nine Months Ended September 30, 2007" for a summary and description of these adjustments. Adjusted pre-tax income for our equipment rental segment as a percent of its revenues decreased from 21.1% to 17.5%.

The ratio of adjusted pre-tax income to revenues for our two segments reflects the different environments in which they operate. Our infrastructure costs are higher within our car rental segment due to the number and type of locations in which it operates and the corresponding headcount. Within our equipment rental segment, our revenue earning equipment generates lower depreciation expense due to its longer estimated useful life.

Provision for Taxes on Income, Minority Interest and Net Income

	Nine Months Ended September 30,
(in millions of dollars)	2008			2007			$ Change			% Change
Income before income taxes and minority interest	$	63.3		$	305.5		$	(242.2	)		(79.3	)%
Provision for taxes on income		(36.0	)		(107.3	)		71.3			(66.5	)%
Minority interest		(16.1	)		(14.4	)		(1.7	)		12.1	%
Net income	$	11.2		$	183.8		$	(172.6	)		(93.9	)%

65

ITEM 2.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)

The effective tax rate for the nine months ended September 30, 2008 increased to 56.8% from 35.1% in the nine months ended September 30, 2007. The provision for taxes on income decreased 66.5% primarily due to the decline in 2008 annual projections based upon third quarter operating results, partly offset by the non-recognition of benefits for certain non-U.S. jurisdictions in loss positions and the recording of a valuation allowance on certain deferred tax assets that we believe are no longer realizable.

Minority interest increased 12.1% due to an increase in our majority-owned subsidiary Navigation Solutions, L.L.C.'s net income in the nine months ended September 30, 2008 as compared to the nine months ended September 30, 2007.

Net income decreased 93.9% primarily due to lower pricing in our worldwide car and equipment rental operations, higher fleet and operating costs and lower volume in our equipment rental operations, partly offset by a slightly higher volume in our worldwide car rental operations, as well as the net effect of other contributing factors noted above. The impact of changes in exchange rates on the net income was mitigated by the fact that not only foreign revenues but also most foreign expenses were incurred in local currencies.

Effects of the Acquisition

The following table summarizes the purchase accounting effects of the Acquisition on our results of operations for the nine months ended September 30, 2008 and 2007 (in millions of dollars):

		Nine Months Ended September 30,
		2008		2007
Depreciation and amortization of tangible and intangible assets:
	Other intangible assets	$	45.9	$	45.9
	Revenue earning equipment		15.7		13.2
	Property and equipment		5.1		5.9
Accretion of revalued liabilities:
	Discount on debt		3.5		5.3
	Workers' compensation and public liability and property damage		4.1		4.0
		$	74.3	$	74.3

Liquidity and Capital Resources

As of September 30, 2008, we had cash and equivalents of $731.5 million, an increase of $1.3 million from December 31, 2007. As of September 30, 2008, we had $514.0 million of restricted cash to be used for the purchase of revenue earning vehicles and other specified uses under our Fleet Debt facilities (defined below), our like-kind exchange programs and to satisfy certain of our self-insurance regulatory reserve requirements. The decrease in restricted cash of $147.0 million from December 31, 2007 to September 30, 2008, primarily related to the timing of purchases and sales of revenue earning vehicles.

Our domestic and foreign operations are funded by cash provided by operating activities and by extensive financing arrangements maintained by us in the United States, Europe, Puerto Rico, Australia, New Zealand, Canada and Brazil. Net cash provided by operating activities during the nine months ended September 30, 2008 was $1,574.8 million, a decrease of $633.7 million from the nine months ended September 30, 2007. The decrease was primarily due to changes in working capital, fleet

66

ITEM 2.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)

receivables and a decrease in net income, partly offset by an increase in depreciation of revenue earning equipment.

Our primary use of cash in investing activities is for the acquisition of revenue earning equipment, which consists of cars and equipment. In addition, we and our affiliates may from time to time repurchase or otherwise retire debt of our subsidiaries and take other steps to reduce such debt or otherwise improve our balance sheet. These actions may include open market repurchases, negotiated repurchases and other retirements of outstanding debt. The amount of debt that may be repurchased or otherwise retired, if any, will depend on market conditions, trading levels of such debt from time to time, our cash position and other considerations. Net cash used in investing activities during the nine months ended September 30, 2008 was $2,536.8 million, a decrease of $436.0 million from the nine months ended September 30, 2007. The decrease is primarily due to a decrease in revenue earning equipment expenditures, partly offset by a decrease in proceeds from the disposal of revenue earning equipment. For the nine months ended September 30, 2008, our expenditures for revenue earning equipment were $8,637.2 million and our proceeds from the disposal of such equipment were $6,135.7 million.

For the nine months ended September 30, 2008, our capital expenditures for property and non-revenue earning equipment were $149.5 million and our proceeds from the disposal of such equipment were $36.8 million. For the nine months ended September 30, 2008, we experienced a decreased level of net expenditures for revenue earning equipment and property and equipment compared to the nine months ended September 30, 2007. This decrease was primarily due to a decrease in revenue earning equipment expenditures, partly offset by a decrease in proceeds from the disposal of revenue earning equipment. For the full year 2008, we expect the level of net expenditures for revenue earning equipment, property and non-revenue earning equipment to be lower than the full year 2007. See "—Capital Expenditures" below.

Our car rental and equipment rental operations are seasonal businesses with decreased levels of business in the winter months and typically heightened activity during the spring and summer. This is particularly true of our airport car rental operations and our equipment rental operations. To accommodate increased demand, we maintain a larger fleet by holding vehicles and equipment and purchasing additional fleet which increases our financing requirements in the second and third quarters of the year. These seasonal financing needs are funded by increasing the utilization of our various corporate and fleet credit facilities and the variable funding notes portion of our U.S. Fleet Debt facilities (defined below). As business demand moderates during the winter, we reduce our fleet accordingly and dispose of vehicles and equipment. The disposal proceeds are used to reduce debt.

We are highly leveraged and a substantial portion of our liquidity needs arises from debt service on indebtedness incurred in connection with the Transactions and from the funding of our costs of operations, working capital and capital expenditures.

As of September 30, 2008, we had approximately $12,844.2 million of total indebtedness outstanding. Cash paid for interest during the nine months ended September 30, 2008 was $626.9 million, net of amounts capitalized.

We rely significantly on asset-backed financing to purchase cars for our domestic and international car rental fleets. For further information concerning our asset-backed financing programs, see Note 3 to the Notes to our audited annual consolidated financial statements included in our Form 10-K. For a discussion of risks related to our reliance on asset-backed financing to purchase cars, see "Item 1A—Risk Factors" contained in our Form 10-K and "Part II—Other Information, Item 1A—Risk Factors" in this Report.

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Also, substantially all of our revenue earning equipment and certain related assets are owned by special purpose entities, or are subject to liens in favor of our lenders under the Senior ABL Facility, the U.S. ABS Program, the International Fleet Debt facilities (all as defined below) or the fleet financing facilities relating to our car rental fleet in Hawaii, Kansas, Puerto Rico and St. Thomas, the U.S. Virgin Islands, Brazil, Canada, Belgium and our U.K. leveraged financing facility. Substantially all our other assets in the United States are also subject to liens in favor of our lenders under the Senior Credit Facilities (defined below), and substantially all of our other assets outside the United States are (with certain limited exceptions) subject to liens in favor of our lenders under the International Fleet Debt facilities or (in the case of our Canadian equipment rental business) the Senior ABL Facility. None of such assets will be available to satisfy the claims of our general creditors.

We have a significant amount of debt that will mature over the next several years. The aggregate amounts of maturities of debt for each of the twelve-month periods ending September 30 (in millions of dollars) are as follows: 2009, $5,109.4 (including $3,967.6 of other short-term borrowings, of which $3,892.1 were under long-term committed credit facilities); 2010, $2,431.3; 2011, $1,035.3; 2012, $176.4; 2013, $1,375.8; after 2013, $2,769.8. We believe that cash generated from operations, together with amounts available under the Senior Credit Facilities, asset-backed financing and other available financing arrangements will be adequate to permit us to meet our debt service obligations, ongoing costs of operations, working capital needs and capital expenditure requirements for the foreseeable future. Our future financial and operating performance, ability to service or refinance our debt and ability to comply with covenants and restrictions contained in our debt agreements will be subject to future economic conditions and to financial, business and other factors, many of which are beyond our control. Recent turmoil in the credit markets and the financial instability of insurance companies providing financial guarantees for asset-backed securities has reduced the availability of debt financing, which may result in increases in the interest rates at which lenders are willing to make debt financing available to us. The impact of such an increase would be more significant than it would be for some other companies because of our substantial debt. For a discussion of risks related to our substantial indebtedness, see "Item 1A—Risk Factors" contained in our Form 10-K and "Part II—Other Information, Item 1A—Risk Factors" in this Report.

A significant number of cars that we purchase are subject to repurchase by car manufacturers under contractual repurchase or guaranteed depreciation programs. Under these programs, car manufacturers agree to repurchase cars at a specified price or guarantee the depreciation rate on the cars during a specified time period, typically subject to certain car condition and mileage requirements. We use this specified price or guaranteed depreciation rate to calculate our asset-backed financing capacity. If any manufacturer of our cars fails to fulfill its repurchase or guaranteed depreciation obligations, due to bankruptcy or otherwise, it could make vehicle-related debt financing more difficult to obtain on reasonable terms and our asset-backed financing capacity could be decreased, or our financing costs and interest rates could be increased. For a discussion of risks related to the repurchase of program cars from us or the guarantee of the depreciation rate of program cars by the manufacturers of our cars, see "Part II—Other Information, Item 1A—Risk Factors" in this Report.

Approximately half of our $4,300.0 million U.S. Fleet Debt issued and funded on or prior to the Closing Date is subject to the benefit of a financial guaranty from MBIA Inc., or "MBIA," while the remainder is subject to the benefit of a financial guaranty from Ambac Financial Group Inc., or "Ambac." MBIA and Ambac are facing financial instability due to factors beyond our control. Each of MBIA and Ambac has been downgraded by one or more credit ratings agencies and is on review for a further credit downgrade or under developing outlook. These or any further downgrade or a bankruptcy of either MBIA or Ambac could make vehicle-related debt financing more difficult to obtain on reasonable terms and our asset-

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ITEM 2.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)

backed financing capacity could be substantially decreased, or our financing costs and interest rates could be increased. To help offset this financial guaranty risk, in September we closed on the "Series 2008-1 Notes", as defined below, which is not subject to a financial guaranty, including from either MBIA or Ambac. For a discussion of risks related to the financial instability of MBIA or Ambac, see "Part II—Other Information, Item 1A—Risk Factors" in this Report.

Financing

Our "Senior Term Facility" is a secured term loan facility entered into by Hertz in connection with the Acquisition consisting of (a) a maximum borrowing capacity of $2,000.0 million (which was decreased in February 2007 to $1,400.0 million), which included a delayed draw facility of $293.0 million (which was utilized during 2006) and (b) a prefunded synthetic letter of credit facility in an aggregate principal amount of $250.0 million. This term loan facility and the synthetic letter of credit facility mature in December 2012.

Our "Senior ABL Facility" is a senior asset-based revolving loan facility entered into by Hertz and certain of its U.S. and of its Canadian subsidiaries in connection with the Acquisition with a maximum borrowing capacity of $1,600.0 million (which was increased in February 2007 to $1,800.0 million and was decreased in September 2008 to $1,785.0 million). Up to $200.0 million of the revolving loan facility is available for the issuance of letters of credit. The Senior ABL Facility matures in February 2012. We refer to the Senior Term Facility and the Senior ABL Facility together as the "Senior Credit Facilities."

Our "Senior Dollar Notes" are the $1,800.0 million aggregate principal amount of 8.875% Senior Notes due January 2014 issued by Hertz in connection with the Acquisition. Our "Senior Euro Notes" are the €225 million aggregate principal amount of 7.875% Senior Notes due January 2014 issued by Hertz in connection with the Acquisition. We refer to the Senior Dollar Notes and the Senior Euro Notes together as the "Senior Notes." Our "Senior Subordinated Notes" refer to the $600.0 million aggregate principal amount of 10.5% Senior Subordinated Notes due January 2016 issued by Hertz in connection with the Acquisition.

Our "Promissory Notes" consist of the outstanding untendered senior notes issued under three separate indentures existing prior to the Acquisition. These senior notes have remaining maturities ranging from March 2009 to January 2028.

Our "U.S. Fleet Debt" consists of approximately $4,300.0 million of asset-backed securities issued on the Closing Date by Hertz Vehicle Financing LLC, or "HVF," a special purpose entity wholly-owned by us, backed by our U.S. car rental fleet, all of which we issued under our existing asset-backed notes program, or the "ABS Program." An additional $600.0 million of issued asset-backed medium term notes that were issued prior to the Closing Date, or "Pre-Acquisition ABS Notes," having maturities from May 2007 to May 2009 remained outstanding under the ABS Program following the Closing Date ($430.0 million of which have subsequently matured). We have also issued approximately $1,500 million of variable funding notes on the Closing Date in two series under these facilities, none of which were funded on the Closing Date. The current capacity is $1,450.0 million. We also issued $825.0 million of 2008-1 Variable Funding Rental Car Asset-Backed Notes, or the "Series 2008-1 Notes," on September 12, 2008, which as of September 30, 2008 had not been funded. The U.S. Fleet Debt facilities have maturities ranging from February 2009 to November 2010.

Our "International Fleet Debt" consists of the aggregate borrowings of our foreign subsidiaries under asset-based revolving loan facilities entered into by Hertz International Ltd, or "HIL," a Delaware corporation organized as a foreign subsidiary holding company and a direct subsidiary of Hertz, and

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ITEM 2.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)

certain of its subsidiaries (all of which are organized outside the United States), together with certain bankruptcy-remote special purpose entities, subject to borrowing bases comprised of rental vehicles, rental equipment, and related assets of certain of our foreign subsidiaries (substantially all of which are organized outside of the United States) or one or more special purpose entities, as the case may be. The subsidiaries conducting the car rental business in certain European jurisdictions may, at their option, continue to engage in capital lease financings relating to revenue earning equipment outside the International Fleet Debt facilities. In 2007 and 2008, additional borrowers consented to the senior bridge facility agreement under the International Fleet Debt facilities in connection with the expected take-out of the interim facilities entered into at the time of the Acquisition. The International Fleet Debt matures in December 2010.

Our "Fleet Financing Facility" is a credit agreement entered into by Hertz and its subsidiary, Puerto Ricancars, Inc., or "PR Cars," in September 2006, which provides for a commitment of up to $275.0 million to finance the acquisition of Hertz's and/or PR Cars fleet in Hawaii, Kansas, Puerto Rico and St. Thomas, the U.S. Virgin Islands. The Fleet Financing Facility matures in December 2011, but Hertz and PR Cars may terminate or reduce the commitments of the lenders thereunder at any time.

Our "Brazilian Fleet Financing Facility" refers to the agreement dated April 4, 2007 amending and restating our Brazilian subsidiary's credit facility (which was originally included under the International Fleet Debt facilities) to, among other things, increase the facility to R$130 million (or $67.8 million, calculated using exchange rates in effect on September 30, 2008) consisting of a R$70 million (or $36.5 million) term loan facility and a R$60 million (or $31.3 million) revolving credit facility. This facility matures in December 2010.

Our "Canadian Fleet Financing Facility" refers to a Note Purchase Agreement entered into by our indirect subsidiary, Hertz Canada Limited, and certain of its subsidiaries, on May 30, 2007, with CARE Trust, a third-party special purpose commercial paper conduit administered by Bank of Montreal, or "CARE Trust," which acts as conduit for the asset-backed borrowing facility, and certain related agreements and transactions, in order to establish an asset-backed borrowing facility to provide financing for our Canadian car rental fleet. The new facility refinanced the Canadian portion of the International Fleet Debt facilities. The maximum amount which may be borrowed under the new facility is CAN$400 million (or $382.0 million). The Canadian Fleet Facility matures in May 2012.

Our "Belgian Fleet Financing Facility" consists of a secured revolving credit facility entered into by our Belgian subsidiary, Hertz Belgium BVBA on June 21, 2007, with varying facility limits of up to €25.4 million (or $36.2 million). This facility refinanced the Belgian portion of our International Fleet Debt facilities. The facility is scheduled to mature in December 2010.

Our "U.K. Leveraged Financing" consists of an agreement for a sale and leaseback facility entered into with a financial institution in the United Kingdom, or the "U.K.," by our subsidiary in the U.K., Hertz (U.K.) Limited, on December 21, 2007, under which we may sell and lease back fleet up to the value of £175.0 million (or $316.5 million). The amount available under this facility increases over the term of the facility. This facility refinanced the U.K. portion of the International Fleet Debt facilities. The facility is scheduled to mature in December 2013.

Our "International ABS Fleet Financing Facility" consists of a multi jurisdictional fleet financing initially covering Australia, France and the Netherlands. The maximum commitment under (i) the Euro denominated financing is €632.0 million (or $901.0 million) and (ii) the Australian dollar denominated financing is A$325.0 million (or $262.0 million). The expected maturity date is in December 2010.

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ITEM 2.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)

As of September 30, 2008, the aggregate principal amount of $168.7 million (net of $1.3 million discount) of pre-Acquisition ABS Notes was outstanding and the average interest rate was 3.2%.

As of September 30, 2008, there were $30.5 million of capital lease financings outstanding. These capital lease financings are included in the International Fleet Debt total and mature in August 2010.

International ABS Fleet Financing Facility

On July 24, 2008, HIL and certain of its subsidiaries entered into the "Amendment Agreement" to amend the International Fleet Debt facility. The Amendment Agreement, effective on July 24, 2008, reduced the borrowing margins on the Tranche A1 and Tranche A2 bridge loans of certain borrowers under the facility participating in the International ABS Fleet Financing Facility and provided an August 12, 2008 final maturity date for loans to HIL's Swiss subsidiary borrower. In August, we paid off the loan to HIL's Swiss subsidiary borrower and closed out the loan.

Also on July 24, 2008, HA Fleet Pty Ltd, RAC Finance SAS and Stuurgroep Fleet (Netherlands) B.V., special-purpose indirect subsidiaries of HIL, each a "FleetCo," closed on the International ABS Fleet Financing Facility, initially covering Australia, France and the Netherlands, respectively, or the "Relevant Jurisdictions."

The funds under the new fleet financing will be used to (i) initially repay in whole the FleetCos' portion of indebtedness under the International Fleet Debt facility and the FleetCos' existing inter-company borrowings related to the acquisition of vehicles and (ii) finance the acquisition of vehicles from time to time in the Relevant Jurisdictions.

International Fleet Financing No. 1 B.V, the issuer of the fleet financing, or the "Issuer," is a special purpose entity incorporated as a Dutch B.V. under the laws of the Netherlands. Of the shares of the Issuer, 75% are held by a charitable trust and 25% are owned by Hertz Holdings Netherlands B.V., an indirect wholly-owned subsidiary of HIL.

The expected maturity date is in December 2010 (when the FleetCos' obligations to the Issuer are scheduled to come due). The maximum commitment under (i) the Euro denominated financing is €632 million (or $901 million) and (ii) the Australian dollar denominated financing is A$325 million (or $262 million). On July 24, 2008, actual issuance to the French FleetCo, the Dutch FleetCo and the Australian FleetCo was €230.4 million (or $328.4 million), €35.9 million (or $51.2 million) and A$151.9 million (or $122.4 million), respectively.

Series 2008-1 Notes

On September 12, 2008, HVF completed the closing of a new variable funding note facility referred to as the Series 2008-1 Notes. This series is not subject to a financial guaranty, including from either MBIA or Ambac. The aggregate principal amount of such facility is not to exceed $825.0 million and such facility is available to HVF on a revolving basis. The Series 2008-1 Notes were not funded on the closing date.

The Series 2008-1 Notes are secured primarily by, among other things, a pledge in (i) collateral owned by HVF, including substantially all of the U.S. car rental fleet that Hertz uses in its daily rental operations, a portion of which is subject to repurchase programs with vehicle manufacturers, (ii) the related manufacturer receivables, (iii) all rights of HVF under a lease agreement between Hertz and HVF relating to such U.S. car rental fleet, and (iv) all monies on deposit from time to time in certain collection and cash collateral accounts and all proceeds thereof. The assets of HVF, including the U.S. car rental fleet owned by HVF, will not be available to satisfy the claims of our general creditors.

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ITEM 2.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)

The expected final maturity date of the Series 2008-1 Notes is August 2010. The Series 2008-1 Notes bear interest at variable rates partially based upon their rating. The Series 2008-1 Notes are currently rated "A" by Standard & Poor's Ratings Services and "A2" by Moody's Investors Service and based on these ratings the borrowing spread is approximately 150 basis points higher than HVF's existing variable funding notes.

Pursuant to a note purchase agreement, HVF sold the Series 2008-1 Notes to each of Deutsche Bank AG, New York Branch, Nantucket Funding Corp. LLC, (an affiliate of Deutsche Bank AG, New York Branch), Sheffield Receivables Corporation (an affiliate of Barclays Bank PLC), and Merrill Lynch Mortgage Capital Inc. The Series 2008-1 Notes were issued pursuant to a series supplement to HVF's indenture, or the "Indenture," with The Bank of New York Mellon Trust Company, N.A., as trustee.

The Series 2008-1 Notes are subject to events of default and amortization events that are customary in nature for U.S. rental car asset-backed securitizations of this type, including non-payment of principal or interest, violation of covenants, material inaccuracy of representations or warranties, failure to maintain certain enhancement levels and insolvency or certain bankruptcy events. The occurrence of an amortization event or event of default could result in the acceleration of principal of the Series 2008-1 Notes and the liquidation of vehicles in the U.S. car rental fleet.

HVF is subject to numerous restrictive covenants under the Indenture and related agreements, including restrictive covenants with respect to liens, indebtedness, benefit plans, mergers, disposition of assets, acquisition of assets, dividends, officers compensation, investments, agreements, the types of business it may conduct and other customary covenants for a bankruptcy-remote special purpose entity.

Certain of the purchasers of the Series 2008-1 Notes, the administrative agent and the trustee, and their respective affiliates, have performed and may in the future perform, various investment banking, commercial banking, and other financial advisory services for us for which they have received and will receive, customary fees and expenses, and such parties are also participants in other of our credit facilities.

Guarantees and Security

Hertz's obligations under the Senior Term Facility and the Senior ABL Facility are guaranteed by Hertz Investors, Inc., its immediate parent and most of its direct and indirect domestic subsidiaries (subject to certain exceptions, including for subsidiaries involved in the U.S. Fleet Debt facility and similar special purpose financings), though HERC does not guarantee Hertz's obligations under the Senior ABL Facility because it is a borrower under that facility. In addition, the obligations of the Canadian borrowers under the Senior ABL Facility are guaranteed by their respective subsidiaries, if any, subject to limited exceptions. The lenders under each of the Senior Term Facility and the Senior ABL Facility have received a security interest in substantially all of the tangible and intangible assets of the borrowers and guarantors under those facilities, including pledges of the stock of certain of their respective subsidiaries, subject in each case to certain exceptions (including in respect of the U.S. Fleet Debt, the International Fleet Debt and, in the case of the Senior ABL Facility, other secured fleet financing). Consequently, these assets will not be available to satisfy the claims of Hertz's general creditors.

Hertz's obligations under the Senior Notes and Senior Subordinated Notes are guaranteed by each of its direct and indirect domestic subsidiaries that is a guarantor under the Senior Term Facility.

The U.S. Fleet Debt issued on the Closing Date has the benefit of financial guaranty insurance policies under which either MBIA Insurance Corporation or Ambac Assurance Corporation guarantee the timely

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ITEM 2.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)

payment of interest on and ultimate payment of principal of such notes. See "Liquidity and Capital Resources" above.

The obligations of the borrowers under the International Fleet Debt facilities are guaranteed by HIL, and by the other borrowers and certain related entities under the applicable tranche, in each case subject to certain legal, tax, cost and other structuring considerations. The obligations and the guarantees of the obligations of the Tranche A borrowers under the Tranche A2 loans are subordinated to the obligations and the guarantees of the obligations of such borrowers under the Tranche A1 loans. Subject to legal, tax, cost and other structuring considerations and to certain exceptions, the International Fleet Debt facilities are secured by a material part of the assets of each borrower, certain related entities and each guarantor, including pledges of the capital stock of each borrower and certain related entities. The obligations of the Tranche A borrowers under the Tranche A2 loans and the guarantees thereof are secured on a junior second priority basis by any assets securing the obligations of the Tranche A borrowers under the Tranche A1 loans and the guarantees thereof. The assets that collateralize the International Fleet Debt facilities will not be available to satisfy the claims of Hertz's general creditors.

The obligations of each of the borrowers under the Fleet Financing Facility are guaranteed by each of Hertz's direct and indirect domestic subsidiaries (other than subsidiaries whose only material assets consist of securities and debt of foreign subsidiaries and related assets, subsidiaries involved in the U.S. ABS Program or other similar special purpose financings, subsidiaries with minority ownership positions, certain subsidiaries of foreign subsidiaries and certain immaterial subsidiaries). In addition, the obligations of PR Cars are guaranteed by Hertz. The obligations of Hertz under the Fleet Financing Facility and the other loan documents, including, without limitation, its guarantee of PR Cars' obligations under the Fleet Financing Facility, are secured by security interests in Hertz's rental car fleet in Hawaii and by certain assets related to Hertz's rental car fleet in Hawaii and Kansas, including, without limitation, manufacturer repurchase program agreements. PR Cars' obligations under the Fleet Financing Facility and the other loan documents are secured by security interests in PR Cars' rental car fleet in Puerto Rico and St. Thomas, the U.S. Virgin Islands and by certain assets related thereto.

The Brazilian Fleet Financing Facility is secured by our Brazilian subsidiary's fleet of vehicles and backed by a $63.5 million Hertz guarantee.

The Canadian Fleet Financing Facility is secured by the fleet vehicles used in the Canadian operations.

The Belgian Fleet Financing Facility is guaranteed by HIL and the fleet assets used in the Belgian operations are pledged as collateral.

The U.K. Leveraged Financing facility is guaranteed by HIL.

The International ABS Fleet Financing Facility is secured by our fleet in each of the Relevant Jurisdictions. Each of the Fleetcos' portion of the facility is guaranteed by its respective Hertz vehicle rental company in each of the Relevant Jurisdictions. In certain cases, the International ABS Fleet Financing Facility is guaranteed by HIL or its subsidiary Hertz Europe Limited.

Also, substantially all of our revenue earning equipment and certain related assets are owned by special purpose entities, or are subject to liens in favor of our lenders under the Senior ABL Facility, the ABS Program, the International Fleet Debt facilities, the Fleet Financing Facility, the Brazilian Fleet Financing Facility, the Canadian Fleet Financing Facility, the Belgian Fleet Financing Facility, the U.K. Leveraged Financing and the International ABS Fleet Financing Facility. Substantially all our other assets in the United States are also subject to liens in favor of our lenders under the Senior Credit Facilities, and substantially all of our other assets outside the United States are (with certain limited exceptions) subject

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ITEM 2.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)

to liens in favor of our lenders under the International Fleet Debt facilities or (in the case of our Canadian HERC business) the Senior ABL Facility. None of such assets will be available to satisfy the claims of our general creditors.

Covenants

Certain of our debt instruments and credit facilities contain a number of covenants that, among other things, limit or restrict the ability of the borrowers and the guarantors to dispose of assets, incur additional indebtedness, incur guarantee obligations, prepay other indebtedness, make dividends and other restricted payments, create liens, make investments, make acquisitions, engage in mergers, change the nature of their business, make capital expenditures, or engage in certain transactions with affiliates. Some of these agreements also require the maintenance of certain financial covenants. As of September 30, 2008, we were in compliance with all of these financial covenants.

Derivatives

In connection with the Acquisition and the issuance of $3,550.0 million of floating rate U.S. Fleet Debt, HVF entered into certain interest rate swap agreements, or the "HVF Swaps," effective December 21, 2005, which qualify as cash flow hedging instruments in accordance with SFAS No. 133, "Accounting for Derivative Instruments and Hedging Activities." These agreements mature at various terms, in connection with the scheduled maturity of the associated debt obligations, through November 2010. Under these agreements, HVF pays monthly interest at a fixed rate of 4.5% per annum in exchange for monthly amounts at one-month LIBOR, effectively transforming the floating rate U.S. Fleet Debt to fixed rate obligations. HVF paid $44.8 million to reduce the fixed interest rate on the HVF Swaps from the prevailing market rates to 4.5%. Ultimately, this amount will be recognized as additional interest expense over the remaining terms of the HVF Swaps, which range from approximately 1 to 3 years. For the three and nine months ended September 30, 2008, we recorded an expense of $2.8 million and $7.8 million, respectively, and for the three and nine months ended September 30, 2007, we recorded an expense of $17.7 million in our consolidated statement of operations, in "Interest, net of interest income," associated with the ineffectiveness of the HVF Swaps. The ineffectiveness resulted from a decline in the value of the HVF Swaps due to a decrease in forward interest rates along with a decrease in the time value component as we continue to approach the maturity dates of the HVF Swaps. The effective portion of the change in fair value of the HVF Swaps is recorded in "Accumulated other comprehensive income." As of September 30, 2008 and December 31, 2007, the balance reflected in "Accumulated other comprehensive income" was a loss of $51.4 million (net of tax of $32.8 million) and $45.6 million (net of tax of $29.0 million), respectively. As of September 30, 2008 and December 31, 2007, the fair value of the HVF Swaps was a liability of $67.6 million and $50.2 million, respectively, which is reflected in our condensed consolidated balance sheet in "Accrued liabilities." The fair value of the HVF Swaps was calculated using a discounted cash flow method and applying observable market data (i.e. the 1-month LIBOR yield curve and credit default swap spreads).

In connection with the entrance into the HVF Swaps, Hertz entered into seven differential interest rate swap agreements, or the "differential swaps." These differential swaps were required to be put in place to protect the counterparties to the HVF Swaps in the event of an "amortization event" under the asset-backed notes agreements. In the event of an "amortization event," the amount by which the principal balance on the floating rate portion of the U.S. Fleet Debt is reduced, exclusive of the originally scheduled amortization, becomes the notional amount of the differential swaps and is transferred to Hertz. There was no payment associated with these differential swaps and their notional amounts are

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ITEM 2.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)

and will continue to be zero unless (1) there is an amortization event, which causes the amortization of the loan balance, or (2) the debt is prepaid.

An "event of bankruptcy" (as defined in the indentures governing the U.S. Fleet Debt) with respect to MBIA Insurance Corporation or Ambac Assurance Corporation would constitute an "amortization event" under the portion of the U.S. Fleet Debt facilities guaranteed by the affected insurer. In that event, we would also be required to apply a proportional amount, or substantially all in the case of insolvency of both insurers, of all rental payments by Hertz to its special purpose leasing subsidiary and all car disposal proceeds under the applicable facility or series, or under substantially all U.S. Fleet Debt facilities in the case of insolvency of both insurers, to pay down the amounts owed under the affected facility or series instead of applying those proceeds to purchase additional cars and/or for working capital purposes. An insurer "event of bankruptcy" could lead to consequences that have a material adverse effect on our liquidity if we were unable to negotiate mutually acceptable new terms with our U.S. Fleet Debt lenders or if alternate funding were not available to us.

In May 2006, in connection with the forecasted issuance of the permanent take-out international asset-based facilities, HIL purchased two swaptions for €3.3 million, to protect itself from interest rate increases. These swaptions gave HIL the right, but not the obligation, to enter into three year interest rate swaps, based on a total notional amount of €600 million at an interest rate of 4.155%. The swaptions were renewed twice in 2007, prior to their scheduled expiration dates of March 15, 2007 and September 5, 2007, at a total cost of €2.7 million and were due to expire on June 5, 2008. On June 4, 2008, these swaptions were sold for a realized gain of €9.4 million (or $14.8 million). Additionally, on June 4, 2008, HIL purchased two new swaptions for €8.6 million, to protect itself from interest rate increases associated with the International ABS Fleet Financing Facility, which closed on July 24, 2008. These swaptions were based on an underlying transaction with a notional amount of €600 million at an interest rate of 4.25%. As of September 30, 2008 and December 31, 2007, the fair value of the swaptions was €5.3 million (or $7.6 million) and €6.2 million (or $9.2 million), respectively, which is reflected in our condensed consolidated balance sheet in "Prepaid expenses and other assets." The fair value of the HIL swaptions was calculated using a discounted cash flow method and applying observable market data. During the three and nine months ended September 30, 2008, the fair value adjustments related to these swaptions were a loss of $15.0 million (unrealized loss on the new swaptions) and a gain $2.8 million ($14.8 million realized gain on sale of the old swaptions and a net $12.0 million unrealized loss on the old and new swaptions), respectively, which were recorded in our consolidated statement of operations in "Selling, general and administrative" expenses. During the three and nine months ended September 30, 2007, the fair value adjustments related to these swaptions was a loss of $6.9 million and a gain of $3.0 million, respectively, which was recorded in our consolidated statement of operations in "Selling, general and administrative" expenses. On October 10, 2008, the outstanding swaptions were terminated and Hertz received a €1.9 million payment from counterparties.

On September 12, 2008, a supplement was signed to the Indenture, dated as of August 1, 2006, between HVF and the Bank of New York Mellon Trust Company, N.A. This supplement created the Series 2008-1 Notes for issuance by HVF. In order to satisfy rating agency requirements related to its bankruptcy-remote status, HVF acquired an interest rate cap in an amount equal to the Series 2008-1 maximum principal amount of $825.0 million with a strike rate of 7% and a term until August 15, 2011. HVF bought the cap on the date the supplement was signed for $0.4 million. In connection with this interest rate cap, Hertz sold an equal and opposite cap for $0.3 million. The fair value of these interest rate caps on September 30, 2008 were an asset of $0.4 million and a liability of $0.4 million. The fair value of these interest rate caps was calculated using a discounted cash flow method and applying observable

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ITEM 2.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)

market data. Gains and losses resulting from changes in the fair value of these interest rate caps are included in our results of operations in the periods incurred.

Additionally, as of September 30, 2008, we have incurred $23.6 million of financing costs related to certain countries expected to enter into the take-out international asset-based facilities, which are recorded on our condensed consolidated balance sheet in "Prepaid expenses and other assets." We expect to enter into these take-out international asset-based facilities upon completion of the structuring and amortize the costs over the term of the facility. For the nine months ended September 30, 2008, we recorded $7.7 million related to the write off of the deferred financing costs of those countries who are not participating in the take-out international asset-based facilities.

Credit Facilities

As of September 30, 2008, the following credit facilities were available for the use of Hertz and its subsidiaries:

•

The Senior Term Facility had approximately $25.4 million available under the letter of credit facility.



•

The Senior ABL Facility had the foreign currency equivalent of approximately $1,076.9 million of remaining capacity, all of which was available under the borrowing base limitation and $82.4 million of which was available under the letter of credit facility sublimit.



•

The U.S. Fleet Debt had approximately $1,843.7 million of remaining capacity, of which $28.8 million was available under the borrowing base limitation. No additional amounts were available under the letter of credit facility.



•

The International Fleet Debt facilities had the foreign currency equivalent of approximately $515.2 million of remaining capacity, of which $115.1 million was available under the borrowing base limitation.



•

The Fleet Financing Facility had approximately $120.8 million of remaining capacity, of which none was available under the borrowing base limitation.



•

The Brazilian Fleet Financing Facility had the foreign currency equivalent of approximately $1.0 million of remaining capacity, of which none was available under the borrowing base limitation.



•

The Canadian Fleet Financing Facility had the foreign currency equivalent of approximately $113.3 million of remaining capacity, of which none was available under the borrowing base limitation.



•

The Belgian Fleet Financing Facility had no remaining capacity.



•

The U.K. Leveraged Financing facility had the foreign currency equivalent of approximately $1.5 million of remaining capacity, of which none was available under the borrowing base limitation.



•

The International ABS Fleet Financing Facility had the foreign currency equivalent of approximately $183.7 million of remaining capacity, of which $132.9 million was available under the borrowing base limitation.

As noted above, subject to borrowing base limitations, we had $2,779.2 million available under our various fleet financing facilities and $1,076.9 million available under our various corporate debt facilities.

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ITEM 2.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)

As of September 30, 2008, substantially all of our assets were pledged under one or more of the facilities noted above.

Capital Expenditures

The following table sets forth the revenue earning equipment and property and equipment capital expenditures and related disposal proceeds received by quarter for 2008 and 2007 (in millions of dollars):

			Revenue Earning Equipment								Property and Equipment
			Capital Expenditures		Disposal Proceeds			Net Capital Expenditures (Disposal Proceeds)			Capital Expenditures		Disposal Proceeds			Net Capital Expenditures
2008
	First Quarter		$	2,880.3	$	(1,748.4	)	$	1,131.9		$	40.8	$	(11.7	)	$	29.1
	Second Quarter			3,662.5		(2,103.0	)		1,559.5			61.9		(17.5	)		44.4
	Third Quarter			2,094.4		(2,284.3	)		(189.9	)		46.8		(7.6	)		39.2
		Total	$	8,637.2	$	(6,135.7	)	$	2,501.5		$	149.5	$	(36.8	)	$	112.7
2007
	First Quarter		$	3,333.2	$	(2,243.2	)	$	1,090.0		$	37.6	$	(10.8	)	$	26.8
	Second Quarter			3,817.6		(2,061.9	)		1,755.7			59.7		(16.6	)		43.1
	Third Quarter			2,418.4		(2,268.9	)		149.5			46.8		(25.8	)		21.0
	Fourth Quarter			1,772.9		(2,640.3	)		(867.4	)		51.9		(45.8	)		6.1
		Total Year	$	11,342.1	$	(9,214.3	)	$	2,127.8		$	196.0	$	(99.0	)	$	97.0

Revenue earning equipment expenditures in our car rental operations were $8,392.3 million and $8,983.7 million for the nine months ended September 30, 2008 and 2007, respectively. Revenue earning equipment expenditures in our equipment rental operations were $244.9 million and $585.5 million for the nine months ended September 30, 2008 and 2007, respectively.

Revenue earning equipment expenditures in our car rental and equipment rental operations for the nine months ended September 30, 2008 decreased by 6.6% and 58.2%, respectively, compared to the nine months ended September 30, 2007. The decrease in our car rental operations revenue earning equipment expenditures is due to the change in the mix of purchases made and aging of our rental fleet during the nine months ended September 30, 2008 as compared to the nine months ended September 30, 2007. The decrease in our equipment rental operations revenue earning equipment expenditures is primarily due to slowing non-residential construction growth and aging of our rental fleet during the nine months ended September 30, 2008 as compared to the nine months ended September 30, 2007.

Property and equipment expenditures in our car rental operations were $109.1 million and $100.2 million for the nine months ended September 30, 2008 and 2007, respectively. Property and equipment expenditures in our equipment rental operations were $33.4 million and $42.2 million for the nine months ended September 30, 2008 and 2007, respectively. Property and equipment expenditures for all other activities were $7.0 million and $1.7 million for the nine months ended September 30, 2008 and 2007, respectively.

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ITEM 2.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)

Property and equipment expenditures in our car rental operations, equipment rental operations and for all other activities for the nine months ended September 30, 2008 increased by 8.9%, decreased by 20.9% and increased by 311.8%, respectively, compared to the nine months ended September 30, 2007.

For the nine months ended September 30, 2008, we experienced a decreased level of net expenditures for revenue earning equipment and property and equipment compared to the nine months ended September 30, 2007. This decrease was primarily due to a decrease in revenue earning equipment expenditures, partly offset by a decrease in revenue earning equipment disposal proceeds.

Off-Balance Sheet Commitments

As of September 30, 2008 and December 31, 2007, the following guarantees (including indemnification commitments) were issued and outstanding:

Indemnifications

In the ordinary course of business, we execute contracts involving indemnifications standard in the relevant industry and indemnifications specific to a transaction such as the sale of a business. These indemnifications might include claims relating to the following: environmental matters; intellectual property rights; governmental regulations and employment-related matters; customer, supplier and other commercial contractual relationships; and financial matters. Performance under these indemnities would generally be triggered by a breach of terms of the contract or by a third party claim. We regularly evaluate the probability of having to incur costs associated with these indemnifications and have accrued for expected losses that are probable and estimable. The types of indemnifications for which payments are possible include the following:

Sponsors; Directors

On the Closing Date, Hertz entered into customary indemnification agreements with us, the Sponsors and our stockholders affiliated with the Sponsors, pursuant to which Hertz Holdings and Hertz indemnify the Sponsors, our stockholders affiliated with the Sponsors and their respective affiliates, directors, officers, partners, members, employees, agents, representatives and controlling persons, against certain liabilities arising out of performance of a consulting agreement with Hertz Holdings and each of the Sponsors and certain other claims and liabilities, including liabilities arising out of financing arrangements or securities offerings. We do not believe that these indemnifications are reasonably likely to have a material impact on us. We also entered into indemnification agreements with each of our directors in connection with the initial public offering of our common stock in November 2006.

Environmental

We have indemnified various parties for the costs associated with remediating numerous hazardous substance storage, recycling or disposal sites in many states and, in some instances, for natural resource damages. The amount of any such expenses or related natural resource damages for which we may be held responsible could be substantial. The probable expenses that we expect to incur for such matters have been accrued, and those expenses are reflected in our condensed consolidated financial statements. As of September 30, 2008 and December 31, 2007, the aggregate amounts accrued for environmental liabilities, including liability for environmental indemnities, reflected in our condensed consolidated balance sheet in "Accrued liabilities" were $2.6 million and $2.7 million, respectively. The accrual generally represents the estimated cost to study potential environmental issues at sites deemed to require investigation or clean-up activities, and the estimated cost to implement remediation actions,

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ITEM 2.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)

including on-going maintenance, as required. Cost estimates are developed by site. Initial cost estimates are based on historical experience at similar sites and are refined over time on the basis of in-depth studies of the sites. For many sites, the remediation costs and other damages for which we ultimately may be responsible cannot be reasonably estimated because of uncertainties with respect to factors such as our connection to the site, the materials there, the involvement of other potentially responsible parties, the application of laws and other standards or regulations, site conditions, and the nature and scope of investigations, studies, and remediation to be undertaken (including the technologies to be required and the extent, duration, and success of remediation).

Risk Management

For a discussion of additional risks arising from our operations, including vehicle liability, general liability and property damage insurable risks, see "Item 1—Business—Risk Management" in our Form 10-K.

Market Risks

We are exposed to a variety of market risks, including the effects of changes in interest rates and foreign currency exchange rates. We manage our exposure to these market risks through our regular operating and financing activities and, when deemed appropriate, through the use of derivative financial instruments. Derivative financial instruments are viewed as risk management tools and historically have not been used for speculative or trading purposes. In addition, derivative financial instruments are entered into with a diversified group of major financial institutions in order to manage our exposure to counterparty nonperformance on such instruments. For more information on these exposures see Note 13 to the Notes to our audited annual consolidated financial statements included in our Form 10-K.

Interest Rate Risk

From time to time, we may enter into interest rate swap agreements to manage interest rate risk. In connection with the Acquisition and the issuance of $3,550.0 million of floating rate U.S. Fleet Debt, HVF entered into the HVF Swaps effective December 21, 2005, which qualify as cash flow hedging instruments in accordance with SFAS No. 133. These agreements mature at various terms, in connection with the scheduled maturity of the associated debt obligations, through November 2010. Under these agreements, HVF pays monthly interest at a fixed rate of 4.5% per annum in exchange for monthly amounts at one-month LIBOR, effectively transforming the floating rate U.S. Fleet Debt to fixed rate obligations.

In connection with the entrance into the HVF Swaps, Hertz entered into seven differential swaps. These differential swaps were required to be put in place to protect the counterparties to the HVF Swaps in the event of an "amortization event" under the asset-backed notes agreements. In the event of an amortization event, the amount by which the principal balance on the floating rate portion of the U.S. Fleet Debt is reduced, exclusive of the originally scheduled amortization, becomes the notional amount of the differential swaps, and is transferred to Hertz.

In May 2006, in connection with the forecasted issuance of the permanent take-out international asset-based facilities, HIL purchased two swaptions for €3.3 million, to protect itself from interest rate increases. These swaptions gave HIL the right, but not the obligation, to enter into three year interest rate swaps, based on a total notional amount of €600 million at an interest rate of 4.155%. The swaptions were renewed twice in 2007, prior to their scheduled expiration dates of March 15, 2007 and September 5, 2007, at a total cost of €2.7 million and were due to expire on June 5, 2008. On June 4, 2008, these swaptions were sold for a realized gain of €9.4 million (or $14.8 million). Additionally, on

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ITEM 2.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)

June 4, 2008, HIL purchased two new swaptions for €8.6 million, to protect itself from interest rate increases associated with the International ABS Fleet Financing Facility, which closed on July 24, 2008. These swaptions were based on an underlying transaction with a notional amount of €600 million at an interest rate of 4.25%. On October 10, 2008, the outstanding swaptions were terminated and Hertz received a €1.9 million payment from counterparties.

On September 12, 2008, a supplement was signed to the Indenture, dated as of August 1, 2006, between HVF and the Bank of New York Mellon Trust Company, N.A. This supplement created the Series 2008-1 Notes for issuance by HVF. In order to satisfy rating agency requirements related to its bankruptcy-remote status, HVF acquired an interest rate cap in an amount equal to the Series 2008-1 maximum principal amount of $825.0 million with a strike rate of 7% and a term until August 15, 2011. HVF bought the cap on the date the supplement was signed for $0.4 million. In connection with this interest rate cap, Hertz sold an equal and opposite cap for $0.3 million. The fair value of these interest rate caps on September 30, 2008 were an asset of $0.4 million and a liability of $0.4 million. The fair value of these interest rate caps was calculated using a discounted cash flow method and applying observable market data. Gains and losses resulting from changes in the fair value of these interest rate caps are included in our results of operations in the periods incurred.

See Notes 7 and 14 to the Notes to our condensed consolidated financial statements included in this Report and Notes 3 and 13 to the Notes to our audited annual consolidated financial statements included in our Form 10-K.

We have a significant amount of debt (including under our U.S. and International Fleet Debt facilities, other international fleet debt facilities and Senior ABL Facility) with variable rates of interest based generally on LIBOR, EURIBOR or their equivalents for local currencies plus an applicable margin. Increases in interest rates could therefore significantly increase the associated interest payments that we are required to make on this debt.

We have assessed our exposure to changes in interest rates by analyzing the sensitivity to our earnings assuming various changes in market interest rates. Assuming a hypothetical increase of one percentage point in interest rates on our debt portfolio as of September 30, 2008, our net income would decrease by an estimated $32.1 million over a twelve-month period.

Consistent with the terms of the agreements governing the respective debt obligations, we may hedge a portion of the floating rate interest exposure under the Senior Credit Facilities and the U.S. and International Fleet Debt to provide protection in respect of such exposure.

Foreign Currency Risk

We manage our foreign currency risk primarily by incurring, to the extent practicable, operating and financing expenses in the local currency in the countries in which we operate, including making fleet and equipment purchases and borrowing for working capital needs. Also, we have purchased foreign currency option contracts to manage exposure to fluctuations in foreign exchange rates for selected marketing programs. The effect of exchange rate changes on these financial instruments would not materially affect our consolidated financial position, results of operations or cash flows. Our risks with respect to foreign currency option contracts are limited to the premium paid for the right to exercise the option and the future performance of the option's counterparty. Premiums paid for options outstanding as of September 30, 2008, were approximately $0.5 million, and we limit counterparties to financial institutions that have strong credit ratings. As of September 30, 2008 and December 31, 2007, the fair value of all outstanding foreign currency option contracts was approximately $0.7 million and

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ITEM 2.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)

$0.1 million, respectively, which was recorded in our condensed consolidated balance sheet in "Prepaid expenses and other assets." The fair value of the foreign currency option contracts were calculated using a discounted cash flow method and applying observable market data. Gains and losses resulting from changes in the fair value of these options are included in our results of operations in the periods incurred.

We also manage exposure to fluctuations in currency risk on intercompany loans we make to certain of our subsidiaries by entering into foreign currency forward contracts at the time of the loans. The forward rate is reflected in the intercompany loan rate to the subsidiaries, and as a result, the forward contracts have no material impact on our results of operations.

In connection with the Transactions, we issued €225 million of unhedged Senior Euro Notes. Prior to October 1, 2006, our Senior Euro Notes were not designated as a net investment hedge of our Euro-denominated net investment in our foreign operations. On October 1, 2006, we designated our Senior Euro Notes as an effective net investment hedge of our Euro-denominated net investment in our foreign operations. As a result of this net investment hedge designation, as of September 30, 2008 and December 31, 2007, losses of $21.3 million (net of tax of $14.1 million) and $27.8 million (net of tax of $18.3 million), respectively, attributable to the translation of our Senior Euro Notes into the U.S. dollar are recorded in our condensed consolidated balance sheet in "Accumulated other comprehensive income."

Inflation

The increased cost of vehicles is the primary inflationary factor affecting us. Many of our other operating expenses are also expected to increase with inflation, including health care costs and gasoline. Management does not expect that the effect of inflation on our overall operating costs will be greater for us than for our competitors.

Like-Kind Exchange Program

In January 2006, we implemented a like-kind exchange program for our U.S. car rental business. Pursuant to the program, we dispose of vehicles and acquire replacement vehicles in a form intended to allow such dispositions and replacements to qualify as tax-deferred "like-kind exchanges" pursuant to section 1031 of the Internal Revenue Code. The program has resulted in a material deferral of federal and state income taxes for fiscal 2007 and the nine months ended September 30, 2008. A like-kind exchange program for HERC has been in place for several years. We cannot, however, offer assurance that the expected tax deferral will be achieved or that the relevant law concerning the programs will remain in its current form. In addition, the benefit of deferral is subject to recapture, if, for example, there were a material downsizing of our fleet.

Employee Retirement Benefits

Pension

We sponsor defined benefit pension plans worldwide. Pension obligations give rise to significant expenses that are dependent on assumptions discussed in Note 4 of the Notes to our audited annual consolidated financial statements included in our Form 10-K. Based on present assumptions, 2008 worldwide pre-tax pension expense is expected to be approximately $36.4 million, which is a decrease of $4.7 million from 2007. The decrease in expense compared to 2007 is primarily due to lower expense in the United Kingdom of $4.0 million, higher discount rates and foreign exchange rate changes. To the

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ITEM 2.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)

extent that there are layoffs affecting a significant number of employees covered by any pension plan worldwide, 2008 expense could vary significantly because of further charges or credits.

We participate in various "multiemployer" pension plans administered by labor unions representing some of our employees. We make periodic contributions to these plans to allow them to meet their pension benefit obligations to their participants. In the event that we withdraw from participation in one of these plans, then applicable law could require us to make an additional lump-sum contribution to the plan, and we would have to reflect that as an expense in our consolidated statement of operations and as a liability on our condensed consolidated balance sheet. Our withdrawal liability for any multiemployer plan would depend on the extent of the plan's funding of vested benefits. In the ordinary course of our renegotiation of collective bargaining agreements with labor unions that maintain these plans, we could decide to discontinue participation in a plan, and in that event we could face a withdrawal liability. Some multiemployer plans, including one in which we participate, are reported to have significant underfunded liabilities. Such underfunding could increase the size of our potential withdrawal liability.

Other Postretirement Benefits

We provide limited postretirement health care and life insurance for employees of our domestic operations with hire dates prior to January 1, 1990. There are no plan assets associated with this plan. We provide for these postretirement costs through monthly accruals in our condensed consolidated financial statements.

Recent Accounting Pronouncements

For a discussion of recent accounting pronouncements, see Note 2 to the Notes to our condensed consolidated financial statements included in this Report.

Other Financial Information

The interim financial information included in this Report has not been audited by PricewaterhouseCoopers LLP, or "PwC." In reviewing this interim financial information, PwC has applied limited procedures in accordance with professional standards for reviews of interim financial information. Accordingly, reliance on their reports on this information should be restricted. PwC is not subject to the liability provisions of Section 11 of the Securities Act of 1933 for its reports on the interim financial information because their reports do not constitute "reports" or "parts" of registration statements prepared or certified by PwC within the meaning of Sections 7 and 11 of the Securities Act of 1933.

ITEM 3.    QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

There is no material change in the information reported under "Part II, Item 7A.—Quantitative and Qualitative Disclosures About Market Risk," contained in our Annual Report on Form 10-K for the fiscal year ended December 31, 2007. See "Item 2—Management's Discussion and Analysis of Financial Condition and Results of Operations—Market Risks," included in this Report.

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ITEM 4.    CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

Disclosure controls and procedures are controls and other procedures that are designed to ensure that information required to be disclosed in company reports filed or submitted under the Securities and Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified in the SEC's rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed in company reports filed under the Securities and Exchange Act of 1934 is accumulated and communicated to management, including our Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure.

An evaluation of the effectiveness of our disclosure controls and procedures was performed under the supervision of, and with the participation of, management, including our Chief Executive Officer and Chief Financial Officer, as of the end of the period covered by this Report. Based on this evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures are effective.

Changes in Internal Control Over Financial Reporting

An evaluation of our internal controls over financial reporting was performed under the supervision of, and with the participation of, management, including our Chief Executive Officer and Chief Financial Officer, to determine whether any changes have occurred during the period covered by this Report that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting. Based upon this evaluation, our Chief Executive Officer and Chief Financial Officer concluded that no changes in our internal control over financial reporting have occurred during the three months ended September 30, 2008 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

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PART II—OTHER INFORMATION

ITEM 1.    LEGAL PROCEEDINGS

For a description of all material pending legal proceedings, see Note 16 to the Notes to our condensed consolidated financial statements included in this Report.

The following recent material developments pertaining to our material pending legal proceedings are furnished on a supplemental basis:

In September 2008, the United States District Court for the Central District of California granted the rental car defendants' motion to transfer the In re Tourism Assessment Fee Litigation to the United States District Court for the Southern District of California.

After the Jose M. Gomez, individually and on behalf of all other similarly situated persons, v. The Hertz Corporation case was decertified by the appellate court and remanded to the trial court for further proceedings, the case was settled. In September of 2008, a "take nothing judgment" was entered at the trial court indicating that the plaintiff took nothing on his claims against the defendants with a final judgment being entered with prejudice.

In October 2008, the plaintiff in Fun Services of Kansas City, Inc., individually and as the representative of a class of similarly-situated persons, v. Hertz Equipment Rental Corporation, voluntarily dismissed its conversion claim, without prejudice.

Aside from the above mentioned, there were no material changes in our material pending legal proceedings and we are not otherwise required to disclose any pending legal proceedings in response to Item 103 of Regulation S-K.

ITEM 1A.    RISK FACTORS

There is no material change in the information reported under "Item 1A—Risk Factors" contained in our Annual Report on Form 10-K for the fiscal year ended December 31, 2007 with the exception of the following.

Risks Related to Our Business

A further or continued economic downturn could result in even greater declines in business and leisure travel and non-residential capital investment, which could further harm our business.

Our results of operations are affected by many economic factors, including the level of economic activity in the markets in which we operate. In the car rental business, a decline in economic activity typically results in a decline in both business and leisure travel and, accordingly, a decline in the volume of car rental transactions. In the equipment rental business, a decline in economic activity typically results in a decline in activity in non-residential construction and other businesses in which our equipment rental customers operate and, therefore, results in a decline in the volume of equipment rental transactions. In the case of a decline in car or equipment rental activity, we may reduce rental rates to meet competitive pressures, which could have a material adverse effect on our results of operations. A decline in economic activity also may have a material adverse effect on residual values realized on the disposition of our revenue earning cars and/or equipment.

The United States and international markets are currently experiencing a distinct decline in economic activity, including a tightening of credit markets, and reduced airline passenger traffic. Due to this decline in economic activity the following has occurred:

•

During the three months ended September 30, 2008, we have experienced a period of rapid volume contraction across all of our businesses—domestic car rental, European car rental and worldwide equipment rental. The declines have happened very quickly, particularly in our car

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ITEM 1A.    RISK FACTORS (Continued)

rental business, due to both commercial and leisure demand reductions in response to the economic slowdown. Higher fuel costs and reductions in airline capacity, along with increased airfares, led consumers to rent fewer cars. Businesses also cut back on employee travel.



•

The utilization of our vehicles and equipment is adversely impacted when demand declines rapidly, resulting in an increase in depreciation and fleet-related costs as a percentage of revenue.



•

The volume reduction and temporary excess fleet levels led directly to lower industry pricing.



•

Efforts by us and our competitors to downsize our fleets have resulted in an increase in used car inventories at car auctions and in other disposal channels, and when combined with tighter credit and lower consumer spending, residual values suffer.

The combination of these factors has adversely impacted our business in the three months ended September 30, 2008 and we currently expect that our business in the fourth quarter of 2008 will also be adversely impacted. If the current economic conditions do not improve, our results of operations could be adversely impacted beyond 2008.

We could be harmed by a further decline in the results of operations or financial condition of the manufacturers of our cars, particularly if they are unable, reject or fail to fulfill their obligations, to repurchase program cars from us or to guarantee the depreciation of program cars.

In the past several years, Ford and General Motors, which are the principal suppliers of cars to us on both a program and non-program basis, have experienced deterioration in their operating results and significant declines in their credit ratings. This trend has accelerated in recent months as a result of the worldwide credit crisis, substantial losses in worldwide equity markets and the recent tightening of consumer credit. A severe or persistent decline in the results of operations or financial condition of a manufacturer of cars that we own could reduce the cars' residual values, particularly to the extent that the manufacturer unexpectedly announced the eventual elimination of its models or nameplates or ceased manufacturing them altogether. Such a reduction could cause us to sustain a loss on the ultimate sale of non-program cars, on which we bear the risk of such declines in residual value, or require us to depreciate those cars on a more rapid basis while we own them.

In addition, if a decline in results or conditions were so severe as to cause a manufacturer to default on an obligation to repurchase or guarantee the depreciation of program cars we own, or to cause a manufacturer to commence bankruptcy reorganization proceedings, and reject its repurchase or guaranteed depreciation obligations, or if any manufacturer of our cars does not fulfill its obligations under our current arrangement with them, for whatever reason, we would have to dispose of those program cars without the benefits of the associated programs. This could significantly increase our expenses. In addition, disposing of program cars following a manufacturer default or rejection of the program in bankruptcy could result in losses similar to those associated with the disposition of cars that have become ineligible for return or sale under the applicable program. Such losses could be material if a large number of program cars were affected. For example, we estimate that if Ford Motor Company, but not its subsidiaries, had filed for bankruptcy reorganization and rejected all its commitments to repurchase program cars from us, based upon the highest number of Ford program cars we had in the twelve months ended September 30, 2008, we would sustain material losses in the U.S., which would have been as high as $200.0 million, upon disposition of those cars. A reduction in the number of program cars that we buy would reduce the magnitude of this exposure, but it would simultaneously increase our exposure to residual value risk. See "—We face risks related to decreased acquisition or disposition of cars through repurchase and guaranteed depreciation programs."

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ITEM 1A.    RISK FACTORS (Continued)

Any default or reorganization of a manufacturer that has sold us program cars might also leave us with a substantial unpaid claim against the manufacturer with respect to program cars that were sold and returned to the car manufacturer but not paid for, or that were sold for less than their agreed repurchase price or guaranteed value. For the twelve months ended September 30, 2008, the highest outstanding month-end receivable balance for cars sold to a single manufacturer was $203.6 million owed by General Motors. See "—We face risks of increased costs of cars and of decreased profitability, including as a result of limited supplies of competitively priced cars."

A decline in the economic and business prospects of car manufacturers, including any economic distress impacting the suppliers of car components to manufacturers, could also cause manufacturers to raise the prices we pay for cars or reduce their supply to us.

In addition, events negatively affecting the car manufacturers could affect how much we may borrow under our asset-backed financing and may in the case of certain manufacturers also increase the levels of credit enhancement we are required to provide under our asset-backed financing. See "—Our reliance on asset- backed financing to purchase cars subjects us to a number of risks, many of which are beyond our control."

We face risks of increased costs of cars and of decreased profitability, including as a result of limited supplies of competitively priced cars.

We believe we are one of the largest private sector purchasers of new cars in the world for our rental fleet, and as of September 30, 2008, our approximate average holding period for a rental car was twelve months in the United States and nine months in our international car rental operations. In recent years, the average holding cost of new cars has increased. As compared to last year, we expect our per car vehicle depreciation costs in the United States for 2008 to increase in the mid single digits. We may not be able to offset these car cost increases to a degree sufficient to maintain our profitability.

Historically, we have purchased more of the cars we rent from Ford than from any other automobile manufacturer. Over the five years ended December 31, 2007, approximately 40% of the cars acquired by us for our U.S. car rental fleet, and approximately 31% of the cars acquired by us for our international fleet, were manufactured by Ford and its subsidiaries. During the twelve months ended September 30, 2008, approximately 32% of the cars acquired by us domestically were manufactured by Ford and its subsidiaries and approximately 19% of the cars acquired by us for our international fleet were manufactured by Ford and its subsidiaries. Under our Master Supply and Advertising Agreement with Ford, Ford has agreed to develop fleet offerings in the United States that are generally competitive with terms and conditions of similar offerings by other automobile manufacturers. The Master Supply and Advertising Agreement expires in 2010. See "Item 1—Business—Relationship with Ford—Supply and Advertising Arrangements" in our Form 10-K. We cannot assure you that we will be able to extend the Master Supply and Advertising Agreement beyond its current term or enter into similar agreements at reasonable terms. In the future, we expect to buy a smaller proportion of our car rental fleet from Ford than we have in the past. If Ford does not offer us competitive terms and conditions, and we are not able to purchase sufficient quantities of cars from other automobile manufacturers on competitive terms and conditions, then we may be forced to purchase cars at higher prices, or on terms less competitive, than for cars purchased by our competitors. Historically, we have also purchased a significant percentage of our car rental fleet from General Motors. Over the five years ended December 31, 2007, approximately 22% of the cars acquired by us for our U.S. car rental fleet, and approximately 15% of the cars acquired by us for our international fleet, were manufactured by General Motors. During the twelve months ended September 30, 2008, approximately 20% of the cars acquired by our U.S. car rental fleet, and approximately 19% of the cars acquired by us for our international fleet, were manufactured by General

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ITEM 1A.    RISK FACTORS (Continued)

Motors. If Ford does not fulfill its obligations under our Master Supply and Advertising Agreement or General Motors does not fulfill its obligations under our 2009 model year arrangement, for whatever reason including a bankruptcy filing by Ford or General Motors, this could cause a significant disruption in our supply of cars, may increase our average cost of new cars, could adversely impact how much we can borrow under our asset-backed financing facilities, and could require us to provide additional enhancement or collateral under our asset-backed financing facilities.

To date we have not entered into any long-term car supply arrangements with manufacturers other than Ford. In addition, certain car manufacturers, including Ford, have adopted strategies to de-emphasize sales to the car rental industry which they view as less profitable due to historical sales incentive and other discount programs that tended to lower the average cost of cars for fleet purchasers such as us. Reduced or limited supplies of equipment together with increased prices are risks that we also face in our equipment rental business. We cannot offer assurance that we will be able to pass on increased costs of cars or equipment to our rental customers. Failure to pass on significant cost increases to our customers would have a material adverse impact on our results of operations and financial condition.

We face risks related to decreased acquisition or disposition of cars through repurchase and guaranteed depreciation programs.

Through the twelve months ended September 30, 2008, approximately 55% of the cars purchased in our combined U.S. and international car rental fleet were subject to repurchase by car manufacturers under contractual repurchase or guaranteed depreciation programs. Under these programs, car manufacturers agree to repurchase cars at a specified price or guarantee the depreciation rate on the cars during a specified time period, typically subject to certain car condition, mileage and holding period requirements. These repurchase and guaranteed depreciation programs limit the risk to us that the market value of a car at the time of its disposition will be less than its estimated residual value at such time. We refer to this risk as "residual risk."

Repurchase and guaranteed depreciation programs enable us to determine our depreciation expense in advance. This predictability is useful to us, since depreciation is a significant cost factor in our operations. Repurchase and guaranteed depreciation programs are also useful in managing our seasonal peak demand for fleet, because some of them permit us to acquire cars and dispose of them after relatively short periods of time. A trade-off we face when we purchase program cars is that we typically pay the manufacturer of a program car more than we would pay to buy the same car as a non-program car. Program cars thus involve a larger initial investment than their non-program counterparts. If a program car is damaged and we are unable to recover the cost of the damage from our customer or another third party or otherwise becomes ineligible for return or sale under the relevant program, our loss upon the disposition of the car will be larger than if the car had been a non-program car, because our initial investment in the car was larger.

The percentage of our car rental fleet subject to repurchase or guaranteed depreciation programs has substantially decreased due primarily to changes in the overall terms offered by automobile manufacturers under repurchase programs. Accordingly, we are now bearing increased risk relating to the residual market value and the related depreciation on our car rental fleet and must use different rotational techniques to accommodate our seasonal peak demand for cars.

Repurchase and guaranteed depreciation programs generally provide us with flexibility to reduce the size of our fleet by returning cars sooner than originally expected without risk of loss in the event of an economic downturn or to respond to changes in rental demand. This flexibility has been reduced as the percentage of program cars in our car rental fleet has decreased materially. See "Item 1—Business—

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ITEM 1A.    RISK FACTORS (Continued)

Worldwide Car Rental—Fleet" in our Form 10-K and "Item 2—Management's Discussion and Analysis of Financial Condition and Results of Operations—Overview of our Business" in this Report

Our car manufacturers may fail to fulfill their repurchase obligations under our current or future arrangements with them, for whatever reason including a bankruptcy filing, or in the future, car manufacturers could modify or eliminate their repurchase or guaranteed depreciation programs or change their return policies (which include condition, mileage and holding period requirements for returned cars) from one program year to another to make it disadvantageous to acquire certain cars. Any failure of our car manufacturers to fulfill their current repurchase obligations, or modification or elimination of such programs in the future, would increase our exposure to the risks described in the preceding paragraphs. In addition, because we obtain a substantial portion of our financing in reliance on repurchase and guaranteed depreciation programs, the failure of our car manufacturers to fulfill their current repurchase obligations, or modification or elimination of those programs in the future, or significant adverse changes in the financial condition of our car manufacturers could impact our outstanding asset-backed facilities and could in the future make some vehicle-related debt financing more difficult to obtain on reasonable terms. See "—Our reliance on asset-backed financing to purchase cars subjects us to a number of risks, many of which are beyond our control."

An impairment of our goodwill and/or our indefinite-lived intangible assets could have a material non-cash adverse impact on our results of operations.

We account for our goodwill and indefinite-lived intangible assets under SFAS No. 142 and review these assets for impairment whenever events or changes in circumstances indicate that the carrying amount of these assets may not be recoverable and at least annually. The current economic environment is having a negative impact on our results in 2008 through reductions in rental volume, decreases in pricing and increases in certain costs. In addition, there is industry related downward pressure on our stock price, resulting in a reduced market capitalization which may not recover in the short term. We have taken a number of actions as described elsewhere in this filing to mitigate the impact of these negative factors on our projected future cash flows. However, the global economy could continue to deteriorate and our planned actions may not be sufficient to allow us to maintain consistent levels of cash flows as currently projected. If such further economic deterioration occurs, we may be required to record a charge for goodwill and/or indefinite-lived intangible asset impairments in the future which could have a material adverse non-cash impact on our results of operations. We will be performing our annual impairment tests for goodwill and indefinite-lived intangible assets in the fourth quarter of 2008.

Risks Relating to Our Indebtedness

The third-party insurance companies that provide credit enhancements in the form of financial guaranties of U.S. Fleet Debt could face financial instability due to factors beyond our control, which in turn could have material adverse effects on our business.

MBIA Insurance Corporation, or "MBIA," and Ambac Assurance Corporation, or "Ambac," provide credit enhancements in the form of financial guaranties for our U.S. Fleet Debt, with each providing guaranties for approximately half of the $4.3 billion in principal amount of the notes issued under our ABS program in December 2005. MBIA and Ambac are facing financial instability due to factors beyond our control. Each of MBIA and Ambac has been downgraded and is on review for further credit downgrade or under developing outlook by one or more credit ratings agencies. We may be required to utilize alternate sources of funding as our outstanding ABS notes mature, which may not be available on terms as favorable or in amounts comparable to those available to us under our existing ABS program.

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ITEM 1A.    RISK FACTORS (Continued)

An "event of bankruptcy" (as defined in the indentures governing the U.S. Fleet Debt) with respect to MBIA or Ambac would constitute an amortization event under the portion of the U.S. Fleet Debt facilities guaranteed by the affected insurer. In that event we would also be required to apply a proportional amount, or substantially all in the case of insolvency of both insurers, of all rental payments by Hertz to its special purpose leasing subsidiary and all car disposal proceeds under the applicable facility or series, or under substantially all U.S. Fleet Debt facilities in the case of insolvency of both insurers, to pay down the amounts owed under the affected facility or series instead of applying those proceeds to purchase additional cars and/or for working capital purposes. An insurer "event of bankruptcy" could lead to consequences that have a material adverse effect on our liquidity if we were unable to negotiate mutually acceptable new terms with our U.S. Fleet Debt lenders or if alternate funding were not available to us.

After 30 days, an insurer event of bankruptcy would constitute a limited liquidation event of default under the applicable indenture supplement governing the U.S. Fleet Debt insured by the bankrupt insurer. At that point, noteholders for the affected series of notes would have the right to instruct the trustee to exercise all remedies available to secured creditors, including the termination of the master lease under which Hertz leases its U.S. vehicle fleet and foreclosure of the vehicle fleet, provided that the exercise of any such right is supported by a majority of the affected noteholders. If the master lease were terminated due to the insolvency of either MBIA or Ambac, the termination would trigger an amortization event with respect to the notes insured by the other insurer. Foreclosure of the vehicle fleet would have a material adverse effect on our business, financial condition and results of operations.

The occurrence of an amortization event as a result of insurer insolvency would also result in our inability to make use of the Like-Kind Exchange Program, which is described under "Item 2—Management's Discussion and Analysis of Financial Conditions and Results of Operations—Like-Kind Exchange Program," with respect to future dispositions and acquisitions of fleet vehicles subject to the ABS program. This could expose us to increased income tax liability in the future as a result of recognition of gains upon sales from our then-existing ABS Program fleet, although we would expect to be able to utilize the Like-Kind Exchange Program for certain cars within our then-existing fleet as well as future cars purchased outside of the ABS Program.

A limited liquidation event of default under the applicable indenture supplement governing the U.S. Fleet Debt and any related foreclosure of the vehicle fleet could result in our inability to have access to other facilities or could accelerate outstanding indebtedness under those facilities or other financing arrangements.

Our reliance on asset-backed financing to purchase cars subjects us to a number of risks, many of which are beyond our control.

We rely significantly on asset-backed financing to purchase cars for our domestic and international car rental fleets. In connection with the Acquisition, a bankruptcy-remote special purpose entity wholly-owned by us issued approximately $4,300.0 million of new debt (plus an additional $1,500.0 million in the form of variable funding notes issued but not funded at the closing of the Acquisition) backed by our U.S. car rental fleet under the ABS program. In addition, we issued $600.0 million of medium term notes backed by our U.S. car rental fleet, or the "Pre-Acquisition ABS Notes," prior to the Acquisition, which remained outstanding following the Acquisition. As part of the Acquisition, various of our non-U.S. subsidiaries and certain special purpose entities issued approximately $1,781.0 million of debt under the International Fleet Debt and certain of our other international debt facilities, which are secured by rental vehicles and related assets of certain of our subsidiaries (all of which are organized outside the United States) or by rental equipment and related assets of certain of our subsidiaries organized outside North America, as well as (subject to certain limited exceptions) substantially all our other assets outside North

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ITEM 1A.    RISK FACTORS (Continued)

America. The asset-backed debt issued in connection with the Transactions has expected final payment dates ranging through 2010 and the Pre-Acquisition ABS Notes have expected final payment dates ranging through 2009. Based upon these repayment dates, this debt will need to be refinanced within the next two years. Recent turmoil in the credit markets has reduced the availability of debt financing and asset-backed securities have become the focus of increased investor and regulatory scrutiny. Approximately half of our outstanding U.S. Fleet Debt issued prior to, or in connection with, the Transactions is subject to the benefit of a financial guaranty from MBIA, while the remainder is subject to the benefit of a financial guaranty from Ambac. However, the 2008-1 Series Notes ($825.0 million) that we issued but did not fund in September 2008, are not subject to any financial guaranty. Consequently, if our access to asset-backed financing were reduced or were to become significantly more expensive for any reason, including as a result of the deterioration in the markets for asset-backed securities or as a result of deterioration in the credit ratings or the insolvency of the financial guarantors, we cannot assure you that we would be able to refinance or replace our existing asset-backed financing or continue to finance new car acquisitions through asset-backed financing on favorable terms, or at all.

Our asset-backed financing capacity could be decreased, our financing costs and interest rates could be increased, or our future access to the financial markets could be limited, as a result of risks and contingencies, many of which are beyond our control, including, without limitation:

•

the acceptance by credit markets of the structures and structural risks associated with our asset-backed financing programs, particularly in light of recent developments in the markets for mortgage-backed securities;



•

rating agencies that provide credit ratings for our asset-backed indebtedness, MBIA and Ambac, or other third parties requiring changes in the terms and structure of our asset-backed financing, including increased credit enhancement (i) in connection with the incurrence of additional or refinancing of existing asset-backed debt, (ii) upon the occurrence of external events, such as changes in general economic and market conditions or further deterioration in the credit ratings of our principal car manufacturers, including Ford and General Motors, or (iii) or otherwise;



•

the terms, availability and credit market acceptance of third party credit enhancement at the time of the incurrence of additional or refinancing of existing asset-backed debt or the amount of cash collateral required in addition to or instead of such guaranties;



•

the insolvency of one or more of the third-party credit enhancers that insure our asset-backed indebtedness, or downgrading of their credit ratings;



•

the insolvency or deterioration of the financial condition of one or more of our principal suppliers of cars; or



•

changes in law that negatively impact our asset-backed financing structure.

The occurrence of certain of the events listed above could result, among other things, in the occurrence of an amortization event pursuant to which the proceeds of sales of cars that collateralize the affected facility or series of asset-backed notes would be required to be applied to the payment of principal and interest on the affected facility or series, rather than being reinvested in our car rental fleet. The continuation of an amortization event for 30 days, as well as, certain other events, including defaults by Hertz and its affiliates in the performance of covenants set forth in the agreements governing the U.S. Fleet Debt, could result in the occurrence of a liquidation event pursuant to which the trustee or holders of asset-backed notes of the affected series would be permitted to require the sale of the assets collateralizing that series. We would not be able to effect short term borrowings under the variable funding notes issued at the closing of the Acquisition, although we would be able to borrow on a short

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ITEM 1A.    RISK FACTORS (Continued)

term basis under the 2008-1 Series Notes. Any of these consequences could affect our liquidity and our ability to maintain sufficient fleet levels to meet customer demands and could trigger cross defaults under certain of our other debt instruments.

Any disruption in our ability to refinance or replace our existing asset-backed financing or to continue to finance new car acquisitions through asset-backed financing, or any negative development in the terms of the asset-backed financing available to us, could cause our cost of financing to increase significantly and have a material adverse effect on our financial condition and results of operations. The assets that collateralize our asset-backed financing will not be available to satisfy the claims of our general creditors.

The terms of our Senior Credit Facilities permit us to finance or refinance new car acquisitions through other means, including secured financing that is not limited to the assets of special purpose entity subsidiaries. We may seek in the future to finance or refinance new car acquisitions, including cars excluded from the ABS Program, through such other means. No assurances can be given, however, as to whether such financing will be available, or as to whether the terms of such financing will be comparable to the debt issued under the ABS Program. In addition, the borrowing capacity under our Senior ABL Facility is based upon the value of the assets securing such facility; therefore in periods where the value of the assets securing this facility decline or we are selling such assets and not replacing them, the availability of funds under the Senior ABL Facility will be reduced and we will have less funds available to purchase new cars or equipment.

We may not be able to generate sufficient cash to service all of our debt, and may be forced to take other actions to satisfy our obligations under such indebtedness, which may not be successful.

Our ability to make scheduled payments on our indebtedness, or to refinance our obligations under our debt agreements, will depend on the financial and operating performance of us and our subsidiaries, which, in turn, will be subject to prevailing economic and competitive conditions and to the financial and business risk factors, many of which may be beyond our control, as described under "—Risks Related to Our Business" above.

We cannot assure you that we will maintain a level of cash flows from operating activities sufficient to permit us to pay the principal, premium, if any, and interest on our indebtedness.

If our cash flows and capital resources are insufficient to fund our debt service obligations, we may be forced to reduce or delay capital expenditures, sell assets, seek to obtain additional equity capital or restructure our indebtedness. In the future, our cash flows and capital resources may not be sufficient for payments of interest on and principal of our debt, and such alternative measures may not be successful and may not permit us to meet scheduled debt service obligations. The recent worldwide credit crisis will also likely make it more difficult for us to refinance our indebtedness and we cannot assure you that we will be able to refinance any of our indebtedness or obtain additional financing, particularly because of our high levels of debt and the debt incurrence restrictions imposed by the agreements governing our debt, as well as prevailing market conditions. In the absence of such operating results and resources, we could face substantial liquidity problems and might be required to dispose of material assets or operations to meet our debt service and other obligations. The instruments governing our indebtedness restrict our ability to dispose of assets and restrict the use of proceeds from any such dispositions. We cannot assure you we will be able to consummate those sales, or, if we do, what the timing of the sales will be or whether the proceeds that we realize will be adequate to meet debt service obligations when due.

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ITEM 1A.    RISK FACTORS (Continued)

The instruments governing our debt contain cross default or cross acceleration provisions that may cause all of the debt issued under such instruments to become immediately due and payable as a result of a default under an unrelated debt instrument.

The indentures governing our Senior Notes and Senior Subordinated Notes and the agreements governing our Senior Credit Facilities and U.S Fleet Debt facilities contain numerous covenants, and in certain cases require us to meet certain financial ratios and tests which utilize Corporate EBITDA. In addition, under the agreements governing certain of our U.S. Fleet Debt we are required to have a financial guaranty from a third-party insurance company. Our failure to comply with the obligations contained in one of these agreements or other instruments governing our indebtedness could result in an event of default under the applicable instrument, which could result in the related debt becoming immediately due and payable and could further result in a cross default or cross acceleration of our debt issued under other instruments. In such event, we would need to raise funds from alternative sources, which funds may not be available to us on favorable terms, on a timely basis or at all. Alternatively, such a default could require us to sell our assets and otherwise curtail our operations in order to pay our creditors. Such alternative measures could have a material adverse effect on our business, financial condition and results of operations.

An increase in interest rates or in our borrowing spread would increase the cost of servicing our debt and could reduce our profitability.

A significant portion of our outstanding debt, including borrowings under the Senior Credit Facilities, the International Fleet Debt facilities and certain of our other outstanding debt securities, bear interest at variable rates. As a result, an increase in interest rates, whether because of an increase in market interest rates or an increase in our own cost of borrowing, would increase the cost of servicing our debt and could materially reduce our profitability, including, in the case of the U.S. Fleet Debt and the International Fleet Debt facilities, our Corporate EBITDA. We have recently seen an increase in our borrowing spread, as the borrowing spread of the Series 2008-1 Notes, based on current conditions, is approximately 150 basis points higher than HVF's existing variable funding notes. In addition, recent turmoil in the credit markets has reduced the availability of debt financing, which may result in increases in the interest rates at which lenders are willing to make future debt financing available to us. The impact of such an increase would be more significant than it would be for some other companies because of our substantial debt. For a discussion of how we manage our exposure to changes in interest rates through the use of interest rate swap agreements on certain portions of our outstanding debt, see "Item 7—Management's Discussion and Analysis of Financial Condition and Results of Operations—Market Risks—Interest Rate Risk" in our Form 10-K.

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ITEM 6.    Exhibits

(a)

Exhibits:

Exhibit Number	Description
4.5.1.3	Amendment Agreement, dated as of July 24, 2008, in respect of the Senior Bridge Facilities Agreement, dated as of December 21, 2005, by and between Hertz International, Ltd., certain of its subsidiaries, Hertz Europe Limited, as Coordinator, BNP Paribas and The Royal Bank of Scotland plc, as Mandated Lead Arrangers, Calyon, as Co-Arranger, BNP Paribas, The Royal Bank of Scotland plc, and Calyon, as Joint Bookrunners, BNP Paribas, as Facility Agent, BNP Paribas, as Security Agent, BNP Paribas, as Global Coordinator, and the financial institutions named therein (Incorporated by reference to Exhibit 4.5.1.3 to the Quarterly Report on Form 10-Q of Hertz Global Holdings, Inc, as filed on August 8, 2008.)
4.9.26.1	Series 2008-1 Supplement, dated as of September 12, 2008, to the Second Amended and Restated Base Indenture, dated as of August 1, 2006, among Hertz Vehicle Financing LLC, as Issuer, and the Bank of New York Mellon Trust Company, N.A., as Trustee and Securities Intermediary
4.9.26.2	Series 2008-1 Note Purchase Agreement (Series 2008-1 Variable Funding Rental Car Asset Backed Notes), dated as of September 12, 2008, among Hertz Vehicle Financing LLC, the Hertz Corporation, as Administrator, certain conduit investors, each as Conduit Investor, certain financial institutions, each as a Committed Note Purchaser, certain funding agents and Deutsche Bank Securities Inc., as Administrative Agent.
10.37	Form of Director Stock Option Agreement under the Hertz Global Holdings, Inc. 2008 Omnibus Incentive Plan for awards to directors in May 2008*
10.38	Form of Employee Stock Option Agreement under the Hertz Global Holdings, Inc. 2008 Omnibus Incentive Plan*
10.39	Hertz Global Holdings, Inc. Severance Plan for Senior Executives*
10.40	Form of Change in Control Severance Agreement among Hertz Global Holdings, Inc. and our executive officers*
10.41	Letter amending terms of Change in Control Severance Agreement between Hertz Global Holdings, Inc. and Joseph Nothwang*
15	Letter from PricewaterhouseCoopers LLP, Independent Registered Public Accounting Firm, dated November 7, 2008, relating to Unaudited Interim Financial Information
31.1-31.2	Rule 13a-14(a)/15d-14(a) Certifications of Chief Executive Officer and Chief Financial Officer
32.1-32.2	Section 1350 Certifications of Chief Executive Officer and Chief Financial Officer

*

Indicates management compensation plan.

Note:

Certain instruments with respect to various additional obligations, which could be considered as long-term debt, have not been filed as exhibits to this Report because the total amount of securities authorized under any such instrument does not exceed 10% of our total assets on a consolidated basis. We agree to furnish to the SEC upon request a copy of any such instrument defining the rights of the holders of such long-term debt.

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SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

Date: November 7, 2008	HERTZ GLOBAL HOLDINGS, INC. (Registrant)
	By:	/s/ ELYSE DOUGLAS
		Elyse Douglas
		Executive Vice President and Chief Financial Officer (principal financial officer and duly authorized officer)

94

EXHIBIT INDEX

Exhibit Number	Description
4.5.1.3	Amendment Agreement, dated as of July 24, 2008, in respect of the Senior Bridge Facilities Agreement, dated as of December 21, 2005, by and between Hertz International, Ltd., certain of its subsidiaries, Hertz Europe Limited, as Coordinator, BNP Paribas and The Royal Bank of Scotland plc, as Mandated Lead Arrangers, Calyon, as Co-Arranger, BNP Paribas, The Royal Bank of Scotland plc, and Calyon, as Joint Bookrunners, BNP Paribas, as Facility Agent, BNP Paribas, as Security Agent, BNP Paribas, as Global Coordinator, and the financial institutions named therein (Incorporated by reference to Exhibit 4.5.1.3 to the Quarterly Report on Form 10-Q of Hertz Global Holdings, Inc, as filed on August 8, 2008.)
4.9.26.1	Series 2008-1 Supplement, dated as of September 12, 2008, to the Second Amended and Restated Base Indenture, dated as of August 1, 2006, among Hertz Vehicle Financing LLC, as Issuer, and the Bank of New York Mellon Trust Company, N.A., as Trustee and Securities Intermediary
4.9.26.2	Series 2008-1 Note Purchase Agreement (Series 2008-1 Variable Funding Rental Car Asset Backed Notes), dated as of September 12, 2008, among Hertz Vehicle Financing LLC, the Hertz Corporation, as Administrator, certain conduit investors, each as Conduit Investor, certain financial institutions, each as a Committed Note Purchaser, certain funding agents and Deutsche Bank Securities Inc., as Administrative Agent.
10.37	Form of Director Stock Option Agreement under the Hertz Global Holdings, Inc. 2008 Omnibus Incentive Plan for awards to directors in May 2008*
10.38	Form of Employee Stock Option Agreement under the Hertz Global Holdings, Inc. 2008 Omnibus Incentive Plan*
10.39	Hertz Global Holdings, Inc. Severance Plan for Senior Executives*
10.40	Form of Change in Control Severance Agreement among Hertz Global Holdings, Inc. and our executive officers*
10.41	Letter amending terms of Change in Control Severance Agreement between Hertz Global Holdings, Inc. and Joseph Nothwang*
15	Letter from PricewaterhouseCoopers LLP, Independent Registered Public Accounting Firm, dated November 7, 2008, relating to Unaudited Interim Financial Information
31.1-31.2	Rule 13a-14(a)/15d-14(a) Certifications of Chief Executive Officer and Chief Financial Officer
32.1-32.2	Section 1350 Certifications of Chief Executive Officer and Chief Financial Officer

*

Indicates management compensation plan.

Note:

Certain instruments with respect to various additional obligations, which could be considered as long-term debt, have not been filed as exhibits to this Report because the total amount of securities authorized under any such instrument does not exceed 10% of our total assets on a consolidated basis. We agree to furnish to the SEC upon request a copy of any such instrument defining the rights of the holders of such long-term debt.

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QuickLinks

HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES
INDEX
PART I—FINANCIAL INFORMATION
ITEM 1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
ITEM 1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
CONDENSED CONSOLIDATED BALANCE SHEETS AS OF SEPTEMBER 30, 2008 AND DECEMBER 31, 2007
CONSOLIDATED STATEMENTS OF OPERATIONS FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2008 AND 2007
CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2008 AND 2007
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
ITEM 4. CONTROLS AND PROCEDURES
PART II—OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

ITEM 6. EXHIBITS
SIGNATURE
EXHIBIT INDEX

EX-4.9.26.1

Exhibit 4.9.26.1

EXECUTION VERSION

HERTZ VEHICLE FINANCING LLC,

as Issuer

and

THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A.,

(formerly known as The Bank of New York Trust Company, N.A.),

as Trustee and Securities Intermediary

SERIES 2008-1 SUPPLEMENT

dated as of September 12, 2008

to

SECOND AMENDED AND RESTATED
BASE INDENTURE

dated as of August 1, 2006

$825,000,000 Series 2008-1 Variable Funding Rental Car Asset Backed Notes

TABLE OF CONTENTS

	Page
ARTICLE I DEFINITIONS	4
ARTICLE II INITIAL ISSUANCE AND INCREASES AND DECREASES OF PRINCIPAL AMOUNT OF SERIES 2008-1 NOTES	42
Section 2.1   Initial Issuance; Procedure for Increasing the Series 2008-1 Principal Amount	42
Section 2.2   Procedure for Decreasing the Series 2008-1 Principal Amount	43
ARTICLE III SERIES 2008-1 ALLOCATIONS	45
Section 3.1   Series 2008-1 Series Accounts	45
Section 3.2   Allocations with Respect to the Series 2008-1 Notes	47
Section 3.3   Application of Interest Collections	50
Section 3.4   Payment of Note Interest	53
Section 3.5   Payment of Note Principal	53
Section 3.6   Payment by Wire Transfer	58
Section 3.7   The Administrator’s Failure to Instruct the Trustee to Make a Deposit or Payment	58
Section 3.8   Series 2008-1 Reserve Account	59
Section 3.9   Series 2008-1 Letters of Credit and Series 2008-1 Cash Collateral Accounts	60
Section 3.10   Series 2008-1 Distribution Account	64
Section 3.11   Trustee as Securities Intermediary	66
Section 3.12   Series 2008-1 Interest Rate Caps	67
Section 3.13   Series 2008-1 Demand Note Constitutes Additional Collateral for Series 2008-1 Notes	69
ARTICLE IV AMORTIZATION EVENTS	70
ARTICLE V FORM OF SERIES 2008-1 NOTES	72
Section 5.1   Issuance of Series 2008-1 Notes	72
Section 5.2   Transfer of Series 2008-1 Notes	73
ARTICLE VI GENERAL	75
Section 6.1   Optional Redemption of Series 2008-1 Notes	75
Section 6.2   Information	75
Section 6.3   Exhibits	80

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TABLE OF CONTENTS

(continued)

	Page
Section 6.4   Ratification of Base Indenture	80
Section 6.5   Notice to the Rating Agencies	80
Section 6.6   Third Party Beneficiary	80
Section 6.7   Counterparts	80
Section 6.8   Governing Law	80
Section 6.9   Amendments	81
Section 6.10   Covenant Regarding Affiliate Issuers	81
Section 6.11   Termination of Series Supplement	81
Section 6.12   Discharge of Indenture	81

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TABLE OF CONTENTS

(continued)

EXHIBITS

Exhibit A:	Form of Series 2008-1 Variable Funding Rental Car Asset Backed Notes
Exhibit B:	Form of Series 2008-1 Letter of Credit
Exhibit C:	Form of Lease Payment Deficit Notice
Exhibit D:	Form of Series 2008-1 Letter of Credit Reduction Notice
Exhibit E:	Form of Purchaser’s Letter
Exhibit F-1:	Form of Monthly Noteholders’ Statement
Exhibit F-2:	Form of Weekly Noteholders’ Statement
Exhibit G-1:	Form of Demand Notice
Exhibit G-2:	Form of Series 2008-1 Demand Note
Exhibit H:	Form of Estimated Interest Adjustment Notice

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SERIES 2008-1 SUPPLEMENT dated as of September 12, 2008 (“Series Supplement”) between HERTZ VEHICLE FINANCING LLC, a special purpose limited liability company established under the laws of Delaware (“HVF”), and THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A. (formerly known as the Bank of New York Trust Company, N.A.), a national banking association, as trustee (together with its successors in trust thereunder as provided in the Base Indenture referred to below, the “Trustee”), and as securities intermediary (in such capacity, the “Securities Intermediary”), to the Second Amended and Restated Base Indenture, dated as of August 1, 2006, between HVF and the Trustee (as amended, modified or supplemented from time to time, exclusive of Series Supplements, the “Base Indenture”).

PRELIMINARY STATEMENT

WHEREAS, Sections 2.2 and 12.1 of the Base Indenture provide, among other things, that HVF and the Trustee may at any time and from time to time enter into a supplement to the Base Indenture for the purpose of authorizing the issuance of one or more Series of Notes.

NOW, THEREFORE, the parties hereto agree as follows:

DESIGNATION

There is hereby created a Series of Notes to be issued pursuant to the Base Indenture and this Series Supplement and such Series of Notes shall be designated as Rental Car Asset Backed Notes, Series 2008-1.  On the Series 2008-1 Closing Date, one class of Series 2008-1 Variable Funding Rental Car Asset Backed Notes shall be issued, and be referred to herein as the “Series 2008-1 Notes”.

The net proceeds from the sale of the Series 2008-1 Notes shall be deposited in the Series 2008-1 Excess Collection Account and used to make payments in reduction of the Principal Amount of other Series of Notes or paid to HVF and used to acquire Eligible Vehicles from HGI pursuant to the Purchase Agreement or for other purposes permitted under the Related Documents.

ARTICLE I

DEFINITIONS 

(a)           All capitalized terms not otherwise defined herein shall have the meanings assigned thereto in the Definitions List attached to the Base Indenture as Schedule I thereto, as amended, modified, restated or supplemented from time to time in accordance with the terms of the Base Indenture or the Series 2008-1 Note Purchase Agreement; provided, however, that to the extent any capitalized term used but not defined herein has a meaning assigned to such term in both the Definitions List attached to the Base Indenture as Schedule I thereto and the Series 2008-1 Note Purchase Agreement, then the meaning given to such term in the Definitions List attached to the Base Indenture as Schedule I shall apply.  All Article, Section or Subsection references herein shall refer to Articles, Sections or Subsections of the Base Indenture, except as

otherwise provided herein.  Unless otherwise stated herein, as the context otherwise requires or if such term is otherwise defined in the Base Indenture, each capitalized term used or defined herein shall relate only to the Series 2008-1 Notes and not to any other Series of Notes issued by HVF.  All references herein to the “Series 2008-1 Supplement” shall mean the Base Indenture, as supplemented hereby.

(b)           The following words and phrases shall have the following meanings with respect to the Series 2008-1 Notes (whether such words and phrases are used in this Series Supplement, the Base Indenture or any other Related Document) and the definitions of such terms are applicable to the singular as well as the plural form of such terms and to the masculine as well as the feminine and neuter genders of such terms:

“Additional Series 2008-1 Notes” has the meaning specified in Section 5.1 of this Series Supplement.

“Adjusted Aggregate Asset Amount” means, as of any day, the sum of (a) the Aggregate Asset Amount and (b) the sum of (1) the amount of cash and Permitted Investments on deposit in the Series 2008-1 Collection Account and available for reduction of the Series 2008-1 Principal Amount and (2) the amount of cash and Permitted Investments on deposit in the Series 2008-1 Excess Collection Account, in each case, on such day.

“Administrative Agent” has the meaning specified in the Series 2008-1 Note Purchase Agreement.

“Administrator Default” means any of the events described in Section 8(c) of the Administration Agreement.

“Aggregate BMW/Lexus/Mercedes/Audi Amount” means, as of any date of determination, the sum of the BMW Amount, the Lexus Amount, the Mercedes Amount and the Audi Amount, in each case, as of such date.

“Aggregate Kia/Subaru/Hyundai Amount” means, as of any date of determination, the sum of the Kia Amount, the Subaru Amount and the Hyundai Amount, in each case, as of such date.

“Annualized Financing Cost” means, with respect to any Series 2008-1 Interest Period, the amounts payable pursuant to Sections 3.3(a)(i) and (ii) of this Series Supplement with respect to such Series 2008-1 Interest Period, expressed as an annual percent of the Series 2008-1 Principal Amount.

“Audi Amount” means, as of any date of determination, an amount equal to the sum of the Manufacturer Non-Eligible Vehicle Amount and the Manufacturer Eligible Program Vehicle Amount, in each case, with respect to Audi as of such date.

“Bankrupt Manufacturer” means, as of any day, each Manufacturer for which an Event of Bankruptcy (determined without regard to the 60 day period in the case of clause (a) of the definition of Event of Bankruptcy) has occurred; provided that

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any such Manufacturer for which an Event of Bankruptcy has occurred shall cease to constitute a Bankrupt Manufacturer when it has satisfied the Confirmation Condition.

“Bankrupt Manufacturer Vehicle Amount” means, as of any date of determination, an amount equal to the sum of the Manufacturer Eligible Program Vehicle Amounts and the Manufacturer Non-Eligible Vehicle Amounts for all Bankrupt Manufacturers as of such date.

“Bankrupt Manufacturer Vehicle Percentage” means, as of any date of determination, the percentage equivalent of a fraction, the numerator of which is the Bankrupt Manufacturer Vehicle Amount as of such date and the denominator of which is the excess of (A) the Aggregate Asset Amount over (B) the amount of cash and Permitted Investments on deposit in the Collection Account and the HVF Exchange Account, in each case, as of such date.

 “BMW Amount” means, as of any date of determination, an amount equal to the sum of the Manufacturer Non-Eligible Vehicle Amount and the Manufacturer Eligible Program Vehicle Amount, in each case, with respect to BMW as of such date.

“Capital Stock” means any and all shares, interests, participations or other equivalents (however designated) of capital stock of a corporation, any and all equivalent ownership interests (including, without limitation, membership interests) in a Person (other than a corporation) and any and all warrants or options to purchase any of the foregoing.

“Capped Category 2 Manufacturer Eligible Program Vehicle Percentage” means, as of any date of determination, the lesser of (i) the Category 2 Manufacturer Eligible Program Vehicle Percentage as of such date and (ii) 10%.

“Capped Category 2 Manufacturer Program Vehicle Percentage” means, as of any date of determination, the lesser of (i) the Category 2 Manufacturer Program Vehicle Percentage as of such date and (ii) 10%.

“Capped Non-Top Two Category 3 Manufacturer Vehicle Percentage” means, as of any date of determination, the lesser of (i) the Non-Top Two Category 3 Manufacturer Vehicle Percentage as of such date and (ii) 30%.

“Carlyle” means TC Group LLC (which operates under the trade name The Carlyle Group).

“Carlyle Investors” means the collective reference to (a) Carlyle Partners IV, L.P., a Delaware limited partnership, (b) CEP II Participations S.àr.l., a Luxembourg limited liability company, (c) CP IV Co-investment L.P., a Delaware limited partnership, (d) CEP II U.S. Investments, L.P., a Delaware limited partnership, and (e) any Affiliate of any thereof.

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“Category 1 Manufacturer” means, as of any date of determination, each Eligible Manufacturer who as of such date (i) is not a Bankrupt Manufacturer and (ii) has a long-term unsecured debt rating of at least “A2” from Moody’s and at least “A” from Standard & Poor’s; provided, that if an Eligible Manufacturer does not have a rating from Moody’s or Standard & Poor’s, then the rating of an affiliated entity specified by the Rating Agencies shall apply for purposes of this definition; provided, further, that if (a) the rating of a Manufacturer by a Rating Agency is withdrawn by such Rating Agency or a Manufacturer is downgraded by a Rating Agency to a rating that would require the exclusion of such Manufacturer from this definition and (b) prior to such withdrawal or downgrade, as the case may be, such Manufacturer was a Category 1 Manufacturer, then for purposes of this definition and each instance in which this definition is used in this Supplement, such Manufacturer shall be deemed to be rated “A2” or “A”, as applicable, by the Rating Agency that withdrew the rating of such Manufacturer or downgraded the rating of such Manufacturer for a period of thirty (30) days following the earlier of (i) the date on which any of the Administrator, HVF or the Servicer obtains actual knowledge of such withdrawal or downgrade and (ii) the date on which the Trustee or the Administrative Agent notifies the Servicer of such withdrawal or downgrade.

“Category 1 Manufacturer Eligible Program Vehicle Amount” means, as of any date of determination, the sum of the Manufacturer Eligible Program Vehicle Amounts for all Category 1 Manufacturers as of such date.

“Category 1 Manufacturer Eligible Program Vehicle Percentage” means, as of any date of determination, the percentage equivalent of a fraction, the numerator of which is the Category 1 Manufacturer Eligible Program Vehicle Amount as of such date and the denominator of which is the excess of (A) the Aggregate Asset Amount over (B) the amount of cash and Permitted Investments on deposit in the Collection Account and the HVF Exchange Account, in each case, as of such date.

“Category 1 Manufacturer Non-Eligible Program Vehicle Amount” means, as of any date of determination, the sum of the Manufacturer Non-Eligible Program Vehicle Amounts for all Category 1 Manufacturers as of such date.

“Category 1 Manufacturer Non-Eligible Program Vehicle Percentage” means, as of any date of determination, the percentage equivalent of a fraction, the numerator of which is the Category 1 Manufacturer Non-Eligible Program Vehicle Amount as of such date and the denominator of which is the excess of (A) the Aggregate Asset Amount over (B) the amount of cash and Permitted Investments on deposit in the Collection Account and the HVF Exchange Account, in each case, as of such date.

“Category 1 Manufacturer Non-Eligible Vehicle Amount” means, as of any date of determination, the sum of the Manufacturer Non-Eligible Vehicle Amounts for all Category 1 Manufacturers as of such date.

“Category 1 Manufacturer Non-Eligible Vehicle Percentage” means, as of any date of determination, the percentage equivalent of a fraction, the numerator of which is the Category 1 Manufacturer Non-Eligible Vehicle Amount as of such date and the

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denominator of which is the excess of (A) the Aggregate Asset Amount over (B) the amount of cash and Permitted Investments on deposit in the Collection Account and the HVF Exchange Account, in each case, as of such date.

“Category 2 Manufacturer” means, as of any date of determination, each Eligible Manufacturer who as of such date (i) is not a Bankrupt Manufacturer and (ii) has a long-term unsecured debt rating of at least “A3” from Moody’s and at least “A-” from Standard & Poor’s, but which does not have a long-term unsecured debt rating of at least “A2” from Moody’s and at least “A” from Standard &Poor’s; provided that if an Eligible Manufacturer does not have a rating from Moody’s or Standard & Poor’s, then the rating of an affiliated entity specified by the Rating Agencies shall apply for purposes of this definition; provided, further, that if (a) (x) a Manufacturer is downgraded by a Rating Agency to a rating that would require inclusion of such Manufacturer in this definition and (y) prior to such downgrade, as the case may be, such Manufacturer was a Category 1 Manufacturer, then for purposes of this definition and each instance in which this definition is used in this Supplement, then such Manufacturer shall be deemed to be rated “A2” or “A”, as applicable, by the Rating Agency that downgraded such Manufacturer for a period of thirty (30) days following the earlier of (i) the date on which any of the Administrator, HVF or the Servicer obtains actual knowledge of such downgrade and (ii) the date on which the Trustee or the Administrative Agent notifies the Servicer of such downgrade or (b) (x) the rating of a Manufacturer by a Rating Agency is withdrawn by such Rating Agency or a Manufacturer is downgraded by a Rating Agency to a rating that would require the exclusion of such Manufacturer from this definition and (y) prior to such withdrawal or downgrade, as the case may be, such Manufacturer was a Category 2 Manufacturer, then such Manufacturer shall be deemed to be rated “A3” or “A-”, as applicable, by the Rating Agency that withdrew the rating of such Manufacturer or downgraded the rating of such Manufacturer for a period of thirty (30) days following the earlier of (i) the date on which any of the Administrator, HVF or the Servicer obtains actual knowledge of such withdrawal or downgrade and (ii) the date on which the Trustee or the Administrative Agent notifies the Servicer of such withdrawal or downgrade.

“Category 2 Manufacturer Eligible Program Vehicle Amount” means, as of any date of determination, the sum of the Manufacturer Eligible Program Vehicle Amounts for all Category 2 Manufacturers as of such date.

“Category 2 Manufacturer Eligible Program Vehicle Percentage” means, as of any date of determination, the percentage equivalent of a fraction, the numerator of which is the Category 2 Manufacturer Eligible Program Vehicle Amount as of such date and the denominator of which is the excess of (A) the Aggregate Asset Amount over (B) the amount of cash and Permitted Investments on deposit in the Collection Account and the HVF Exchange Account, in each case, as of such date.

“Category 2 Manufacturer Eligible Program Vehicle Percentage Excess” means, as of any date of determination, the excess, if any, of the Category 2 Manufacturer Eligible Program Vehicle Percentage as of such date over 10%.

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“Category 2 Manufacturer Non-Eligible Program Vehicle Amount” means, as of any date of determination, the sum of the Manufacturer Non-Eligible Program Vehicle Amounts for all Category 2 Manufacturers as of such date.

“Category 2 Manufacturer Non-Eligible Program Vehicle Percentage” means, as of any date of determination, the percentage equivalent of a fraction, the numerator of which is the Category 2 Manufacturer Non-Eligible Program Vehicle Amount as of such date and the denominator of which is the excess of (A) the Aggregate Asset Amount over (B) the amount of cash and Permitted Investments on deposit in the Collection Account and the HVF Exchange Account, in each case, as of such date.

“Category 2 Manufacturer Non-Eligible Vehicle Amount” means, as of any date of determination, the sum of the Manufacturer Non-Eligible Vehicle Amounts for all Category 2 Manufacturers as of such date.

“Category 2 Manufacturer Non-Eligible Vehicle Percentage” means, as of any date of determination, the percentage equivalent of a fraction, the numerator of which is the Category 2 Manufacturer Non-Eligible Vehicle Amount as of such date and the denominator of which is the excess of (A) the Aggregate Asset Amount over (B) the amount of cash and Permitted Investments on deposit in the Collection Account and the HVF Exchange Account, in each case, as of such date.

“Category 2 Manufacturer Program Vehicle Percentage” means, as of any date of determination, the sum of (i) the Category 2 Manufacturer Eligible Program Vehicle Percentage as of such date and (ii) the Category 2 Manufacturer Non-Eligible Program Vehicle Percentage as of such date.

“Category 3 Manufacturer” means, as of any date of determination, each Eligible Manufacturer that as of such date (i) is not a Bankrupt Manufacturer and (ii) does not have a long-term unsecured debt rating of at least “A3” from Moody’s and at least “A-” from Standard & Poor’s; provided that if an Eligible Manufacturer does not have a rating from Moody’s or Standard & Poor’s, then the rating of an affiliated entity specified by the Rating Agencies shall apply for purposes of this definition; provided, further, that if (a) the rating of a Manufacturer by a Rating Agency is withdrawn by such Rating Agency or a Manufacturer is downgraded by a Rating Agency to a rating that would require inclusion of such Manufacturer in this definition and (b) prior to such withdrawal or downgrade, as the case may be, such Manufacturer was a Category 1 Manufacturer or a Category 2 Manufacturer, then for purposes of this definition and each instance in which this definition is used in this Supplement, such Manufacturer shall be deemed to be rated “A3” or “A-”, as applicable, by the Rating Agency that withdrew the rating of such Manufacturer or downgraded the rating of such Manufacturer for a period of thirty (30) days following the earlier of (i) the date on which any of the Administrator, HVF or the Servicer obtains actual knowledge of such withdrawal or downgrade and (ii) the date on which the Trustee or the Administrative Agent notifies the Servicer of such withdrawal or downgrade.

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“Category 3 Manufacturer Non-Eligible Vehicle Amount” means, as of any date of determination, the sum of the Manufacturer Non-Eligible Vehicle Amounts for all Category 3 Manufacturers as of such date.

“Category 3 Manufacturer Non-Eligible Vehicle Percentage” means, as of any date of determination, the percentage equivalent of a fraction, the numerator of which is the Category 3 Manufacturer Non-Eligible Vehicle Amount as of such date and the denominator of which is the excess of (A) the Aggregate Asset Amount over (B) the amount of cash and Permitted Investments on deposit in the Collection Account and the HVF Exchange Account, in each case, as of such date.

“Category 3 Manufacturer Vehicle Amount” means, as of any date of determination, the sum of the Manufacturer Eligible Program Vehicle Amounts and Manufacturer Non-Eligible Vehicle Amounts for all Category 3 Manufacturers as of such date.

“Category 3 Manufacturer Vehicle Percentage” means, as of any date of determination, the percentage equivalent of a fraction, the numerator of which is the Category 3 Manufacturer Vehicle Amount as of such date and the denominator of which is the excess of (A) the Aggregate Asset Amount over (B) the amount of cash and Permitted Investments on deposit in the Collection Account and the HVF Exchange Account, in each case, as of such date.

“CD&R” means Clayton, Dubilier & Rice, Inc.

“CD&R Investors”  means the collective reference to (i) Clayton, Dubilier & Rice Fund VII, L.P., a Cayman Islands exempted limited partnership, (ii) CD&R CCMG Co-Investor L.P., a Cayman Islands exempted limited partnership, (iii) CD&R Parallel Fund VII, L.P., a Cayman Islands exempted limited partnership, and (iv) any Affiliate of any thereof.

“Change of Control”  means the occurrence of any of the following events:  (a) (i) (x) the Permitted Holders shall in the aggregate be the “beneficial owner” (as defined in Rules 13d-3 and 13d-5 under the Exchange Act) of (A) so long as Investors is a Subsidiary of any Parent Entity, shares of Voting Stock having less than 35% of the total voting power of all outstanding shares of such Parent Entity (other than a Parent Entity that is a Subsidiary of another Parent Entity) and (B) if Investors is not a Subsidiary of any Parent Entity, shares of Voting Stock having less than 35% of the total voting power of all outstanding shares of Investors and (y) any “person” or “group” (as such terms are used in Sections 13(d) and 14(d) of the Exchange Act), other than one or more Permitted Holders, shall be the “beneficial owner” of (A) so long as Investors is a Subsidiary of any Parent Entity, shares of Voting Stock having more than 35% of the total voting power of all outstanding shares of such Parent Entity (other than a Parent Entity that is a Subsidiary of another Parent Entity) and (B) if Investors is not a Subsidiary of any Parent Entity, shares of Voting Stock having more than 35% of the total voting power of all outstanding shares of Investors or (ii) the Continuing Directors shall cease to constitute a majority of the members of the board of directors of Investors;

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(b) Investors shall cease to own, directly or indirectly, 100% of the Capital Stock of Hertz; (c) Investors shall cease to own, directly or indirectly, 100% of the Capital Stock of HVF; or (d) Hertz shall cease to directly own 100% of the Capital Stock of HVF.

“Committed Purchaser” means a special purpose company or any other Person, including each Committed Note Purchaser, that has committed to purchase a Series of Notes from HVF from time to time and that may finance such purchases with, among other things, the proceeds of commercial paper notes.

“Confirmation Condition” means, with respect to a Manufacturer that is the subject of an Event of Bankruptcy that is a proceeding under Chapter 11 of the Bankruptcy Code to reorganize (the “Proceeding”), a condition that is satisfied upon entry and during the effectiveness of an order by the bankruptcy court having jurisdiction over the Proceeding approving (i) (A) assumption under Section 365 of the Bankruptcy Code by the Manufacturer, or trustee in bankruptcy on its behalf, of its Manufacturer Program (and all related Assignment Agreements), (B) at the time of such assumption, payment of all amounts due and payable by the Manufacturer to HVF or any of its Affiliates under its Manufacturer Program, and (C) all actions and payments necessary to cure all existing defaults by the Manufacturer with respect to HVF or any of its Affiliates under the Manufacturer Program to the date of effectiveness of such order, or (ii) (A) execution, delivery and performance by the Manufacturer of (x) a new post-petition Manufacturer Program under which HVF is an eligible fleet purchaser and having substantially the same terms and covering Vehicles with substantially the same characteristics as the Manufacturer Program in effect on the date the Proceeding was commenced and (y) new Assignment Agreements effecting the assignment of benefits of such new Manufacturer Program from HVF to the Collateral Agent and acknowledged by the Manufacturer, (B) payment of all amounts due and payable by such Manufacturer to HVF or any of its Affiliates under the Manufacturer Program in effect on the date the Proceeding was commenced at the time of the execution and delivery of the new post-petition Manufacturer Program, and (C) all actions and payments necessary to cure all existing defaults by the Manufacturer with respect to HVF or any of its Affiliates under the Manufacturer Program in effect on the date the Proceeding was commenced to the date of effectiveness of such order, and in each case in (i) or (ii) above the actions and payments in clause (C) have been taken or made.

“Continuing Directors” means the directors of Investors on the Series 2008-1 Closing Date and each other director if, in each case, such other director’s nomination for election to the board of directors of Investors is recommended by at least a majority of the then Continuing Directors or the election of such other director is approved by one or more Permitted Holders.

“Credit Support Annex” has the meaning set forth in Section 3.12(b) of this Series Supplement.

“Decrease” means a Mandatory Decrease or a Voluntary Decrease, as applicable.

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“Demand Notice” has the meaning specified in Section 3.5(b)(iii) of this Series Supplement.

“Eligible Interest Rate Cap Provider” means a counterparty to a Series 2008-1 Interest Rate Cap that is a bank, other financial institution or Person which (i) satisfies the Moody’s First Trigger Required Ratings and/or the Moody’s Second Trigger Required Ratings (or whose present and future obligations under its Series 2008-1 Interest Rate Cap are guaranteed pursuant to a guarantee (in form and substance satisfactory to the Rating Agencies and the Administrative Agent and satisfying the other requirements set forth in the related Series 2008-1 Interest Rate Cap) provided by a guarantor which satisfies the Moody’s First Trigger Required Ratings and/or the Moody’s Second Trigger Required Ratings) and (ii) has a short-term senior unsecured debt, deposit, claims paying or credit (as the case may be) rating of at least “A-1” from Standard & Poor’s, or if such counterparty does not have a short-term senior unsecured debt rating from Standard & Poor’s, a long-term senior unsecured debt, deposit, claims paying or credit (as the case may be) rating of at least “A+” from Standard & Poor’s (or whose present and future obligations under its Series 2008-1 Interest Rate Cap are guaranteed pursuant to a guarantee (in form and substance satisfactory to the Rating Agencies and the Administrative Agent and satisfying the other requirements set forth in the related Series 2008-1 Interest Rate Cap) provided by a guarantor which has the ratings set forth in this clause (ii)); provided that each Eligible Interest Rate Cap Provider shall be approved by the Administrative Agent, such approval not to be unreasonably withheld or delayed.

“Eligible Program Manufacturer” means (a) Ford, GM, Chrysler, Toyota, Honda, Mazda, Nissan, Volvo, Jaguar, Audi, Volkswagen, Land Rover, Hyundai, Kia, Lexus, Mercedes and BMW or (b) a Manufacturer (i) who, at the time that such Manufacturer is proposed for consideration as an Eligible Program Manufacturer, has a long term unsecured debt rating of at least “A-” from S&P and at least “A3” from Moody’s (provided, that if a Manufacturer proposed for consideration under this clause (b)(i) does not have a rating from S&P or Moody’s, then the rating of the entity specified by the Rating Agencies shall apply), or (ii) with respect to which the Rating Agency Condition with respect to each Series of Notes Outstanding shall have been satisfied; provided, however, that upon the occurrence of a Manufacturer Event of Default with respect to any Manufacturer described in clauses (a) or (b) above, such Manufacturer shall no longer qualify as an Eligible Program Manufacturer.

“Eligible Program Vehicle Amount” means, as of any date of determination, an amount equal to the sum, rounded to the nearest $100,000, of the following amounts to the extent that such amounts are included in the definition of “Aggregate Asset Amount” for such date: (i) the Net Book Value of all Eligible Program Vehicles that are Eligible Vehicles as of such date and not turned in to and accepted by the Manufacturer thereof pursuant to its Manufacturer Program, not delivered and accepted for Auction pursuant to a Manufacturer Program or not otherwise sold or deemed to be sold under the Related Documents, plus (ii) the aggregate amount of Manufacturer Receivables (other than Excluded Payments) payable to HVF or to the Intermediary pursuant to the Master Exchange Agreement, in each case, as of such date

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by Manufacturers which are Eligible Program Manufacturers with respect to Vehicles that were Eligible Vehicles and Eligible Program Vehicles when turned in to and accepted by such Manufacturers or delivered and accepted for Auction, plus (iii) with respect to Eligible Vehicles that were Eligible Program Vehicles that have been delivered and accepted for Auction pursuant to a Manufacturer Program with a Manufacturer which is an Eligible Program Manufacturer, all amounts receivable (other than amounts specified in clause (ii) above) from any person or entity in connection with the Auction of such Eligible Vehicles as of such date, plus (iv) with respect to Eligible Vehicles that were Eligible Program Vehicles that have been turned in to and accepted by the Manufacturer thereof, delivered and accepted for Auction, otherwise sold or become a Casualty, any accrued and unpaid Casualty Payments or Termination Payments with respect to such Eligible Vehicles under the HVF Lease, plus (v) with respect to Eligible Vehicles that were Eligible Program Vehicles that have been turned in to and accepted by the Manufacturer thereof, delivered for Auction or otherwise sold, any accrued and unpaid Monthly Base Rent with respect to such Eligible Vehicles under the HVF Lease (net of amounts set forth in clauses (ii), (iii) and (iv) above), plus (vi) with respect to Eligible Vehicles that were Eligible Program Vehicles sold by HVF to a third party pursuant to Section 2.5(a) of the HVF Lease, any non-return incentives payable to HVF under a Manufacturer Program by an Eligible Program Manufacturer in respect of the sale of such Vehicles outside of the related Manufacturer Program as of such date, plus (vii) if such date is during the period from and including a Determination Date to but excluding the next Payment Date, accrued and unpaid Monthly Base Rent payable on the next Payment Date with respect to all Eligible Vehicles that are Eligible Program Vehicles as of such date and that have not been turned in to and accepted by the Manufacturer thereof pursuant to its Manufacturer Program, not been delivered and accepted for Auction pursuant to a Manufacturer Program and not otherwise been sold or deemed to be sold under the Related Documents.

“Equity Investors” means the collective reference to (a) the CD&R Investors, the Carlyle Investors and the Merrill Lynch Investors and (b) any Person that acquired Voting Stock of Holdings on or prior to December 21, 2005, and any Affiliate of such Person.

“Estimated Interest” has the meaning specified in Section 3.3(a) of this Series Supplement.

“Estimated Interest Adjustment Amount” means, with respect to any Determination Date, the result (whether a positive or negative number) of (i) the actual amount of Series 2008-1 Monthly Interest that accrued during the Estimated Interest Period which commenced on the immediately preceding Determination Date minus (ii) the Estimated Interest with respect to such Estimated Interest Period.

“Estimated Interest Adjustment Notice” has the meaning specified in Section 3.3(a) of this Series Supplement.

“Estimated Interest Period” has the meaning specified in Section 3.3(a) of this Series Supplement.

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“Excluded Redesignated Vehicle” means each Vehicle manufactured by a Manufacturer with respect to which an Event of Bankruptcy has occurred that becomes a Redesignated Vehicle prior to the Inclusion Date for such Vehicle, as of and from the date such Vehicle becomes a Redesignated Vehicle to and until the Inclusion Date for such Vehicle.

“Existing Series of Notes” means, as of any date of determination, each Series of Notes issued by HVF prior to the Series 2008-1 Closing Date under an Existing Series Supplement that remains Outstanding as of such date.

“Existing Series Supplement” means each of the Series 2004-1 Supplement, the Series 2005-1 Supplement,  the Series 2005-2 Supplement, the Series 2005-3 Supplement and the Series 2005-4 Supplement.

“Expected Final Payment Date” means the Series 2008-1 Commitment Termination Date as defined in the Series 2008-1 Note Purchase Agreement.

“Financial Assets” has the meaning specified in Section 3.11(b)(i) of this Series Supplement.

“First Level Ratings Event” means, with respect to the Series 2008-1 Notes, the Series 2008-1 Notes shall not have the Required Ratings for a period in excess of thirty (30) days so long as no Second Level Ratings Event shall have occurred and be continuing.

“Holdings” means Hertz Global Holdings, Inc.

“HVF Service Vehicle Amount” means, as of any date of determination, an amount equal to the sum of the Manufacturer Non-Eligible Vehicle Amount and the Manufacturer Eligible Program Vehicle Amount, in each case, with respect to HVF Service Vehicles as of such date.

“HVF Service Vehicles” means, an HVF Vehicle used by Hertz’s employees, or to the extent permitted under the HVF Lease, employees of Hertz Equipment Rental Corporation.

“Hyundai Amount” means, as of any date of determination, an amount equal to the sum of the Manufacturer Non-Eligible Vehicle Amount and the Manufacturer Eligible Program Vehicle Amount, in each case, with respect to Hyundai as of such date.

“Inclusion Date” means, with respect to any Vehicle manufactured by a Manufacturer with respect to which an Event of Bankruptcy has occurred, the date that is 90 days after the earlier of (i) the date such Vehicle became a Redesignated Vehicle and (ii) the date upon which such Event of Bankruptcy with respect to the Manufacturer of such Vehicle first occurred.

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“Increase” has the meaning specified in Section 2.1(a) of this Series Supplement.

“Indenture Carrying Charges” means, as of any day, any fees or other costs, fees and expenses and indemnity amounts, if any, payable by HVF to the Trustee, the Administrator, the Intermediary under the Master Exchange Agreement, the Administrative Agent, the Series 2008-1 Noteholders under the Series 2008-1 Note Purchase Agreement (other than any Program Fee or any Undrawn Fee) or the Nominee under the Indenture or the Related Documents plus any other operating expenses of HVF then payable by HVF.

“Ineligible Receivable Manufacturer Receivable Amount” means, as of any date of determination, with respect to each Ineligible Receivable Manufacturer, an amount equal to the sum (without duplication) of the following amounts to the extent that such amounts are included in clauses (i) through (x) of the definition of Aggregate Asset Amount for such date:  (a) the aggregate amount of Manufacturer Receivables (other than Excluded Payments) payable to HVF or to the Intermediary pursuant to the Master Exchange Agreement, in each case, as of such date by such Ineligible Receivable Manufacturer with respect to Vehicles that are Eligible Vehicles and Eligible Program Vehicles when turned in to and accepted by such Ineligible Receivable Manufacturer or delivered and accepted for Auction, plus (b) the aggregate amount of Manufacturer Receivables (other than Excluded Payments) payable to HVF or to the Intermediary pursuant to the Master Exchange Agreement, in each case, as of such date by such Ineligible Receivable Manufacturers with respect to Vehicles that were Eligible Vehicles but not Eligible Program Vehicles when turned in to and accepted by such Ineligible Receivable Manufacturer or delivered and accepted for Auction; provided, that the definition of “Ineligible Receivable Manufacturer Receivable Amount” may be amended by HVF with the consent of the Funding Agents, subject to satisfaction of the Rating Agency Condition with respect to such amendment; provided further that any Ineligible Receivable Manufacturer may be excluded from this definition by HVF with the consent of the Funding Agents, subject to satisfaction of the Rating Agency Condition with respect to such exclusion.

“Ineligible Receivable Manufacturer” means a Manufacturer that is either a Category 2 Manufacturer, a Category 3 Manufacturer or a Bankrupt Manufacturer.

“Insurer Related Amortization Event” means, with respect to the applicable Series of Notes, those certain Amortization Events described in clauses (h) and (i) of Article III of the Series 2004-1 Supplement, clauses (j) and (k) of Article III of the Series 2005-1 Supplement, clauses (j) and (k) of Article III of the Series 2005-2 Supplement, clauses (j) and (k) of Article IV of the Series 2005-3 Supplement and clauses (j) and (k) of Article IV of the Series 2005-4 Supplement.

“Interest Rate Cap Provider” means HVF’s counterparty under a Series 2008-1 Interest Rate Cap.

“Investors” means Hertz Investors, Inc.

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“Jaguar Amount” means, as of any date of determination, an amount equal to the sum of the Manufacturer Non-Eligible Vehicle Amount and the Manufacturer Eligible Program Vehicle Amount, in each case, with respect to Jaguar as of such date.

“Kia Amount” means, as of any date of determination, an amount equal to the sum of the Manufacturer Non-Eligible Vehicle Amount and the Manufacturer Eligible Program Vehicle Amount, in each case, with respect to Kia as of such date.

“Land Rover Amount” means, as of any date of determination, an amount equal to the sum of the Manufacturer Non-Eligible Vehicle Amount and the Manufacturer Eligible Program Vehicle Amount, in each case, with respect to Land Rover as of such date.

“Lease Payment Deficit Notice” has the meaning specified in Section 3.3(b) of this Series Supplement.

“Legal Final Payment Date” means the one-year anniversary of the Expected Final Payment Date.

“Lexus Amount” means, as of any date of determination, an amount equal to the sum of the Manufacturer Non-Eligible Vehicle Amount and the Manufacturer Eligible Program Vehicle Amount, in each case, with respect to Lexus as of such date.

“Limited Liquidation Event of Default” means, so long as such event or condition continues, (a) any event or condition of the type specified in Section 9.1(c) of the Base Indenture or clauses (a), (b), (c), (d), (f), (g), (h), (i), (j), (m), (n) and (o) of Article IV of this Series Supplement that continues for thirty (30) days (without double counting the cure period, if any, provided therein), (b) any event or condition of the type specified in clause (p) of Article IV of this Series Supplement if and when the applicable Amortization Event under the related Existing Series Supplement constitutes a Limited Liquidation Event of Default (as defined in the related Existing Series Supplement) with respect to such Existing Series of Notes and Noteholders under such Existing Series of Notes have directed the Trustee to commence (either through its agents or otherwise) or cause the commencement of the liquidation or other disposition of any HVF Vehicles as a result of such Limited Liquidation Event of Default or (c) any event or condition of the type specified in clause (e) of Article IV of this Series Supplement.

“Management Investors” means the collective reference to the officers, directors, employees and other members of the management of Investors, Hertz or any of their Subsidiaries, or family members or relatives thereof or trusts for the benefit of any of the foregoing, who at any particular date shall beneficially own or have the right to acquire, directly or indirectly, common stock of Investors or any Parent Entity.

“Mandatory Decrease” has the meaning specified in Section 2.2(a) of this Series Supplement.

“Manufacturer Eligible Program Vehicle Amount” means, as of any date of determination, with respect to any Manufacturer, an amount equal to the sum, rounded

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to the nearest $100,000, of the following amounts to the extent that such amounts are included in the definition of “Aggregate Asset Amount” for such date: (i) the Net Book Value of all Eligible Program Vehicles that are Eligible Vehicles as of such date that were manufactured by such Manufacturer or an Affiliate thereof and not turned in to and accepted by such Manufacturer pursuant to its Manufacturer Program, not delivered and accepted for Auction pursuant to its Manufacturer Program or not otherwise sold or deemed to be sold under the Related Documents, plus (ii) the aggregate amount of Manufacturer Receivables (other than Excluded Payments) payable to HVF or to the Intermediary pursuant to the Master Exchange Agreement, in each case, as of such date by such Manufacturer with respect to Vehicles that were Eligible Vehicles and Eligible Program Vehicles when turned in to and accepted by such Manufacturer or delivered and accepted for Auction, plus (iii) with respect to Eligible Vehicles that were Eligible Program Vehicles that have been delivered and accepted for Auction pursuant to a Manufacturer Program with such Manufacturer, all amounts receivable (other than amounts specified in clause (ii) above) from any person or entity in connection with the Auction of such Eligible Vehicles as of such date, plus (iv) with respect to Eligible Vehicles that were Eligible Program Vehicles manufactured by such Manufacturer or an Affiliate thereof that have been turned in to and accepted by such Manufacturer, delivered and accepted for Auction, otherwise sold or become a Casualty, any accrued and unpaid Casualty Payments or Termination Payments with respect to such Eligible Vehicles as of such date under the HVF Lease, plus (v) with respect to Eligible Vehicles that were Eligible Program Vehicles manufactured by such Manufacturer or an Affiliate thereof that have been turned in to and accepted by such Manufacturer, delivered and accepted for Auction or otherwise sold, any accrued and unpaid Monthly Base Rent with respect to such Eligible Vehicles under the HVF Lease (net of amounts set forth in clauses (ii), (iii), and (iv) above) plus (vi) with respect to Eligible Vehicles that were Eligible Program Vehicles sold by HVF to a third party pursuant to Section 2.5(a) of the HVF Lease, any non-return incentives payable to HVF under a Manufacturer Program by such Manufacturer in respect of the sale of such Vehicles outside of the related Manufacturer Program as of such date, plus (vii) if such date is during the period from and including a Determination Date to but excluding the next Payment Date, accrued and unpaid Monthly Base Rent payable on the next Payment Date with respect to all Eligible Vehicles that are Eligible Program Vehicles as of such date that were manufactured by such Manufacturer or an Affiliate thereof and that have not been turned in to and accepted by such Manufacturer pursuant to its Manufacturer Program, not been delivered and accepted for Auction pursuant to its Manufacturer Program and not otherwise been sold or deemed to be sold under the Related Documents.  For the purposes of this definition, an Affiliate of a Manufacturer shall not include any Person who is included as a Manufacturer hereunder.

“Manufacturer Non-Eligible Program Vehicle Amount” means, as of any date of determination, with respect to any Manufacturer, an amount equal to the portion of the Manufacturer Non-Eligible Vehicle Amount for such Manufacturer as of such date allocable to or arising from Non-Eligible Program Vehicles.

“Manufacturer Non-Eligible Vehicle Amount” means, as of any date of determination, with respect to any Manufacturer, an amount equal to the sum, rounded to

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the nearest $100,000, of the following amounts to the extent that such amounts are included in the definition of “Aggregate Asset Amount” for such date: (i) the Net Book Value of all Non-Eligible Program Vehicles or Non-Program Vehicles that are Eligible Vehicles as of such date that were manufactured by such Manufacturer or an Affiliate thereof and not turned in to and accepted by such Manufacturer thereof pursuant to its Manufacturer Program, not delivered and accepted for Auction pursuant to its Manufacturer Program or not otherwise sold or deemed to be sold under the Related Documents, plus (ii) the aggregate amount of Manufacturer Receivables (other than Excluded Payments) payable to HVF or to the Intermediary pursuant to the Master Exchange Agreement, in each case, as of such date by such Manufacturer with respect to Vehicles that were Eligible Vehicles and Non-Eligible Program Vehicles when turned in to and accepted by such Manufacturer or delivered and accepted for Auction, plus (iii) with respect to Eligible Vehicles that were Non-Eligible Program Vehicles that have been delivered and accepted for Auction pursuant to a Manufacturer Program with such Manufacturer, all amounts receivable (other than amounts specified in clause (ii) above) from any Person in connection with the Auction of such Eligible Vehicles as of such date, plus (iv) with respect to Eligible Vehicles that were Non-Eligible Program Vehicles or Non-Program Vehicles manufactured by such Manufacturer or an Affiliate thereof that have been turned in to and accepted by such Manufacturer, delivered and accepted for Auction, otherwise sold or become a Casualty, any accrued and unpaid Casualty Payments or Termination Payments with respect to such Eligible Vehicles as of such date under the HVF Lease, plus (v) with respect to Eligible Vehicles that were Non-Eligible Program Vehicles or Non-Program Vehicles manufactured by such Manufacturer or an Affiliate thereof that have been turned in to and accepted by such Manufacturer, delivered and accepted for Auction or otherwise sold, any accrued and unpaid Monthly Base Rent with respect to such Eligible Vehicles under the HVF Lease (net of amounts set forth in clauses (ii), (iii) and (iv) above), plus (vi) if such date is during the period from and including a Determination Date to but excluding the next Payment Date, accrued and unpaid Monthly Base Rent payable on the next Payment Date with respect to all Eligible Vehicles as of such date that are Non-Eligible Program Vehicles or Non-Program Vehicles manufactured by such Manufacturer or an Affiliate thereof and that have not been turned in to and accepted by such Manufacturer thereof pursuant to its Manufacturer Program, not been delivered and accepted for Auction pursuant to a Manufacturer Program and not otherwise been sold or deemed to be sold under the Related Documents.  For the purposes of this definition, an Affiliate of a Manufacturer shall not include any Person who is included as a Manufacturer hereunder.

“Market Value Average” means, as of any day on or after the third Determination Date, the percentage equivalent (not to exceed 100%) of a fraction, the numerator of which is the average of the Non-Program Fleet Market Value as of such preceding Determination Date and the two Determination Dates precedent thereto and the denominator of which is the average of the aggregate Net Book Value of all Non-Program Vehicles (excluding any Excluded Redesignated Vehicles) as of the preceding Determination Date and the two Determination Dates precedent thereto.

“Maximum Investor Group Principal Amount” has the meaning set forth in the Series 2008-1 Note Purchase Agreement.

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“Mazda Amount” means, as of any date of determination, an amount equal to the sum of the Manufacturer Non-Eligible Vehicle Amount and the Manufacturer Eligible Program Vehicle Amount, in each case, with respect to Mazda as of such date.

“Mercedes Amount” means, as of any date of determination, an amount equal to the sum of the Manufacturer Non-Eligible Vehicle Amount and the Manufacturer Eligible Program Vehicle Amount, in each case, with respect to Mercedes as of such date.

“Merrill Lynch Investors” means the collective reference to (i) ML Global Private Equity Fund, L.P., a Cayman Islands exempted limited partnership, (ii) Merrill Lynch Ventures L.P. 2001, a Delaware limited partnership, (iii) CMC-Hertz Partners, L.P., a Delaware limited partnership, (iv) ML Hertz Co-Investor, L.P., a Delaware limited partnership, and (v) any Affiliate of any thereof.

“Mitsubishi Amount” means, as of any date of determination, an amount equal to the sum of the Manufacturer Non-Eligible Vehicle Amount and the Manufacturer Eligible Program Vehicle Amount, in each case, with respect to Mitsubishi as of such date.

“MLGP” means Merrill Lynch Global Partners, Inc.

“Moody’s First Trigger Required Ratings” means, with respect to any entity, rating requirements which are satisfied where (i) if such entity has a short-term, unsecured and unsubordinated debt obligation rating by Moody’s, such rating is “Prime-1” and its long-term senior unsecured debt, deposit, claims paying or credit (as the case may be) rating is “A1” or above by Moody’s or (ii) if such entity does not have a short-term, unsecured and unsubordinated debt obligation rating by Moody’s, its long-term senior unsecured debt, deposit, claims paying or credit (as the case may be) rating is “A1” or above by Moody’s.

“Moody’s Second Trigger Required Ratings” means, with respect to any entity, rating requirements which are satisfied where (i) if such entity has a short-term, unsecured and unsubordinated debt obligation rating by Moody’s, such rating is “Prime-2” or above and its long-term senior unsecured debt, deposit, claims paying or credit (as the case may be) rating is “A3” or above by Moody’s or (ii) if such entity does not have a short-term, unsecured and unsubordinated debt obligation rating by Moody’s, its long-term senior unsecured debt, deposit, claims paying or credit (as the case may be) rating is “A3” or above by Moody’s.

 “Monthly Total Principal Allocation” means for any Related Month the sum of all Series 2008-1 Principal Allocations with respect to such Related Month plus any amounts deposited in the Series 2008-1 Collection Account pursuant to Section 3.3(f)(iv)(B) of this Series Supplement.

“New York UCC” has the meaning specified in Section 3.11(b)(i) of this Series Supplement.

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“Nissan Amount” means, as of any date of determination, an amount equal to the sum of the Manufacturer Non-Eligible Vehicle Amount and the Manufacturer Eligible Program Vehicle Amount, in each case, with respect to Nissan as of such date.

“Non-Eligible Manufacturer Amount” means, as of any date of determination, an amount equal to the sum, rounded to the nearest $100,000, of the following amounts to the extent that such amounts are included in the definition of “Aggregate Asset Amount” for such date: (i) the Net Book Value of all HVF Vehicles that are Eligible Vehicles as of such date that were manufactured by Manufacturers other than Eligible Manufacturers and not turned in to and accepted by the Manufacturer thereof pursuant to its Manufacturer Program, not delivered and accepted for Auction pursuant to its Manufacturer Program or not otherwise sold or deemed to be sold under the Related Documents, plus (ii) the aggregate amount of Manufacturer Receivables (other than Excluded Payments) payable to HVF or to the Intermediary pursuant to the Master Exchange Agreement, in each case, as of such date by Manufacturers other than Eligible Manufacturers with respect to Vehicles that were Eligible Vehicles when turned in to and accepted by such Manufacturers or delivered and accepted for Auction, plus (iii) with respect to Eligible Vehicles that have been delivered and accepted for Auction pursuant to a Manufacturer Program with a Manufacturer other than an Eligible Manufacturer, all amounts receivable (other than amounts specified in clause (ii) above) from any Person in connection with the Auction of such Eligible Vehicles as of such date, plus (iv) with respect to Eligible Vehicles that were manufactured by Manufacturers other than Eligible Manufacturers that have been turned in to and accepted by the Manufacturer thereof, delivered and accepted for Auction, otherwise sold or become a Casualty, any accrued and unpaid Casualty Payments or Termination Payments with respect to such Eligible Vehicles as of such date under the HVF Lease, plus (v) with respect to Eligible Vehicles that were manufactured by Manufacturers other than Eligible Manufacturers that have been turned in to and accepted by the Manufacturer thereof, delivered and accepted for Auction or otherwise sold, any accrued and unpaid Monthly Base Rent with respect to such Eligible Vehicles under the HVF Lease (net of amounts set forth in clauses (ii), (iii) and (iv) above), plus (vi) if such date is during the period from and including a Determination Date to but excluding the next Payment Date, accrued and unpaid Monthly Base Rent payable on the next Payment Date with respect to all Eligible Vehicles as of such date that were manufactured by Manufacturers other than Eligible Manufacturers and that have not been turned in to and accepted by the Manufacturer thereof pursuant to its Manufacturer Program, not been delivered and accepted for Auction pursuant to its Manufacturer Program and not otherwise been sold or deemed to be sold under the Related Documents.

“Non-Eligible Vehicle Amount” means, as of any date of determination, an amount equal to the sum, rounded to the nearest $100,000, of the following amounts to the extent that such amounts are included in the definition of “Aggregate Asset Amount” for such date: (i) the Net Book Value of all Non-Eligible Program Vehicles and Non-Program Vehicles that are Eligible Vehicles as of such date and not turned in to and accepted by the Manufacturer thereof pursuant to its Manufacturer Program, not delivered and accepted for Auction pursuant to its Manufacturer Program or not otherwise sold or deemed to be sold under the Related Documents, plus (ii) the aggregate

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amount of Manufacturer Receivables (other than Excluded Payments) payable to HVF or to the Intermediary pursuant to the Master Exchange Agreement, in each case, as of such date by Manufacturers with respect to Vehicles that were Eligible Vehicles and Non-Eligible Program Vehicles when turned in to and accepted by such Manufacturers or delivered and accepted for Auction, plus (iii) with respect to Eligible Vehicles that were Non-Eligible Program Vehicles that have been delivered and accepted for Auction pursuant to a Manufacturer Program with a Manufacturer, all amounts receivable (other than amounts specified in clause (ii) above) from any Person in connection with the Auction of such Eligible Vehicles as of such date, plus (iv) with respect to Eligible Vehicles that were Non-Eligible Program Vehicles or Non-Program Vehicles that have been turned in to and accepted by the Manufacturer thereof, delivered and accepted for Auction, otherwise sold or become a Casualty, any accrued and unpaid Casualty Payments or Termination Payments with respect to such Eligible Vehicles as of such date under the HVF Lease, plus (v) with respect to Eligible Vehicles that were Non-Eligible Program Vehicles or Non-Program Vehicles that have been turned in to and accepted by the Manufacturer thereof, delivered and accepted for Auction or otherwise sold, any accrued and unpaid Monthly Base Rent with respect to such Eligible Vehicles under the HVF Lease (net of amounts set forth in clauses (ii), (iii) and (iv) above), plus (vi) if such date is during the period from and including a Determination Date to but excluding the next Payment Date, accrued and unpaid Monthly Base Rent payable on the next Payment Date with respect to all Eligible Vehicles as of such date that are Non-Eligible Program Vehicles or Non-Program Vehicles and that have not been turned in to and accepted by the Manufacturer thereof pursuant to its Manufacturer Program, not been delivered and accepted for Auction pursuant to a Manufacturer Program and not otherwise been sold or deemed to be sold under the Related Documents.

“Non-Investment Grade Manufacturer” means, as of any date of determination, each Eligible Manufacturer who as of such date does not have a long-term unsecured debt rating of at least “BBB-” from Standard & Poor’s and at least “Baa3” from Moody’s; provided that upon the withdrawal of the rating of a Manufacturer by a Rating Agency or upon the downgrade of a Manufacturer by a Rating Agency to a rating that would require inclusion of such Manufacturer in this definition, for purposes of this definition and each instance in which this definition is used in this Series Supplement, such Manufacturer shall be deemed to be rated “BBB-” or “Baa3”, as applicable, by the Rating Agency which downgraded such Manufacturer for a period of 30 days following the earlier of (i) the date on which any of the Administrator, HVF or the Servicer obtains actual knowledge of such downgrade and (ii) the date on which the Trustee or the Administrative Agent notifies the Administrator of such downgrade.

“Non-Program Fleet Market Value” means, with respect to all Non-Program Vehicles (excluding any Excluded Redesignated Vehicles) as of any date of determination, the sum of the respective Third-Party Market Values of each such Non-Program Vehicle.

“Non-Program Vehicle Amount” means, as of any date of determination, an amount equal to the portion of the Non-Eligible Vehicle Amount as of such date allocable to or arising from Non-Program Vehicles.

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“Non-Program Vehicle Percentage” means, as of any date of determination, the percentage equivalent of a fraction, the numerator of which is the Non-Program Vehicle Amount as of such date and the denominator of which is the excess of (A) the Aggregate Asset Amount over (B) the amount of cash and Permitted Investments on deposit in the Collection Account and the HVF Exchange Account, in each case, as of such date.

“Non-Program Vehicle Measurement Month Average” means, with respect to any Measurement Month, the lesser of (a) the percentage equivalent of a fraction, the numerator of which is the aggregate amounts of Disposition Proceeds paid or payable in respect of all Non-Program Vehicles that are sold to third parties, at auction or otherwise (excluding salvage sales), during such Measurement Month and the two Measurement Months preceding such Measurement Month and the denominator of which is the aggregate Net Book Values of such Non-Program Vehicles on the dates of their respective sales and (b) 100%.

“Non-Top Two Category 3 Manufacturer Vehicle Percentage” means, as of any date of determination, the excess of the Category 3 Manufacturer Vehicle Percentage as of such date over the Top Two Category 3 Manufacturer Vehicle Percentage as of such date.

“Non-Top Two Category 3 Manufacturer Vehicle Percentage Excess” means, as of any date of determination, the excess of the Non-Top Two Category 3 Manufacturer Vehicle Percentage as of such date over the Capped Non-Top Two Category 3 Manufacturer Vehicle Percentage as of such date.

“Outstanding” means with respect to the Series 2008-1 Notes, all Series 2008-1 Notes theretofore authenticated and delivered under the Indenture, except (a) Series 2008-1 Notes theretofore cancelled or delivered to the Registrar for cancellation, (b) Series 2008-1 Notes which have not been presented for payment but funds for the payment of which are on deposit in the Series 2008-1 Distribution Account and are available for payment of such Series 2008-1 Notes, and Series 2008-1 Notes which are considered paid pursuant to Section 8.1 of the Base Indenture, or (c) Series 2008-1 Notes in exchange for or in lieu of other Series 2008-1 Notes which have been authenticated and delivered pursuant to the Indenture unless proof satisfactory to the Trustee is presented that any such Series 2008-1 Notes are held by a purchaser for value.

“Parent Entity” means any of Holdings and any other Person that is a Subsidiary of Holdings and of which Investors is a subsidiary.

“Past Due Rent Payment” has the meaning specified in Section 3.2(c) of this Series Supplement.

“Permitted Holders” means, (a) any of the Equity Investors, Management Investors, CD&R, Carlyle, MLGP and any of their respective Affiliates; (b) any investment fund or vehicle managed, sponsored or advised by CD&R, Carlyle, MLGP or any Affiliate thereof, and any Affiliate of or successor to any such investment fund or

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vehicle; (c) any limited or general partners of, or other investors in, any CD&R Investor, Carlyle Investor or Merrill Lynch Investor or any Affiliate thereof, or any such investment fund or vehicle and (d) any Person acting in the capacity of an underwriter in connection with a public or private offering of Capital Stock of Investors or any Parent Entity.

“Preference Amount” means any amount previously paid by Hertz pursuant to the Series 2008-1 Demand Note and distributed to the Series 2008-1 Noteholders in respect of amounts owing under the Series 2008-1 Notes that is recoverable or that has been recovered as a voidable preference by the trustee in a bankruptcy proceeding of Hertz pursuant to the Bankruptcy Code in accordance with a final nonappealable order of a court having competent jurisdiction.

“Principal Amount” means, with respect to the Series 2008-1 Notes, the Series 2008-1 Principal Amount.

“Principal Deficit Amount” means, on any date of determination, the excess, if any, of (a) the Series 2008-1 Adjusted Principal Amount on such date (after giving effect to the distribution of the Monthly Total Principal Allocation for the Related Month) over (b) the Series 2008-1 Asset Amount on such date; provided, however, the Principal Deficit Amount on any date that is prior to the Legal Final Payment Date occurring during the period commencing on and including the date of the filing by Hertz of a petition for relief under Chapter 11 of the Bankruptcy Code to but excluding the date on which Hertz shall have resumed making all payments of Monthly Variable Rent required to be made under the HVF Lease, shall mean the excess, if any, of (x) the Series 2008-1 Adjusted Principal Amount on such date (after giving effect to the distribution of the Monthly Total Principal Allocation for the Related Month) over (y) the sum of (1) the Series 2008-1 Asset Amount on such date and (2) the lesser of (a) the Series 2008-1 Liquidity Amount on such date and (b) the Series 2008-1 Required Liquidity Amount on such date.

“Pro Rata Share” means, with respect to any Series 2008-1 Letter of Credit Provider, as of any date, the fraction (expressed as a percentage) obtained by dividing (A) the available amount under such Series 2008-1 Letter of Credit Provider’s Series 2008-1 Letter of Credit as of such date by (B) an amount equal to the aggregate available amount under all Series 2008-1 Letters of Credit as of such date; provided, that only for purposes of calculating the Pro Rata Share with respect to any Series 2008-1 Letter of Credit Provider as of any date, if such Series 2008-1 Letter of Credit Provider has not complied with its obligation to pay the Trustee the amount of any draw under its Series 2008-1 Letter of Credit made prior to such date, the available amount under such Series 2008-1 Letter of Credit Provider’s Series 2008-1 Letter of Credit as of such date shall be treated as reduced (for calculation purposes only) by the amount of such unpaid demand and shall not be reinstated for purposes of such calculation unless and until the date as of which such Series 2008-1 Letter of Credit Provider has paid such amount to the Trustee and been reimbursed by the Lessee for such amount (provided that the foregoing calculation shall not in any manner reduce a Series 2008-1 Letter of Credit Provider’s

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actual liability in respect of any failure to pay any demand under its Series 2008-1 Letter of Credit).

“Rating” means the rating of the Series 2008-1 Notes by Standard & Poor’s or Moody’s, as applicable.

“Rating Agencies” means, with respect to the Series 2008-1 Notes, Standard & Poor’s and Moody’s and any other nationally recognized rating agency rating the Series 2008-1 Notes at the request of HVF.

“Record Date” means, with respect to any Payment Date, the last day of the Related Month.

“Redesignated Vehicle” means any Program Vehicle manufactured by a Manufacturer with respect to which an Event of Bankruptcy has occurred which has been redesignated as a Non-Program Vehicle pursuant to Section 18(b) of the HVF Lease in accordance with Section 2.6 thereof.

“Reference Banks” means four major banks in the London interbank market selected by the Calculation Agent.

“Required Noteholders” means, with respect to the Series 2008-1 Notes, Series 2008-1 Noteholders holding more than 662/3% of the Series 2008-1 Principal Amount (excluding any Series 2008-1 Notes held by HVF or any Affiliate of HVF (other than Series 2008-1 Notes held by an Affiliate Issuer if such Affiliate Issuer has assigned all voting, consent and control rights associated with such Series 2008-1 Notes to Persons that are not Affiliates of HVF)).

“Required Ratings” means, with respect to the Series 2008-1 Notes, explicit public ratings of at least “A” by S&P and “A2” by Moody’s.

“Second Level Ratings Event” means, with respect to the Series 2008-1 Notes, the Series 2008-1 Notes shall not have explicit public ratings of at least “BBB-” by S&P and “Baa3” by Moody’s for a period in excess of thirty (30) days.

“Senior Credit Facilities” means the Hertz’s (a) senior secured asset based revolving loan facility, provided under a credit agreement, dated as of December 21, 2005, among Hertz Equipment Rental Corporation, Hertz together with certain of the Hertz’s subsidiaries, as borrower, the several banks and financial institutions from time to time party thereto, as lenders, Deutsche Bank AG, New York Branch, as administrative agent and collateral agent, Lehman Commercial Paper Inc., as syndication agent, Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner & Smith Incorporated, as sole documentation agent, and the other financial institutions party thereto from time to time (as it may be amended, amended and restated, supplemented or otherwise modified (including as amended by that certain Amendment to Credit Agreement, dated as of June 30, 2006, that certain Second Amendment to Credit Agreement, dated as of February 15, 2007, that certain Third Amendment to Credit Agreement, dated as of May 23, 2007 and that certain Fourth Amendment to Credit Agreement, dated as of September 30, 2007)),

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(b) senior secured term loan facility, provided under a credit agreement, dated as of December 21, 2005, among Hertz together with certain of the Hertz’s subsidiaries, as borrower, the several banks and financial institutions from time to time party thereto, as lenders, Deutsche Bank AG, New York Branch, as administrative agent and collateral agent, Lehman Commercial Paper Inc., as syndication agent, Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner & Smith Incorporated, as sole documentation agent, and the other financial institutions party thereto from time to time (as it may be amended, amended and restated, supplemented or otherwise modified (including as amended by that certain Amendment to Credit Agreement, dated as of June 30, 2006, that certain Second Amendment to Credit Agreement, dated as of February 9, 2007 and that certain Third Amendment to Credit Agreement, dated as of May 23, 2007)) and (c) any successor or replacement credit facility to the senior secured asset based revolving loan facility or senior secured term loan facility described in clauses (a) and (b)).

“Series 2004-1 Supplement” means that certain Second Amended and Restated Series Supplement to the Base Indenture, dated as of August 1, 2006, as amended by Amendment No. 1 thereto, dated as of October 24, 2007 (as further amended, modified, restated or supplemented from time to time in accordance with the terms thereof), by and between HVF and the Trustee, relating to, among other things, the issuance by HVF of its Series 2004-1 Notes.

“Series 2005-1 Supplement” means that certain Amended and Restated Series Supplement to the Base Indenture, dated as of August 1, 2006, as amended by Amendment No. 1 thereto, dated as of October 24, 2007 (as further amended, modified, restated or supplemented from time to time in accordance with the terms thereof), by and between HVF and the Trustee, relating to, among other things, the issuance by HVF of its Series 2005-1 Notes.

“Series 2005-2 Supplement” means that certain Amended and Restated Series Supplement to the Base Indenture, dated as of August 1, 2006, as amended by Amendment No. 1 thereto, dated as of October 24, 2007 (as further amended, modified, restated or supplemented from time to time in accordance with the terms thereof), by and between HVF and the Trustee, relating to, among other things, the issuance by HVF of its Series 2005-2 Notes.

“Series 2005-3 Supplement” means that certain Amended and Restated Series Supplement to the Base Indenture, dated as of August 1, 2006, as amended by Amendment No. 1 thereto, dated as of October 24, 2007 (as further amended, modified, restated or supplemented from time to time in accordance with the terms thereof), by and between HVF and the Trustee, relating to, among other things, the issuance by HVF of its Series 2005-3 Notes.

“Series 2005-4 Supplement” means that certain Amended and Restated Series Supplement to the Base Indenture, dated as of August 1, 2006, as amended by Amendment No. 1 thereto, dated as of October 24, 2007 (as further amended, modified, restated or supplemented from time to time in accordance with the terms thereof), by and

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between HVF and the Trustee, relating to, among other things, the issuance by HVF of its Series 2005-4 Notes.

“Series 2008-1 Accrued Amounts” means, on any date of determination, the sum of (i) accrued and unpaid interest on the Series 2008-1 Notes as of such date (including, without limitation, any accrued and unpaid Program Fee and Undrawn Fee), (ii) the Indenture Carrying Charges due and payable to the Series 2008-1 Noteholders on the next succeeding Payment Date and (iii) the product of (x) the Series 2008-1 Percentage as of such date of determination and (y) the Indenture Carrying Charges not included in clause (ii) above.

“Series 2008-1 Accrued Interest Account” has the meaning specified in Section 3.1(a) of this Series Supplement.

 “Series 2008-1 Adjusted Enhancement Amount” means, the Series 2008-1 Enhancement Amount, excluding from the calculation thereof the amount available to be drawn under any Series 2008-1 Letter of Credit if at the time of such calculation (A) such Series 2008-1 Letter of Credit shall not be in full force and effect, (B) an Event of Bankruptcy shall have occurred with respect to the Series 2008-1 Letter of Credit Provider of such Series 2008-1 Letter of Credit, (C) such Series 2008-1 Letter of Credit Provider shall have repudiated such Series 2008-1 Letter of Credit or failed to honor a draw thereon made in accordance with the terms thereof or (D) a Series 2008-1 Downgrade Event shall have occurred and be continuing for at least 30 days with respect to the Series 2008-1 Letter of Credit Provider of such Series 2008-1 Letter of Credit.

“Series 2008-1 Adjusted Liquidity Amount” means, the Series 2008-1 Liquidity Amount, excluding from the calculation thereof the amount available to be drawn under any Series 2008-1 Letter of Credit if at the time of such calculation (A) such Series 2008-1 Letter of Credit shall not be in full force and effect, (B) an Event of Bankruptcy shall have occurred with respect to the Series 2008-1 Letter of Credit Provider of such Series 2008-1 Letter of Credit, (C) such Series 2008-1 Letter of Credit Provider shall have repudiated such Series 2008-1 Letter of Credit or failed to honor a draw thereon made in accordance with the terms thereof or (D) a Series 2008-1 Downgrade Event shall have occurred and be continuing for at least 30 days with respect to the Series 2008-1 Letter of Credit Provider of such Series 2008-1 Letter of Credit.

 “Series 2008-1 Adjusted Principal Amount” means, as of any date of determination, the excess, if any, of (A) the Series 2008-1 Principal Amount as of such date over (B) the sum of (1) the amount of cash and Permitted Investments on deposit in the Series 2008-1 Excess Collection Account and (2) the amount of cash and Permitted Investments on deposit in the Series 2008-1 Collection Account and available for reduction of the Series 2008-1 Principal Amount, in each case, as of such date.

“Series 2008-1 Asset Amount” means, as of any date of determination, the product of (i) the Series 2008-1 Asset Percentage as of such date and (ii) the Aggregate Asset Amount as of such date.

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“Series 2008-1 Asset Percentage” means, as of any date of determination, the percentage equivalent of a fraction, the numerator of which shall be equal to the Series 2008-1 Required Asset Amount, determined during the Series 2008-1 Revolving Period as of the last day of the immediately preceding Related Month (or, until the end of the initial Related Month after the Series 2008-1 Closing Date, on the Series 2008-1 Closing Date), or, during the Series 2008-1 Rapid Amortization Period, as of the last day of the Series 2008-1 Revolving Period, and the denominator of which shall be the greater of (I) the Aggregate Asset Amount as of the end of the immediately preceding Related Month or, until the end of the initial Related Month after the Series 2008-1 Closing Date, as of the Series 2008-1 Closing Date and (II) as of the same date as in clause (I), the Aggregate Required Asset Amount.

“Series 2008-1 Available Cash Collateral Account Amount” means, as of any date of determination, the amount on deposit in the Series 2008-1 Cash Collateral Account (after giving effect to any deposits thereto and withdrawals and releases therefrom on such date).

“Series 2008-1 Available Reserve Account Amount” means, as of any date of determination, the amount on deposit in the Series 2008-1 Reserve Account.

“Series 2008-1 Base Rate Tranche” means that portion of the Series 2008-1 Principal Amount purchased or maintained with Series 2008-1 Advances which bear interest by reference to the Series 2008-1 Base Rate.

“Series 2008-1 Cash Collateral Account” has the meaning specified in Section 3.9(f) of this Series Supplement.

“Series 2008-1 Cash Collateral Account Collateral” has the meaning specified in Section 3.9(a) of this Series Supplement.

“Series 2008-1 Cash Collateral Account Interest and Earnings” means with respect to a Series 2008-1 Cash Collateral Account all interest and earnings (net of losses and investment expenses) paid on funds on deposit in such Series 2008-1 Cash Collateral Account.

“Series 2008-1 Cash Collateral Account Surplus” means, with respect to any Payment Date, the lesser of (a) the Series 2008-1 Available Cash Collateral Account Amount and (b) the lesser of (i) the excess, if any, of the Series 2008-1 Adjusted Enhancement Amount (after giving effect to any withdrawal from the Series 2008-1 Reserve Account on such Payment Date) over the Series 2008-1 Required Enhancement Amount on such Payment Date and (ii) the excess, if any, of the Series 2008-1 Adjusted Liquidity Amount over the Series 2008-1 Required Liquidity Amount on such Payment Date.

 “Series 2008-1 Cash Collateral Percentage” means, as of any date of determination, the percentage equivalent of a fraction, the numerator of which is the Series 2008-1 Available Cash Collateral Account Amount as of such date and the

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denominator of which is the Series 2008-1 Letter of Credit Liquidity Amount as of such date.

“Series 2008-1 Certificate of Credit Demand” means a certificate in the form of Annex A to a Series 2008-1 Letter of Credit.

“Series 2008-1 Certificate of Preference Payment Demand” means a certificate in the form of Annex C to a Series 2008-1 Letter of Credit.

“Series 2008-1 Certificate of Termination Demand” means a certificate in the form of Annex D to a Series 2008-1 Letter of Credit.

“Series 2008-1 Certificate of Unpaid Demand Note Demand” means a certificate in the form of Annex B to Series 2008-1 Letter of Credit.

“Series 2008-1 Closing Date” means September 12, 2008.

“Series 2008-1 Collateral” means the Collateral, the Series 2008-1 Interest Rate Caps, each Series 2008-1 Letter of Credit, the Series 2008-1 Series Account Collateral, the Series 2008-1 Cash Collateral Account Collateral, the Series 2008-1 Demand Note, the Series 2008-1 Distribution Account Collateral and the Series 2008-1 Reserve Account Collateral.

“Series 2008-1 Collection Account” has the meaning specified in Section 3.1(a) of this Series Supplement.

“Series 2008-1 Commercial Paper” means the promissory notes of each Series 2008-1 Noteholder issued by such Series 2008-1 Noteholder in the commercial paper market and allocated to the funding of Series 2008-1 Advances in respect of the Series 2008-1 Notes.

“Series 2008-1 CP Tranche” means that portion of the Series 2008-1 Principal Amount purchased or maintained with Series 2008-1 Advances which bear interest by reference to the CP Rate.

“Series 2008-1 Daily Interest Amount” means, for any day in a Series 2008-1 Interest Period, an amount equal to the result of (a) the product of (i) the Series 2008-1 Note Rate for such Series 2008-1 Interest Period and (ii) the Series 2008-1 Principal Amount as of the close of business on such date divided by (b) 360.

“Series 2008-1 Deficiency Amount” has the meaning specified in Section 3.3(e) of this Series Supplement.

“Series 2008-1 Demand Note” means each demand note made by Hertz, substantially in the form of Exhibit G-2 to this Series Supplement, as amended, modified or restated from time to time in accordance with its terms and the terms of this Series Supplement.

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“Series 2008-1 Demand Note Payment Amount” means, as of any date of determination, the excess, if any, of (a) the aggregate amount of all proceeds of demands made on the Series 2008-1 Demand Note that were deposited into the Series 2008-1 Distribution Account and paid to the Series 2008-1 Noteholders during the one year period ending on such date of determination over (b) the amount of any Preference Amount relating to such proceeds that has been repaid to HVF (or any payee of HVF) with the proceeds of any Series 2008-1 LOC Preference Payment Disbursement (or any withdrawal from any Series 2008-1 Cash Collateral Account); provided, however, that if an Event of Bankruptcy (or the occurrence of an event described in clause (a) of the definition thereof, without the lapse of a period of 60 consecutive days) with respect to Hertz shall have occurred on or before such date of determination, the Series 2008-1 Demand Note Payment Amount shall equal (i) on any date of determination until the conclusion or dismissal of the proceedings giving rise to such Event of Bankruptcy without continuing jurisdiction by the court in such proceedings (or on any earlier date upon which the statute of limitations in respect of avoidance actions in such proceedings has run or when such actions otherwise become unavailable to the bankruptcy estate), the Series 2008-1 Demand Note Payment Amount as if it were calculated as of the date of the occurrence of such Event of Bankruptcy and (ii) on any date of determination thereafter, $0.

“Series 2008-1 Deposit Date” has the meaning specified in Section 3.2 of this Series Supplement.

“Series 2008-1 Designated Account” has the meaning specified in Section 3.11(a) of this Series Supplement.

“Series 2008-1 Disbursement” shall mean any Series 2008-1 LOC Credit Disbursement, any Series 2008-1 LOC Preference Payment Disbursement, any Series 2008-1 LOC Termination Disbursement or any Series 2008-1 LOC Unpaid Demand Note Disbursement under the Series 2008-1 Letters of Credit or any combination thereof, as the context may require.

“Series 2008-1 Distribution Account” has the meaning specified in Section 3.10(a) of this Series Supplement.

“Series 2008-1 Distribution Account Collateral” has the meaning specified in Section 3.10(d) of this Series Supplement.

“Series 2008-1 Downgrade Event” has the meaning specified in Section 3.9(c) of this Series Supplement.

“Series 2008-1 Eligible Letter of Credit Provider” means a Person having, at the time of the issuance of the related Series 2008-1 Letter of Credit, a long-term senior unsecured debt rating (or the equivalent thereof in the case of Moody’s or Standard & Poor’s, as applicable) of at least “A+” from Standard & Poor’s and at least “A1” from Moody’s and a short-term senior unsecured debt rating of at least “A-1” from Standard & Poor’s and “P-1” from Moody’s; provided that, other than in connection with the initial

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Series 2008-1 Letter of Credit Provider, each Series 2008-1 Eligible Letter of Credit Provider shall be approved by the Administrative Agent, such approval not to be unreasonably withheld or delayed.

“Series 2008-1 Enhancement Amount” means, as of any date of determination, the sum of (i) the Series 2008-1 Overcollateralization Amount as of such date, (ii) the Series 2008-1 Letter of Credit Amount as of such date and (iii) the Series 2008-1 Available Reserve Account Amount as of such date (after giving effect to any deposits thereto and withdrawals and releases therefrom on such date).

“Series 2008-1 Enhancement Deficiency” means, on any day, the amount by which the Series 2008-1 Adjusted Enhancement Amount is less than the Series 2008-1 Required Enhancement Amount.

“Series 2008-1 Eurodollar Tranche” means that portion of the Series 2008-1 Principal Amount purchased or maintained with Series 2008-1 Advances which bear interest by reference to the Series 2008-1 Eurodollar Rate.

“Series 2008-1 Excess Collection Account” has the meaning specified in Section 3.1(a) of this Series Supplement.

“Series 2008-1 Excess Principal Event” shall be deemed to have occurred if, on any date, the Series 2008-1 Outstanding Principal Amount exceeds the Series 2008-1 Maximum Principal Amount.

“Series 2008-1 Initial Principal Amount” means the aggregate initial principal amount of the Series 2008-1 Notes, which is $0.

“Series 2008-1 Interest Period” means a period commencing on and including a Payment Date and ending on and including the day preceding the next succeeding Payment Date; provided, however, that the initial Series 2008-1 Interest Period shall commence on and include the Series 2008-1 Closing Date and end on and include October 24, 2008.

“Series 2008-1 Interest Rate Cap” has the meaning specified in Section 3.12(a) of this Series Supplement; provided that for the avoidance of doubt each Series 2008-1 Interest Rate Cap shall constitute a “Series-Specific Swap Agreement”, but shall not constitute a “Swap Agreement” for all purposes under the Base Indenture or any other Related Document.

“Series 2008-1 Invested Percentage” means on any date of determination:

(a)           when used with respect to Principal Collections, the percentage equivalent (which percentage shall never exceed 100%) of a fraction, the numerator of which shall be equal to the Series 2008-1 Required Adjusted Asset Amount, determined during the Series 2008-1 Revolving Period as of the last day of the immediately preceding Related Month (or, until the end of the initial Related Month after the Series 2008-1 Closing Date, on the Series 2008-1 Closing Date), or, the Series 2008-1 Required

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Adjusted Asset Amount, determined during the Series 2008-1 Rapid Amortization Period, as of the last day of the Series 2008-1 Revolving Period, and the denominator of which shall be the greater of (I) the Aggregate Asset Amount as of the end of the immediately preceding Related Month or, until the end of the initial Related Month after the Series 2008-1 Closing Date, as of the Series 2008-1 Closing Date and (II) as of the same date as in clause (I), the Aggregate Required Asset Amount;

(b)           when used with respect to Interest Collections, the percentage equivalent (which percentage shall never exceed 100%) of a fraction, the numerator of which shall be the Series 2008-1 Accrued Amounts on such date of determination, and the denominator of which shall be the aggregate Accrued Amounts with respect to all Series of Notes on such date of determination.

“Series 2008-1 Investor Group” has the meaning set forth in the Series 2008-1 Note Purchase Agreement.

“Series 2008-1 Investor Group Principal Amount” has the meaning set forth in the Series 2008-1 Note Purchase Agreement.

 “Series 2008-1 Lease Interest Payment Deficit” means on any Payment Date an amount equal to the excess, if any, of (a) the aggregate amount of Interest Collections which pursuant to Section 3.2(a), (b) or (c) of this Series Supplement would have been deposited into the Series 2008-1 Accrued Interest Account if all payments of Monthly Variable Rent required to have been made under the HVF Lease from and excluding the preceding Payment Date to and including such Payment Date were made in full over (b) the aggregate amount of Interest Collections which pursuant to Section 3.2(a), (b) or (c) of this Series Supplement have been received for deposit into the Series 2008-1 Accrued Interest Account from and excluding the preceding Payment Date to and including such Payment Date.

“Series 2008-1 Lease Payment Deficit” means either a Series 2008-1 Lease Interest Payment Deficit or a Series 2008-1 Lease Principal Payment Deficit.

“Series 2008-1 Lease Principal Payment Carryover Deficit” means (a) for the initial Payment Date, zero and (b) for any other Payment Date, the excess, if any, of (x) the Series 2008-1 Lease Principal Payment Deficit, if any, on the preceding Payment Date over (y) the amount deposited in the Series 2008-1 Distribution Account pursuant to Section 3.5(d) of this Series Supplement on such preceding Payment Date on account of such Series 2008-1 Lease Principal Payment Deficit.

“Series 2008-1 Lease Principal Payment Deficit” means on any Payment Date the sum of (a) the Series 2008-1 Monthly Lease Principal Payment Deficit for such Payment Date and (b) the Series 2008-1 Lease Principal Payment Carryover Deficit for such Payment Date.

“Series 2008-1 Letter of Credit” means an irrevocable letter of credit, substantially in the form of Exhibit B to this Series Supplement and otherwise in form and substance satisfactory to the Administrative Agent issued by a Series 2008-1 Eligible

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Letter of Credit Provider in favor of the Trustee for the benefit of the Series 2008-1 Noteholders; provided, however, that the Administrative Agent agrees that any Series 2008-1 Letter of Credit that is in the form and substance of the Series 2008-1 Letter of Credit provided to the Trustee on the Series 2008-1 Closing Date is in form and substance satisfactory to the Administrative Agent; provided further that any Series 2008-1 Letter of Credit issued after the Series 2008-1 Closing Date shall be subject to the satisfaction of the Series 2008-1 Rating Agency Condition.

 “Series 2008-1 Letter of Credit Agreement” means the Series 2008-1 Letter of Credit Reimbursement Agreement and any other agreement pursuant to which a Series 2008-1 Letter of Credit is issued in favor of the Trustee for the benefit of the Series 2008-1 Noteholders.

“Series 2008-1 Letter of Credit Amount” means, as of any date of determination, the lesser of (a) the sum of (i) the aggregate amount available to be drawn on such date under the Series 2008-1 Letters of Credit, as specified therein, and (ii) if the Series 2008-1 Cash Collateral Account has been established and funded pursuant to Section 3.9 of this Series Supplement, the Series 2008-1 Available Cash Collateral Account Amount on such date and (b) the outstanding principal amount of the Series 2008-1 Demand Note on such date.

“Series 2008-1 Letter of Credit Expiration Date” means, with respect to any Series 2008-1 Letter of Credit, the expiration date set forth in such Series 2008-1 Letter of Credit, as such date may be extended in accordance with the terms of such Series 2008-1 Letter of Credit.

“Series 2008-1 Letter of Credit Liquidity Amount” means, as of any date of determination, the sum of (a) the aggregate amount available to be drawn on such date under each Series 2008-1 Letter of Credit, as specified therein, and (b) if a Series 2008-1 Cash Collateral Account has been established and funded pursuant to Section 3.9(e) of this Series Supplement, the Series 2008-1 Available Cash Collateral Account Amount on such date.

“Series 2008-1 Letter of Credit Provider” means the issuer of a Series 2008-1 Letter of Credit.

 “Series 2008-1 Letter of Credit Reimbursement Agreement” means any and each reimbursement agreement providing for the reimbursement of a Series 2008-1 Letter of Credit Provider for draws under its Series 2008-1 Letter of Credit, as the same may be amended, restated, modified or supplemented from time to time in accordance with its terms.

“Series 2008-1 Liquidity Amount” means, as of any date of determination, the sum of (a) the Series 2008-1 Letter of Credit Liquidity Amount and (b) the Series 2008-1 Available Reserve Account Amount on such date (after giving effect to any deposits thereto on such date).

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“Series 2008-1 Liquidity Deficiency” means, as of any date of determination, the amount by which the Series 2008-1 Adjusted Liquidity Amount is less than the Series 2008-1 Required Liquidity Amount as of such date.

“Series 2008-1 Liquidity Surplus” means, with respect to any date of determination, the excess, if any, of the Series 2008-1 Adjusted Liquidity Amount over the Series 2008-1 Required Liquidity Amount, in each case, as of such date.

“Series 2008-1 LOC Credit Disbursement” means an amount drawn under a Series 2008-1 Letter of Credit pursuant to a Series 2008-1 Certificate of Credit Demand.

“Series 2008-1 LOC Preference Payment Disbursement” means an amount drawn under a Series 2008-1 Letter of Credit pursuant to a Series 2008-1 Certificate of Preference Payment Demand.

“Series 2008-1 LOC Termination Disbursement” means an amount drawn under a Series 2008-1 Letter of Credit pursuant to a Series 2008-1 Certificate of Termination Demand.

“Series 2008-1 LOC Unpaid Demand Note Disbursement” means an amount drawn under a Series 2008-1 Letter of Credit pursuant to a Series 2008-1 Certificate of Unpaid Demand Note Demand.

“Series 2008-1 Maximum Aggregate BMW/Lexus/Mercedes/Audi Amount” means, as of any day, an amount equal to 9% of the Adjusted Aggregate Asset Amount on such day.

“Series 2008-1 Maximum Aggregate Kia/Subaru/Hyundai Amount” means, as of any day, an amount equal to 30% of the Adjusted Aggregate Asset Amount on such day.

“Series 2008-1 Maximum Amount” means any of the Series 2008-1 Maximum Hyundai Amount, the Series 2008-1 Maximum Jaguar Amount, the Series 2008-1 Maximum Kia Amount, the Series 2008-1 Maximum Land Rover Amount, the Series 2008-1 Maximum Mazda Amount, the Series 2008-1 Maximum Mitsubishi Amount, the Series 2008-1 Maximum Subaru Amount, the Series 2008-1 Maximum Volvo Amount, the Series 2008-1 Maximum Manufacturer Non-Eligible Vehicle Amount, the Series 2008-1 Maximum Non-Eligible Manufacturer Amount, the Series 2008-1 Maximum Non-Eligible Vehicle Amount, the Series 2008-1 Maximum Audi Amount, the Series 2008-1 Maximum BMW Amount, the Series 2008-1 Maximum Lexus Amount, the Series 2008-1 Maximum Mercedes Amount, the Series 2008-1 Maximum Nissan Amount, the Series 2008-1 Maximum Volkswagen Amount, the Series 2008-1 Maximum Aggregate BMW/Lexus/Audi Mercedes Amount, the Series 2008-1 Maximum Aggregate Kia/Subaru/Hyundai Amount and the Series 2008-1 Maximum HVF Service Vehicle Amount.

“Series 2008-1 Maximum Audi Amount” means, as of any day, an amount equal to 3% of the Adjusted Aggregate Asset Amount on such day.

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“Series 2008-1 Maximum BMW Amount” means, as of any day, an amount equal to 3% of the Adjusted Aggregate Asset Amount on such day.

“Series 2008-1 Maximum HVF Service Vehicle Amount” means, as of any day, an amount equal to 2% of the Adjusted Aggregate Asset Amount on such day.

“Series 2008-1 Maximum Hyundai Amount” means, as of any day, an amount equal to 13% of the Adjusted Aggregate Asset Amount on such day.

“Series 2008-1 Maximum Jaguar Amount” means, as of any day, an amount equal to 5% of the Adjusted Aggregate Asset Amount on such day.

“Series 2008-1 Maximum Kia Amount” means, as of any day, an amount equal to 10% of the Adjusted Aggregate Asset Amount on such day.

“Series 2008-1 Maximum Land Rover Amount” means, as of any day, an amount equal to 5% of the Adjusted Aggregate Asset Amount on such day.

“Series 2008-1 Maximum Lexus Amount” means, as of any day, an amount equal to 3% of the Adjusted Aggregate Asset Amount on such day.

“Series 2008-1 Maximum Manufacturer Non-Eligible Vehicle Amount” means, as of any day, with respect to any Manufacturer, an amount equal to 40% of the Non-Eligible Vehicle Amount.

“Series 2008-1 Maximum Mazda Amount” means, as of any day, an amount equal to 20% of the Adjusted Aggregate Asset Amount on such day.

“Series 2008-1 Maximum Mercedes Amount” means, as of any day, an amount equal to 3% of the Adjusted Aggregate Asset Amount on such day.

“Series 2008-1 Maximum Mitsubishi Amount” means, as of any day, an amount equal to 10% of the Adjusted Aggregate Asset Amount on such day.

“Series 2008-1 Maximum Nissan Amount” means, as of any day, an amount equal to 10% of the Adjusted Aggregate Asset Amount on such day.

“Series 2008-1 Maximum Non-Eligible Manufacturer Amount” means, as of any day, an amount equal to 3% of the Adjusted Aggregate Asset Amount on such day.

“Series 2008-1 Maximum Non-Eligible Vehicle Amount” means, as of any day, an amount equal to 85% of the Adjusted Aggregate Asset Amount.

“Series 2008-1 Maximum Principal Amount” means, $825,000,000; provided that such amount may be (i) reduced at any time and from time to time by written agreement among HVF, each Series 2008-1 Noteholder, the Administrative Agent, each Conduit Investor and each Committed Note Purchaser in accordance with the terms of the Series 2008-1 Note Purchase Agreement, or (ii) increased at any time and from

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time to time upon an Additional Investor Group becoming party to the Series 2008-1 Note Purchase Agreement in accordance with the terms thereof.

“Series 2008-1 Maximum Subaru Amount” means, as of any day, an amount equal to 5% of the Adjusted Aggregate Asset Amount on such day.

“Series 2008-1 Maximum Volkswagen Amount” means, as of any day, an amount equal to 10% of the Adjusted Aggregate Asset Amount on such day.

“Series 2008-1 Maximum Volvo Amount” means, as of any day, an amount equal to 5% of the Adjusted Aggregate Asset Amount on such day.

“Series 2008-1 Monthly Default Interest Amount” means, with respect to any Payment Date, the sum of (i) an amount equal to the product of (x) 2.0%, (y) the result of (a) the sum of the Series 2008-1 Principal Amount as of each day during the related Series 2008-1 Interest Period (after giving effect to any increases or decreases to the Series 2008-1 Principal Amount on such day) during which an Amortization Event with respect to the Series 2008-1 Notes has occurred and is continuing divided by (b) the actual number of days in the related Series 2008-1 Interest Period during which an Amortization Event with respect to the Series 2008-1 Notes has occurred and is continuing, and (z) the result of (a) the actual number of days in the related Series 2008-1 Interest Period during which an Amortization Event with respect to the Series 2008-1 Notes has occurred and is continuing divided by (b) 360 plus (ii) all previously due and unpaid amounts described in clause (i) with respect to prior Series 2008-1 Interest Periods (together with interest on such unpaid amounts required to be paid in this clause (ii) at the rate specified in clause (i)).

 “Series 2008-1 Monthly Interest” means, with respect to any Payment Date, the sum of (i) the Series 2008-1 Daily Interest Amount for each day in the related Series 2008-1 Interest Period, plus (ii) all previously due and unpaid amounts described in clause (i) with respect to prior Series 2008-1 Interest Periods (together with interest on such unpaid amounts required to be paid in this clause (ii) at the Series 2008-1 Note Rate), plus (iii) the Undrawn Fee for such Payment Date, calculated in accordance with Section 3.02(b) of the Series 2008-1 Note Purchase Agreement.

“Series 2008-1 Monthly Lease Principal Payment Deficit” means on any Payment Date an amount equal to the excess, if any, of (a) the aggregate amount of Principal Collections which pursuant to Section 3.2(a), (b) or (c) of this Series Supplement would have been deposited into the Series 2008-1 Collection Account if all payments required to have been made under the HVF Lease from and excluding the preceding Payment Date to and including such Payment Date were made in full over (b) the aggregate amount of Principal Collections which pursuant to Section 3.2(a), (b) or (c) of this Series Supplement have been received for deposit into the Series 2008-1 Collection Account (without giving effect to any amounts deposited into the Series 2008-1 Accrued Interest Account pursuant to the proviso in Section 3.2(b)(ii) of this Series Supplement) from and excluding the preceding Payment Date to and including such Payment Date.

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“Series 2008-1 Moody’s Highest Enhancement Percentage” means, with respect to any date of determination, the sum of (a) 39.50% (or such lower percentage as may be agreed to by HVF, each Funding Agent and Moody’s, subject to satisfaction of the Series 2008-1 Rating Agency Condition with respect to Moody’s) and (b) an amount equal to 100% minus the lower of (x) the lowest Non-Program Vehicle Measurement Month Average for any Measurement Month within the preceding 12 calendar months (or such fewer number of months as have elapsed since the Series 2008-1 Closing Date) and (y) the lowest Market Value Average as of any Determination Date within the preceding 12 calendar months (or such fewer number of months as have elapsed since the Series 2008-1 Closing Date).

“Series 2008-1 Moody’s Highest Enhancement Vehicle Percentage” means, as of any date of determination, the sum of (a) the Non-Program Vehicle Percentage as of such date plus (b) the Bankrupt Manufacturer Vehicle Percentage as of such date.

 “Series 2008-1 Moody’s Intermediate Enhancement Percentage” means, with respect to any date of determination, the sum of (a) 34.00% (or such lower percentage as may be agreed to by HVF, each Funding Agent and Moody’s, subject to satisfaction of the Series 2008-1 Rating Agency Condition with respect to Moody’s) and (b) an amount equal to 100% minus the lower of (x) the lowest Non-Program Vehicle Measurement Month Average for any Measurement Month within the preceding 12 calendar months (or such fewer number of months as have elapsed since the Series 2008-1 Closing Date) and (y) the lowest Market Value Average as of any Determination Date within the preceding 12 calendar months (or such fewer number of months as have elapsed since the Series 2008-1 Closing Date).

“Series 2008-1 Moody’s Intermediate Enhancement Vehicle Percentage” means, as of any date of determination, the excess of (i) 100% over (ii) the sum of (x) the Series 2008-1 Moody’s Lowest Enhancement Vehicle Percentage as of such date plus (y) the Series 2008-1 Moody’s Highest Enhancement Vehicle Percentage as of such date.

“Series 2008-1 Moody’s Lowest Enhancement Percentage” means, with respect to any date of determination, 16.50% (or such lower percentage as may be agreed to by HVF, each Funding Agent and Moody’s, subject to satisfaction of the Series 2008-1 Rating Agency Condition with respect to Moody’s).

“Series 2008-1 Moody’s Lowest Enhancement Vehicle Percentage” means, as of any date of determination, the sum of (a) the Category 1 Manufacturer Eligible Program Vehicle Percentage as of such date plus (b) the Category 1 Manufacturer Non-Eligible Program Vehicle Percentage as of such date plus (c) the Capped Category 2 Manufacturer Program Vehicle Percentage as of such date.

“Series 2008-1 Moody’s Required Enhancement Percentage” means, as of any date of determination, the sum of (a) the product of (i) the Series 2008-1 Moody’s Lowest Enhancement Percentage as of such date times (ii) the Series 2008-1 Moody’s Lowest Enhancement Vehicle Percentage as of such date plus (b) the product of (i) the

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Series 2008-1 Moody’s Intermediate Enhancement Percentage as of such date times (ii) Series 2008-1 Moody’s Intermediate Enhancement Vehicle Percentage as of such date plus (c) the product of (i) the Series 2008-1 Moody’s Highest Enhancement Percentage as of such date times (ii) the Series 2008-1 Moody’s Highest Enhancement Vehicle Percentage as of such date.

“Series 2008-1 Noteholder” means the Person in whose name a Series 2008-1 Note is registered in the Note Register.

“Series 2008-1 Note Purchase Agreement” means the Note Purchase Agreement, dated as of September 12, 2008, among HVF, the Series 2008-1 Noteholders, the Administrative Agent, the Administrator, the Series 2008-1 Funding Agents, the Conduit Investors and the Committed Note Purchasers, pursuant to which the Series 2008-1 Noteholders have agreed to purchase the Series 2008-1 Notes from HVF, subject to the terms and conditions set forth therein, as amended, supplemented, restated or otherwise modified from time to time.

“Series 2008-1 Note Rate” means, for any Series 2008-1 Interest Period, the sum of (i) the weighted average of the CP Rates applicable to the Series 2008-1 CP Tranche and the weighted average of the Series 2008-1 Eurodollar Rates (Reserve Adjusted) applicable to the Series 2008-1 Eurodollar Tranche and the weighted average of the Series 2008-1 Base Rates applicable to the Series 2008-1 Base Rate Tranche, in each case, for the Series 2008-1 Interest Period and (ii) the Program Fee Rate as defined in the Series 2008-1 Note Purchase Agreement; provided, however, that the Series 2008-1 Note Rate will in no event be higher than the maximum rate permitted by applicable law.

“Series 2008-1 Notes” means any one of the Series 2008-1 Variable Funding Rental Car Asset Backed Notes, executed by HVF and authenticated by or on behalf of the Trustee, substantially in the form of Exhibit A.

“Series 2008-1 Notice of Reduction” means a notice in the form of Annex E to a Series 2008-1 Letter of Credit.

 “Series 2008-1 Outstanding Principal Amount” means, when used with respect to any date, an amount equal to (a) the sum of (i) Series 2008-1 Initial Principal Amount plus (ii), without duplication, the sum of the Additional Investor Group Initial Principal Amounts for each Additional Investor Group as of such date minus (b) the amount of principal payments (whether pursuant to a Decrease, a redemption or otherwise) made to the Series 2008-1 Noteholders on or prior to such date plus (c) any Increases in the Series 2008-1 Principal Amount pursuant to Section 2.1(a) of this Series Supplement on or prior to such date; provided that at no time may the Series 2008-1 Outstanding Principal Amount exceed the Series 2008-1 Maximum Principal Amount.

“Series 2008-1 Overcollateralization Amount” means as of any date of determination, (i) on which no Aggregate Asset Amount Deficiency exists, the Series 2008-1 Required Overcollateralization Amount as of such date or (ii) on which an

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Aggregate Asset Amount Deficiency exists, the excess, if any, of the Series 2008-1 Asset Amount over the Series 2008-1 Adjusted Principal Amount as of such date.

“Series 2008-1 Past Due Rent Payment” has the meaning specified in Section 3.2(c) of this Series Supplement.

“Series 2008-1 Percentage” means, as of any date of determination, a fraction, expressed as a percentage, the numerator of which is the Series 2008-1 Principal Amount as of such date and the denominator of which is the Aggregate Principal Amount as of such date.

 “Series 2008-1 Principal Amount” means when used with respect to any date, an amount equal to the Series 2008-1 Outstanding Principal Amount plus the amount of any principal payments made to Series 2008-1 Noteholders that have been rescinded or otherwise returned by the Series 2008-1 Noteholders for any reason; provided that, for the avoidance of doubt, for purposes of determining whether or not the Requisite Investors have given any consent, waiver, direction or instruction, the Series 2008-1 Principal Amount held by each Series 2008-1 Noteholder shall be deemed to include, without double counting, the undrawn portion of the “Maximum Purchaser Group Invested Amount” (i.e., the unutilized purchase commitments under the Series 2008-1 Note Purchase Agreement) for such Series 2008-1 Noteholder’s Investor Group.

“Series 2008-1 Principal Allocation” has the meaning specified in Section 3.2 (a)(ii) of this Series Supplement.

 “Series 2008-1 Rapid Amortization Period” means the period beginning on the earlier to occur of (i) the close of business on the Business Day immediately preceding the Expected Final Payment Date and (ii) the close of business on the Business Day immediately preceding the day on which an Amortization Event is deemed to have occurred with respect to the Series 2008-1 Notes, and ending upon the earlier to occur of (i) the date on which (A) the Series 2008-1 Notes are fully paid and (B) the termination of the Indenture.

“Series 2008-1 Rating Agency Condition” means, with respect to the Series 2008-1 Notes and any action, including the issuance of an additional Series of Notes, that each Rating Agency shall have notified HVF, the Administrative Agent and the Trustee in writing that such action will not result in a reduction or withdrawal of the then-current ratings of the Series 2008-1 Notes.

“Series 2008-1 Repurchase Amount” has the meaning specified in Section 6.1 of this Series Supplement.

 “Series 2008-1 Required Adjusted Asset Amount” means, as of any date of determination, the sum of (i) the excess, if any, of (A) the Series 2008-1 Principal Amount as of such date over (B) the sum of (1) the amount of cash and Permitted Investments on deposit in the Series 2008-1 Excess Collection Account and (2) the amount of cash and Permitted Investments on deposit in the Series 2008-1 Collection Account that, in the case of each of (i)(B)(1) and (i)(B)(2), is required to be applied to

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reduce the Series 2008-1 Principal Amount, as of such date and (ii) the Series 2008-1 Required Overcollateralization Amount as of such date.

“Series 2008-1 Required Asset Amount” means, as of any date of determination, the sum of (i) the Series 2008-1 Adjusted Principal Amount as of such date and (ii) the Series 2008-1 Required Overcollateralization Amount as of such date.

“Series 2008-1 Required Asset Amount Percentage” means, as of any date of determination, the percentage equivalent of a fraction, the numerator of which is the Series 2008-1 Required Asset Amount and the denominator of which is the Aggregate Required Asset Amount as of such date.

“Series 2008-1 Required Enhancement Amount” means, as of any date of determination, the sum of (i) the product of (x) the Series 2008-1 Required Enhancement Percentage as of such date and (y) the Series 2008-1 Adjusted Principal Amount as of such date and (ii) the Series 2008-1 Required Incremental Enhancement Amount as of such date; provided, however, that, as of any date of determination after the occurrence of a Limited Liquidation Event of Default, the Series 2008-1 Required Enhancement Amount shall equal the lesser of (x) the Series 2008-1 Adjusted Principal Amount as of such date and (y) the sum of (l) the product of the Series 2008-1 Required Enhancement Percentage as of such date of determination and the Series 2008-1 Adjusted Principal Amount as of the date of the occurrence of such Limited Liquidation Event of Default and (2) the Series 2008-1 Required Incremental Enhancement Amount as of such date of determination.

“Series 2008-1 Required Incremental Enhancement Amount” means

(i)            as of the Series 2008-1 Closing Date, $0; and

(ii)           as of any date thereafter on which the Series 2008-1 Adjusted Principal Amount is greater than zero, the product of (A) the Series 2008-1 Required Asset Amount Percentage as of the immediately preceding Business Day and (B) the sum of (1) the excess, if any, of the Non-Eligible Vehicle Amount (excluding from the calculation thereof, to the extent that an Event of Bankruptcy has occurred with respect to any of Ford, GM, Chrysler, Toyota and Honda, the Net Book Value of the HVF Vehicles (other than Non-Program Vehicles manufactured by any such Manufacturer as of the date of the occurrence of such Event of Bankruptcy) manufactured by each such Manufacturer for which an Event of Bankruptcy has occurred and any amounts related to such HVF Vehicles due from such Manufacturer) over the Series 2008-1 Maximum Non-Eligible Vehicle Amount as of such immediately preceding Business Day, (2) the excess, if any, of the Hyundai Amount over the Series 2008-1 Maximum Hyundai Amount as of such immediately preceding Business Day, (3) the excess, if any, of the Jaguar Amount over the Series 2008-1 Maximum Jaguar Amount as of such immediately preceding Business Day, (4) the excess, if any, of the Kia Amount over the Series 2008-1 Maximum Kia Amount as of such immediately preceding Business Day, (5) the excess, if any, of the Land Rover Amount over the Series 2008-1 Maximum Land Rover Amount as of such immediately preceding Business Day, (6) the excess, if any, of the Mazda Amount over

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the Series 2008-1 Maximum Mazda Amount as of such immediately preceding Business Day, (7) the excess, if any, of the Mitsubishi Amount over the Series 2008-1 Maximum Mitsubishi Amount as of such immediately preceding Business Day, (8) the excess, if any, of the Subaru Amount over the Series 2008-1 Maximum Subaru Amount as of such immediately preceding Business Day, (9) the excess, if any, of the Volvo Amount over the Series 2008-1 Maximum Volvo Amount as of such immediately preceding Business Day, (10) the excess, if any, of the Non-Eligible Manufacturer Amount over the Series 2008-1 Maximum Non-Eligible Manufacturer Amount as of such immediately preceding Business Day, (11) the excess, if any, of the Manufacturer Non-Eligible Vehicle Amount with respect to any Manufacturer (excluding from the calculation thereof, to the extent that an Event of Bankruptcy has occurred with respect to any of Ford, GM, Chrysler, Toyota and Honda, the Net Book Value of the HVF Vehicles (other than Non-Program Vehicles manufactured by any such Manufacturer as of the date of the occurrence of such Event of Bankruptcy) manufactured by each such Manufacturer for which an Event of Bankruptcy has occurred and any amounts related to such HVF Vehicles due from such Manufacturer) over the Series 2008-1 Maximum Manufacturer Non-Eligible Vehicle Amount as of such immediately preceding Business Day, (12) the excess, if any, of the Audi Amount over the Series 2008-1 Maximum Audi Amount as of such immediately preceding Business Day, (13) the excess, if any of the BMW Amount over the Series 2008-1 Maximum BMW Amount as of such immediately preceding Business Day, (14) the excess, if any of the Lexus Amount over the Series 2008-1 Maximum Lexus Amount as of such immediately preceding Business Day, (15) the excess, if any of the Mercedes Amount over the Series 2008-1 Maximum Mercedes Amount as of such immediately preceding Business Day, (16) the excess, if any of the Nissan Amount over the Series 2008-1 Maximum Nissan Amount as of such immediately preceding Business Day, (17) the excess, if any of the Volkswagen Amount over the Series 2008-1 Maximum Volkswagen Amount as of such immediately preceding Business Day, (18) the excess, if any of the Aggregate BMW/Lexus/Mercedes/Audi Amount over the Series 2008-1 Maximum Aggregate BMW/Lexus/Mercedes/Audi Amount as of such immediately preceding Business Day, (19) the excess, if any of the Aggregate Kia/Subaru/Hyundai Amount over the Series 2008-1 Maximum Aggregate Kia/Subaru/Hyundai Amount as of such immediately preceding Business Day, (20) the excess, if any of the HVF Service Vehicle Amount over the Series 2008-1 Maximum HVF Service Vehicle Amount as of such immediately preceding Business Day and (21) the excess, if any, of the Ineligible Receivable Manufacturer Receivable Amount over the Ineligible Non-Investment Grade Manufacturer Receivable Amount as of such immediately preceding Business Day.  The Manufacturer Non-Eligible Vehicle Amounts with respect to Ford, Volvo and Mazda shall be calculated on an aggregate basis so that they will be considered as one Manufacturer for the purpose of the calculation of the Series 2008-1 Maximum Manufacturer Non-Eligible Vehicle Amount for so long as each of Volvo and Mazda is an Affiliate of Ford.

“Series 2008-1 Required Enhancement Percentage” means, as of any date of determination, the greater of (i) the Series 2008-1 S&P Required Enhancement Percentage as of such date and (ii) the Series 2008-1 Moody’s Required Enhancement Percentage as of such date.

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“Series 2008-1 Required Liquidity Amount” means, as of any date of determination, an amount equal to the product of (i) the Series 2008-1 Required Liquidity Percentage as of such date times (ii) the Series 2008-1 Adjusted Principal Amount as of such date.

“Series 2008-1 Required Liquidity Percentage” means, as of any date of determination, 6.75%.

“Series 2008-1 Required Overcollateralization Amount” means, as of any date of determination, the excess, if any, of (a) the Series 2008-1 Required Enhancement Amount as of such date over (b) the sum of (i) the Series 2008-1 Available Reserve Account Amount as of such date (after giving effect to any deposits thereto and withdrawals and releases therefrom on such date) and (ii) the Series 2008-1 Letter of Credit Amount as of such date.

“Series 2008-1 Required Reserve Account Amount” means, with respect to any date of determination, an amount equal to the greater of (a) the excess, if any, of the Series 2008-1 Required Liquidity Amount over the Series 2008-1 Letter of Credit Liquidity Amount, in each case, as of such date, excluding from the calculation thereof the amount available to be drawn under any Series 2008-1 Letter of Credit if at the time of such calculation (A) such Series 2008-1 Letter of Credit shall not be in full force and effect, (B) an Event of Bankruptcy shall have occurred with respect to the Series 2008-1 Letter of Credit Provider of such Series 2008-1 Letter of Credit, (C) such Series 2008-1 Letter of Credit Provider shall have repudiated such Series 2008-1 Letter of Credit or failed to honor a draw thereon made in accordance with the terms thereof or (D) a Series 2008-1 Downgrade Event shall have occurred and be continuing for at least 30 days with respect to the Series 2008-1 Letter of Credit Provider of such Series 2008-1 Letter of Credit and (b) the excess, if any, of the Series 2008-1 Required Enhancement Amount over the Series 2008-1 Adjusted Enhancement Amount (excluding therefrom the Series 2008-1 Available Reserve Account Amount), in each case, as of such date.

“Series 2008-1 Reserve Account” has the meaning specified in Section 3.8(a) of this Series Supplement.

“Series 2008-1 Reserve Account Collateral” has the meaning specified in Section 3.8(d) of this Series Supplement.

“Series 2008-1 Reserve Account Surplus” means, with respect to any date of determination, the excess, if any, of the Series 2008-1 Available Reserve Account Amount (after giving effect to any deposits thereto and withdrawals and releases therefrom on such date) over the Series 2008-1 Required Reserve Account Amount, in each case, as of such date.

“Series 2008-1 Revolving Period” means the period from and including the Series 2008-1 Closing Date to the commencement of the Series 2008-1 Rapid Amortization Period.

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“Series 2008-1 S&P Highest Enhancement Percentage” means, with respect to any date of determination, the sum of (a) 40.00% (or such lower percentage as may be agreed to by HVF, each Funding Agent and S&P, subject to satisfaction of the Series 2008-1 Rating Agency Condition with respect to S&P) and (b) an amount equal to 100% minus the lower of (x) the lowest Non-Program Vehicle Measurement Month Average for any Measurement Month within the preceding 12 calendar months (or such fewer number of months as have elapsed since the Series 2008-1 Closing Date) and (y) the lowest Market Value Average as of any Determination Date within the preceding 12 calendar months (or such fewer number of months as have elapsed since the Series 2008-1 Closing Date).

“Series 2008-1 S&P Highest Enhancement Vehicle Percentage” means, as of any date of determination, the sum of (i) the Top Two Category 3 Manufacturer Vehicle Percentage as of such date, (ii) Non-Top Two Category 3 Manufacturer Vehicle Percentage Excess as of such date and (iii) the Bankrupt Manufacturer Vehicle Percentage as of such date.

“Series 2008-1 S&P Intermediate Enhancement Percentage” means, with respect to any date of determination, the sum of (a) 34.00% (or such lower percentage as may be agreed to by HVF, each Funding Agent and S&P, subject to satisfaction of the Series 2008-1 Rating Agency Condition with respect to S&P) and (b) an amount equal to 100% minus the lower of (x) the lowest Non-Program Vehicle Measurement Month Average for any Measurement Month within the preceding 12 calendar months (or such fewer number of months as have elapsed since the Series 2008-1 Closing Date) and (y) the lowest Market Value Average as of any Determination Date within the preceding 12 calendar months (or such fewer number of months as have elapsed since the Series 2008-1 Closing Date).

“Series 2008-1 S&P Intermediate Enhancement Vehicle Percentage” means, as of any date of determination, the excess of (i) 100% over (ii) the sum of (x) the Series 2008-1 S&P Lowest Enhancement Vehicle Percentage as of such date plus (y) the Series 2008-1 S&P Highest Enhancement Vehicle Percentage as of such date.

“Series 2008-1  S&P Lowest Enhancement Percentage” means, with respect to any date of determination, 23.50% (or such lower percentage as may be agreed to by HVF, each Funding Agent and S&P, subject to satisfaction of the Series 2008-1 Rating Agency Condition with respect to S&P).

“Series 2008-1 S&P Lowest Enhancement Vehicle Percentage” means, as of any date of determination, the sum of (a) the Category 1 Manufacturer Eligible Program Vehicle Percentage as of such date and (b) the Capped Category 2 Manufacturer Eligible Program Vehicle Percentage as of such date.

“Series 2008-1 S&P Required Enhancement Percentage” means, as of any date of determination, the sum of (a) the product of (i) the Series 2008-1 S&P Lowest Enhancement Percentage as of such date times (ii) the Series 2008-1 S&P Lowest Enhancement Vehicle Percentage as of such date plus (b) the product of (i) the Series

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2008-1 S&P Intermediate Enhancement Percentage as of such date times (ii) the Series 2008-1 S&P Intermediate Enhancement Vehicle Percentage as of such date plus (c) the product of (i) the Series 2008-1 S&P Highest Enhancement Percentage as of such date times (ii) the Series 2008-1 S&P Highest Enhancement Vehicle Percentage as of such date.

“Series 2008-1 Series Account Collateral” has the meaning specified in Section 3.1(d) of this Series Supplement.

“Series 2008-1 Series Accounts” has the meaning specified in Section 3.1(a) of this Series Supplement.

“Series Supplement” has the meaning set forth in the preamble.

“Servicer Event of Default” means the occurrence of an event that results in amounts due under the Servicer’s Senior Credit Facilities becoming immediately due and payable and that has not been waived by the lenders under such facilities.

“Standard & Poor’s First Trigger Required Ratings” means, with respect to any entity, rating requirements which are satisfied where (i) if such entity has a short-term, unsecured and unsubordinated debt obligation rating by Standard & Poor’s, such rating is “A-1” or (ii) if such entity does not have a short-term, unsecured and unsubordinated debt obligation rating by Standard & Poor’s, its unsecured and unsubordinated debt rating or counterparty rating is “A+” or above by Standard & Poor’s.

“Subaru Amount” means, as of any date of determination, an amount equal to the sum of the Manufacturer Non-Eligible Vehicle Amount and Manufacturer Eligible Program Vehicle Amount, in each case, with respect to Subaru as of such date.

“Third-Party Market Value” means, with respect to any HVF Vehicle as of any date of determination, the market value of such HVF Vehicle as specified in the Related Month’s published NADA Guide for the model class and model year of such HVF Vehicle based on the average equipment and the average mileage of each HVF Vehicle of such model class and model year; provided, that if the NADA Guide was not published in the Related Month or the NADA Guide is being published but such HVF Vehicle is not included therein, the Third-Party Market Value of such HVF Vehicle shall be based on the market value specified in the Finance Guide for the model class and model year of such HVF Vehicle based on the average equipment and the average mileage of each HVF Vehicle of such model class and model year; provided, further, that if the Finance Guide is being published but such HVF Vehicle is not included therein, the Third-Party Market Value of such HVF Vehicle shall mean the Net Book Value of such HVF Vehicle; provided, further, that if the Finance Guide was not published in the Related Month, the Third-Party Market Value of such HVF Vehicle shall be based on an independent third-party data source selected by the Servicer and approved by each Rating Agency that is rating the Series 2008-1 Notes and the Administrative Agent (such approval not to be unreasonably withheld or delayed), at the request of HVF based on the average equipment and average mileage of each HVF Vehicle of such model class and

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model year; provided, further, that if no such third-party data source or methodology shall have been so approved or any such third-party source or methodology is not available, the Third-Party Market Value of such HVF Vehicle shall be equal to a reasonable estimate of the wholesale market value of such Vehicle as determined by the Servicer, based on the Net Book Value of such Vehicle and any other factors deemed relevant by the Servicer.

“Top Two Category 3 Manufacturers” means, as of any date of determination, the two Category 3 Manufacturers with the largest portions of the Aggregate Asset Amount attributable to Vehicles manufactured by such Category 3 Manufacturers (or one or more Affiliates of such Category 3 Manufacturers) and amounts receivable from such Manufacturers (or one or more Affiliates of such Category 3 Manufacturers), in each case, as of such date.

“Top Two Category 3 Manufacturer Vehicle Amount” means, as of any date of determination, the sum of the Manufacturer Eligible Program Vehicle Amounts and Manufacturer Non-Eligible Vehicle Amounts for the Top Two Category 3 Manufacturers as of such date.

“Top Two Category 3 Manufacturer Vehicle Percentage” means, as of any date of determination, the percentage equivalent of a fraction, the numerator of which is the Top Two Category 3 Manufacturer Vehicle Amount as of such date and the denominator of which is the excess of (A) the Aggregate Asset Amount over (B) the amount of cash and Permitted Investments on deposit in the Collection Account and the HVF Exchange Account, in each case, as of such date.

“Volkswagen Amount” means, as of any date of determination, an amount equal to the sum of the Manufacturer Non-Eligible Vehicle Amount and the Manufacturer Eligible Program Vehicle Amount, in each case, with respect to Volkswagen as of such date.

“Voluntary Decrease” has the meaning specified in Section 2.2(b) of this Series Supplement.

“Volvo Amount” means, as of any date of determination, an amount equal to the sum of the Manufacturer Non-Eligible Vehicle Amount and the Manufacturer Eligible Program Vehicle Amount, in each case, with respect to Volvo as of such date.

“Voting Stock” means, with respect to any Person, shares of Capital Stock entitled to vote generally in the election of directors.

“Weekly Noteholders Statement” means, with respect to the Series 2008-1 Notes, a statement substantially in the form of Exhibit F-2 hereto.

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ARTICLE II

INITIAL ISSUANCE AND INCREASES AND DECREASES
OF PRINCIPAL AMOUNT OF SERIES 2008-1 NOTES

Section 2.1.   Initial Issuance; Procedure for Increasing the Series 2008-1 Principal Amount.

(a)           Subject to satisfaction of the conditions precedent set forth in subsection (b) of this Section 2.1 (in the case of subsections (b)(i), (b)(ii), (b)(iii), (b)(iv), (b)(v), (b)(vi), (b)(vii), (b)(viii) and (b)(x) of this Section 2.1, as evidenced by an Advance Request delivered to the Trustee as to which the Trustee may rely) (i) on the Series 2008-1 Closing Date, HVF may issue Series 2008-1 Notes in the aggregate initial principal amount equal to the Series 2008-1 Initial Principal Amount, (ii) on any Business Day during the Series 2008-1 Revolving Period, issue Additional Series 2008-1 Notes in an aggregate initial principal amount equal to the Additional Investor Group Initial Principal Amount with respect to the related Additional Investor Group and (iii) on any Business Day during the Series 2008-1 Revolving Period, HVF may, in accordance with the Series 2008-1 Note Purchase Agreement, increase the Series 2008-1 Principal Amount (such increase referred to as an “Increase”), by issuing, at par, ratable amounts of additional principal amounts of the Series 2008-1 Notes.  Each Increase shall be made in accordance with the provisions of Sections 2.02 and 2.03 of the Series 2008-1 Note Purchase Agreement and shall be ratably allocated among the Series 2008-1 Notes, based on their respective portion of the Series 2008-1 Principal Amount prior to giving effect to such Increase.  Proceeds from the initial issuance of the Series 2008-1 Notes and from any Increase shall be deposited into the Collection Account and allocated in accordance with Article III hereof.  Upon each Increase, the Trustee shall, or shall cause the Registrar to, indicate in the Note Register such Increase.

(b)           The initial Series 2008-1 Notes will be issued on the Series 2008-1 Closing Date, Additional Series 2008-1 Notes will be issued on any Business Day during the Series 2008-1 Revolving Period that an Additional Investor Group becomes a party to the Series 2008-1 Note Purchase Agreement, and the Series 2008-1 Principal Amount may be increased on any Business Day during the Series 2008-1 Revolving Period (subject to the limitations set forth in Section 2.2(a) below), in each case, pursuant to subsection (a) above, only upon satisfaction of each of the following conditions with respect to such initial issuance, such additional issuance of Additional Series 2008-1 Notes and each proposed Increase:

(i)            other than in the case of the initial issuance of the Series 2008-1 Notes on the Closing Date, the amount of such issuance or Increase shall be equal to or greater than $2,500,000 and integral multiples of $100,000 in excess thereof;

(ii)           after giving effect to such issuance or Increase, (A) the Investor Group Principal Amount with respect to each Investor Group shall not exceed the Maximum Investor Group Principal Amount with respect to such Investor Group

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and (B) the Series 2008-1 Principal Amount shall not exceed the Series 2008-1 Maximum Principal Amount;

(iii)          after giving effect to such issuance or Increase and the application of the proceeds thereof, no Series 2008-1 Enhancement Deficiency, Series 2008-1 Liquidity Deficiency or Aggregate Asset Amount Deficiency shall exist;

(iv)          after giving effect to such issuance or Increase and the application of the proceeds thereof, the amount on deposit in the Series 2008-1 Reserve Account shall be equal to or greater than the Series 2008-1 Required Reserve Account Amount;

(v)           no Series 2008-1 Amortization Event has occurred and is continuing and such issuance or Increase and the application of the proceeds thereof will not result in the occurrence of (1) an Amortization Event with respect to the Series 2008-1 Notes or a Limited Liquidation Event of Default, or (2) an event or occurrence, which, with the passing of time or the giving of notice thereof, or both, would become an Amortization Event with respect to the Series 2008-1 Notes or a Limited Liquidation Event of Default;

(vi)          all representations and warranties set forth in Article 7 of the Base Indenture shall be true and correct with the same effect as if made on and as of such date (except to the extent such representations relate to an earlier date);

(vii)         all conditions precedent to the making of advances under the Series 2008-1 Note Purchase Agreement shall have been satisfied;

(viii)        in the case of the initial issuance of the Series 2008-1 Notes on the Closing Date, receipt by HVF of a letter from each Rating Agency confirming that the Series 2008-1 Notes have been rated with the applicable Required Rating by such Rating Agency and receipt by the Trustee and the Administrative Agent of a true and correct copy thereof;

(ix)           no more than three Increases shall occur during any calendar week;

(x)            each Rating Agency shall have received prior written notice of each issuance of Additional Series 2008-1 Notes; and

(xi)           in the case of any Increase, the Series 2008-1 Letter of Credit shall have been issued and remains outstanding and in full force and effect.

Section 2.2.   Procedure for Decreasing the Series 2008-1 Principal Amount.

(a)           Mandatory Decrease.  Whenever (i) a Series 2008-1 Enhancement Deficiency exists, then, on or before the Payment Date immediately following discovery of such Series 2008-1 Enhancement Deficiency, HVF shall apply funds in the Series 2008-1 Excess Collection Account in accordance with Section 3.2(e)

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of this Series Supplement, to make a pro rata reduction in the Series 2008-1 Principal Amount (subject to the limitations specified in Section 2.2(c) below) by the lesser of (x) the amount necessary, so that after giving effect to all Decreases of the Series 2008-1 Principal Amount on such Payment Date, no such Series 2008-1 Enhancement Deficiency shall exist and (y) the amount that would reduce the Series 2008-1 Principal Amount to zero, (ii) an Aggregate Asset Amount Deficiency exists, then, on or before the Payment Date immediately following discovery of such Aggregate Asset Amount Deficiency, HVF shall allocate to and deposit in the Series 2008-1 Excess Collection Account to be applied in accordance with Section 3.2(e) of this Series Supplement, funds to make a pro rata reduction in the Series 2008-1 Principal Amount (subject to the limitations specified in Section 2.2(c) below) in an amount equal to the lesser of (x) the Series 2008-1 Invested Percentage (with respect to Principal Collections) of the amount of such Aggregate Asset Amount Deficiency and (y) the Series 2008-1 Principal Amount as of the date of application of such funds and (iii) a Series 2008-1 Excess Principal Event shall have occurred, then, on or before the Payment Date immediately following discovery of such Series 2008-1 Excess Principal Event, HVF shall allocate to and deposit in the Series 2008-1 Excess Collection Account to be applied in accordance with Section 3.2(e) of this Series Supplement, funds to make a pro rata reduction in the Series 2008-1 Principal Amount (subject to the limitations specified in Section 2.2(c) below) by the lesser of (x) the amount necessary, so that after giving effect to all Decreases of the Series 2008-1 Principal Amount on such Payment Date, no such Series 2008-1 Excess Principal Event shall exist and (y) the amount that would reduce the Series 2008-1 Principal Amount to zero (each reduction of the Series 2008-1 Principal Amount pursuant to this Section 2.2(a), a “Mandatory Decrease”); plus, with respect to each clause above, any associated breakage costs (including Series 2008-1 Commercial Paper discounts and interest scheduled to accrue through the maturity of such Series 2008-1 Commercial Paper) incurred as a result of such decrease (paid together with such decrease calculated in accordance with the procedures outlined in Section 6.1 of this Series Supplement for optional repurchases).  Such Mandatory Decrease shall be ratably allocated among the Series 2008-1 Noteholders, based on their respective portion of the Series 2008-1 Principal Amount prior to giving effect to such Mandatory Decrease.  Upon discovery of such a Series 2008-1 Enhancement Deficiency, Aggregate Asset Amount Deficiency or Series 2008-1 Excess Principal Event, HVF promptly, but in any event within 5 Business Days, shall deliver written notice (by facsimile with original to follow by mail) of any such Mandatory Decreases to the Trustee.

(b)           Voluntary Decrease.  On any Business Day, upon at least 3 Business Day’s prior notice to each Series 2008-1 Noteholder, each Committed Note Purchaser and the Trustee, HVF may decrease the Series 2008-1 Principal Amount (each such reduction of the Series 2008-1 Principal Amount pursuant to this Section 2.2(b), a “Voluntary Decrease”) by withdrawing from the Series 2008-1 Excess Collection Account or, after the Series 2008-1 Revolving Period, the Series 2008-1 Collection Account, an amount (subject to the last sentence of this Section 2.2(b)) up to the sum of all Principal Collections on deposit in such accounts and, in the case of the Series 2008-1 Excess Collection Account, available for distribution to effect a Voluntary Decrease pursuant to Section 3.2(e) of this Series Supplement, and distributing pro rata to the Series 2008-1 Noteholders in respect of principal of the Series 2008-1 Notes, the amount

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of such withdrawal in accordance with Section 3.5(d);  plus any associated breakage costs (including Series 2008-1 Commercial Paper discounts and interest scheduled to accrue through the maturity of such Series 2008-1 Commercial Paper) incurred as a result of such decrease (paid together with such decrease and calculated in accordance with the procedures outlined in Section 6.1 of this Series Supplement for optional repurchases); provided that HVF shall not effect a Voluntary Decrease pursuant to this Section 2.2(b) more than three times in any calendar week; provided further that the Trustee shall not be required to monitor the compliance of HVF with the limitation on the frequency of Voluntary Decreases set forth in the immediately preceding proviso.  Such Voluntary Decrease shall be ratably allocated among the Series 2008-1 Noteholders, based on their respective portion of the Series 2008-1 Principal Amount.  Each such Voluntary Decrease shall be, in the aggregate for all Series 2008-1 Notes, in a minimum principal amount of $5,000,000 and integral multiples of $100,000 in excess thereof.

(c)           Upon distribution to the Series 2008-1 Noteholders of principal of the Series 2008-1 Notes in connection with each Decrease, the Trustee shall, or shall cause the Registrar to indicate in the Note Register such Decrease.  The amount of any Decrease shall not exceed the amount allocated to the Series 2008-1 Excess Collection Account or the Series 2008-1 Collection Account and available for distribution to Series 2008-1 Noteholders in respect of principal of the Series 2008-1 Notes on the date of such Decrease pursuant to the terms hereof.

ARTICLE III

SERIES 2008-1 ALLOCATIONS

With respect to the Series 2008-1 Notes only, the following shall apply:

Section 3.1.   Series 2008-1 Series Accounts.

(a)           Establishment of Series 2008-1 Series Accounts.  HVF shall establish and maintain in the name of the Trustee for the benefit of the Series 2008-1 Noteholders three accounts: the Series 2008-1 Collection Account (such account, the “Series 2008-1 Collection Account”), the Series 2008-1 Accrued Interest Account (such account, the “Series 2008-1 Accrued Interest Account”) and the Series 2008-1 Excess Collection Account (such account, the “Series 2008-1 Excess Collection Account” and, together with the Series 2008-1 Collection Account and the Series 2008-1 Accrued Interest Account, the “Series 2008-1 Series Accounts”).  Each Series 2008-1 Series Account shall bear a designation clearly indicating that the funds deposited therein are held for the benefit of the Series 2008-1 Noteholders.  Each Series 2008-1 Series Account shall be an Eligible Deposit Account.  If a Series 2008-1 Series Account is at any time no longer an Eligible Deposit Account, HVF shall, within 10 Business Days of obtaining knowledge that such Series 2008-1 Series Account is no longer an Eligible Deposit Account, establish a new Series 2008-1 Series Account that is an Eligible Deposit Account.  If a new Series 2008-1 Series Account is established, HVF shall instruct the Trustee in writing to transfer all cash and investments from the non-qualifying Series 2008-1 Series Account into the new Series 2008-1 Series Account.

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Initially, each of the Series 2008-1 Series Accounts will be established with The Bank of New York.

(b)           Administration of the Series 2008-1 Series Accounts.  HVF may instruct (by standing instructions or otherwise) the institution maintaining each of the Series 2008-1 Series Accounts to invest funds on deposit in such Series 2008-1 Series Account from time to time in Permitted Investments; provided, however, that (x) any such investment in the Series 2008-1 Excess Collection Account shall mature not later than the Business Day following the date on which such funds were received (including funds received upon a payment in respect of a Permitted Investment made with funds on deposit in the Series 2008-1 Excess Collection Account) and (y) any such investment in the Series 2008-1 Collection Account or the Series 2008-1 Accrued Interest Account shall mature not later than the Business Day prior to the first Payment Date following the date on which such funds were received (including funds received upon a payment in respect of a Permitted Investment made with funds on deposit in the Series 2008-1 Collection Account or Series 2008-1 Accrued Interest Account), unless any such Permitted Investment is held with the Trustee, then such investment may mature on such Payment Date so long as such funds shall be available for withdrawal on or prior to such Payment Date.  HVF shall not direct the Trustee to dispose of (or permit the disposal of) any Permitted Investments prior to the maturity thereof to the extent such disposal would result in a loss of the initial purchase price of such Permitted Investment.  In the absence of written investment instructions hereunder, funds on deposit in the Series 2008-1 Series Accounts shall remain uninvested.

(c)           Earnings from Series 2008-1 Series Accounts.  All interest and earnings (net of losses and investment expenses) paid on funds on deposit in the Series 2008-1 Series Accounts shall be deemed to be on deposit therein and available for distribution.

(d)           Series 2008-1 Series Accounts Constitute Additional Collateral for Series 2008-1 Notes.  In order to secure and provide for the repayment and payment of the Note Obligations with respect to the Series 2008-1 Notes, HVF hereby grants a security interest in and assigns, pledges, grants, transfers and sets over to the Trustee, for the benefit of the Series 2008-1 Noteholders, all of HVF’s right, title and interest in and to the following (whether now or hereafter existing or acquired):  (i) the Series 2008-1 Series Accounts, including any security entitlement thereto; (ii) all funds on deposit therein from time to time; (iii) all certificates and instruments, if any, representing or evidencing any or all of the Series 2008-1 Series Accounts or the funds on deposit therein from time to time; (iv) all investments made at any time and from time to time with monies in the Series 2008-1 Series Accounts, whether constituting securities, instruments, general intangibles, investment property, financial assets or other property; (v) all interest, dividends, cash, instruments and other property from time to time received, receivable or otherwise distributed in respect of or in exchange for the Series 2008-1 Series Accounts, the funds on deposit therein from time to time or the investments made with such funds; and (vi) all proceeds of any and all of the foregoing, including, without limitation, cash (the items in the foregoing clauses (i) through (vi) are referred to, collectively, as the “Series 2008-1 Series Account Collateral”).

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Section 3.2.   Allocations with Respect to the Series 2008-1 Notes.  The net proceeds from the initial sale of the Series 2008-1 Notes will be deposited into the Collection Account and allocated in accordance with clause (a)(ii) of this Section 3.2 below.  All amounts payable to HVF under the Series 2008-1 Interest Rate Caps will be deposited into the Series 2008-1 Collection Account.  On each Business Day on which the proceeds of the initial sale of the Series 2008-1 Notes, any Increase or Collections are deposited into the Collection Account (each such date, a “Series 2008-1 Deposit Date”), the Administrator will direct the Trustee in writing pursuant to the Administration Agreement to apply from all amounts deposited into the Collection Account in accordance with the provisions of this Section 3.2:

(a)           Allocations of Collections During the Series 2008-1 Revolving Period.  During the Series 2008-1 Revolving Period, the Administrator will direct the Trustee in writing pursuant to the Administration Agreement, prior to 1:00 p.m. (New York City time) on each Series 2008-1 Deposit Date, to apply from all amounts deposited into the Collection Account as set forth below:

(i)            allocate to and deposit in the Series 2008-1 Collection Account an amount equal to the sum of (A) the Series 2008-1 Invested Percentage (as of such day) of the aggregate amount of Interest Collections on such day and (B) any amounts received by the Trustee in respect of the Series 2008-1 Interest Rate Caps.  All such amounts deposited into the Series 2008-1 Collection Account shall thereafter be deposited into the Series 2008-1 Accrued Interest Account; and

(ii)           allocate to and deposit in the Series 2008-1 Excess Collection Account (A) an amount equal to the Series 2008-1 Invested Percentage (as of such day) of the aggregate amount of Principal Collections on such day, (B) on the Series 2008-1 Closing Date, the net proceeds from the issuance of the Series 2008-1 Notes and (C) on the date of any Increase, the proceeds of such Increase (for any such day, the “Series 2008-1 Principal Allocation”).

(b)           Allocations of Collections During the Series 2008-1 Rapid Amortization Period.  During the Series 2008-1 Rapid Amortization Period, the Administrator will direct the Trustee in writing pursuant to the Administration Agreement, prior to 1:00 p.m. (New York City time) on any Series 2008-1 Deposit Date, to apply from all amounts deposited into the Collection Account as set forth below:

(i)            allocate to and deposit in the Series 2008-1 Collection Account an amount determined as set forth in Section 3.2(a)(i) above for such day, which amount shall be thereafter allocated to and deposited in the Series 2008-1 Accrued Interest Account; and

(ii)           allocate to and deposit in the Series 2008-1 Collection Account an amount equal to the Series 2008-1 Principal Allocation for such day, which amount shall be used to make principal payments on a pro rata basis in respect of the Series 2008-1 Notes until the Series 2008-1 Notes have been paid in full; provided that if on any Determination Date (A) the Administrator determines that

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the amount anticipated to be available from Interest Collections allocable to the Series 2008-1 Notes, any amounts payable to the Trustee in respect of any Series 2008-1 Interest Rate Caps and other amounts available pursuant to Section 3.3 of this Series Supplement to pay Series 2008-1 Monthly Interest on the next succeeding Payment Date will be less than the sum of the Series 2008-1 Monthly Interest for such Payment Date and (B) the Series 2008-1 Enhancement Amount is greater than zero, then the Administrator shall direct the Trustee in writing to withdraw from the Series 2008-1 Collection Account a portion of the Principal Collections allocated to the Series 2008-1 Notes during the Related Month equal to the lesser of such insufficiency and the Series 2008-1 Enhancement Amount and deposit such amount into the Series 2008-1 Accrued Interest Account to be treated as Interest Collections on such Payment Date.

(c)           Past Due Rental Payments.  Notwithstanding the foregoing, if, after the occurrence of a Series 2008-1 Lease Payment Deficit, the Lessee shall make a payment of Rent or other amount payable by the Lessee under the HVF Lease on or prior to the fifth Business Day after the occurrence of such Series 2008-1 Lease Payment Deficit (a “Past Due Rent Payment”), the Administrator shall direct the Trustee in writing pursuant to the Administration Agreement to allocate to and deposit in the Series 2008-1 Collection Account an amount equal to the Series 2008-1 Invested Percentage as of the date of the occurrence of such Series 2008-1 Lease Payment Deficit of the Collections attributable to such Past Due Rent Payment (the “Series 2008-1 Past Due Rent Payment”).  The Administrator shall instruct the Trustee in writing pursuant to the Administration Agreement to withdraw from the Series 2008-1 Collection Account and apply the Series 2008-1 Past Due Rent Payment in the following order:

(i)            if the occurrence of the related Series 2008-1 Lease Payment Deficit resulted in one or more Series 2008-1 LOC Credit Disbursements being made under the Series 2008-1 Letters of Credit, pay to each Series 2008-1 Letter of Credit Provider who made such a Series 2008-1 LOC Credit Disbursement for application in accordance with the provisions of the applicable Series 2008-1 Letter of Credit Reimbursement Agreement an amount equal to the lesser of (x) the unreimbursed amount of such Series 2008-1 Letter of Credit Provider’s Series 2008-1 LOC Credit Disbursement and (y) such Series 2008-1 Letter of Credit Provider’s pro rata share, calculated on the basis of the unreimbursed amount of each such Series 2008-1 Letter of Credit Provider’s Series 2008-1 LOC Credit Disbursement, of the amount of the Series 2008-1 Past Due Rent Payment;

(ii)           if the occurrence of such Series 2008-1 Lease Payment Deficit resulted in a withdrawal being made from the Series 2008-1 Cash Collateral Account, deposit in the Series 2008-1 Cash Collateral Account an amount equal to the lesser of (x) the amount of the Series 2008-1 Past Due Rent Payment remaining after any payments pursuant to clauses (i) above and (y) the amount withdrawn from the Series 2008-1 Cash Collateral Account on account of such Series 2008-1 Lease Payment Deficit;

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(iii)          if the occurrence of such Series 2008-1 Lease Payment Deficit resulted in a withdrawal being made from the Series 2008-1 Reserve Account pursuant to Section 3.3(d) of this Series Supplement, deposit in the Series 2008-1 Reserve Account an amount equal to the lesser of (x) the amount of the Series 2008-1 Past Due Rent Payment remaining after any payments pursuant to clauses (i) and (ii) above and (y) the excess, if any, of the Series 2008-1 Required Reserve Account Amount over the Series 2008-1 Available Reserve Account Amount on such day;

(iv)          deposit into the Series 2008-1 Accrued Interest Account the amount, if any, by which the Series 2008-1 Lease Interest Payment Deficit, if any, relating to such Series 2008-1 Lease Payment Deficit exceeds the amount of the Series 2008-1 Past Due Rent Payment applied pursuant to clauses (i) through (iii) above; and

(v)           deposit into the Series 2008-1 Excess Collection Account and treat as Principal Collections the remaining amount of the Series 2008-1 Past Due Rent Payment.

(d)           Amounts Allocated from Other Series.  Amounts allocated to other Series of Notes that have been reallocated by HVF to the Series 2008-1 Notes (i) during the Series 2008-1 Revolving Period shall be deposited into the Series 2008-1 Excess Collection Account and applied in accordance with Section 3.2(e) of this Series Supplement and (ii) during the Series 2008-1 Rapid Amortization Period shall be deposited into the Series 2008-1 Collection Account and applied in accordance with Section 3.2(b) of this Series Supplement to make principal payments in respect of the Series 2008-1 Notes.

(e)           Series 2008-1 Excess Collection Account.  Amounts deposited into the Series 2008-1 Excess Collection Account on any Series 2008-1 Deposit Date prior to the commencement of the Series 2008-1 Rapid Amortization Period will be (i) first, withdrawn and deposited in the Series 2008-1 Reserve Account in an amount up to the excess, if any, of the Series 2008-1 Required Reserve Account Amount for such date over the Series 2008-1 Available Reserve Account Amount for such date, (ii) second, used to make a Mandatory Decrease, if applicable, in accordance with Sections 2.2(a) and 3.5(e) of this Series Supplement, (iii) third, used to pay the principal amount of other Series of Notes that are then required to be paid or, at the option of HVF, to pay the principal amount of other Series of Notes that may be paid under the Indenture, (iv) fourth, used at the option of HVF to make a Voluntary Decrease in accordance with Sections 2.2(b) and 3.5(e) of this Series Supplement, and (v) fifth, any remaining funds may be released to HVF, in the case of clauses (iii) through (v), only to the extent that no Series 2008-1 Enhancement Deficiency or other Amortization Event with respect to the Series 2008-1 Notes would result therefrom or exist immediately thereafter.  Notwithstanding the foregoing, on the first day of the Series 2008-1 Rapid Amortization Period, all funds on deposit in the Series 2008-1 Excess Collection Account will be withdrawn from the Series 2008-1 Excess Collection Account and deposited into the

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Series 2008-1 Collection Account and applied in accordance with Section 3.2(b)(ii) of this Series Supplement.

Section 3.3.   Application of Interest Collections.

On the fourth Business Day prior to each Payment Date, as provided below, the Administrator shall instruct the Trustee in writing pursuant to the Administration Agreement to withdraw, and on such Payment Date the Trustee, acting in accordance with such instructions, shall withdraw the amounts required to be withdrawn from the Series 2008-1 Accrued Interest Account pursuant to Section 3.3(a) below in respect of all funds available from any Series 2008-1 Interest Rate Caps and Interest Collections processed since the preceding Payment Date and allocated to the holders of the Series 2008-1 Notes.

(a)           Note Interest with respect to the Series 2008-1 Notes.  On the fourth Business Day prior to each Payment Date, the Administrator shall instruct the Trustee in writing pursuant to the Administration Agreement as to the amount to be withdrawn from the Series 2008-1 Accrued Interest Account to the extent funds are anticipated to be available from Interest Collections allocable to the Series 2008-1 Notes processed from but not including the preceding Payment Date through the succeeding Payment Date and any amounts payable to HVF under any Series 2008-1 Interest Rate Cap during that period in respect of (i) first, (I) first an amount equal to the sum of (A) the Series 2008-1 Monthly Interest (excluding amounts referenced in clause (ii) of the definition thereof to the extent duplicative of Series 2008-1 Deficiency Amounts payable under clause (ii) below) for such Payment Date (the portion of such amount of Series 2008-1 Monthly Interest that will accrue for the period (each an, “Estimated Interest Period”) from and including the Determination Date immediately preceding such Payment Date to but excluding such Payment Date (such portion of the Series 2008-1 Monthly Interest with respect to any such Estimated Interest Period, the “Estimated Interest”) shall be estimated by the Administrator on such Determination Date) plus (B) the Estimated Interest Adjustment Amount with respect to such Determination Date and (II) second, an amount equal to any Indenture Carrying Charges due to the Series 2008-1 Noteholders and unpaid as of such Payment Date which are not included in the definition of Series 2008-1 Monthly Interest, (ii) second, an amount equal to the unpaid Series 2008-1 Deficiency Amounts, if any, as of the preceding Payment Date (together with any accrued interest on such Series 2008-1 Deficiency Amounts) and (iii) third, an amount equal to the Series 2008-1 Monthly Default Interest Amount, if any, for such Payment Date.  On or before 10:00 a.m. (New York City time) on the following Payment Date, the Trustee shall withdraw the amounts described in the first sentence of this Section 3.3(a), from the Series 2008-1 Accrued Interest Account and deposit such amounts into the Series 2008-1 Distribution Account.

On or before 4:00 p.m. (New York City time) on the Business Day immediately preceding each Determination Date, the Administrator shall notify the Trustee of any Estimated Interest Adjustment Amount with respect to such Determination Date, such notification to be in the form of Exhibit H to this Series Supplement (each an “Estimated Interest Adjustment Notice”).

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(b)           Lease Payment Deficit Notice.  On or before 10:00 a.m. (New York City time) on each Payment Date, the Administrator shall notify the Trustee of the amount of any Series 2008-1 Lease Payment Deficit, such notification to be in the form of Exhibit C to this Series Supplement (each a “Lease Payment Deficit Notice”).

(c)           Withdrawals from the Series 2008-1 Reserve Account.  If the Administrator determines on any Payment Date that the amounts available from the Series 2008-1 Accrued Interest Account are insufficient to pay the sum of the amounts described in clauses (i) and (ii) of Section 3.3(a) of this Series Supplement on such Payment Date, the Administrator shall instruct the Trustee in writing to withdraw from the Series 2008-1 Reserve Account and deposit in the Series 2008-1 Distribution Account on such Payment Date an amount equal to the lesser of the Series 2008-1 Available Reserve Account Amount and such insufficiency.  The Trustee shall withdraw such amount from the Series 2008-1 Reserve Account and deposit such amount in the Series 2008-1 Distribution Account.

(d)           Draws on Series 2008-1 Letters of Credit.  If the Administrator determines on any Payment Date that there exists a Series 2008-1 Lease Interest Payment Deficit, the Administrator shall instruct the Trustee in writing to draw on the Series 2008-1 Letters of Credit, if any, and, upon receipt of such notice by the Trustee on or prior to 10:30 a.m. (New York City time) on such Payment Date, the Trustee shall, by 12:00 p.m. (New York City time) on such Payment Date draw an amount, as set forth in such notice, equal to the least of (i) such Series 2008-1 Lease Interest Payment Deficit, (ii) the excess, if any, of the sum of the amounts described in clauses (i) and (ii) of Section 3.3(a) of this Series Supplement on such Payment Date over the amounts available from the Series 2008-1 Accrued Interest Account plus the amount withdrawn from the Series 2008-1 Reserve Account pursuant to Section 3.3(c) of this Series Supplement on such Payment Date and (iii) the Series 2008-1 Letter of Credit Liquidity Amount on the Series 2008-1 Letters of Credit by presenting to each Series 2008-1 Letter of Credit Provider a draft accompanied by a Series 2008-1 Certificate of Credit Demand and shall cause the Series 2008-1 LOC Credit Disbursements to be deposited in the Series 2008-1 Distribution Account on such Payment Date; provided, however, that if the Series 2008-1 Cash Collateral Account has been established and funded, the Trustee shall withdraw from the Series 2008-1 Cash Collateral Account and deposit in the Series 2008-1 Distribution Account an amount equal to the lesser of (x) the Series 2008-1 Cash Collateral Percentage on such Payment Date of the least of the amounts described in clauses (i), (ii) or (iii) above and (y) the Series 2008-1 Available Cash Collateral Account Amount on such Payment Date and draw an amount equal to the remainder of such amount on the Series 2008-1 Letters of Credit.

(e)           Deficiency Amounts.  If the amounts described in Sections 3.3(a), (b), (c) and (d) of this Series Supplement are insufficient to pay the Series 2008-1 Monthly Interest for any Payment Date, payments of interest to the Series 2008-1 Noteholders will be reduced on a pro rata basis by the amount of such deficiency.  The aggregate amount, if any, of such deficiency on any Payment Date allocable to the Series 2008-1 Notes shall be referred to as the “Series 2008-1 Deficiency Amount”.  Interest

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shall accrue on the Series 2008-1 Deficiency Amount at the applicable Series 2008-1 Note Rate.

(f)            Balance.  On the fourth Business Day prior to each Payment Date, the Administrator shall instruct the Trustee in writing pursuant to the Administration Agreement to pay, on such Payment Date, the balance (after making the payments required in Section 3.4 of this Series Supplement), if any, of the amounts available from the Series 2008-1 Accrued Interest Account as follows:

(i)            first, to the Administrator, in an amount equal to the Series 2008-1 Percentage as of the beginning of the Series 2008-1 Interest Period ending on the day preceding such Payment Date of the Monthly Administration Fee for such Series 2008-1 Interest Period;

(ii)           second, to the Trustee, in an amount equal to the Series 2008-1 Percentage as of the beginning of the Series 2008-1 Interest Period ending on the day preceding such Payment Date of the Trustee’s fees for such Series 2008-1 Interest Period;

(iii)          third, on a pro rata basis, to pay any Indenture Carrying Charges to the Persons to whom such amounts are owed, in an amount equal to the Series 2008-1 Percentage as of the beginning of the Series 2008-1 Interest Period ending on the day preceding such Payment Date of such Indenture Carrying Charges (other than Indenture Carrying Charges provided for above) for such Series 2008-1 Interest Period; and

(iv)          fourth, the balance, if any, shall be withdrawn from the Series 2008-1 Accrued Interest Account by the Trustee and (A) during the Series 2008-1 Revolving Period, deposited into the Series 2008-1 Excess Collection Account or (B) during the Series 2008-1 Rapid Amortization Period, deposited into the Series 2008-1 Collection Account and treated as Principal Collections.

(g)           Trustee Fees. If, on any Payment Date after the occurrence and during the continuance of a Liquidation Event of Default or a Limited Liquidation Event of Default, (x) the funds available to pay the Trustee fees pursuant to Section 3.3(f)(ii) of this Series Supplement on such Payment Date are less than the amount payable to the Trustee thereunder on such Payment Date or (y) the funds available to pay the portion of the Indenture Carrying Charges payable to the Trustee pursuant to Section 3.3(f)(iii) of this Series Supplement on such Payment Date are less than the amount payable to the Trustee thereunder on such Payment Date, the Administrator shall instruct the Trustee in writing to withdraw from the Series 2008-1 Reserve Account and pay to itself on such Payment Date an amount equal to the least of (A) the Series 2008-1 Available Reserve Account Amount on such Payment Date (after giving effect to any deposits thereto and withdrawals and releases therefrom on such date), (B) an amount equal to the excess, if any, of (i) 0.70% of the Series 2008-1 Required Asset Amount as of the date of the occurrence of such Liquidation Event of Default or Limited Liquidation Event of Default over (ii) the aggregate of the amounts previously withdrawn from the Series 2008-1

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Reserve Account under this Section 3.3(g) in respect of fees and other amounts due and owing to the Trustee and (C) such insufficiency.  The Trustee shall withdraw such amounts from the Series 2008-1 Reserve Account and pay or reimburse itself.

Section 3.4.   Payment of Note Interest.  On each Payment Date, the Trustee shall, in accordance with Section 6.1 of the Base Indenture, pay to the Series 2008-1 Noteholders from the Series 2008-1 Distribution Account the amount deposited in the Series 2008-1 Distribution Account for the payment of all amounts payable to the Series 2008-1 Noteholders pursuant to Section 3.3 of this Series Supplement.

Section 3.5.   Payment of Note Principal.

(a)           Monthly Payments During Series 2008-1 Rapid Amortization Period.  Commencing on the earlier to occur of (i) the Determination Date immediately preceding the Expected Final Payment Date or (ii) the first Determination Date after the commencement of the Series 2008-1 Rapid Amortization Period and on each Determination Date thereafter, the Administrator shall instruct the Trustee in writing pursuant to the Administration Agreement as to (v) the amount allocated to the Series 2008-1 Notes during the Related Month pursuant to Section 3.2(b)(ii) of this Series Supplement, as the case may be, (w) any amounts to be withdrawn from the Series 2008-1 Reserve Account and deposited into the Series 2008-1 Distribution Account, (x) any amounts to be drawn on the Series 2008-1 Letters of Credit (and/or withdrawn from the Series 2008-1 Cash Collateral Account) and (y) the amount of proceeds received in respect of a demand made under the Series 2008-1 Demand Note.  On the Payment Date following each such Determination Date, the Trustee shall withdraw the amount allocated to the Series 2008-1 Notes of each Class during the Related Month pursuant to Section 3.2(b)(ii) of this Series Supplement, as the case may be, from the Series 2008-1 Collection Account and deposit such amount together with the proceeds of any demand made on the Series 2008-1 Demand Note received during the period from and excluding the immediately preceding Payment Date to and including such Payment Date into the Series 2008-1 Distribution Account, which amount shall be paid to the Series 2008-1 Noteholders.

(b)           Principal Deficit Amount.  If the Principal Deficit Amount is greater than zero on any date or the Administrator determines that there exists a Series 2008-1 Lease Principal Payment Deficit, the Administrator shall promptly provide written notice thereof to the Administrative Agent and the Trustee.  On each Payment Date on which the Principal Deficit Amount is greater than zero or a Series 2008-1 Lease Principal Payment Deficit exists, amounts shall be transferred to the Series 2008-1 Distribution Account as follows:

(i)            Series 2008-1 Reserve Account Withdrawal.  On each Payment Date on which the Principal Deficit Amount is greater than zero, the Administrator shall instruct the Trustee in writing prior to 12:00 noon (New York City time) on such Payment Date, in the case of a Principal Deficit Amount resulting from a Series 2008-1 Lease Payment Deficit, or prior to 12:00 noon (New York City time) on the second Business Day prior to such Payment Date, in

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the case of any other Principal Deficit Amount, to withdraw from the Series 2008-1 Reserve Account, an amount equal to the lesser of (x) such Principal Deficit Amount and (y) the Series 2008-1 Available Reserve Account Amount on such Payment Date (after giving effect to any withdrawals from the Series 2008-1 Reserve Account on such Payment Date pursuant to Section 3.3(c) of this Series Supplement), and deposit such withdrawal in the Series 2008-1 Distribution Account on such Payment Date.

(ii)           Principal Draws on Series 2008-1 Letters of Credit.  If the Administrator determines on any Payment Date that there exists a Series 2008-1 Lease Principal Payment Deficit that exceeds the amount, if any, withdrawn from the Series 2008-1 Reserve Account in accordance with clause (i) of this Section 3.5(b), then the Administrator shall instruct the Trustee in writing to draw on the Series 2008-1 Letters of Credit, if any, in an amount equal to the least of (1) the excess of the Series 2008-1 Lease Principal Payment Deficit over the amount, if any, withdrawn from the Series 2008-1 Reserve Account in accordance with clause (i) of this Section 3.5(b), (2) the Series 2008-1 Letter of Credit Liquidity Amount (after giving effect to any drawings on the Series 2008-1 Letters of Credit on such Payment Date pursuant to Section 3.3(d) of this Series Supplement) and (3) on any date that is prior to the Legal Final Payment Date occurring during the period commencing on and including the date of the filing by Hertz of a petition for relief under Chapter 11 of the Bankruptcy Code to but excluding the date on which Hertz shall have resumed making all payments of Monthly Variable Rent required to be made under the HVF Lease, the excess, if any, of the Principal Deficit Amount over the amount, if any, withdrawn from the Series 2008-1 Reserve Account in accordance with clause (i) of this Section 3.5(b).  Upon receipt of a notice by the Trustee from the Administrator in respect of a Series 2008-1 Lease Principal Payment Deficit on or prior to 10:30 a.m. (New York City time) on a Payment Date, the Trustee shall, by 12:00 p.m. (New York City time) on such Payment Date draw an amount as set forth in such notice equal to the applicable amount set forth above on the Series 2008-1 Letters of Credit by presenting to each Series 2008-1 Letter of Credit Provider a draft accompanied by a Series 2008-1 Certificate of Credit Demand and shall cause the Series 2008-1 LOC Credit Disbursements to be deposited in the Series 2008-1 Distribution Account on such Payment Date; provided, however, that if the Series 2008-1 Cash Collateral Account has been established and funded, the Trustee shall withdraw from the Series 2008-1 Cash Collateral Account and deposit in the Series 2008-1 Distribution Account an amount equal to the lesser of (x) the Series 2008-1 Cash Collateral Percentage on such Payment Date of the amount set forth in the notice provided to the Trustee by the Administrator and (y) the Series 2008-1 Available Cash Collateral Account Amount on such Payment Date and draw an amount equal to the remainder of such amount on the Series 2008-1 Letters of Credit.

(iii)          Demand Note Draw.  If on any Determination Date, the Administrator determines that the Principal Deficit Amount on the next succeeding Payment Date (after giving effect to the withdrawal from the Series

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2008-1 Reserve Account on such Payment Date pursuant to clause (i) of this Section 3.5(b) of this Series Supplement and any drawings on the Series 2008-1 Letters of Credit on such Payment Date pursuant to clause (ii) of this Section 3.5(b)) will be greater than zero, then, prior to 10:00 a.m. (New York City time) on the second Business Day prior to such Payment Date, the Administrator shall instruct the Trustee in writing (and provide the requisite information to the Trustee) to deliver a demand notice substantially in the form of Exhibit G-1 (each a “Demand Notice”) on Hertz for payment under the Series 2008-1 Demand Note in an amount equal to the lesser of (i) the Principal Deficit Amount less the amount to be deposited in the Series 2008-1 Distribution Account in accordance with clauses (i) and/or (ii) of this Section 3.5(b) of this Series Supplement and (ii) the principal amount of the Series 2008-1 Demand Note.  The Trustee shall, prior to 12:00 noon (New York City time) on the second Business Day preceding such Payment Date, deliver such Demand Notice to Hertz; provided, however, that if an Event of Bankruptcy (or the occurrence of an event described in clause (a) of the definition thereto, without the lapse of a period of 60 consecutive days) with respect to Hertz shall have occurred and be continuing, the Trustee shall not be required to deliver such Demand Notice to Hertz.  The Trustee shall cause the proceeds of any demand on the Series 2008-1 Demand Note to be deposited into the Series 2008-1 Distribution Account, and such proceeds shall be treated as Principal Collections for all purposes hereunder.

(iv)          Letter of Credit Draw.  If (1) the Trustee shall have delivered a Demand Notice as provided in Section 3.5(b)(iii) of this Series Supplement and Hertz shall have failed to pay to the Trustee or deposit into the Series 2008-1 Distribution Account the amount specified in such Demand Notice in whole or in part by 12:00 noon (New York City time) on the Business Day following the making of the Demand Notice, (2) due to the occurrence of an Event of Bankruptcy (or the occurrence of an event described in clause (a) of the definition thereof, without the lapse of a period of 60 consecutive days) with respect to Hertz, the Trustee shall not have delivered such Demand Notice to Hertz or (3) there is a Preference Amount, the Trustee shall draw on the Series 2008-1 Letters of Credit, if any, by 12:00 p.m. (New York City time) on such Business Day in an amount equal to the lesser of (A) the amount that Hertz failed to pay under the Series 2008-1 Demand Note, the amount that the Trustee failed to demand for payment thereunder or the Preference Amount, as the case may be; and (B) the Series 2008-1 Letter of Credit Amount on such Business Day, by presenting to each Series 2008-1 Letter of Credit Provider a draft accompanied by a Series 2008-1 Certificate of Unpaid Demand Note Demand or, in the case of a Preference Amount, a Series 2008-1 Certificate of Preference Payment Demand; provided, however that if the Series 2008-1 Cash Collateral Account has been established and funded, the Trustee shall withdraw from the Series 2008-1 Cash Collateral Account and deposit in the Series 2008-1 Distribution Account an amount equal to the lesser of (x) the Series 2008-1 Cash Collateral Percentage on such Business Day of the lesser of the amounts set forth in clause (A) and (B) above and (y) the Series 2008-1 Available Cash Collateral Account Amount on such Business Day and draw an amount equal to the remainder of such amount on

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the Series 2008-1 Letters of Credit.  The Trustee shall deposit, or cause the deposit of, the proceeds of any such draw on the Series 2008-1 Letters of Credit and the proceeds of any such withdrawal from the Series 2008-1 Cash Collateral Account into the Series 2008-1 Collection Account and such proceeds shall be treated as Principal Collections for the Related Month.

(c)           Legal Final Payment Dates.  The Series 2008-1 Principal Amount shall be due and payable on the Legal Final Payment Date.  In connection therewith:

(i)            Reserve Account Withdrawal.  If the amount to be deposited in the Series 2008-1 Distribution Account in accordance with Section 3.5(a) of this Series Supplement with respect to the Legal Final Payment Date together with any amounts to be deposited therein in accordance with Section 3.5(b) of this Series Supplement on the Legal Final Payment Date, in each case, to pay principal of the Series 2008-1 Notes, is less than the Series 2008-1 Principal Amount on the Legal Final Payment Date, prior to 10:30 a.m. (New York City time) on the second Business Day prior to the Legal Final Payment Date, the Administrator shall instruct the Trustee to withdraw from the Series 2008-1 Reserve Account, an amount equal to the lesser of (i) the Series 2008-1 Available Reserve Account Amount (after giving effect to any withdrawals from the Series 2008-1 Reserve Account pursuant to Section 3.3(c) and Section 3.5(b)(i) of this Series Supplement), and (ii) such insufficiency, and deposit such withdrawn amounts in the Series 2008-1 Distribution Account on the Legal Final Payment Date.  The Trustee shall withdraw such amounts from the Series 2008-1 Reserve Account and deposit such amounts in the Series 2008-1 Distribution Account on or prior to the Legal Final Payment Date.

(ii)           Demand Note Draw.  If the amount to be deposited in the Series 2008-1 Distribution Account pursuant to Section 3.5(a) of this Series Supplement together with any amounts to be deposited therein in accordance with Section 3.5(b) and Section 3.5(c)(i) of this Series Supplement on the Legal Final Payment Date is less than the Series 2008-1 Principal Amount, then, prior to 10:00 a.m. (New York City time) on the second Business Day prior to the Legal Final Payment Date, the Administrator shall instruct the Trustee in writing (and provide the requisite information to the Trustee) to deliver a Demand Notice to Hertz for payment under the Series 2008-1 Demand Note in an amount equal to the lesser of (i) such insufficiency and (ii) the principal amount of the Series 2008-1 Demand Note.  The Trustee shall, prior to 12:00 noon (New York City time) on the second Business Day preceding the Legal Final Payment Date, deliver such Demand Notice to Hertz; provided, however, that if an Event of Bankruptcy (or the occurrence of an event described in clause (a) of the definition thereof, without the lapse of a period of 60 consecutive days) with respect to Hertz shall have occurred and be continuing, the Trustee shall not be required to deliver such Demand Notice to Hertz.  The Trustee shall cause the proceeds of any demand on the Series 2008-1 Demand Note to be deposited into the Series 2008-1 Distribution Account, and such proceeds shall be treated as Principal Collections for all purposes hereunder.

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(iii)          Letter of Credit Draw.  If (1) the Trustee shall have delivered a Demand Notice as provided in Section 3.5(c)(ii) of this Series Supplement and Hertz shall have failed to pay to the Trustee or deposit into the Series 2008-1 Distribution Account the amount specified in such Demand Notice referred to in Section 3.5(c)(ii) of this Series Supplement in whole or in part by 12:00 noon (New York City time) on the Business Day following the making of the Demand Notice, (2) due to the occurrence of an Event of Bankruptcy (or the occurrence of an event described in clause (a) of the definition thereof, without the lapse of a period of 60 consecutive days) with respect to Hertz, the Trustee shall not have delivered such Demand Notice to Hertz or (3) there is a Preference Amount, the Trustee shall draw on the Series 2008-1 Letters of Credit, if any, by 12:00 p.m. (New York City time) on such Business Day an amount equal to the lesser of (A) the amount that Hertz failed to pay under the Series 2008-1 Demand Note (or the amount that the Trustee failed to demand for payment thereunder) or the Preference Amount, as the case may be; and (B) the Series 2008-1 Letter of Credit Amount on such Business Day, by presenting to each Series 2008-1 Letter of Credit Provider a draft accompanied by a Series 2008-1 Certificate of Unpaid Demand Note Demand or, in the case of a Preference Amount, a Series 2008-1 Certificate of Preference Demand; provided, however that if the Series 2008-1 Cash Collateral Account has been established and funded, the Trustee shall withdraw from the Series 2008-1 Cash Collateral Account and deposit in the Series 2008-1 Distribution Account an amount equal to the lesser of (x) the Series 2008-1 Cash Collateral Percentage on such Business Day of the lesser of the amounts set forth in clause (A) and (B) above and (y) the Series 2008-1 Available Cash Collateral Account Amount on such Business Day and draw an amount equal to the remainder of such amount on the Series 2008-1 Letters of Credit.  The Trustee shall deposit, or cause the deposit of, the proceeds of any such draw on the Series 2008-1 Letters of Credit and the proceeds of any such withdrawal from the Series 2008-1 Cash Collateral Account into the Series 2008-1 Collection Account and such proceeds shall be treated as Principal Collections for the Related Month.

(d)           Distribution.  On each Payment Date occurring on or after the date a withdrawal is made pursuant to Section 3.5(a) of this Series Supplement, the Trustee shall, in accordance with Section 6.1 of the Base Indenture, pay to the Series 2008-1 Noteholders the amount deposited in the Series 2008-1 Distribution Account for the payment of principal of the Series 2008-1 Notes held by such Series 2008-1 Noteholders pursuant to Section 3.5(a) of this Series Supplement and any amounts deposited in the Series 2008-1 Distribution Account for the payment of principal of such Series 2008-1 Notes pursuant to Section 3.5(b) of this Series Supplement and amounts deposited in the Series 2008-1 Distribution Account pursuant to Section 3.5(c) of this Series Supplement.

(e)           Decreases.  (i)  On any Business Day on which (a) a Mandatory Decrease pursuant to Section 2.2(a) of this Series Supplement shall be declared, the Trustee shall withdraw from the Series 2008-1 Excess Collection Account in accordance with the written instructions of the Administrator an amount equal to the lesser of (x) the

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funds then allocated to the Series 2008-1 Excess Collection Account (including proceeds from any Increase) pursuant to Section 3.2(a)(ii) or (b)(ii) of this Series Supplement and any amounts allocated by HVF to the Series 2008-1 Excess Collection Account pursuant to Section 3.2(d) of this Series Supplement) and, in each case, available for payment of such Mandatory Decrease pursuant to Section 3.2(e) of this Series Supplement and (y) the amount of such Mandatory Decrease, and distribute on a pro rata basis such amount to the Series 2008-1 Noteholders as a payment of principal or (b) a Voluntary Decrease pursuant to Section 2.2(b) and 3.2(e) of this Series Supplement shall be declared, the Trustee shall distribute the amounts withdrawn from the Series 2008-1 Excess Collection Account and/or the Series 2008-1 Collection Account pursuant to Section 3.2(b) of this Series Supplement in connection with such Voluntary Decrease to the Series 2008-1 Noteholders as a payment of principal.

(ii) On the Expected Final Payment Date, the Trustee shall withdraw from the Series 2008-1 Excess Collection Account in accordance with the written instructions of the Administrator an amount equal to the lesser of (x) the funds then allocated to the Series 2008-1 Excess Collection Account (including proceeds from any Increase) pursuant to Section 3.2(a)(ii) or (b)(ii) of this Series Supplement and any amounts allocated by HVF to the Series 2008-1 Excess Collection Account pursuant to Section 3.2(d) of this Series Supplement) and, in each case, available for payment of principal of the Series 2008-1 Notes pursuant to Section 3.2(e) of this Series Supplement and (y) the Series 2008-1 Principal Amount on such date, and distribute such amount to the Series 2008-1 Noteholders on a pro rata basis as payment of principal of the Series 2008-1 Notes until the Series 2008-1 Noteholders have been paid the Series 2008-1 Principal Amount in full.

Section 3.6.   Payment by Wire Transfer.  On each Payment Date, pursuant to Section 6.1 of the Base Indenture and Sections 3.4 and 3.5 hereof, the Trustee shall cause the amounts (to the extent received by the Trustee) set forth in Section 3.4 or 3.5 of this Series Supplement to be paid by wire transfer of immediately available funds released from the Series 2008-1 Distribution Account no later than 4:30 p.m. (New York City time) for credit to the account designated by the Series 2008-1 Noteholders.

Section 3.7.   The Administrator’s Failure to Instruct the Trustee to Make a Deposit or Payment.  If the Administrator fails to give notice or instructions to make any payment from or deposit into the Collection Account or any Series 2008-1 Series Account required to be given by the Administrator, at the time specified in the Administration Agreement or any other Related Document (including applicable grace periods), the Trustee shall make such payment or deposit into or from the Collection Account or such Series 2008-1 Series Account without such notice or instruction from the Administrator, provided that the Administrator, upon request of the Trustee, the Administrative Agent or any Funding Agent, promptly provides the Trustee with all information necessary to allow the Trustee to make such a payment or deposit.  When any payment or deposit hereunder or under any other Related Document is required to be made by the Trustee at or prior to a specified time, the Administrator shall deliver any applicable written instructions with respect thereto reasonably in advance of such specified time.  If the Administrator fails to give instructions to draw on any Series

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2008-1 Letters of Credit with respect to a Class of Series 2008-1 Notes required to be given by the Administrator, at the time specified in this Series Supplement, the Trustee shall draw on such Series 2008-1 Letters of Credit with respect to such Class of Series 2008-1 Notes without such instruction from the Administrator, provided that the Administrator, upon request of the Trustee, the Administrative Agent or any Funding Agent, promptly provides the Trustee with all information necessary to allow the Trustee to draw on each such Series 2008-1 Letter of Credit.

Section 3.8.   Series 2008-1 Reserve Account.

(a)           Establishment of Series 2008-1 Reserve Account.  HVF shall establish and maintain in the name of the Trustee for the benefit of the Series 2008-1 Noteholders an account (the “Series 2008-1 Reserve Account”), bearing a designation clearly indicating that the funds deposited therein are held for the benefit of the Series 2008-1 Noteholders.  The Series 2008-1 Reserve Account shall be an Eligible Deposit Account.  If the Series 2008-1 Reserve Account is at any time no longer an Eligible Deposit Account, HVF shall, within 10 Business Days of obtaining knowledge that the Series 2008-1 Reserve Account is no longer an Eligible Deposit Account, establish a new Series 2008-1 Reserve Account that is an Eligible Deposit Account.  If a new Series 2008-1 Reserve Account is established, HVF shall instruct the Trustee in writing to transfer all cash and investments from the non-qualifying Series 2008-1 Reserve Account into the new Series 2008-1 Reserve Account.  Initially, the Series 2008-1 Reserve Account will be established with the Trustee.

(b)           Administration of the Series 2008-1 Reserve Account.  HVF may instruct (by standing instructions or otherwise) the institution maintaining the Series 2008-1 Reserve Account to invest funds on deposit in the Series 2008-1 Reserve Account from time to time in Permitted Investments; provided, however, that any such investment shall mature not later than the Business Day prior to the first Payment Date following the date on which such funds were received (including funds received upon a payment in respect of a Permitted Investment made with funds on deposit in the Series 2008-1 Reserve Account), unless any Permitted Investment held in the Series 2008-1 Reserve Account is held with the Trustee, then such investment may mature on such Payment Date so long as such funds shall be available for withdrawal on or prior to such Payment Date.  HVF shall not direct the Trustee to dispose of (or permit the disposal of) any Permitted Investments prior to the maturity thereof to the extent such disposal would result in a loss of the initial purchase price of such Permitted Investment.  In the absence of written investment instructions hereunder, funds on deposit in the Series 2008-1 Reserve Account shall remain uninvested.

(c)           Earnings from Series 2008-1 Reserve Account.  All interest and earnings (net of losses and investment expenses) paid on funds on deposit in the Series 2008-1 Reserve Account shall be deemed to be on deposit therein and available for distribution.

(d)           Series 2008-1 Reserve Account Constitutes Additional Collateral for Series 2008-1 Notes.  In order to secure and provide for the repayment and payment

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of the Note Obligations with respect to the Series 2008-1 Notes, HVF hereby grants a security interest in and assigns, pledges, grants, transfers and sets over to the Trustee, for the benefit of the Series 2008-1 Noteholders, all of HVF’s right, title and interest in and to the following (whether now or hereafter existing or acquired):  (i) the Series 2008-1 Reserve Account, including any security entitlement thereto; (ii) all funds on deposit therein from time to time; (iii) all certificates and instruments, if any, representing or evidencing any or all of the Series 2008-1 Reserve Account or the funds on deposit therein from time to time; (iv) all investments made at any time and from time to time with monies in the Series 2008-1 Reserve Account, whether constituting securities, instruments, general intangibles, investment property, financial assets or other property; (v) all interest, dividends, cash, instruments and other property from time to time received, receivable or otherwise distributed in respect of or in exchange for the Series 2008-1 Reserve Account, the funds on deposit therein from time to time or the investments made with such funds; and (vi) all proceeds of any and all of the foregoing, including, without limitation, cash (the items in the foregoing clauses (i) through (vi) are referred to, collectively, as the “Series 2008-1 Reserve Account Collateral”).

(e)           Series 2008-1 Reserve Account Surplus.  In the event that the Series 2008-1 Reserve Account Surplus on any Payment Date is greater than zero, the Trustee, acting in accordance with the written instructions of the Administrator (with a copy to the Administrative Agent), shall withdraw from the Series 2008-1 Reserve Account an amount equal to the Series 2008-1 Reserve Account Surplus and pay such Series 2008-1 Reserve Account Surplus to HVF.

(f)            Termination of Series 2008-1 Reserve Account.  On or after the date on which the Series 2008-1 Notes are fully paid, the Trustee, acting in accordance with the written instructions of the Administrator, shall withdraw from the Series 2008-1 Reserve Account all remaining amounts on deposit therein for payment to HVF.

Section 3.9.   Series 2008-1 Letters of Credit and Series 2008-1 Cash Collateral Accounts.

(a)           Series 2008-1 Cash Collateral Account Constitutes Additional Collateral for Series 2008-1 Notes.  In order to secure and provide for the repayment and payment of the Note Obligations with respect to the Series 2008-1 Notes, HVF hereby grants a security interest in and assigns, pledges, grants, transfers and sets over to the Trustee, for the benefit of the Series 2008-1 Noteholders, all of HVF’s right, title and interest in and to the following (whether now or hereafter existing or acquired):  (i) the Series 2008-1 Cash Collateral Account, including any security entitlement thereto; (ii) all funds on deposit in the Series 2008-1 Cash Collateral Account from time to time; (iii) all certificates and instruments, if any, representing or evidencing any or all of the Series 2008-1 Cash Collateral Account or the funds on deposit therein from time to time; (iv) all investments made at any time and from time to time with monies in the Series 2008-1 Cash Collateral Account, whether constituting securities, instruments, general intangibles, investment property, financial assets or other property; (v) all interest, dividends, cash, instruments and other property from time to time received, receivable or otherwise distributed in respect of or in exchange for the Series 2008-1 Cash Collateral Account,

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the funds on deposit therein from time to time or the investments made with such funds; and (vi) all proceeds of any and all of the foregoing, including, without limitation, cash (the items in the foregoing clauses (i) through (vi) are referred to, collectively, as the “Series 2008-1 Cash Collateral Account Collateral”).

(b)           Series 2008-1 Letter of Credit Expiration Date. If prior to the date which is sixteen (16) Business Days prior to the then scheduled Series 2008-1 Letter of Credit Expiration Date with respect to any Series 2008-1 Letter of Credit, excluding the amount available to be drawn under such Series 2008-1 Letter of Credit but taking into account each substitute Series 2008-1 Letter of Credit which has been obtained from a Series 2008-1 Eligible Letter of Credit Provider and is in full force and effect on such date, (i) the Series 2008-1 Adjusted Enhancement Amount would be equal to or greater than the Series 2008-1 Required Enhancement Amount, (ii) the Series 2008-1 Adjusted Liquidity Amount would be equal to or greater than the Series 2008-1 Required Liquidity Amount, or (iii) the Series 2008-1 Letter of Credit Liquidity Amount would be equal to or greater than the Series 2008-1 Demand Note Payment Amount, then the Administrator shall notify the Trustee and the Administrative Agent in writing no later than fifteen (15) Business Days prior to such Series 2008-1 Letter of Credit Expiration Date of such determination.  If prior to the date which is sixteen (16) Business Days prior to the then scheduled Series 2008-1 Letter of Credit Expiration Date with respect to any Series 2008-1 Letter of Credit, excluding such Series 2008-1 Letter of Credit but taking into account any substitute Series 2008-1 Letter of Credit which has been obtained from a Series 2008-1 Eligible Letter of Credit Provider and is in full force and effect on such date, (i)  the Series 2008-1 Adjusted Enhancement Amount would be less than the Series 2008-1 Required Enhancement Amount, (ii) the Series 2008-1 Adjusted Liquidity Amount would be less than the Series 2008-1 Required Liquidity Amount, or (iii) the Series 2008-1 Letter of Credit Liquidity Amount would be less than the Series 2008-1 Demand Note Payment Amount, then the Administrator shall notify the Trustee and the Administrative Agent in writing no later than fifteen (15) Business Days prior to such Series 2008-1 Letter of Credit Expiration Date of (x) the greatest of (A) the excess, if any, of the Series 2008-1 Required Enhancement Amount over the Series 2008-1 Adjusted Enhancement Amount, excluding such Series 2008-1 Letter of Credit but taking into account any substitute Series 2008-1 Letter of Credit which has been obtained from a Series 2008-1 Eligible Letter of Credit Provider and is in full force and effect on such date, (B) the excess, if any, of the Series 2008-1 Required Liquidity Amount over the Series 2008-1 Adjusted Liquidity Amount, excluding such Series 2008-1 Letter of Credit but taking into account each substitute Series 2008-1 Letter of Credit which has been obtained from a Series 2008-1 Eligible Letter of Credit Provider and is in full force and effect on such date, and (C) the excess, if any, of the Series 2008-1 Demand Note Payment Amount over the Series 2008-1 Letter of Credit Liquidity Amount, excluding such Series 2008-1 Letter of Credit but taking into account each substitute Series 2008-1 Letter of Credit which has been obtained from a Series 2008-1 Eligible Letter of Credit Provider and is in full force and effect on such date, and (y) the amount available to be drawn on such expiring Series 2008-1 Letter of Credit on such date.  Upon receipt of such notice by the Trustee on or prior to 10:30 a.m. (New York City time) on any Business Day, the Trustee shall, by 12:00 p.m. (New York City time) on such Business Day (or, in the case of any notice given to the Trustee after 10:30 a.m. (New York City time), by 12:00 p.m. (New York City time)

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on the next following Business Day), draw the lesser of the amounts set forth in clauses (x) and (y) above on such Series 2008-1 Letter of Credit by presenting a draft accompanied by a Series 2008-1 Certificate of Termination Demand and shall cause the Series 2008-1 LOC Termination Disbursements to be deposited in the Series 2008-1 Cash Collateral Account.  If the Trustee does not receive the notice from the Administrator described above on or prior to the date that is fifteen (15) Business Days prior to each Series 2008-1 Letter of Credit Expiration Date, the Trustee shall, by 12:00 p.m. (New York City time) on such Business Day draw the full amount of such Series 2008-1 Letter of Credit by presenting a draft accompanied by a Series 2008-1 Certificate of Termination Demand and shall cause the Series 2008-1 LOC Termination Disbursements to be deposited in the applicable Series 2008-1 Cash Collateral Account.

(c)           Series 2008-1 Letter of Credit Providers.  The Administrator shall notify the Trustee and the Administrative Agent in writing within one Business Day of becoming aware that the short-term debt credit rating of any Series 2008-1 Letter of Credit Provider has fallen below “A-1” as determined by Standard & Poor’s or “P-1” as determined by Moody’s or the long-term debt credit rating of any Series 2008-1 Letter of Credit Provider has fallen below “A+” as determined by Standard & Poor’s or “A1” as determined by Moody’s (with respect to any Series 2008-1 Letter of Credit Provider, a “Series 2008-1 Downgrade Event”).  On the thirtieth (30th) day after the occurrence of a Series 2008-1 Downgrade Event with respect to any Series 2008-1 Letter of Credit Provider, the Administrator shall notify the Trustee and the Administrative Agent in writing on such date of (i) the greatest of (A) the excess, if any, of the Series 2008-1 Required Enhancement Amount over the Series 2008-1 Adjusted Enhancement Amount, excluding the available amount under the Series 2008-1 Letter of Credit issued by such Series 2008-1 Letter of Credit Provider, on such date, (B) the excess, if any, of the Series 2008-1 Required Liquidity Amount over the Series 2008-1 Adjusted Liquidity Amount, excluding the available amount under such Series 2008-1 Letter of Credit, on such date, and (C) the excess, if any, of the Series 2008-1 Demand Note Payment Amount over the Series 2008-1 Letter of Credit Liquidity Amount, excluding the available amount under such Series 2008-1 Letter of Credit, on such date, and (ii) the amount available to be drawn on such Series 2008-1 Letter of Credit on such date.  Upon receipt of such notice by the Trustee on or prior to 10:30 a.m. (New York City time) on any Business Day, the Trustee shall, by 12:00 p.m. (New York City time) on such Business Day (or, in the case of any notice given to the Trustee after 10:30 a.m. (New York City time), by 12:00 p.m. (New York City time) on the next following Business Day), draw on such Series 2008-1 Letter of Credit in an amount equal to the lesser of the amount in clause (i) or clause (ii) of the immediately preceding sentence on such Business Day by presenting a draft accompanied by a Series 2008-1 Certificate of Termination Demand and shall cause the Series 2008-1 LOC Termination Disbursement to be deposited in a Series 2008-1 Cash Collateral Account.

(d)           Reductions in Stated Amounts of the Series 2008-1 Letters of Credit.  If the Trustee receives a written notice from the Lessee, substantially in the form of Exhibit D, requesting a reduction in the stated amount of any Series 2008-1 Letter of Credit, the Trustee shall within two Business Days of the receipt of such notice deliver to the Series 2008-1 Letter of Credit Provider who issued such Series 2008-1

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Letter of Credit a Series 2008-1 Notice of Reduction requesting a reduction in the stated amount of such Series 2008-1 Letter of Credit in the amount requested in such notice effective on the date set forth in such notice, provided that on such effective date, after giving effect to the requested reduction in the stated amount of such Series 2008-1 Letter of Credit, (i) the Series 2008-1 Adjusted Enhancement Amount will equal or exceed the Series 2008-1 Required Enhancement Amount, (ii) the Series 2008-1 Adjusted Liquidity Amount will equal or exceed the Series 2008-1 Required Liquidity Amount, and (iii) the Series 2008-1 Letter of Credit Liquidity Amount will equal or exceed the Series 2008-1 Demand Note Payment Amount.

(e)           Draws on the Series 2008-1 Letters of Credit.  If there is more than one Series 2008-1 Letter of Credit on the date of any draw on the Series 2008-1 Letters of Credit pursuant to the terms of this Series Supplement (other than pursuant to Sections 3.9(b) and (c) of this Series Supplement), the Administrator shall instruct the Trustee, in writing, to draw on each Series 2008-1 Letter of Credit in an amount equal to the Pro Rata Share of the Series 2008-1 Letter of Credit Provider issuing such Series 2008-1 Letter of Credit of the amount of such draw on the Series 2008-1 Letters of Credit.

(f)            Establishment of Series 2008-1 Cash Collateral Account.  On or prior to the date of any drawing under a Series 2008-1 Letter of Credit pursuant to Section 3.9(b) or (c) of this Series Supplement, HVF shall establish and maintain in the name of the Trustee for the benefit of the Series 2008-1 Noteholders, an account (the “Series 2008-1 Cash Collateral Account”), bearing a designation clearly indicating that the funds deposited therein are held for the benefit of the Series 2008-1 Noteholders.  The Series 2008-1 Cash Collateral Account shall be an Eligible Deposit Account.  If the Series 2008-1 Cash Collateral Account is at any time no longer an Eligible Deposit Account, HVF shall, within 10 Business Days of obtaining knowledge that the Series 2008-1 Cash Collateral Account is no longer an Eligible Deposit Account, establish a new Series 2008-1 Cash Collateral Account that is an Eligible Deposit Account.  If a new Series 2008-1 Cash Collateral Account is established, HVF shall instruct the Trustee in writing to transfer all cash and investments from the non-qualifying Series 2008-1 Cash Collateral Account into the new Series 2008-1 Cash Collateral Account

(g)           Administration of the Series 2008-1 Cash Collateral Account.  HVF may instruct (by standing instructions or otherwise) the institution maintaining a Series 2008-1 Cash Collateral Account to invest funds on deposit in a Series 2008-1 Cash Collateral Account from time to time in Permitted Investments.  Any investment of funds on deposit in a Series 2008-1 Cash Collateral Account shall mature not later than the Business Day prior to the first Payment Date following the date on which such funds were received (including funds received upon a payment in respect of a Permitted Investment made with funds on deposit in a Series 2008-1 Cash Collateral Account), unless any Permitted Investment held in such Series 2008-1 Cash Collateral Account is held with the Trustee, in which case such investment may mature on such Payment Date so long as such funds shall be available for withdrawal on or prior to such Payment Date.  HVF shall not direct the Trustee to dispose of (or permit the disposal of) any Permitted Investments prior to the maturity thereof to the extent such disposal would result in a loss of the initial purchase price of such Permitted Investment.  In the absence of written

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investment instructions hereunder, funds on deposit in a Series 2008-1 Cash Collateral Account shall remain uninvested.

(h)           Earnings from Series 2008-1 Cash Collateral Account.  All Series 2008-1 Cash Collateral Account Interest and Earnings shall be deemed to be on deposit therein and available for distribution.

(i)            Series 2008-1 Cash Collateral Account Surplus.  In the event that the Series 2008-1 Cash Collateral Account Surplus on any Payment Date is greater than zero, the Administrator may direct the Trustee to, and the Trustee, acting in accordance with the written instructions of the Administrator (with a copy to the Administrative Agent), shall, subject to the limitations set forth in this Section 3.9(i), withdraw the amount specified by the Administrator from the Series 2008-1 Cash Collateral Account specified by the Administrator and apply such amount in accordance with the terms of this Section 3.9(i).  The amount of any such withdrawal from the Series 2008-1 Cash Collateral Account shall be limited to the least of (a) the Series 2008-1 Available Cash Collateral Account Amount on such Payment Date, (b) the Series 2008-1 Cash Collateral Account Surplus on such Payment Date and (c) the excess, if any, of the Series 2008-1 Letter of Credit Liquidity Amount on such Payment Date over the Series 2008-1 Demand Note Payment Amount on such Payment Date.  Any amounts withdrawn from the Series 2008-1 Cash Collateral Account pursuant to this Section 3.9(i) shall be paid:  first, to the Series 2008-1 Letter of Credit Providers, to the extent that there are unreimbursed Series 2008-1 Disbursements due and owing to such Series 2008-1 Letter of Credit Providers in respect of the Series 2008-1 Letters of Credit, for application in accordance with the provisions of the respective Series 2008-1 Letter of Credit Reimbursement Agreement, and second, to HVF any remaining amounts.

(j)            Termination of Series 2008-1 Cash Collateral Account.  Upon the termination of this Series Supplement in accordance with its terms, the Trustee, acting in accordance with the written instructions of the Administrator, after the prior payment of all amounts due and owing to the Series 2008-1 Noteholders and payable from the Series 2008-1 Cash Collateral Account as provided herein, shall withdraw from such Series 2008-1 Cash Collateral Account all amounts on deposit therein and shall pay such amounts, first, pro rata to the Series 2008-1 Letter of Credit Providers, to the extent that there are unreimbursed Series 2008-1 Disbursements due and owing to such Series 2008-1 Letter of Credit Providers, for application in accordance with the provisions of the respective Series 2008-1 Letters of Credit, and second, to HVF any remaining amounts.

Section 3.10.   Series 2008-1 Distribution Account.

(a)           Establishment of Series 2008-1 Distribution Account.  The Trustee shall establish and maintain in the name of the Trustee for the benefit of the Series 2008-1 Noteholders an account (the “Series 2008-1 Distribution Account”), bearing a designation clearly indicating that the funds deposited therein are held for the benefit of the Series 2008-1 Noteholders.  The Series 2008-1 Distribution Account shall be an Eligible Deposit Account.  If the Series 2008-1 Distribution Account is at any time no longer an Eligible Deposit Account, HVF shall, within 10 Business Days of

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obtaining knowledge that the Series 2008-1 Distribution Account is no longer an Eligible Deposit Account, establish a new Series 2008-1 Distribution Account that is an Eligible Deposit Account.  If a new Series 2008-1 Distribution Account is established, HVF shall instruct the Trustee in writing to transfer all cash and investments from the non-qualifying Series 2008-1 Distribution Account into the new Series 2008-1 Distribution Account.  Initially, the Series 2008-1 Distribution Account will be established with the Trustee.

(b)           Administration of the Series 2008-1 Distribution Account.  The Administrator may instruct the institution maintaining the Series 2008-1 Distribution Account in writing to invest funds on deposit in the Series 2008-1 Distribution Account from time to time in Permitted Investments; provided, however, that any such investment shall mature not later than the Business Day prior to the Payment Date following the date on which such funds were received (including funds received upon a payment in respect of a Permitted Investment made with funds on deposit in the Series 2008-1 Distribution Account), unless any Permitted Investment held in the Series 2008-1 Distribution Account is held with the Trustee, then such investment may mature on such Payment Date and such funds shall be available for withdrawal on or prior to such Payment Date.  All such Permitted Investments will be credited to the Series 2008-1 Distribution Account.  HVF shall not direct the Trustee to dispose of (or permit the disposal of) any Permitted Investments prior to the maturity thereof to the extent such disposal would result in a loss of the initial purchase price of such Permitted Investment.  In the absence of written investment instructions hereunder, funds on deposit in the Series 2008-1 Distribution Account shall remain uninvested.

(c)           Earnings from Series 2008-1 Distribution Account.  All interest and earnings (net of losses and investment expenses) paid on funds on deposit in the Series 2008-1 Distribution Account shall be deemed to be on deposit and available for distribution.

(d)           Series 2008-1 Distribution Account Constitutes Additional Collateral for Series 2008-1 Notes.  In order to secure and provide for the repayment and payment of the Note Obligations with respect to the Series 2008-1 Notes, HVF hereby grants a security interest in and assigns, pledges, grants, transfers and sets over to the Trustee, for the benefit of the Series 2008-1 Noteholders, all of HVF’s right, title and interest in and to the following (whether now or hereafter existing or acquired): (i) the Series 2008-1 Distribution Account, including any security entitlement thereto; (ii) all funds on deposit therein from time to time; (iii) all certificates and instruments, if any, representing or evidencing any or all of the Series 2008-1 Distribution Account or the funds on deposit therein from time to time; (iv) all investments made at any time and from time to time with monies in the Series 2008-1 Distribution Account, whether constituting securities, instruments, general intangibles, investment property, financial assets or other property; (v) all interest, dividends, cash, instruments and other property from time to time received, receivable or otherwise distributed in respect of or in exchange for the Series 2008-1 Distribution Account, the funds on deposit therein from time to time or the investments made with such funds; and (vi) all proceeds of any and all of the foregoing, including, without limitation, cash (the items in the foregoing clauses (i)

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through (vi) are referred to, collectively, as the “Series 2008-1 Distribution Account Collateral”).

Section 3.11.   Trustee as Securities Intermediary.

(a)           The Trustee or other Person holding the Series 2008-1 Collection Account, the Series 2008-1 Excess Collection Account, the Series 2008-1 Accrued Interest Account, the Series 2008-1 Reserve Account, the Series 2008-1 Cash Collateral Account or the Series 2008-1 Distribution Account (each a “Series 2008-1 Designated Account”) shall be the “securities intermediary” (as defined in Section 8-102 of the UCC in effect in the State of New York (the “New York UCC”), in such capacity, the “Securities Intermediary”).  If the Securities Intermediary in respect of any Series 2008-1 Designated Account is not the Trustee, HVF shall obtain the express agreement of such Person to the obligations of the Securities Intermediary set forth in this Section 3.11.

(b)           The Securities Intermediary agrees that:

(i)            The Series 2008-1 Designated Accounts are accounts to which “financial assets” within the meaning of Section 8-102(a)(9) (“Financial Assets”) of the New York UCC will be credited;

(ii)           All securities or other property underlying any Financial Assets credited to any Series 2008-1 Designated Account shall be registered in the name of the Securities Intermediary, indorsed to the Securities Intermediary or in blank or credited to another securities account maintained in the name of the Securities Intermediary and in no case will any Financial Asset credited to any Series 2008-1 Designated Account be registered in the name of HVF, payable to the order of HVF or specially endorsed to HVF;

(iii)          All property delivered to the Securities Intermediary pursuant to this Series Supplement will be promptly credited to the appropriate Series 2008-1 Designated Account;

(iv)          Each item of property (whether investment property, security, instrument or cash) credited to a Series 2008-1 Designated Account shall be treated as a Financial Asset;

(v)           If at any time the Securities Intermediary shall receive any order from the Trustee directing transfer or redemption of any Financial Asset relating to the Series 2008-1 Designated Accounts, the Securities Intermediary shall comply with such entitlement order without further consent by HVF or the Administrator;

(vi)          The Series 2008-1 Designated Accounts shall be governed by the laws of the State of New York, regardless of any provision of any other agreement.  For purposes of the UCC, New York shall be deemed to the Securities Intermediary’s jurisdiction and the Series 2008-1 Designated Accounts (as well as the “securities entitlements” (as defined in Section 8-102(a)(17) of the

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New York UCC) related thereto) shall be governed by the laws of the State of New York;

(vii)         The Securities Intermediary has not entered into, and until termination of this Series Supplement, will not enter into, any agreement with any other Person relating to the Series 2008-1 Designated Accounts and/or any Financial Assets credited thereto pursuant to which it has agreed to comply with entitlement orders (as defined in Section 8-102(a)(8) of the New York UCC) of such other Person and the Securities Intermediary has not entered into, and until the termination of this Series Supplement will not enter into, any agreement with HVF purporting to limit or condition the obligation of the Securities Intermediary to comply with entitlement orders as set forth in Section 3.11(b)(v) of this Series Supplement; and

(viii)        Except for the claims and interest of the Trustee and HVF in the Series 2008-1 Designated Accounts, the Securities Intermediary knows of no claim to, or interest, in the Series 2008-1 Designated Accounts or in any Financial Asset credited thereto.  If the Securities Intermediary has actual knowledge of the assertion by any other person of any lien, encumbrance, or adverse claim (including any writ, garnishment, judgment, warrant of attachment, execution or similar process) against any Series 2008-1 Designated Account or in any Financial Asset carried therein, the Securities Intermediary will promptly notify the Trustee, the Administrator and HVF thereof.

(c)           The Trustee shall possess all right, title and interest in all funds on deposit from time to time in the Series 2008-1 Designated Accounts and in all proceeds thereof, and shall be the only person authorized to originate entitlement orders in respect of the Series 2008-1 Designated Accounts.

Section 3.12.   Series 2008-1 Interest Rate Caps.

(a)           On the Series 2008-1 Closing Date, HVF shall acquire one or more interest rate caps (each a “Series 2008-1 Interest Rate Cap”) from an Eligible Interest Rate Cap Provider.  At the time of the acquisition of the initial Series 2008-1 Interest Rate Caps, the aggregate notional amount of all Series 2008-1 Interest Rate Caps shall equal the Series 2008-1 Maximum Principal Amount, and the aggregate notional amount of all Series 2008-1 Interest Rate Caps may be reduced to the extent that the Series 2008-1 Maximum Principal Amount is reduced after the acquisition of the initial Series 2008-1 Interest Rate Caps but shall not at any time be less than the Series 2008-1 Maximum Principal Amount at such time.  HVF shall acquire one or more additional Series 2008-1 Interest Rate Caps in connection with any increase of the Series 2008-1 Maximum Principal Amount such that the aggregate notional amounts of all Series 2008-1 Interest Rate Caps shall equal the Series 2008-1 Maximum Principal Amount after giving effect to such increase. The strike rate of each Series 2008-1 Interest Rate Cap shall not be greater than 7.0%. Each Series 2008-1 Interest Rate Cap shall have a term of at least until the Legal Final Payment Date.  HVF shall satisfy the Series 2008-1 Rating Agency Condition and obtain the consent of the Administrative Agent (such consent not to be

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unreasonably withheld or delayed) in connection with its acquisition of any Series 2008-1 Interest Rate Cap or replacement thereof.

(b)           If, at any time, an Interest Rate Cap Provider (and, if the present and future obligations of an Interest Rate Cap Provider under its Series 2008-1 Interest Rate Cap are guaranteed pursuant to a guarantee (in form and substance satisfactory to the Rating Agencies and the Administrative Agent and satisfying the other requirements set forth in the related Series 2008-1 Interest Rate Cap), the related guarantor) fails to satisfy the Moody’s First Trigger Required Ratings or the Standard & Poor’s First Trigger Required Rating, then the Interest Rate Cap Provider will be required, pursuant to the terms of the Series 2008-1 Interest Rate Cap, at the Interest Rate Cap Provider’s expense, to post and maintain collateral pursuant to a credit support annex entered into in connection with the Series 2008-1 Interest Rate Cap (the “Credit Support Annex”).

(c)           If, at any time, an Interest Rate Cap Provider is not an Eligible Interest Rate Cap Provider, then such Interest Rate Cap Provider will be required, pursuant to the terms of the Series 2008-1 Interest Rate Cap, at such Interest Rate Cap Provider’s expense, to obtain a replacement interest rate cap on the same terms as the Series 2008-1 Interest Rate Cap (or with such modifications as are acceptable to the Rating Agencies and the Administrative Agent) from an Eligible Interest Rate Cap Provider and, simultaneously with such replacement, HVF shall terminate the Series 2008-1 Interest Rate Cap being replaced; provided that no termination of the Series 2008-1 Interest Rate Cap shall occur until HVF has entered into a replacement Series 2008-1 Interest Rate Cap. Each Series 2008-1 Interest Rate Cap must provide that if the Interest Rate Cap Provider is required to obtain a replacement as described in the preceding sentence and such replacement is not obtained within the period specified in the Series 2008-1 Interest Rate Cap, then the Interest Rate Cap Provider must, until such replacement is obtained or such Interest Rate Cap Provider again becomes an Eligible Interest Rate Cap Provider, collateralize its obligations under such Series 2008-1 Interest Rate Cap in an amount determined pursuant to the Credit Support Annex.  If HVF is unable to cause such Interest Rate Cap Provider to take any of the actions described in this Section 3.12(c) after making commercially reasonable efforts, HVF will obtain a replacement Series 2008-1 Interest Rate Cap at the expense of the replaced Interest Rate Cap Provider or, if the replaced Interest Rate Cap Provider fails to make such payment, at the expense of HVF (in which event, such amount will be considered Indenture Carrying Charges and paid solely from Interest Collections available pursuant to Section 3.3(f) of this Series Supplement).

(d)           Each Series 2008-1 Noteholder by its acceptance of a Series 2008-1 Note hereby acknowledges and agrees, and directs the Trustee to acknowledge and agree, and the Trustee, at such direction, hereby acknowledges and agrees, that any collateral posted by an Interest Rate Cap Provider pursuant to clause (b) or (c) above (A) is collateral solely for the obligations of such Interest Rate Cap Provider under its Series 2008-1 Interest Rate Cap, (B) does not constitute collateral for the Series 2008-1 Notes (provided that in order to secure and provide for the payment of the Note Obligations with respect to the Series 2008-1 Notes, HVF has pledged each Series 2008-1 Interest Rate Cap and its security interest in any collateral posted in connection therewith as

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collateral for the Series 2008-1 Notes), and (C) will in no event be available to satisfy any obligations of HVF hereunder or otherwise unless and until such Interest Rate Cap Provider defaults in its obligations under its Series 2008-1 Interest Rate Cap and such collateral is applied in accordance with the terms of such Series 2008-1 Interest Rate Cap to satisfy such defaulted obligations of such Interest Rate Cap Provider.

(e)           HVF shall require all proceeds of each Series 2008-1 Interest Rate Cap (including amounts received in respect of the obligations of the related Interest Rate Cap Provider from a guarantor or from the application of collateral posted by such Interest Rate Cap Provider) to be paid to the Collection Account, and the Trustee shall allocate all such proceeds to the Series 2008-1 Accrued Interest Account in accordance with Section 3.2 of this Series Supplement.

(f)            To secure payment of the Note Obligations with respect to the Series 2008-1 Notes, HVF hereby grants a security interest in, and assigns, pledges, grants, transfers and sets over to the Trustee, for the benefit of the Series 2008-1 Noteholders, all of HVF’s right, title and interest, whether now or hereafter existing or acquired, in the Series 2008-1 Interest Rate Caps and all proceeds thereof.

Section 3.13.   Series 2008-1 Demand Note Constitutes Additional Collateral for Series 2008-1 Notes.

(a)           In order to secure and provide for the repayment and payment of the Note Obligations with respect to the Series 2008-1 Notes, HVF hereby grants a security interest in and assigns, pledges, grants, transfers and sets over to the Trustee, for the benefit of the Series 2008-1 Noteholders, all of HVF’s right, title and interest in and to the following (whether now or hereafter existing or acquired): (i) the Series 2008-1 Demand Note; (ii) all certificates and instruments, if any, representing or evidencing the Series 2008-1 Demand Note; and (iii) all proceeds of any and all of the foregoing, including, without limitation, cash.  On the date hereof, HVF shall deliver to the Trustee, for the benefit of the Series 2008-1 Noteholders, the Series 2008-1 Demand Note, endorsed in blank.  The Trustee, for the benefit of the Series 2008-1 Noteholders, shall be the only Person authorized to make a demand for payment on the Series 2008-1 Demand Note.

(b)           Other than pursuant to a payment made upon a demand thereon by the Trustee, HVF shall not reduce the amount of the Series 2008-1 Demand Note or forgive amounts payable thereunder so that the outstanding principal amount of the Series 2008-1 Demand Note after such reduction or forgiveness is less than the Series 2008-1 Letter of Credit Liquidity Amount.  HVF shall not agree, to any amendment of the Series 2008-1 Demand Note without first satisfying the Series 2008-1 Rating Agency Condition and obtaining the prior written consent of each Funding Agent.

(c)           Other than pursuant to a demand thereon pursuant to Section 3.5(b) or (c) of this Series Supplement, HVF shall not reduce the amount of the Series 2008-1 Demand Note or forgive amounts payable thereunder so that the outstanding principal amount of the Series 2008-1 Demand Note after such forgiveness or reduction is less than

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the greater of (i) the Series 2008-1 Letter of Credit Liquidity Amount and (ii) an amount equal to 3.00% of the Series 2008-1 Principal Amount.

ARTICLE IV

AMORTIZATION EVENTS

In addition to the Amortization Events set forth in Section 9.1 of the Base Indenture, the following shall be Amortization Events with respect to the Series 2008-1 Notes and shall constitute the Amortization Events set forth in Section 9.1(j) of the Base Indenture with respect to the Series 2008-1 Notes:

(a)           HVF defaults in the payment of any interest on, or other amount payable in respect of, the Series 2008-1 Notes (other than the payments described in clause (b) below) when the same becomes due and payable and such default continues for a period of three (3) Business Days;

(b)           HVF defaults in the payment of any principal of the Series 2008-1 Notes when the same becomes due and payable on the applicable Legal Final Payment Date;

(c)           a Series 2008-1 Enhancement Deficiency shall occur and continue for at least three (3) Business Days;

(d)           a Series 2008-1 Liquidity Deficiency shall occur and continue for at least three (3) Business Days;

(e)           all principal of and interest on the Series 2008-1 Notes is not paid in full on or before the Expected Final Payment Date;

(f)            the Series 2008-1 Asset Amount shall be less than the Series 2008-1 Required Asset Amount for at least three (3) Business Days;

(g)           the Principal Deficit Amount shall be greater than zero;

(h)           the Collection Account, any Collateral Account, any Series 2008-1 Series Account, the Series 2008-1 Distribution Account or any HVF Exchange Account shall be subject to an injunction, estoppel or other stay or a Lien (other than a Permitted Lien) and 30 days shall have elapsed without such Lien having been released or discharged;

(i)            (A) the Series 2008-1 Reserve Account shall be subject to an injunction, estoppel or other stay or a Lien (other than a Permitted Lien) for at least three (3) Business Days or (B) the Trustee shall cease to have a valid and perfected first priority security interest in the Series 2008-1 Reserve Account Collateral (or any of the Lessee, HVF or any Affiliate of either so assets in writing) and, in each case, either (x) a Series 2008-1 Enhancement Deficiency would result from excluding the Series 2008-1 Available Reserve Account Amount from the Series 2008-1 Enhancement Amount or (y)

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the Series 2008-1 Adjusted Liquidity Amount, excluding therefrom the Series 2008-1 Available Reserve Account Amount, would be less than the Series 2008-1 Required Liquidity Amount;

(j)            from and after the funding of the Series 2008-1 Cash Collateral Account, (A) the Series 2008-1 Cash Collateral Account shall be subject to an injunction, estoppel or other stay or a Lien (other than a Permitted Lien) for at least three (3) Business Days or (B) the Trustee shall cease to have a valid and perfected first priority security interest in the Series 2008-1 Cash Collateral Account Collateral (or any of the Lessee, HVF or any Affiliate of either so assets in writing) and, in each case, either (x) a Series 2008-1 Enhancement Deficiency would result from excluding the Series 2008-1 Available Cash Collateral Account Amount from the Series 2008-1 Enhancement Amount or (y) the Series 2008-1 Adjusted Liquidity Amount, excluding therefrom the Series 2008-1 Available Cash Collateral Account Amount, would be less than the Series 2008-1 Required Liquidity Amount;

(k)           a Change of Control shall have occurred;

(l)            HVF shall fail to acquire or maintain in force a Series 2008-1 Interest Rate Cap at the times and in the notional amounts required by the terms of Section 3.12;

(m)          the Trustee shall for any reason cease to have a valid and perfected first priority security interest in the Series 2008-1 Collateral (other than the Series 2008-1 Reserve Account Collateral and the Series 2008-1 Cash Collateral Account Collateral) or any of the Lessee, HVF or any Affiliate of either so asserts in writing;

(n)           the occurrence of a Servicer Event of Default;

(o)           the occurrence of a Servicer Default or an Administrator Default;

(p)           an Amortization Event with respect to any Existing Series of Notes shall have occurred (other than an Insurer Related Amortization Event with respect to any such Existing Series of Notes);

(q)           HVF fails to comply with any of its other agreements or covenants in, or provisions of, the Series 2008-1 Notes, the Indenture, this Series Supplement or any other Related Document and the failure to so comply materially and adversely affects the interests of the Series 2008-1 Noteholders and continues to materially and adversely affect the interests of the Series 2008-1 Noteholders for a period of thirty (30) days after the earlier of (i) the date on which HVF obtains knowledge thereof or (ii) the date on which written notice of such failure, requiring the same to be remedied, shall have been given to HVF by the Trustee or to HVF and the Trustee by the Administrative Agent; or

(r)            any representation made by HVF in the Indenture, this Series Supplement or any other Related Document is false and such false representation materially and adversely affects the interests of the Series 2008-1 Noteholders and such false representation is not cured for a period of thirty (30) days after the earlier of (i) the

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date on which HVF obtains knowledge thereof or (ii) the date that written notice thereof is given to HVF by the Trustee or to HVF and the Trustee by the Administrative Agent.

In the case of

(i)            any event described in clauses (a) through (m) above, an Amortization Event with respect to the Series 2008-1 Notes will immediately occur without any notice or other action on the part of the Trustee or any Series 2008-1 Noteholder or

(ii)           any event described in clauses (n) through (r) above, either the Trustee may, by written notice to HVF or the Required Noteholders with respect to the Series 2008-1 Notes may, by written notice to HVF and the Trustee declare that an Amortization Event with respect to the Series 2008-1 Notes has occurred as of the date of the notice.

An Amortization Event with respect to the Series 2008-1 Notes described in clauses (a) through (k), (m) through (p) and (q) (with respect to any agreement, covenant or provision in the Series 2008-1 Notes, the Indenture, this Series Supplement or any other Related Document the amendment or modification of which requires the consent of Series 2008-1 Noteholders holding more than 662/3% of the Series 2008-1 Principal Amount or which otherwise prohibits HVF from taking any action without the consent of Series 2008-1 Noteholders holding more than 662/3 of the Series 2008-1 Principal Amount) above may be waived solely with the written consent of Series 2008-1 Noteholders holding 100% of the Series 2008-1 Principal Amount.  An Amortization Event with respect to the Series 2008-1 Notes described in clauses (l), (q) (other than with respect to any agreement, covenant or provision in the Series 2008-1 Notes, the Indenture, this Series Supplement or any other Related Document the amendment or modification of which requires the consent of Series 2008-1 Noteholders holding more than 662/3% of the Series 2008-1 Principal Amount or which otherwise prohibits HVF from taking any action without the consent of Series 2008-1 Noteholders holding more than 662/3% of the Series 2008-1 Principal Amount) and (r) may be waived in accordance with Section 9.4 of the Base Indenture.  In the event of a waiver of any Amortization Event described above, the Trustee shall provide notification thereof to each Rating Agency.

Notwithstanding anything herein to the contrary, an Amortization Event with respect to the Series 2008-1 Notes described in clause (m) above shall be curable at any time.

ARTICLE V

FORM OF SERIES 2008-1 NOTES

Section 5.1.   Issuance of Series 2008-1 Notes.  The Series 2008-1 Notes will be issued in the form of definitive notes in fully registered form without interest coupons, substantially in the form set forth in Exhibit A-1 hereto, and will be sold to the Series 2008-1 Noteholders pursuant to and in accordance with the Series 2008-1 Note

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Purchase Agreement and shall be duly executed by HVF and authenticated by the Trustee in the manner set forth in Section 2.4 of the Base Indenture.  Other than in accordance with this Series Supplement and the Series 2008-1 Note Purchase Agreement, the Series 2008-1 Notes will not be permitted to be transferred, assigned, exchanged or otherwise pledged or conveyed by the Series 2008-1 Noteholders.  The initial Series 2008-1 Notes issued on the Series 2008-1 Closing Date shall bear a face amount equal to up to the Series 2008-1 Maximum Principal Amount as of the Series 2008-1 Closing Date, and shall be initially issued in a principal amount equal to the Series 2008-1 Initial Principal Amount.  Additional Series 2008-1 Notes (“Additional Series 2008-1 Notes”) may be issued subsequent to the Series 2008-1 Closing Date in accordance with Section 2.1 hereof in connection with the addition of an Additional Investor Group pursuant to Section 9.16 of the Series 2008-1 Note Purchase Agreement.  Additional Series 2008-1 Notes shall bear a face amount equal to up to the Maximum Investor Group Principal Amount with respect to the related Additional Investor Group and shall initially be issued in a principal amount equal to the Additional Investor Group Initial Principal Amount with respect to such Additional Investor Group.  Upon the issuance of any Additional Series 2008-1 Notes, the Series 2008-1 Maximum Principal Account shall be increased by an amount equal to the Maximum Investor Group Principal Amount with respect to the related Additional Investor Group.  The Trustee shall, or shall cause the Registrar, to record any Increases, Decreases or additional issuances with respect to the Series 2008-1 Principal Amount such that the principal amount of the Series 2008-1 Notes that are outstanding accurately reflects all such Increases, Decreases and additional issuances.

The Series 2008-1 Notes may have such letters, numbers or other marks of identification and such legends or endorsements placed thereon as may be required to comply with the rules of any securities exchange or as may, consistently herewith, be determined by the officers executing such Series 2008-1 Notes, as evidenced by their execution of the Series 2008-1 Notes.  The Series 2008-1 Notes may be produced in any manner, all as determined by the officers executing such Series 2008-1 Notes, as evidenced by their execution of such Series 2008-1 Notes. The initial sale of the Series 2008-1 Notes is limited to Persons who have executed the Series 2008-1 Note Purchase Agreement.  The sale of Additional Series 2008-1 Notes shall be limited to Persons who become a party to the Series 2008-1 Note Purchase Agreement in accordance with Section 9.16 thereof.

Section 5.2.   Transfer of Series 2008-1 Notes.

(a)           Subject to the terms of the Indenture and the Series 2008-1 Note Purchase Agreement, the holder of any Series 2008-1 Note may transfer the same in whole or in part, in an amount equivalent to an authorized denomination, by surrendering such Series 2008-1 Note at the office maintained by the Registrar for such purpose pursuant to Section 2.5(a) of the Base Indenture, with the form of transfer endorsed on it duly completed and executed by, or accompanied by a written instrument of transfer in form satisfactory to HVF and the Registrar by, the holder thereof and accompanied by a certificate substantially in the form of Exhibit E hereto; provided, that if the holder of any Series 2008-1 Note transfers, in whole or in part, its interest in any Series 2008-1 Note pursuant to (i) an Assignment and Assumption Agreement substantially in the form of

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Exhibit B to the Series 2008-1 Note Purchase Agreement or (ii) an Investor Group Supplement substantially in the form of Exhibit C to the Series 2008-1 Note Purchase Agreement, then such Series 2008-1 Noteholder will not be required to submit a certificate substantially in the form of Exhibit E hereto upon transfer of its interest in such Series 2008-1 Note.  In exchange for any Series 2008-1 Note properly presented for transfer, HVF shall execute and the Trustee shall promptly authenticate and deliver or cause to be authenticated and delivered in compliance with applicable law, to the transferee at such office, or send by mail (at the risk of the transferee) to such address as the transferee may request, Series 2008-1 Notes for the same aggregate principal amount as was transferred.  In the case of the transfer of any Series 2008-1 Note in part, HVF shall execute and the Trustee shall promptly authenticate and deliver or cause to be authenticated and delivered to the transferor at such office, or send by mail (at the risk of the transferor) to such address as the transferor may request, Series 2008-1 Notes for the aggregate principal amount that was not transferred.  No transfer of any Series 2008-1 Note shall be made unless the request for such transfer is made by the Series 2008-1 Noteholder at such office.  Neither HVF nor the Trustee shall be liable for any delay in delivery of transfer instructions and each may conclusively rely on, and shall be protected in relying on, such instructions.  Upon the issuance of transferred Series 2008-1 Notes, the Trustee shall recognize the Holders of such Series 2008-1 Note as Series 2008-1 Noteholders.

(b)           Each Series 2008-1 Note shall bear the following legend:

THIS SERIES 2008-1 NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR WITH ANY STATE SECURITIES OR “BLUE SKY” LAWS.  THE HOLDER HEREOF, BY ITS ACCEPTANCE HEREOF, AGREES FOR THE BENEFIT OF HVF THAT SUCH SERIES 2008-1 NOTE IS BEING ACQUIRED FOR ITS OWN ACCOUNT AND NOT WITH A VIEW TO DISTRIBUTION AND TO OFFER, SELL OR OTHERWISE TRANSFER SUCH NOTE ONLY (A) TO HVF, (B) PURSUANT TO A REGISTRATION STATEMENT THAT HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT, (C) TO AN INSTITUTIONAL ACCREDITED INVESTOR WITHIN THE MEANING OF RULE 501(A)(1), (2), (3) OR (7) UNDER THE SECURITIES ACT OR (D) PURSUANT TO AN APPLICABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND, IN EACH SUCH CASE, IN COMPLIANCE WITH THE INDENTURE AND ALL APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES OR ANY OTHER JURISDICTION, SUBJECT TO THE RIGHT OF HVF, PRIOR TO ANY TRANSFER PURSUANT TO CLAUSE (C), TO REQUIRE THE DELIVERY TO IT OF A PURCHASER’S LETTER IN THE FORM OF EXHIBIT E TO THE SERIES 2008-1 SUPPLEMENT CERTIFYING, AMONG OTHER THINGS, THAT SUCH PURCHASER IS AN INSTITUTIONAL “ACCREDITED INVESTOR” WITHIN THE MEANING OF RULE 501(A)(1), (2), (3) OR (7) UNDER THE SECURITIES ACT AND SUBJECT TO THE RIGHT OF HVF, PRIOR TO ANY TRANSFER PURSUANT TO CLAUSE (D), TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO IT.

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The required legends set forth above shall not be removed from the Series 2008-1 Notes except as provided herein.

ARTICLE VI

GENERAL

Section 6.1.   Optional Redemption of Series 2008-1 Notes.  The Series 2008-1 Notes shall be subject to repurchase (in whole) by HVF at its option, upon three (3) Business Days’ prior written notice to the Trustee, in accordance with Section 6.1 of the Base Indenture at any time.  The repurchase price for any Series 2008-1 Note (in each case, the “Series 2008-1 Repurchase Amount”) shall equal the sum of (a) the aggregate outstanding principal balance of such Series 2008-1 Notes (determined after giving effect to any payments of principal and interest on the Payment Date immediately preceding the date of purchase pursuant to this Section 6.1), plus (b) (i) with respect to the portion of such principal balance which was funded with Series 2008-1 Commercial Paper issued at a discount, all accrued and unpaid discount on such Series 2008-1 Commercial Paper from the issuance date(s) thereof to the date of purchase under this Section 6.1 and the aggregate discount to accrue on such Series 2008-1 Commercial Paper from the date of purchase under this Section 6.1 to the maturity date of such Series 2008-1 Commercial Paper, or (ii) with respect to the portion of such principal balance which was funded with Series 2008-1 Commercial Paper that was not issued at a discount, all accrued and unpaid interest on such Series 2008-1 Commercial Paper from the issuance date(s) thereof to the date of purchase under this Section 6.1 (and any breakage costs associated with the prepayment of such interest-bearing Series 2008-1 Commercial Paper), or (iii) with respect to the portion of such principal balance which was funded other than with Series 2008-1 Commercial Paper, all accrued and unpaid interest on such principal balance through the date of purchase under this Section 6.1, plus (c) any other amounts then due and payable to the holders of such Series 2008-1 Notes pursuant hereto and pursuant to the Series 2008-1 Note Purchase Agreement.

Section 6.2.   Information.  (a)  On or before the fourth Business Day prior to each Payment Date (unless otherwise agreed to by the Trustee), HVF shall cause the Administrator to furnish to the Trustee a Monthly Noteholders’ Statement with respect to the Series 2008-1 Notes, substantially in the form of Exhibit F-1, setting forth, inter alia, the following information:

(i)            the total amount available to be distributed to Series 2008-1 Noteholders on such Payment Date;

(ii)           the amount of such distribution allocable to the payment of principal of the Series 2008-1 Notes;

(iii)          the amount of such distribution allocable to the payment of interest on the Series 2008-1 Notes;

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(iv)          the Series 2008-1 Invested Percentage with respect to Interest Collections and with respect to Principal Collections for the period from and including the second Determination Date preceding such Payment Date to but excluding the Determination Date immediately preceding such Payment Date;

(v)           the Series 2008-1 Enhancement Amount, the Series 2008-1 Adjusted Enhancement Amount, the Series 2008-1 Liquidity Amount, the Series 2008-1 Adjusted Liquidity Amount, in each case, as of the close of business on the last day of the Related Month;

(vi)          whether, to the knowledge of the Administrator, any Lien exists on any of the Collateral (other than Permitted Liens);

(vii)         whether, to the knowledge of the Administrator, any Operating Lease Event of Default has occurred;

(viii)        whether, to the knowledge of the Administrator, any Amortization Event or Potential Amortization Event with respect to the Series 2008-1 Notes has occurred;

(ix)           the Aggregate Asset Amount and the amount of the Aggregate Asset Amount Deficiency, if any, as of the close of business on the last day of the Related Month;

(x)            the Bankrupt Manufacturer Vehicle Amount, the Bankrupt Manufacturer Vehicle Percentage, the Capped Category 2 Manufacturer Eligible Program Vehicle Percentage, the Capped Category 2 Manufacturer Program Vehicle Percentage, the Capped Non-Top Two Category 3 Manufacturer Vehicle Percentage, the Category 1 Manufacturer Eligible Program Vehicle Amount, the Category 1 Manufacturer Eligible Program Vehicle Percentage, the Category 1 Manufacturer Non-Eligible Program Vehicle Amount, the Category 1 Manufacturer Non-Eligible Program Vehicle Percentage, the Category 1 Manufacturer Non-Eligible Vehicle Amount, the Category 1 Manufacturer Non-Eligible Vehicle Percentage, the Category 2 Manufacturer Eligible Program Vehicle Amount, the Category 2 Manufacturer Eligible Program Vehicle Percentage, the Category 2 Manufacturer Eligible Program Vehicle Percentage Excess, the Category 2 Manufacturer Non-Eligible Program Vehicle Amount, the Category 2 Manufacturer Non-Eligible Program Vehicle Percentage, the Category 2 Manufacturer Non-Eligible Vehicle Amount, the Category 2 Manufacturer Non-Eligible Vehicle Percentage, the Category 2 Manufacturer Program Vehicle Percentage, the Category 3 Manufacturer Non-Eligible Vehicle Amount, the Category 3 Manufacturer Non-Eligible Vehicle Percentage, the Category 3 Manufacturer Vehicle Amount, the Category 3 Manufacturer Vehicle Percentage, the Eligible Program Vehicle Amount, the Manufacturer Eligible Program Vehicle Amount, the Manufacturer Non-Eligible Program Vehicle Amount, the Manufacturer Non-Eligible Vehicle Amount, the Non-Eligible Vehicle Amount, the Non- Program Vehicle Amount, the Non-Program Vehicle Percentage, the

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Non-Top Two Category 3 Manufacturer Vehicle Percentage, the Non-Top Two Category 3 Manufacturer Vehicle Percentage Excess, the Top Two Category 3 Manufacturer Vehicle Amount and the Top Two Category 3 Manufacturer Vehicle Percentage as of the close of business on the last day of the Related Month;

(xi)           the Non-Eligible Manufacturer Amount as of the close of business on the last day of the Related Month;

(xii)          the Series 2008-1 Moody’s Highest Enhancement Percentage, the Series 2008-1 Moody’s Intermediate Enhancement Percentage, the Series 2008-1 Moody’s Lowest Enhancement Percentage, Series 2008-1 Moody’s Intermediate Enhancement Vehicle Percentage, the Series 2008-1 Moody’s Required Enhancement Percentage, the Series 2008-1 S&P Highest Enhancement Percentage, the Series 2008-1 S&P Intermediate Enhancement Percentage, the Series 2008-1 S&P Lowest Enhancement Percentage, Series 2008-1 S&P Required Enhancement Percentage and the Series 2008-1 Required Enhancement Percentage as of the close of business on the last day of the Related Month and the Market Value Average and Non-Program Vehicle Measurement Month Average, if any, included in the calculation of such calculations;

(xiii)         the Aggregate BMW/Lexus/Mercedes/Audi Amount, the Aggegate Kia/Subaru/Hyundai Amount, the Audi Amount, the BMW Amount, the Hyundai Amount, the Jaguar Amount, the Kia Amount, the Land Rover Amount, the Lexus Amount, the Mazda Amount, the Mercedes Amount, the Mitsubishi Amount, the Nissan Amount, the Subaru Amount, the Volvo Amount and the Volkswagen Amount as of the close of business on the last day of the Related Month;

(xiv)        the Series 2008-1 Required Incremental Enhancement Amount, if any, as of the close of business on the last day of the Related Month;

(xv)         the Series 2008-1 Required Liquidity Amount, if any, as of the close of business on the last day of the Related Month, and whether a Series 2008-1 Liquidity Deficiency with respect to any Class of Series 2008-1 Notes existed and the amount thereof, in each case, as of the close of business on the last day of the Related Month;

(xvi)        the Series 2008-1 Required Enhancement Amount as of the close of business on the last day of the Related Month, and whether a Series 2008-1 Enhancement Deficiency with respect to any Class of Series 2008-1 Notes existed and the amount thereof, in each case, as of the close of business on the last day of the Related Month;

(xvii)       the Series 2008-1 Required Overcollateralization Amount, the Series 2008-1 Overcollateralization Amount and the Series 2008-1 Required Asset Amount, in each case, as of the close of business on the last day of the Related Month;

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(xviii)      the Series 2008-1 Required Reserve Account Amount and the Series 2008-1 Available Reserve Account Amount, in each case, as of the close of business on the last day of the Related Month;

(xix)         the percentage of all HVF Vehicles, with respect to each Manufacturer, as of the close of business on the last day of the Related Month which were Eligible Program Vehicles manufactured by such Manufacturer;

(xx)          the percentage of all HVF Vehicles, with respect to each Manufacturer which is not an Eligible Program Manufacturer, as of the close of business on the last day of the Related Month which were Program Vehicles manufactured by such Manufacturer;

(xxi)         the percentage of all HVF Vehicles, with respect to each Manufacturer, as of the close of business on the last day of the Related Month that were Non-Program Vehicles manufactured by such Manufacturer;

(xxii)        the Series 2008-1 Letter of Credit Liquidity Amount, the Series 2008-1 Demand Note Payment Amount and the Series 2008-1 Letter of Credit Amount, in each case, as of the close of business on the last day of the Related Month; and

(xxiii)       the Series 2008-1 Principal Amount and the Series 2008-1 Adjusted Principal Amount, in each case, as of such Payment Date.

The Trustee shall provide to the Series 2008-1 Noteholders, or their designated agent, copies of each Monthly Noteholders’ Statement.

(b)           After an Insurer Related Amortization Event has occurred and for so long as such Insurer Related Amortization Event continues with respect to any Existing Series of Notes, HVF shall promptly furnish, or cause the Administrator to promptly furnish, to the Trustee notice thereof.  In the event that any such Insurer Related Amortization Event becomes a Limited Liquidation Event of Default under the related Existing Series Supplement and Noteholders under such Existing Series of Notes have directed the Trustee to commence (either through its agents or otherwise) or cause the commencement of liquidation of any HVF Vehicles as a result of such Limited Liquidation Event of Default, then on the third Business Day of each calendar week during which such Insurer Related Amortization Event continues, HVF shall furnish, or cause the Administrator to furnish to the Trustee a Weekly Noteholders’ Statement with respect to the Series 2008-1 Notes, substantially in the form of Exhibit F-2, setting forth, inter alia, the following information:

(xxiv)       the Series 2008-1 Enhancement Amount, the Series 2008-1 Adjusted Enhancement Amount, the Series 2008-1 Liquidity Amount, the Series 2008-1 Adjusted Liquidity Amount, in each case, as of the close of business on the last Business Day of the prior calendar week;

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(xxv)        the Aggregate Asset Amount and the amount of the Aggregate Asset Amount Deficiency, if any, as of the close of business on the last Business Day of the prior calendar week;

(xxvi)       the Series 2008-1 Required Enhancement Incremental Amount, if any, as of the close of business on the last Business Day of the prior calendar week;

(xxvii)      the Series 2008-1 Required Liquidity Amount, if any, as of the close of business on the last day of the Related Month, and whether a Series 2008-1 Liquidity Deficiency with respect to any Class of Series 2008-1 Notes existed and the amount thereof, in each case, as of the close of business on the last Business Day of the prior calendar week;

(xxviii)     the Series 2008-1 Required Enhancement Amount as of the close of business on the prior Business Day, and whether a Series 2008-1 Enhancement Deficiency with respect to any Class of Series 2008-1 Notes existed and the amount thereof, in each case, as of the close of business on the last Business Day of the prior calendar week;

(xxix)       the Series 2008-1 Required Overcollateralization Amount, the Series 2008-1 Overcollateralization Amount and the Series 2008-1 Required Asset Amount, in each case, as of the close of business on the last Business Day of the prior calendar week;

(xxx)        the Series 2008-1 Required Reserve Account Amount and the Series 2008-1 Available Reserve Account Amount, in each case, as of the close of business on the last Business Day of the prior calendar week;

(xxxi)       the percentage of all HVF Vehicles, with respect to each Manufacturer, as of the close of business on the last Business Day of the prior calendar week that were Eligible Program Vehicles manufactured by such Manufacturer;

(xxxii)      the Series 2008-1 Letter of Credit Liquidity Amount, the Series 2008-1 Demand Note Payment Amount and the Series 2008-1 Letter of Credit Amount, in each case, as of the close of business on the last Business Day of the prior calendar week; and

(xxxiii)     the Series 2008-1 Principal Amount and the Series 2008-1 Adjusted Principal Amount, in each case, as of the close of business on the last Business Day of the prior calendar week.

Promptly upon its receipt thereof, the Trustee shall provide to the Series 2008-1 Noteholders, or their designated agent, copies of each Weekly Noteholders’ Statement.

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Section 6.3.   Exhibits.  The following exhibits attached hereto supplement the exhibits included in the Indenture.

Exhibit A-1:	Series 2008-1 Variable Funding Rental Car Asset Backed Notes
Exhibit B:	Form of Series 2008-1 Letter of Credit
Exhibit C:	Form of Lease Payment Deficit Notice
Exhibit D:	Form of Series 2008-1 Letter of Credit Reduction Notice
Exhibit E:	Form of Purchaser’s Letter
Exhibit F-1:	Form of Monthly Noteholders’ Statement
Exhibit F-2:	Form of Weekly Noteholders’ Statement
Exhibit G-1:	Form of Demand Notice
Exhibit G-2:	Form of Series 2008-1 Demand Note
Exhibit H:	Form of Estimated Interest Adjustment Notice

Section 6.4.   Ratification of Base Indenture.  As supplemented by this Series Supplement, the Base Indenture is in all respects ratified and confirmed and the Base Indenture as so supplemented by this Series Supplement shall be read, taken, and construed as one and the same instrument.

Section 6.5.   Notice to the Rating Agencies.  The Trustee shall provide to each Funding Agent and each Rating Agency a copy of each notice to the Series 2008-1 Noteholders, Opinion of Counsel and Officer’s Certificate delivered to the Trustee pursuant to this Series Supplement or any other Related Document.  Each such Opinion of Counsel to be delivered to each Funding Agent shall be addressed to each Funding Agent, shall be from counsel reasonably acceptable to each Funding Agent and shall be in form and substance reasonably acceptable to each Funding Agent.  The Trustee shall provide notice to each Rating Agency of any consent by the Series 2008-1 Noteholders to the waiver of the occurrence of any Limited Liquidation Event of Default.  All such notices, opinions, certificates or other items to be delivered to the Funding Agents shall be forwarded, simultaneously, to the address of each Funding Agent set forth in the Series 2008-1 Note Purchase Agreement.  In the event that the Annualized Financing Cost, calculated with respect to the amounts payable in any Series 2008-1 Interest Period, exceeds 10%, HVF shall provide Moody’s with notice of such event.

Section 6.6.   Third Party Beneficiary.  The Administrative Agent is an express third party beneficiary of (i) the Base Indenture and (ii) this Series Supplement.

Section 6.7.   Counterparts.  This Series Supplement may be executed in any number of counterparts, each of which so executed shall be deemed to be an original, but all of such counterparts shall together constitute but one and the same instrument.

Section 6.8.   Governing Law.  This Series Supplement shall be construed in accordance with the law of the State of New York, and the obligations, rights and remedies of the parties hereto shall be determined in accordance with such law.

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Section 6.9.   Amendments. This Series Supplement may be modified or amended from time to time in accordance with the terms of the Base Indenture and subject to satisfaction of the Series 2008-1 Rating Agency Condition, provided that if, pursuant to the terms of the Base Indenture or this Series Supplement, the consent of the Required Noteholders is required for an amendment or modification of this Series Supplement, such requirement shall be satisfied if such amendment or modification is consented to by the Required Noteholders with respect to the Series 2008-1 Notes; provided, further, that, any amendment or other modification to this Series Supplement or any of the Related Documents that would extend the due date for, or reduce the amount of, any scheduled repayment or prepayment of principal of or interest on the Series 2008-1 Notes (or reduce the principal amount of or rate of interest on the Series 2008-1 Notes), alter any provisions (including, without limitation, any relevant definitions) relating to the pro rata treatment of payments to the Series 2008-1 Noteholders, the Conduit Investors and the Committed Note Purchasers, amend or modify this Section 6.9 or otherwise amend or modify any provision relating to the amendment or modification of this Series Supplement, or, pursuant to the Related Documents, would require the consent of 100% of the Series 2008-1 Noteholders or each Series 2008-1 Noteholder affected by such amendment or modification, shall require the prior written consent of each Conduit Investor and Committed Note Purchaser or each Conduit Investor and each Committed Note Purchaser affected thereby, as applicable.

Section 6.10.   Covenant Regarding Affiliate Issuers.  HVF shall not issue or sell Notes of any Series of Notes to an Affiliate Issuer unless, in connection with such issuance or sale, such Affiliate Issuer has assigned all voting, consent and control rights associated with such Notes to Persons that are not Affiliates of HVF.

Section 6.11.   Termination of Series Supplement.  This Series Supplement shall cease to be of further effect when (i) all Outstanding Series 2008-1 Notes theretofore authenticated and issued have been delivered (other than destroyed, lost, or stolen Series 2008-1 Notes which have been replaced or paid) to the Trustee for cancellation, (ii) HVF has paid all sums payable hereunder and (iii) the Series 2008-1 Demand Note Payment Amount is equal to zero or the Series 2008-1 Letter of Credit Liquidity Amount is equal to zero.

Section 6.12.   Discharge of Indenture.  Notwithstanding anything to the contrary contained in the Base Indenture, so long as this Series Supplement shall be in effect in accordance with Section 6.14 of this Series Supplement, no discharge of the Indenture pursuant to Section 11.1(b) of the Base Indenture shall be effective as to the Series 2008-1 Notes without the consent of the Required Noteholders with respect to the Series 2008-1 Notes.

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IN WITNESS WHEREOF, HVF and the Trustee have caused this Series Supplement to be duly executed by their respective officers hereunto duly authorized as of the day and year first above written.

HERTZ VEHICLE FINANCING LLC
By:	/s/ Scott Massengill
	Name:	SCOTT MASSENGILL
	Title:	VP & TREASURER
THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A.,
as Trustee,
By:	/S/ John D Ask
	Name:	John D Ask
	Title:	Assistant Treasurer

Series Supplement

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EXHIBIT A
TO
SERIES 2008-1 SUPPLEMENT

FORM OF SERIES 2008-1 VARIABLE FUNDING

RENTAL CAR ASSET BACKED NOTE

RENTAL CAR ASSET BACKED NOTE

SERIES 2008-1 VARIABLE FUNDING

REGISTERED $[               ]

No. R-[     ]

SEE REVERSE FOR CERTAIN CONDITIONS

THIS SERIES 2008-1 NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR WITH ANY STATE SECURITIES OR “BLUE SKY” LAWS. THE HOLDER HEREOF, BY ITS ACCEPTANCE HEREOF, AGREES FOR THE BENEFIT OF HERTZ VEHICLE FINANCING LLC, A SPECIAL PURPOSE LIMITED LIABILITY COMPANY ESTABLISHED UNDER THE LAWS OF DELAWARE (THE “COMPANY”), THAT SUCH SERIES 2008-1 NOTE IS BEING ACQUIRED FOR ITS OWN ACCOUNT AND NOT WITH A VIEW TO DISTRIBUTION AND TO OFFER, SELL OR OTHERWISE TRANSFER SUCH NOTE ONLY (A) TO THE COMPANY, (B) PURSUANT TO A REGISTRATION STATEMENT THAT HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT, (C) TO AN INSTITUTIONAL ACCREDITED INVESTOR WITHIN THE MEANING OF RULE 501(A)(1), (2), (3) OR (7) UNDER THE SECURITIES ACT OR (D) PURSUANT TO AN APPLICABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND, IN EACH SUCH CASE, IN COMPLIANCE WITH THE INDENTURE AND ALL APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES OR ANY OTHER JURISDICTION, SUBJECT TO THE RIGHT OF THE COMPANY, PRIOR TO ANY TRANSFER PURSUANT TO CLAUSE (C), TO REQUIRE THE DELIVERY TO IT OF A PURCHASER’S LETTER IN THE FORM OF EXHIBIT E TO THE SERIES 2008-1 SUPPLEMENT CERTIFYING, AMONG OTHER THINGS, THAT SUCH PURCHASER IS AN INSTITUTIONAL “ACCREDITED INVESTOR” WITHIN THE MEANING OF RULE 501(A)(1), (2), (3) OR (7) UNDER THE SECURITIES ACT AND SUBJECT TO THE RIGHT OF THE COMPANY, PRIOR TO ANY TRANSFER PURSUANT TO CLAUSE (D), TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO IT.

HERTZ VEHICLE FINANCING LLC

SERIES 2008-1 VARIABLE FUNDING RENTAL CAR ASSET BACKED NOTE

Hertz Vehicle Financing LLC, a special purpose limited liability company established under the laws of Delaware, (herein referenced as the “Company”), for value received, hereby promises to pay to [                            ] (the “Series 2008-1 Note Purchaser”), or its registered assigns, the aggregate principal sum of [              ] ($[              ]) or, if less, the aggregate unpaid principal amount shown on the schedule attached hereto (and any continuation thereof), which amount shall be payable in the amounts and at the times set forth in the Indenture; provided, however, that the entire unpaid principal amount of this Series 2008-1 Note shall be due on the Legal Final Payment Date. The Company will pay interest on this Series 2008-1 Note at the Series 2008-1 Note Rate. Such interest shall be payable on each Payment Date until the principal of this Series 2008-1 Note is paid or made available for payment, to the extent funds are available from Interest Collections allocable to the Series 2008-1 Note processed from but not including the preceding Payment Date through and including the succeeding Payment Date. In addition, the Company will pay interest on this Series 2008-1 Note, to the extent funds are available from Interest Collections allocable to the Series 2008-1 Note, on the dates set forth in Section 3.3 of the Series 2008-1 Supplement. Pursuant to Sections 2.1 and 2.2 of the Series 2008-1 Supplement and Sections 2.02 and 2.03 of the Series 2008-1 Note Purchase Agreement, the principal amount of this Series 2008-1 Note shall be subject to Increases and Decreases on any Business Day during the Series 2008-1 Revolving Period, and accordingly, such principal amount is subject to prepayment at any time. During the Series 2008-1 Revolving Period, this Series 2008-1 Note is subject to mandatory prepayment, to the extent funds have been allocated to the Series 2008-1 Excess Collection Account and are available therefor, in accordance with Section 2.2(a) of the Series 2008-1 Supplement. Beginning on the first Payment Date following the occurrence of a Series 2008-1 Amortization Event, subject to cure in accordance with the Series 2008-1 Supplement, the principal of this Series 2008-1 Note shall be paid in installments on each subsequent Payment Date to the extent of funds available for payment therefor pursuant to the Indenture. Such principal of and interest on this Series 2008-1 Note shall be paid in the manner specified on the reverse hereof.

The principal of and interest on this Series 2008-1 Note are payable in such coin or currency of the United States of America as at the time of payment is legal tender for payment of public and private debts. All payments made by the Company with respect to this Series 2008-1 Note shall be applied first to interest due and payable on this Series 2008-1 Note as provided above and then to the unpaid principal of this Series 2008-1 Note. This Series 2008-1 Note does not represent an interest in, or an obligation of, The Hertz Corporation or any affiliate of The Hertz Corporation other than the Company.

Reference is made to the further provisions of this Series 2008-1 Note set forth on the reverse hereof, which shall have the same effect as though fully set forth on the face of this Series 2008-1 Note. Although a summary of certain provisions of the Indenture is set forth below and on the reverse hereof and made a part hereof, this Series

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2008-1 Note does not purport to summarize the Indenture and reference is made to the Indenture for information with respect to the interests, rights, benefits, obligations, proceeds and duties evidenced hereby and the rights, duties and obligations of the Company and the Trustee. A copy of the Indenture may be requested from the Trustee by writing to the Trustee at: The Bank of New York Mellon Trust Company, N.A., 2 North LaSalle Street, Suite 1020, Chicago, Illinois 60602, Attention: Corporate Trust Administration–Structured Finance. To the extent not defined herein, the capitalized terms used herein have the meanings ascribed to them in Schedule 1 to the Base Indenture.

Unless the certificate of authentication hereon has been executed by the Trustee whose name appears below by manual signature, this Series 2008-1 Note shall not be entitled to any benefit under the Indenture referred to on the reverse hereof, or be valid or obligatory for any purpose.

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IN WITNESS WHEREOF, the Company has caused this instrument to be signed, manually or in facsimile, by its Authorized Officer.

Dated: September     , 2008

HERTZ VEHICLE FINANCING LLC
By:
	Name: Scott Massengill
	Title: Vice President and Treasurer

TRUSTEE’S CERTIFICATE OF AUTHENTICATION

This is a Series 2008-1 Note, a series issued under the within-mentioned Indenture.

Dated: September     , 2008

THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A., as Trustee
By:
	Authorized Signatory

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REVERSE OF SERIES 2008-1 NOTE

This Series 2008-1 Note is one of a duly authorized issue of Notes of the Company, designated as its Series 2008-1 Variable Funding Rental Car Asset Backed Notes (herein called the “Series 2008-1 Note”), issued under (i) a Second Amended and Restated Base Indenture, dated as of August 1, 2006 (such Second Amended and Restated Base Indenture, as further amended or modified, is herein referred to as the “Base Indenture”), between the Company and The Bank of New York Mellon Trust Company, N.A. (formerly known as The Bank of New York Trust Company, N.A.) as trustee (the “Trustee”, which term includes any successor Trustee under the Base Indenture), and (ii) a Series 2008-1 Supplement, dated as of September 12, 2008 (such Series 2008-1 Supplement, as further amended or modified, is herein referred to as the “Series 2008-1 Supplement”), between the Company and the Trustee. The Base Indenture and the Series 2008-1 Supplement are referred to herein as the “Indenture”. Except as set forth in the Series 2008-1 Supplement, the Series 2008-1 Note is subject to all terms of the Indenture. All terms used in this Series 2008-1 Note that are defined in the Indenture, as amended, supplemented or otherwise modified from time to time in accordance with the terms thereof, shall have the meanings assigned to them in or pursuant to the Indenture, as so amended, supplemented or otherwise modified.

The Series 2008-1 Note is and will be equally and ratably secured by the Collateral pledged as security therefore as provided in the Base Indenture and the Series 2008-1 Supplement.

“Payment Date” means the 25th day of each calendar month, or, if any such date is not a Business Day, the next succeeding Business Day, commencing October 25, 2008.

As described above, the entire unpaid principal amount of this Series 2008-1 Note shall be due and payable on the Legal Final Payment Date, in accordance with Section 3.5(c) of the Series 2008-1 Supplement. Notwithstanding the foregoing, this Series 2008-1 Note is subject to mandatory prepayment, to the extent funds have been allocated to the Series 2008-1 Excess Collection Account and are available therefor, in accordance with the Indenture, and if an Amortization Event with respect to the Series 2008-1 Notes shall have occurred and be continuing then, in certain circumstances, principal of the Series 2008-1 Note may be paid earlier, as described in the Indenture. All principal payments of the Series 2008-1 Note shall be made to the Series 2008-1 Noteholders.

Payments of interest on this Series 2008-1 Note are due and payable on each Payment Date or such other date as may be specified in the Series 2008-1 Supplement, together with the installment of principal then due, if any, and any payments of principal made on any Business Day in respect of any Decreases, to the extent not in full payment of this Series 2008-1 Note, shall be made by wire transfer to the Holder of record of this Series 2008-1 Note (or one or more predecessor Series 2008-1

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Notes) on the Note Register as of the close of business on each Record Date. Any reduction in the principal amount of this Series 2008-1 Note (or one or more predecessor Series 2008-1 Notes) effected by any payments made on any Payment Date shall be binding upon all future Holders of this Series 2008-1 Note and of any Series 2008-1 Note issued upon the registration of transfer hereof or in exchange hereof or in lieu hereof, whether or not noted thereon.

The Company shall pay interest on overdue installments of interest at the Series 2008-1 Note Rate to the extent lawful.

Subject to the terms of the Indenture and the Series 2008-1 Note Purchase Agreement, the holder of any Series 2008-1 Note may transfer the same in whole or in part, in an amount equivalent to an authorized denomination, by surrendering such Series 2008-1 Note at the office maintained by the Registrar for such purpose pursuant to Section 2.5(a) of the Base Indenture, with the form of transfer endorsed on it duly completed and executed by, or accompanied by a written instrument of transfer in form satisfactory to the Company and the Registrar by, the holder thereof and accompanied by a certificate substantially in the form of Exhibit E to the Series 2008-1 Supplement. In exchange for any Series 2008-1 Note properly presented for transfer, the Company shall execute and the Trustee shall promptly authenticate and deliver or cause to be authenticated and delivered in compliance with applicable law, to the transferee at such office, or send by mail (at the risk of the transferee) to such address as the transferee may request, Series 2008-1 Notes for the same aggregate principal amount as was transferred. In the case of the transfer of any Series 2008-1 Note in part, the Company shall execute and the Trustee shall promptly authenticate and deliver or cause to be authenticated and delivered to the transferor at such office, or send by mail (at the risk of the transferor) to such address as the transferor may request, Series 2008-1 Notes for the aggregate principal amount that was not transferred. No transfer of any Series 2008-1 Note shall be made unless the request for such transfer is made by each Series 2008-1 Noteholder at such office. Upon the issuance of transferred Series 2008-1 Notes, the Trustee shall recognize the Holders of such Series 2008-1 Note as Series 2008-1 Noteholders.

Each Series 2008-1 Noteholder, by acceptance of a Series 2008-1 Note, covenants and agrees that no recourse may be taken, directly or indirectly, with respect to the obligations of the Trustee or the Company on the Series 2008-1 Note or under the Indenture or any certificate or other writing delivered in connection therewith, against the Trustee in its individual capacity, or against any stockholder, member, employee, officer, director or incorporator of the Company; provided, however, that nothing contained herein shall be taken to prevent recourse to, and enforcement against, the assets of the Company for any and all liabilities, obligations and undertakings contained in the Indenture or in this Series 2008-1 Note.

Each Series 2008-1 Noteholder, by acceptance of a Series 2008-1 Note, covenants and agrees that by accepting the benefits of the Indenture that such Series 2008-1 Noteholder will not, for a period of one year and one day following payment in full of the Series 2008-1 Notes and each other Series of Notes issued under the Base Indenture, institute against the Company, or join with any other Person in instituting against the Company, any bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings, or other proceedings, under any United States Federal or state

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bankruptcy or similar law in connection with any obligations relating to the Notes, the Indenture or the Related Documents.

Prior to the due presentment for registration of transfer of this Series 2008-1 Note, the Company, the Trustee and any agent of the Company or the Trustee may treat the Person in whose name this Series 2008-1 Note (as of the day of determination or as of such other date as may be specified in the Indenture) is registered as the owner hereof for all purposes, whether or not this Series 2008-1 Note be overdue, and neither the Company, the Trustee nor any such agent shall be affected by notice to the contrary.

It is the intent of the Company and each Series 2008-1 Noteholder that, for Federal, state and local income and franchise tax purposes and any other tax imposed on or measured by income, the Series 2008-1 Note will evidence indebtedness secured by the Collateral. Each Series 2008-1 Noteholder, by the acceptance of this Series 2008-1 Note, agrees to treat this Series 2008-1 Note for purposes of Federal, state and local income or franchise taxes and any other tax imposed on or measured by income, as indebtedness.

The Indenture permits, with certain exceptions as therein provided, the amendment thereof and the modification of the rights and obligations of the Company and the rights of the Holders of the Series 2008-1 Notes under the Indenture at any time by the Company with the consent of the Required Noteholders with respect to the Series 2008-1 Notes. The Indenture also contains provisions permitting the Holders of Series 2008-1 Notes representing specified percentages of the aggregate outstanding amount of the Series 2008-1 Notes, on behalf of the Holders of all the Series 2008-1 Notes, to waive compliance by the Company with certain provisions of the Indenture and certain past defaults under the Indenture and their consequences with respect to the Series 2008-1 Notes. Any amendment or other modification to the Series 2008-1 Supplement or any of the Related Documents that would extend the due date for, or reduce the amount of, any scheduled repayment or prepayment of principal of or interest on the Series 2008-1 Notes (or reduce the principal amount of or rate of interest on the Series 2008-1 Notes), alter any provisions (including, without limitation, any relevant definitions) relating to the pro rata treatment of payments to the Series 2008-1 Noteholders, the Conduit Investors and the Committed Note Purchasers, amend or modify Section 6.9 of the Series Supplement or otherwise amend or modify any provision relating to the amendment or modification of the Series Supplement, or, pursuant to the Related Documents, would require the consent of 100% of the Series 2008-1 Noteholders or each Series 2008-1 Noteholder affected by such amendment or modification, shall require the prior written consent of each Conduit Investor and Committed Note Purchaser or each Conduit Investor and each Committed Note Purchaser affected thereby, as applicable. Any such consent or waiver by the Holder of this Series 2008-1 Note (or any one or more predecessor Series 2008-1 Notes) shall be conclusive and binding upon such Holder and upon all future Holders of this Series 2008-1 Note and of any Series 2008-1 Note issued upon the registration of transfer hereof or in exchange hereof or in lieu hereof whether or not notation of such consent or waiver is made upon this Series 2008-1 Note. The Indenture also permits the Company and the Trustee to amend or waive certain terms and conditions set forth in the Indenture without the consent of Holders of the Series 2008-1 Notes issued thereunder.

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The term “Company” as used in this Series 2008-1 Note includes any successor to the Company under the Indenture.

The Series 2008-1 Note is issuable only in registered form in denominations as provided in the Indenture, subject to certain limitations set forth therein.

This Series 2008-1 Note and the Indenture shall be construed in accordance with the law of the State of New York, and the obligations, rights and remedies of the parties hereunder and thereunder shall be determined in accordance with such law.

No reference herein to the Indenture and no provision of this Series 2008-1 Note or of the Indenture shall alter or impair the obligation of the Company, which is absolute and unconditional, to pay the principal of and interest on this Series 2008-1 Note at the times, place and rate, and in the coin or currency herein prescribed, subject to any duty of the Company to deduct or withhold any amounts as required by law, including any applicable U.S. withholding taxes.

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INCREASES AND DECREASES

Date Unpaid 
Principal 
Amount Increase Decrease Total Series 
2008-1 
Note Rate Interest Period 
(if applicable) Notation 
Made By

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ASSIGNMENT

Social Security or taxpayer I.D. or other identifying number of assignee

FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto

(name and address of assignee)

the within Series 2008-1 Note and all rights thereunder, and hereby irrevocably constitutes and appoints                               , attorney, to transfer said Series 2008-1 Note on the books kept for registration thereof, with full power of substitution in the premises.

Dated:
		(1)
	Signature Guaranteed:
	Name:
	Title:

(1) NOTE: The signature to this assignment must correspond with the name of the registered owner as it appears on the face of the within Series 2008-1 Note in every particular, without alteration, enlargement or any change whatsoever.

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EXHIBIT B
TO
SERIES 2008-1 SUPPLEMENT

FORM OF SERIES 2008-1 LETTER OF CREDIT

FORM OF SERIES 2008-1 LETTER OF CREDIT

NO. [     ]

September [    ], 2008

Beneficiary:

The Bank of New York Mellon Trust Company, N.A.
as Trustee
under the Series 2008-1 Supplement
referred to below
2 North LaSalle Street
Chicago, Illinois 60602

Attention:[Corporate Trust Administration—Structured Finance]

Dear Sir or Madam:

The undersigned (“[                           ]” or the “Issuing Bank”) hereby establishes, at the request and for the account of The Hertz Corporation, a Delaware corporation (“Hertz”), pursuant to that certain senior secured asset based revolving loan facility, provided under a credit agreement, dated as of December 21, 2005 (as amended, supplemented, amended and restated or otherwise modified from time to time in accordance with the terms thereof, the “Series 2008-1 Letter of Credit Agreement”), between Hertz, the Issuing Bank, certain affiliates of Hertz and the several banks and financial institutions party thereto from time to time, in Beneficiary’s favor on Beneficiary’s behalf as Trustee under the Series 2008-1 Supplement, dated as of September 12, 2008 (as such agreement may be amended, supplemented, amended and restated or otherwise modified from time to time, the “Series 2008-1 Supplement”), between Hertz Vehicle Financing LLC, a Delaware limited liability company (“HVF”), as Issuer, and The Bank of New York Mellon Trust Company, N.A. (formerly known as The Bank of New York Trust Company, N.A.), as Trustee, to the Second Amended and Restated Base Indenture, dated as of August 1, 2006 (as such agreement may be amended, supplemented, amended and restated or otherwise modified from time to time, the “Base Indenture”) between HVF, as Issuer, and the Trustee, in respect of Credit Demands (as defined below), Unpaid Demand Note Demands (as defined below), Preference Payment Demands (as defined below) and Termination Demands (as defined below) this Irrevocable Letter of Credit No. P- [     ] in the amount of [       ] ($[     ]) (such amount, as the same may be reduced, increased (to an amount not exceeding $[        ]) or reinstated as provided herein, being the “Series 2008-1 Letter of Credit Amount”), effective immediately and expiring at 4:00 p.m. (New York time) at our [        ] office located at [           ] (such office or any other office which may be designated by the Issuing Bank by written notice delivered to Beneficiary, being the “Issuing Bank’s Office”) on [        ] (or, if such date is not a Business Day (as defined below), the immediately succeeding Business Day) (the “Series 2008-1 Letter of Credit

Expiration Date”).Beneficiary is referred to herein (and in each Annex hereto) as the Trustee, as such term is defined in the Base Indenture. Terms used herein and not defined herein shall have the meaning set forth in (i) the Base Indenture and (ii) the Series 2008-1 Supplement.

The Issuing Bank irrevocably authorizes Beneficiary to draw on it, in accordance with the terms and conditions and subject to the reductions in amount as hereinafter set forth, (1) in one or more drawings by one or more of the Trustee’s drafts, each drawn on the Issuing Bank at the Issuing Bank’s Office, payable at sight on a Business Day (as defined below), and accompanied by the Trustee’s written and completed certificate signed by the Trustee in substantially the form of Annex A attached hereto (any such draft accompanied by such certificate being a “Credit Demand”), an amount equal to the face amount of each such draft but in the aggregate amount not exceeding the Series 2008-1 Letter of Credit Amount as in effect on such Business Day, (2) in one or more drawings by one or more of the Trustee’s drafts, drawn on the Issuing Bank at the Issuing Bank’s Office, payable at sight on a Business Day, and accompanied by the Trustee’s written and completed certificate signed by it in substantially the form of Annex B attached hereto (such draft accompanied by such certificate being an “Unpaid Demand Note Demand”), an amount equal to the face amount of such draft but not exceeding the Series 2008-1 Letter of Credit Amount as in effect on such Business Day, (3) in one or more drawings by one or more of the Trustee’s drafts, drawn on the Issuing Bank at the Issuing Bank’s Office, payable at sight on a Business Day, and accompanied by the Trustee’s written and completed certificate signed by it in substantially the form of Annex C attached hereto (such draft accompanied by such certificate being a “Preference Payment Demand”), an amount equal to the face amount of such draft but not exceeding the Series 2008-1 Letter of Credit Amount as in effect on such Business Day and (4) in one or more drawings by one or more of the Trustee’s drafts, drawn on the Issuing Bank at the Issuing Bank’s Office, payable at sight on a Business Day, and accompanied by the Trustee’s written and completed certificate signed by it in substantially the form of Annex D attached hereto (such draft accompanied by such certificate being a “Termination Demand”), an amount equal to the face amount of such draft but not exceeding the Series 2008-1 Letter of Credit Amount as in effect on such Business Day. Any Credit Demand, Unpaid Demand Note Demand, Preference Payment Demand or Termination Demand may be delivered by facsimile transmission. The Trustee shall deliver the original executed counterpart of such Credit Demand, Unpaid Demand Note Demand, Preference Payment Demand or Termination Demand, as the case may be, to the Issuing Bank by means of overnight courier. “Business Day” means any day other than a Saturday, Sunday or other day on which banks are authorized by law to close in New York City, New York. Upon the Issuing Bank honoring any Credit Demand, Unpaid Demand Note Demand, Preference Payment Demand or Termination Demand presented hereunder, the Series 2008-1 Letter of Credit Amount shall automatically be decreased by an amount equal to the amount of such Credit Demand, Unpaid Demand Note Demand, Preference Payment Demand or Termination Demand. In addition to the foregoing reduction, (i) upon the Issuing Bank honoring any Termination Demand in respect of the entire Series 2008-1 Letter of Credit Amount presented to it hereunder, the

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amount available to be drawn under this Series 2008-1 Letter of Credit Amount shall automatically be reduced to zero and this Series 2008-1 Letter of Credit shall be terminated and (ii) no amount decreased on the honoring of any Preference Payment Demand or Termination Demand shall be reinstated.

The Series 2008-1 Letter of Credit Amount shall be automatically reinstated when and to the extent, but only when and to the extent, that (i) the Issuing Bank is reimbursed by Hertz (or by HVF under Section 3.2(c)(i) of the Series 2008-1 Supplement) for any amount drawn hereunder as a Credit Demand or an Unpaid Demand Note Demand and (ii) the Issuing Bank receives written notice from Hertz in substantially the form of Annex E hereto that no Event of Bankruptcy (as defined in the Base Indenture) with respect to Hertz has occurred and is continuing; provided, however, that the Series 2008-1 Letter of Credit Amount shall, in no event, be reinstated to an amount in excess of the then current Series 2008-1 Letter of Credit Amount (without giving effect to any reduction to the Series 2008-1 Letter of Credit Amount that resulted from such Credit Demand or Unpaid Demand Note Demand).

The Series 2008-1 Letter of Credit Amount shall be automatically reduced in accordance with the terms of a written request from the Trustee to the Issuing Bank in substantially the form of Annex G attached hereto that is acknowledged and agreed to in writing by the Issuing Bank. The Series 2008-1 Letter of Credit Amount shall be automatically increased upon receipt by (and written acknowledgment of such receipt by) the Trustee of written notice from the Issuing Bank in substantially the form of Annex H attached hereto certifying that the Series 2008-1 Letter of Credit Amount has been increased and setting forth the amount of such increase, which increase shall not result in the Series 2008-1 Letter of Credit Amount exceeding an amount equal to []($[        ]).

Each Credit Demand, Unpaid Demand Note Demand, Preference Payment Demand and Termination Demand shall be dated the date of its presentation, and shall be presented to the Issuing Bank at the Issuing Bank’s Office, Attention: [Global Loan Operations, Standby Letter of Credit Unit]. If the Issuing Bank receives any Credit Demand, Unpaid Demand Note Demand, Preference Payment Demand or Termination Demand at such office, all in strict conformity with the terms and conditions of this Series 2008-1 Letter of Credit, not later than 12:00 p.m. (New York City time) on a Business Day prior to the termination hereof, the Issuing Bank will make such funds available by 4:00 p.m. (New York City time) on the same day in accordance with Beneficiary’s payment instructions. If the Issuing Bank receives any Credit Demand, Unpaid Demand Note Demand, Preference Payment Demand or Termination Demand at such office, all in strict conformity with the terms and conditions of this Series 2008-1 Letter of Credit, after 12:00 p.m. (New York City time) on a Business Day prior to the termination hereof, the Issuing Bank will make the funds available by 4:00 p.m. (New York City time) on the next succeeding Business Day in accordance with Beneficiary’s payment instructions. If Beneficiary so requests to the Issuing Bank, payment under this Series 2008-1 Letter of Credit may be made by wire transfer of Federal Reserve Bank of New York funds to Beneficiary’s account in a bank on the Federal Reserve wire system or by deposit of same day funds into a designated account. All payments made by the

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Issuing Bank under this Series 2008-1 Letter of Credit shall be made with the Issuing Bank’s own funds.

Upon the earliest of (i) the date on which the Issuing Bank honors a Preference Payment Demand or Termination Demand presented hereunder to the extent of the Series 2008-1 Letter of Credit Amount as in effect on such date, (ii) the date on which the Issuing Bank receives written notice from Beneficiary that an alternate letter of credit or other credit facility has been substituted for this Series 2008-1 Letter of Credit and (iii) the Series 2008-1 Letter of Credit Expiration Date, this Series 2008-1 Letter of Credit shall automatically terminate and Beneficiary shall surrender this Series 2008-1 Letter of Credit to the undersigned Issuing Bank on such day.

This Series 2008-1 Letter of Credit is transferable in its entirety to any transferee(s) who Beneficiary certifies to the Issuing Bank has succeeded Beneficiary as Trustee under the Base Indenture and the Series 2008-1 Supplement, and may be successively transferred. Transfer of this Series 2008-1 Letter of Credit to such transferee shall be effected by the presentation to the Issuing Bank of this Series 2008-1 Letter of Credit accompanied by a certificate in substantially the form of Annex F attached hereto. Upon such presentation the Issuing Bank shall forthwith transfer this Series 2008-1 Letter of Credit to (or to the order of) the transferee or, if so requested by Beneficiary’s transferee, issue a letter of credit to (or to the order of) Beneficiary’s transferee with provisions therein consistent with this Series 2008-1 Letter of Credit.

This Series 2008-1 Letter of Credit sets forth in full the undertaking of the Issuing Bank, and such undertaking shall not in any way be modified, amended, amplified or limited by reference to any document, instrument or agreement referred to herein, except only the certificates and the drafts referred to herein; and any such reference shall not be deemed to incorporate herein by reference any document, instrument or agreement except for such certificates and such drafts.

This Series 2008-1 Letter of Credit is subject to the Uniform Customs and Practice for Documentary Credits, 1993 Revision, ICC Publication No. 500 (the “Uniform Customs”), which is incorporated into the text of this Series 2008-1 Letter of Credit by reference, and shall be governed by the laws of the State of New York, including, as to matters not covered by the Uniform Customs, the Uniform Commercial Code as in effect in the State of New York; provided that if an interruption of business (as described in such Article 17) exists at the Issuing Bank’s Office, the Issuing Bank agrees to (i) promptly notify the Trustee of an alternative location in which to send any communications with respect to this Series 2008-1 Letter of Credit or (ii) to effect payment under this Series 2008-1 Letter of Credit if a drawing which otherwise conforms to the terms and conditions of this Series 2008-1 Letter is made prior to the earlier of (A) the thirtieth day after the resumption of business and (B) the Series 2008-1 Letter of Credit Expiration Date and (ii) Article 41 of the Uniform Customs shall not apply to this Series 2008-1 Letter of Credit as drawings hereunder shall not be deemed to be installments for purposes thereof.

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Communications with respect to this Series 2008-1 Letter of Credit shall be in writing and shall be addressed to the Issuing Bank at the Issuing Bank’s Office, specifically referring to the number of this Series 2008-1 Letter of Credit.

Very truly yours,
[           ]
By:
	Name:
	Title:

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ANNEX A

CERTIFICATE OF CREDIT DEMAND

[Issuing Bank’s Address]

Attention:  [Global Loan Operations, Standby Letter of Credit Unit]

Certificate of Credit Demand under the Irrevocable Letter of Credit No. [        ] (the “Series 2008-1 Letter of Credit”), dated September [  ], 2008, issued by [                                   ], as the Issuing Bank, in favor of the Trustee. Capitalized terms not otherwise defined herein shall have the meanings assigned thereto in the Series 2008-1 Letter of Credit or, if not defined therein, the Series 2008-1 Supplement (as defined in the Series 2008-1 Letter of Credit).

The undersigned, a duly authorized officer of the Trustee, hereby certifies to the Issuing Bank as follows:

1.[The Bank of New York Mellon Trust Company, N.A. (formerly known as The Bank of New York Trust Company, N.A.)](1) is the Trustee under the Series 2008-1 Supplement referred to in the Series 2008-1 Letter of Credit.

2.[A Series 2008-1 Lease Interest Payment Deficit exists and, pursuant to Section 3.3(d) of the Series 2008-1 Supplement, an amount equal to the Issuing Bank’s Pro Rata Share of the least of (i) such Series 2008-1 Lease Interest Payment Deficit, (ii) the excess, if any, of the sum of the amounts described in clauses (i) and (ii) of Section 3.3(a) of the Series 2008-1 Supplement over the amounts available from the Series 2008-1 Accrued Interest Account plus the amount withdrawn from the Series 2008-1 Reserve Account pursuant to Section 3.3(c) of the Series 2008-1 Supplement and (iii) the Series 2008-1 Letter of Credit Liquidity Amount as of the date hereof](2)

[A Series 2008-1 Lease Interest Payment Deficit exists and, pursuant to Section 3.3(d) of the Series 2008-1 Supplement, an amount equal to the Issuing Bank’s Pro Rata Share of the product of (x) 100% minus the Series 2008-1 Cash Collateral Percentage and (y) the least of (i) such Series 2008-1 Lease Interest Payment Deficit, (ii) the excess, if any, of the sum of the amounts described in clauses (i) and (ii) of Section 3.3(a) of the Series 2008-1 Supplement over the amounts available from the Series 2008-1 Accrued Interest Account plus the amount withdrawn from the Series 2008-1 Reserve Account

(1)If Trustee under the Series 2008-1 Letter of Credit is other than The Bank of New York Mellon Trust Company, N.A., the name of such other Trustee is to be inserted.

(2)Use in case of a Series 2008-1 Lease Interest Payment Deficit and if no Series 2008-1 Cash Collateral Account has been established and funded.

A-1

pursuant to Section 3.3(c) of the Series 2008-1 Supplement and (iii) the Series 2008-1 Letter of Credit Liquidity Amount as of the date hereof](3)

[A Series 2008-1 Lease Principal Payment Deficit exists after giving effect to the distribution of amounts to be deposited in the Series 2008-1 Distribution Account in accordance with Section 3.5(b)(i) of the Series 2008-1 Supplement and, pursuant to Section 3.5(b)(ii) of the Series 2008-1 Supplement, an amount equal to the Issuing Bank’s Pro Rata Share of the lesser of (i) the excess, if any, of the Series 2008-1 Lease Principal Payment Deficit over the amount, if any, withdrawn from the Series 2008-1 Reserve Account in accordance with Section 3.5(b)(i) of the Series 2008-1 Supplement, [and] (ii) the Series 2008-1 Letter of Credit Liquidity Amount as of the date hereof (after giving effect to any drawings on the Series 2008-1 Letters of Credit pursuant to Section 3.3(d) of the Series 2008-1 Supplement) [and (iii) the excess, if any, of the Principal Deficit Amount over the over the amount, if any, withdrawn from the Series 2008-1 Reserve Account in accordance with Section 3.5(b)(i) of the Series 2008-1 Supplement](4)](5)

[A Series 2008-1 Lease Principal Payment Deficit exists after giving effect to the distribution of amounts to be deposited in the Series 2008-1 Distribution Account in accordance with Section 3.5(b)(i) of the Series 2008-1 Supplement and, pursuant to Section 3.5(b)(ii) of the Series 2008-1 Supplement, an amount equal to the Issuing Bank’s Pro Rata Share of the product of (x) 100% minus the Series 2008-1 Cash Collateral Percentage and (y) the lesser of (i) the excess, if any, of the Series 2008-1 Lease Principal Payment Deficit over the amount, if any, withdrawn from the Series 2008-1 Reserve Account in accordance with Section 3.5(b)(i) of the Series 2008-1 Supplement, [and] (ii) the Series 2008-1 Letter of Credit Liquidity Amount as of the date hereof (after giving effect to any drawings on the Series 2008-1 Letters of Credit pursuant to Section 3.3(d) of the Series 2008-1 Supplement) [and (iii) the excess, if any, of the Principal Deficit Amount over the over the amount, if any, withdrawn from the Series 

(3)Use in case of a Series 2008-1 Lease Interest Payment Deficit and if the Series 2008-1 Cash Collateral Account has been established and funded.

(4)Use on any date that is prior to the Legal Final Payment Date occurring during the period commencing on and including the date of the filing by Hertz of a petition for relief under Chapter 11 of the Bankruptcy Code to but excluding the date on which Hertz shall have resumed making all payments of Monthly Variable Rent required to be made under the HVF Lease

(5)Use in case of a Series 2008-1 Lease Principal Payment Deficit on any Payment Date and if no Series 2008-1 Cash Collateral Account has been established and funded.

A-2

2008-1 Reserve Account in accordance with Section 3.5(b)(i) of the Series 2008-1 Supplement](6)](7)

has been allocated to making a drawing under the Series 2008-1 Letter of Credit.

3.The Trustee is making a drawing under the Series 2008-1 Letter of Credit as required by Section[s] [3.3(d) and/or 3.5(b)(ii)](8) of the Series 2008-1 Supplement for an amount equal to $                          , which amount is a Series 2008-1 LOC Credit Disbursement (the “Series 2008-1 LOC Credit Disbursement”) and is equal to the amount allocated to making a drawing on the Series 2008-1 Letter of Credit under such Section [3.3(d) and/or 3.5(b)(ii)](9) of the Series 2008-1 Supplement as described above. The Series 2008-1 LOC Credit Disbursement does not exceed the amount that is available to be drawn by the Trustee under the Series 2008-1 Letter of Credit on the date of this certificate.

4.The amount of the draft shall be delivered pursuant to the following instructions:

[insert payment instructions (including payment date) for wire to [The Bank of New York Mellon Trust Company, N.A.](10) as Trustee].

5.The Trustee acknowledges that, pursuant to the terms of the Series 2008-1 Letter of Credit, upon the Issuing Bank honoring the draft accompanying this certificate, the Series 2008-1 Letter of Credit Amount shall be automatically decreased by an amount equal to such draft.

(6)Use on any date that is prior to the Legal Final Payment Date occurring during the period commencing on and including the date of the filing by Hertz of a petition for relief under Chapter 11 of the Bankruptcy Code to but excluding the date on which Hertz shall have resumed making all payments of Monthly Variable Rent required to be made under the HVF Lease

(7)Use in case of a Series 2008-1 Lease Principal Payment Deficit on any Payment Date and the Series 2008-1 Cash Collateral Account has been established and funded.

(8)Use reference to Section 3.3(d) of the Series 2008-1 Supplement in case of a Series 2008-1 Lease Interest Payment Deficit and/or Section 3.5(b)(ii) of the Series 2008-1 Supplement in case of a Series 2008-1 Lease Principal Payment Deficit.

(9)Use reference to Section 3.3(d) of the Series 2008-1 Supplement in case of a Series 2008-1 Lease Interest Payment Deficit and/or Section 3.5(b)(ii) of the Series 2008-1 Supplement in case of a Series 2008-1 Lease Principal Payment Deficit.

(10)See footnote 1 above.

A-3

IN WITNESS WHEREOF, the Trustee has executed and delivered this certificate on this           day of                        ,           .

[THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A.](11),
as Trustee
By
	Title:

(11)See footnote 1 above.

A-4

ANNEX B

CERTIFICATE OF UNPAID DEMAND NOTE DEMAND

[Issuing Bank’s Address]

Attention:  [Global Loan Operations, Standby Letter of Credit Unit]

Certificate of Unpaid Demand Note Demand under the Irrevocable Letter of Credit No. [                          ] (the “Series 2008-1 Letter of Credit”), dated September [  ], 2008, issued by [                            ], as the Issuing Bank, in favor of the Trustee.  Capitalized terms not otherwise defined herein shall have the meanings assigned thereto in the Series 2008-1 Letter of Credit or, if not defined therein, the Series 2008-1 Supplement (as defined in the Series 2008-1 Letter of Credit).

The undersigned, a duly authorized officer of the Trustee, hereby certifies to the Issuing Bank as follows:

1.[The Bank of New York Mellon Trust Company, N.A. (formerly known as The Bank of New York Trust Company, N.A.)](1) is the Trustee under the Series 2008-1 Supplement referred to in the Series 2008-1 Letter of Credit.

2.As of the date of this certificate, there exists an amount due and payable by The Hertz Corporation (“Hertz”) under the Demand Note (the “Demand Note”) issued by Hertz to HVF and pledged to the Trustee under the Series 2008-1 Supplement which amount has not been paid (or the Trustee has failed to make a demand for payment under the Demand Note in such amount due to the occurrence of an Event of Bankruptcy as defined in Schedule 1 to the Base Indenture (or the occurrence of an event described in clause (a) of the definition thereof, without the lapse of a period of 60 consecutive days) with respect to Hertz) and, pursuant to Section 3.5(b)(iv) of the Series 2008-1 Supplement, an amount equal to the Issuing Bank’s Pro Rata Share

[of the lesser of (i) the amount that Hertz failed to pay under the Series 2008-1 Demand Note (or the amount that the Trustee failed to demand for payment thereunder); and (ii) the Series 2008-1 Letter of Credit Amount as of the date hereof;](2)

(1)If Trustee under the Series 2008-1 Letter of Credit is other than The Bank of New York Mellon Trust Company, N.A., the name of such other Trustee is to be inserted.

(2)Use on any Business Day if no Series 2008-1 Cash Collateral Account has been established and funded as of such date.

B-1

[of the product of (x) 100% minus the Series 2008-1 Cash Collateral Account Percentage and (y) the lesser of (i) the amount that Hertz failed to pay under the Series 2008-1 Demand Note (or the amount that the Trustee failed to demand for payment thereunder); and (ii) the Series 2008-1 Letter of Credit Amount as of the date hereof;](3)

has been allocated to making a drawing on the Series 2008-1 Letter of Credit.

3.Pursuant to Section[s] [3.5(b)(iv)] [3.5(c)(iii)](4) of the Series 2008-1 Supplement, the Trustee is making a drawing under the Series 2008-1 Letter of Credit in an amount equal to $                                     , which amount is a Series 2008-1 LOC Unpaid Demand Note Disbursement (the “Series 2008-1 LOC Unpaid Demand Note Disbursement”) and is equal to the amount allocated to making a drawing on the Series 2008-1 Letter of Credit under Section[s] [3.5(b)(iv)] [3.5(c)(iii)](5) of the Series 2008-1 Supplement as described above.  The Series 2008-1 LOC Unpaid Demand Note Disbursement does not exceed the amount that is available to be drawn by the Trustee under the Series 2008-1 Letter of Credit on the date of this certificate.

4.The amount of the draft shall be delivered pursuant to the following instructions:

[insert payment instructions (including payment date) for wire to [The Bank of New York Mellon Trust Company, N.A.](6) as Trustee].

5.The Trustee acknowledges that, pursuant to the terms of the Series 2008-1 Letter of Credit, upon the Issuing Bank honoring the draft accompanying this certificate, the Series 2008-1 Letter of Credit Amount shall be automatically decreased by an amount equal to such draft.

(3)Use on any Business Day if the Series 2008-1 Cash Collateral Account has been established and funded as of such date.

(4)Use reference to Section 3.5(b)(iv) of the Series 2008-1 Supplement on any Business Day other than a Business Day immediately preceding a Legal Final Payment Date and Section 3.5(c)(iii) of the Series 2008-1 Supplement on the Business Day immediately preceding the Legal Final Payment Date.

(5)Use reference to Section 3.5(b)(iv) of the Series 2008-1 Supplement on any Business Day other than a Business Day immediately preceding a Legal Final Payment Date and Section 3.5(c)(iii) of the Series 2008-1 Supplement on the Business Day immediately preceding the Legal Final Payment Date.

(6)See footnote 1 above.

B-2

IN WITNESS WHEREOF, the Trustee has executed and delivered this certificate on this          day of                               ,           .

[THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A.](7),
as Trustee
By
	Title:

(7)See footnote 1 above.

B-3

ANNEX C

CERTIFICATE OF PREFERENCE PAYMENT DEMAND

[Issuing Bank’s Address]

Attention:  [Global Loan Operations, Standby Letter of Credit Unit]

Certificate of Preference Payment Demand under the Irrevocable Letter of Credit No. [                        ] (the “Series 2008-1 Letter of Credit”), dated September [  ], 2008, issued by[                              ], as the Issuing Bank, in favor of the Trustee.  Capitalized terms not otherwise defined herein shall have the meanings assigned thereto in the Series 2008-1 Letter of Credit or, if not defined therein, the Series 2008-1 Supplement (as defined in the Series 2008-1 Letter of Credit).

The undersigned, a duly authorized officer of the Trustee, hereby certifies to the Issuing Bank as follows:

1.[The Bank of New York Mellon Trust Company, N.A. (formerly known as The Bank of New York Trust Company, N.A.)](1) is the Trustee under the Series 2008-1 Supplement referred to in the Series 2008-1 Letter of Credit.

2.The Trustee has received a certified copy of the final non-appealable order of the applicable bankruptcy court requiring the return of a Preference Amount.

4.Pursuant to Section [3.5(b)(iv)][3.5(c)(iii)](2) of the Series 2008-1 Supplement, an amount equal to the Issuing Bank’s Pro Rata Share of [the lesser of (i) the Preference Amount referred to above and (ii) the Series 2008-1 Letter of Credit Liquidity Amount as of the date hereof](3) [the product of (x) 100% minus the Series 2008-1 Cash Collateral Percentage and (y) the lesser of (i) the Preference Amount referred to

(1)If Trustee under the Series 2008-1 Letter of Credit is other than The Bank of New York Mellon Trust Company, N.A., the name of such other Trustee is to be inserted.

(2)Use reference to Section 3.5(b)(iv) of the Series 2008-1 Supplement on any Business Day other than a Business Day immediately preceding a Legal Final Payment Date and Section 3.5(c)(iii) of the Series 2008-1 on the Business Day immediately preceding the Legal Final Payment Date.

(3)Use if no Series 2008-1 Cash Collateral Account has been established and funded as of such date.

C-1

above and (ii) the Series 2008-1 Letter of Credit Liquidity Amount as of the date hereof](4) has been allocated to making a drawing under the Series 2008-1 Letter of Credit.

5.Pursuant to [Section 3.5(b)(iv) )][3.5(c)(iii)](5) of the Series 2008-1 Supplement, the Trustee is making a drawing in the amount of $                         which amount is a Series 2008-1 LOC Preference Payment Disbursement (the “Series 2008-1 LOC Preference Payment Disbursement”) and is equal to the amount allocated to making a drawing on the Series 2008-1 Letter of Credit under such [Section 3.5(b)(iv) )][3.5(c)(iii)](6) of the Series 2008-1 Supplement as described above.  The Series 2008-1 LOC Preference Payment Disbursement does not exceed the amount that is available to be drawn by the Trustee under the Series 2008-1 Letter of Credit on the date of this certificate.

6.The amount of the draft shall be delivered pursuant to the following instructions:

[insert payment instructions (including payment date) for wire to [The Bank of New York Mellon Trust Company, N.A.](7) as Trustee]

7.The Trustee acknowledges that, pursuant to the terms of the Series 2008-1 Letter of Credit, upon the Issuing Bank honoring the draft accompanying this certificate, the Series 2008-1 Letter of Credit Amount shall be automatically decreased by an amount equal to such draft.

(4)Use if the Series 2008-1 Cash Collateral Account has been established and funded as of such date.

(5)Use reference to Section 3.5(b)(iv) of the Series 2008-1 Supplement on any Business Day other than a Business Day immediately preceding a Legal Final Payment Date and Section 3.5(c)(iii) of the Series 2008-1 Supplement on the Business Day immediately preceding the Legal Final Payment Date.

(6)Use reference to Section 3.5(b)(iv) of the Series 2008-1 Supplement on any Business Day other than a Business Day immediately preceding a Legal Final Payment Date and Section 3.5(c)(iii) of the Series 2008-1 Supplement on the Business Day immediately preceding the Legal Final Payment Date.

(7)See footnote 1 above.

C-2

IN WITNESS WHEREOF, the Trustee has executed and delivered this certificate on this            day of                               ,              .

[THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A.](8),
as Trustee
By
	Title:

(8)See footnote 1 above.

C-3

ANNEX D

CERTIFICATE OF TERMINATION DEMAND

[Issuing Bank’s Address]

Attention:  [Global Loan Operations, Standby Letter of Credit Unit]

Certificate of Termination Demand under the Irrevocable Letter of Credit No. [                        ] (the “Series 2008-1 Letter of Credit”), dated September [     ], 2008, issued by [              ], as the Issuing Bank, in favor of the Trustee.  Capitalized terms not otherwise defined herein shall have the meanings assigned thereto in the Series 2008-1 Letter of Credit Agreement or, if not defined therein, the Series 2008-1 Supplement (as defined in the Series 2008-1 Letter of Credit).

The undersigned, a duly authorized officer of the Trustee, hereby certifies to the Issuing Bank as follows:

1.[The Bank of New York Mellon Trust Company, N.A. (formerly known as The Bank of New York Trust Company, N.A.)](27) is the Trustee under the Series 2008-1 Supplement referred to in the Series 2008-1 Letter of Credit.

2.[Pursuant to Section 3.9(b) of the Series 2008-1 Supplement, an amount equal to the Issuing Bank’s Pro Rata Share of the lesser of (x) the greatest of (A) the excess, if any, of the Series 2008-1 Required Enhancement Amount over the Series 2008-1 Adjusted Enhancement Amount, excluding the Series 2008-1 Letter of Credit but taking into account any substitute Series 2008-1 Letter of Credit which has been obtained from a Series 2008-1 Eligible Letter of Credit Provider and is in full force and effect on such date, (B) the excess, if any, of the Series 2008-1 Required Liquidity Amount over the Series 2008-1 Adjusted Liquidity Amount, excluding the Series 2008-1 Letter of Credit but taking into account each substitute Series 2008-1 Letter of Credit which has been obtained from a Series 2008-1 Eligible Letter of Credit Provider and is in full force and effect on such date, and (C) the excess, if any, of the Series 2008-1 Demand Note Payment Amount over the Series 2008-1 Letter of Credit Liquidity Amount, excluding the Series 2008-1 Letter of Credit but taking into account each substitute Series 2008-1 Letter of Credit which has been obtained from a Series 2008-1 Eligible Letter of Credit Provider, and is in full force and effect on such date, and (y) the amount available to be

(27)If Trustee under the Series 2008-1 Letter of Credit is other than The Bank of New York Mellon Trust Company, N.A., the name of such other Trustee is to be inserted.

D-1

drawn on the expiring Series 2008-1 Letter of Credit on such date has been allocated to making a drawing under the Series 2008-1 Letter of Credit.](28)

[The Trustee has not received the notice required from the Administrator pursuant to Section 3.9(b) of the Series 2008-1 Supplement on or prior to the date that is fifteen (15) Business Days prior to each Series 2008-1 Letter of Credit Expiration Date.  As such, pursuant to such Section 3.9(b) of the Series 2008-1 Supplement, the Trustee is making a drawing for the full amount of the Series 2008-1 Letter of Credit.](29)

[Pursuant to Section 3.9(c) of the Series 2008-1 Supplement, an amount equal to  the lesser of (i) the greatest of (A) the excess, if any, of the Series 2008-1 Required Enhancement Amount over the Series 2008-1 Adjusted Enhancement Amount, excluding the available amount under the Series 2008-1 Letter of Credit, on such date, (B) the excess, if any, of the Series 2008-1 Required Liquidity Amount over the Series 2008-1 Adjusted Liquidity Amount, excluding the available amount under the Series 2008-1 Letter of Credit, on such date, and (C) the excess, if any, of the Series 2008-1 Demand Note Payment Amount over the Series 2008-1 Letter of Credit Liquidity Amount, excluding the available amount under the Series 2008-1 Letter of Credit, on such date, and (ii) the amount available to be drawn on the Series 2008-1 Letter of Credit on such date has been allocated to making a drawing under the Series 2008-1 Letter of Credit.](30)

3.[Pursuant to Section [3.9(b)](31) [3.9(c)](32) of the Series 2008-1 Supplement, the Trustee is making a drawing in the amount of $                  which is a Series 2008-1 LOC Termination Disbursement (the “Series 2008-1 LOC Termination Disbursement”) and is equal to the amount allocated to making a drawing on the Series 2008-1 Letter of Credit under such Section [3.9 (b)](33) [3.9(c)](34) of the Series 2008-1 Supplement as described above.  The Series 2008-1 LOC Termination Disbursement does not exceed the

(28)Use in case of an expiring Series 2008-1 Letter of Credit.

(29)Use if Administrator does not provide the Trustee with notices required under Section 3.9(b) of the Series 2008-1 Supplement with respect to an expiring Series 2008-1 Letter of Credit.

(30)Use in case of Issuing Bank being subject to a Series 2008-1 Downgrade Event.

(31)Use in case of an expiring Series 2008-1 Letter of Credit.

(32)Use in case of a Series 2008-1 Letter of Credit Provider being subject to a Downgrade Event.

(33)Use in case of an expiring Series 2008-1 Letter of Credit.

(34)Use in case of a Series 2008-1 Letter of Credit Provider being subject to a Downgrade Event.

D-2

amount that is available to be drawn by the Trustee under the Series 2008-1 Letter of Credit on the date of this certificate.

4.The amount of the draft shall be delivered pursuant to the following instructions:

[insert payment instructions (including payment date) for wire to [The Bank of New York Mellon Trust Company, N.A.](35) as Trustee]

(35)See footnote 1 above.

D-3

5.The Trustee acknowledges that, pursuant to the terms of the Series 2008-1 Letter of Credit, upon the Issuing Bank honoring the draft accompanying this certificate, the Series 2008-1 Letter of Credit Amount shall be automatically reduced to zero and the Series 2008-1 Letter of Credit shall terminate and be immediately returned to the Issuing Bank.

IN WITNESS WHEREOF, the Trustee has executed and delivered this certificate on this            day of                  ,               .

[THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A.](36),
as Trustee
By
	Title:

(36)See footnote 1 above

D-4

ANNEX E

CERTIFICATE OF REINSTATEMENT
OF LETTER OF CREDIT AMOUNT

[Issuing Bank’s Address]

Attention:  [Global Loan Operations, Standby Letter of Credit Unit]

Certificate of Reinstatement of Letter of Credit Amount under the Irrevocable Letter of Credit No. [                      ] (the “Series 2008-1 Letter of Credit”), dated September [  ], 2008, issued by [                            ], as the Issuing Bank, in favor of [The Bank of New York Mellon Trust Company, N.A. (formerly known as The Bank of New York Trust Company, N.A.), a New York banking corporation] (37), as Trustee (in such capacity, the “Trustee”) under the Series 2008-1 Supplement and the Base Indenture.  Capitalized terms not otherwise defined herein shall have the meanings assigned thereto in the Series 2008-1 Letter of Credit.

The undersigned, a duly authorized officer of The Hertz Corporation (“Hertz”), hereby certifies to the Issuing Bank as follows:

1.As of the date of this certificate, the Issuing Bank has been reimbursed by Hertz in the amount of $[                     ] (the “Reimbursement Amount”) in respect of the [Credit Demand] [Unpaid Demand Note Demand] made on                   ,           .

2.The Reimbursement Amount was paid to the Issuing Bank prior to payment in full of the Series 2008-1 Notes (as defined in the Series 2008-1 Supplement).

3.Hertz hereby notifies you that, pursuant to the terms and conditions of the Series 2008-1 Letter of Credit, the Series 2008-1 Letter of Credit Amount of the Issuing Bank is hereby reinstated in the amount of $[] so that the Series 2008-1 Letter of Credit Amount of the Issuing Bank after taking into account such reinstatement is in amount equal to $[].

4.As of the date of this certificate, no Event of Bankruptcy with respect to Hertz has occurred and is continuing.  “Event of Bankruptcy” with respect to Hertz means (a) a case or other proceeding shall be commenced, without the application or consent of Hertz, in any court, seeking the liquidation, reorganization, debt arrangement, dissolution, winding up, or composition or readjustment of debts of Hertz, the appointment of a trustee, receiver, custodian, liquidator, assignee, sequestrator or the like

(37)If the Trustee under the Series 2008-1 Letter of Credit is other than The Bank of New York Mellon Trust Company, N.A., the name of such other Trustee is to be inserted.

E-1

for Hertz or all or any substantial part of its assets, or any similar action with respect to Hertz under any law relating to bankruptcy, insolvency, reorganization, winding up or composition or adjustment of debts, and any such case or proceeding shall continue undismissed, or unstayed and in effect, for a period of 60 consecutive days; or an order for relief in respect of Hertz shall be entered in an involuntary case under the federal bankruptcy laws or any other similar law now or hereafter in effect; or (b) Hertz shall commence a voluntary case or other proceeding under any applicable bankruptcy, insolvency, reorganization, debt arrangement, dissolution or other similar law now or hereafter in effect, or shall consent to the appointment of or taking possession by a receiver, liquidator, assignee, trustee, custodian, sequestrator (or other similar official) for Ford or for any substantial part of its property, or shall make any general assignment for the benefit of creditors; or (c) Hertz or its board of directors shall vote to implement any of the actions set forth in the preceding clause (b).

IN WITNESS WHEREOF, Hertz has executed and delivered this certificate on this          day of                          ,             .

THE HERTZ CORPORATION
By
	Title:

E-2

Acknowledged and Agreed:

The undersigned hereby acknowledges receipt of the Reimbursement Amount (as defined above) in the amount set forth above and agrees that the undersigned’s Series 2008-1 Letter of Credit Amount is in an amount equal to $                       as of this            day of                           , 200     after taking into account the reinstatement of the Series 2008-1 Letter of Credit Amount by an amount equal to the Reimbursement Amount.

[		]
By:
	Name:
	Title:

E-3

ANNEX F

INSTRUCTION TO TRANSFER

[Issuing Bank’s Address]

Attention:Standby Letter of Credit Department

Re:Irrevocable Letter of Credit No. [                   ]

Ladies and Gentlemen:

For value received, the undersigned beneficiary hereby irrevocably transfers to:

[Name of Transferee]

[Issuing Bank’s Address]

all rights of the undersigned beneficiary to draw under the above-captioned Letter of Credit (the “Series 2008-1 Letter of Credit”) issued by the Issuing Bank named therein in favor of the undersigned.  The transferee has succeeded the undersigned as Trustee under the Base Indenture and the Series 2008-1 Supplement (as defined in the Series 2008-1 Letter of Credit).

By this transfer, all rights of the undersigned beneficiary in the Series 2008-1 Letter of Credit are transferred to the transferee and the transferee shall hereafter have the sole rights as beneficiary thereof; provided, however, that no rights shall be deemed to have been transferred to the transferee until such transfer complies with the requirements of the Series 2008-1 Letter of Credit pertaining to transfers.

F-1

The Series 2008-1 Letter of Credit is returned herewith and in accordance therewith we ask that this transfer be effective and that the Issuing Bank transfer the Series 2008-1 Letter of Credit to our transferee and that the Issuing Bank endorse the Series 2008-1 Letter of Credit returned herewith in favor of the transferee or, if requested by the transferee, issue a new irrevocable letter of credit in favor of the transferee with provisions consistent with the Series 2008-1 Letter of Credit.

	Very truly yours,
	[THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A.],(38)
	as Trustee
By
	Name:
	Title:
By
	Name:
	Title:

(38)If the Trustee under the Series 2008-1 Letter of Credit is other than The Bank of New York Mellon Trust Company, N.A., the name of such other Trustee is to be inserted.

F-2

ANNEX G

NOTICE OF REDUCTION OF SERIES 2008-1 LETTER OF CREDIT AMOUNT

[Issuing Bank’s Address]

Attention:  [Global Loan Operations, Standby Letter of Credit Unit]

Notice of Reduction of Series 2008-1 Letter of Credit Amount under the Irrevocable Letter of Credit No. [                    ] (the “Series 2008-1 Letter of Credit”), dated September [  ], 2008, issued by [                              ], as the Issuing Bank, in favor of [The Bank of New York Mellon Trust Company, N.A. (formerly known as The Bank of New York Trust Company, N.A.)](39), as the Trustee.  Capitalized terms not otherwise defined herein shall have the meanings assigned thereto in the Series 2008-1 Letter of Credit.

The undersigned, a duly authorized officer of the Trustee, hereby notifies the Issuing Bank as follows:

1.The Trustee has received a notice pursuant to the Series 2008-1 Letter of Credit Agreement authorizing it to request a reduction of the Series 2008-1 Letter of Credit Amount to $                    and is delivering this notice in accordance with the terms of the Series 2008-1 Letter of Credit Agreement.

2.The Issuing Bank acknowledges that the aggregate maximum amount of the Series 2008-1 Letter of Credit is reduced to $                    from $                    pursuant to and in accordance with the terms and provisions of the Series 2008-1 Letter of Credit and that the reference in the first paragraph of the Series 2008-1 Letter of Credit to “                    ($                    )” is amended to read “                    ($                    ).

3.This request, upon your acknowledgment set forth below, shall constitute an amendment to the Series 2008-1 Letter of Credit and shall form an integral part thereof and confirms that all other terms of the Series 2008-1 Letter of Credit remain unchanged.

4.The Issuing Bank is requested to execute and deliver its acknowledgment and agreement to this notice to the Trustee in the manner provided in Section [2.1(a)] of the Series 2008-1 Letter of Credit Agreement.

(39)If Trustee under the Series 2008-1 Letter of Credit is other than The Bank of New York Mellon Trust Company, N.A., the name of such other Trustee is to be inserted.

G-1

IN WITNESS WHEREOF, the Trustee has executed and delivered this certificate on this          day of             ,      .

			[THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A.](40),
			as Trustee
			By:
				Title:
ACKNOWLEDGED
THIS                   DAY OF              , 200     :
[		]
By:
	Name:
	Title:

(40)See footnote 1 above.

G-2

ANNEX H

NOTICE OF INCREASE OF SERIES 2008-1 LETTER OF CREDIT AMOUNT

[The Bank of New York Mellon Trust Company, N.A.](41),

as Trustee under the
Series 2008-1 Supplement
referred to below

2 North LaSalle Street
Chicago, Illinois 60602

Attention:  Corporate Trust Administration—Structured Finance

Notice of Increase of Series 2008-1 Letter of Credit Amount under the Irrevocable Letter of Credit No. [                        ] (the “Series 2008-1 Letter of Credit”), dated September [  ], 2008, issued by[                                 ], as the Issuing Bank, in favor of [The Bank of New York Mellon Trust Company, N.A. (formerly known as The Bank of New York Trust Company, N.A.)](42), as the Trustee.  Capitalized terms not otherwise defined herein shall have the meanings assigned thereto in the Series 2008-1 Letter of Credit.

The undersigned, duly authorized officers of the Issuing Bank, hereby notify the Trustee as follows:

1.The Issuing Bank has received a request from [                          ] to increase the Series 2008-1 Letter of Credit Amount by $              , which increase shall not result in the Series 2008-1 Letter of Credit Amount exceeding an amount equal to [              ] Dollars ($[                            ]).

2.Upon your acknowledgment set forth below, the aggregate maximum amount of the Series 2008-1 Letter of Credit is increased to $              from $               pursuant to and in accordance with the terms and provisions of the Series 2008-1 Letter of Credit and that the reference in the first paragraph of the Series 2008-1 Letter of Credit to “                                                             ($                    )” is amended to read “                                                        ($              )”.

3.This notice, upon your acknowledgment set forth below, shall constitute an amendment to the Series 2008-1 Letter of Credit and shall form an integral part thereof and confirms that all other terms of the Series 2008-1 Letter of Credit remain unchanged.

(41)If Trustee under the Series 2008-1 Letter of Credit is other than The Bank of New York Mellon Trust Company, N.A., the name of such other Trustee is to be inserted.

(42)See footnote 1 above.

4.The Trustee is requested to execute and deliver its acknowledgment and acceptance to this notice to the Issuing Bank, in the manner provided in Section 2.1(a) of the Series 2008-1 Letter of Credit Agreement.

IN WITNESS WHEREOF, the Issuing Bank has executed and delivered this certificate on this         day of                  ,            .

		[BANK]
		By:
			Name:
			Title:
		By:
			Name:
			Title:
ACKNOWLEDGED AND AGREED TO
THIS            DAY OF                   , 200    :
[THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A.](43),
as Trustee
By:
	Name:
	Title:

(43)See footnote 1 above.

2

EXHIBIT C

TO SERIES 2008-1 SUPPLEMENT

FORM OF LEASE PAYMENT
DEFICIT NOTICE

The Bank of New York Mellon Trust Company, N.A., as Trustee

2 North LaSalle Street

Chicago, Illinois 60602

Attn:  Corporate Trust Administration—Structured Finance

[                ]     , 200   

Ladies and Gentlemen:

This Lease Payment Deficit Notice is delivered to you pursuant to Section 3.3(b) of the Series 2008-1 Supplement, dated as of September 12, 2008, to the Second Amended and Restated Base Indenture, dated as of August 1, 2006, as amended, between Hertz Vehicle Financing LLC, as Issuer, and The Bank of New York Mellon Trust Company, N.A. (formerly known as The Bank of New York Trust Company, N.A.), as Trustee and Securities Intermediary, by The Hertz Corporation, as Administrator.  Terms used herein have the meanings provided in the Series 2008-1 Supplement.

Pursuant to Section 3.3(b) of the Series 2008-1 Supplement, The Hertz Corporation, in its capacity as Administrator under the Related Documents, hereby provides notice of a Series 2008-1 Lease Payment Deficit in the amount of $                    (consisting of a Series 2008-1 Lease Interest Payment Deficit in the amount of $                    and a Series 2008-1 Lease Principal Payment Deficit in the amount of $                   ).

THE HERTZ CORPORATION

By:

Name:

Title:

EXHIBIT D
TO
SERIES 2008-1 SUPPLEMENT

FORM OF REDUCTION NOTICE REQUEST
SERIES 2008-1 LETTER OF CREDIT

The Bank of New York Mellon Trust Company, N.A.,

as Trustee under the
Series 2008-1 Supplement
referred to below

2 North LaSalle Street
Chicago, Illinois 60602

Attention: Corporate Trust Administration—Structured Finance

Request for reduction of the stated amount of the Series 2008-1 Letter of Credit under the Series 2008-1 Letter of Credit Agreement, dated as of [         ], (as amended, supplemented or otherwise modified from time to time in accordance with the terms thereof as of the date hereof, the “Letter of Credit Agreement”), between The Hertz Corporation (“Hertz”) and [                 ], as the Issuing Bank.

The undersigned, duly authorized officers of Hertz, hereby certify to The Bank of New York Mellon Trust Company, N.A. (formerly known as The Bank of New York Trust Company, N.A.), in its capacity as the Trustee (the “Trustee”) under the Series 2008-1 Supplement referred to in the Letter of Credit Agreement (the “Series 2008-1 Supplement”) as follows:

1.             The Series 2008-1 Letter of Credit Amount and the Series 2008-1 Letter of Credit Liquidity Amount as of the date of this request prior to giving effect to the reduction of the stated amount of the Series 2008-1 Letter of Credit requested in paragraph 2 of this request are $                    and $                   , respectively.

2.             The Trustee is hereby requested pursuant to Section 3.9(d) of the Series 2008-1 Series Supplement to execute and deliver to the Series 2008-1 Letter of Credit Provider a Notice of Reduction substantially in the form of Annex G to the Series 2008-1 Letter of Credit (the “Notice of Reduction”) for a reduction (the “Reduction”) in the stated amount of the Series 2008-1 Letter of Credit by an amount equal to $                   . The Trustee is requested to execute and deliver the Notice of Reduction promptly following its receipt of this request, and in no event more than two (2) Business Days following the date of its receipt of this request (as required pursuant to Section 3.9(d) of the Series 2008-1 Series Supplement), and to provide for the reduction pursuant to the Notice of Reduction to be as of                ,       . The undersigned understands that the Trustee will be relying on the contents hereof.  The undersigned further understands that the Trustee shall not be liable to the undersigned for any failure to transmit (or any

delay in transmitting) the Notice of Reduction (including any fees and expenses attributable to the stated amount of the Series 2008-1 Letter of Credit not being reduced in accordance with this paragraph) to the extent such failure (or delay) does not result from the gross negligence or willful misconduct of the Trustee.

3.             To the best of the knowledge of the undersigned, the Series 2008-1 Letter of Credit Amount and the Series 2008-1 Letter of Credit Liquidity Amount will be $                    and $                   , respectively, as of the date of the reduction (immediately after giving effect to such reduction) requested in paragraph 2 of this request.

4.             The undersigned acknowledges and agrees that each of (a) the execution and delivery of this request by the undersigned, (b) the execution and delivery by the Trustee of a Notice of Reduction of the stated amount of the Series 2008-1 Letter of Credit, substantially in the form of Annex G to the Series 2008-1 Letter of Credit, and (c) the Series 2008-1 Letter of Credit Provider’s acknowledgment of such notice constitutes a representation and warranty to the Series 2008-1 Letter of Credit Provider and the Trustee (i) by the undersigned that each of the statements set forth in the Series 2008-1 Letter of Credit Agreement is true and correct and (ii) by the undersigned, in its capacity as Administrator under the Series 2008-1 Supplement, that (A) the Series 2008-1 Adjusted Enhancement Amount will equal or exceed the Series 2008-1 Required Enhancement Amount, (B) the Series 2008-1 Adjusted Liquidity Amount will equal or exceed the Series 2008-1 Required Liquidity Amount and (C) the Series 2008-1 Letter of Credit Liquidity Amount will equal or exceed the Series 2008-1 Demand Note Payment Amount.

5.             The undersigned agrees that if on or prior to the date as of which the stated amount of the Series 2008-1 Letter of Credit is reduced by the amount set forth in paragraph 2 of this request the undersigned obtains knowledge that any of the statements set forth in this request is not true and correct or will not be true and correct after giving effect to such reduction, the undersigned shall immediately so notify the Series 2008-1 Letter of Credit Provider and the Trustee by telephone and in writing by telefacsimile in the manner provided in the Letter of Credit Agreement and the request set forth herein to reduce the stated amount of the Series 2008-1 Letter of Credit shall be deemed canceled upon receipt by the Series 2008-1 Letter of Credit Provider of such notice in writing.

6.             Capitalized terms used herein and not defined herein have the meanings set forth in the Series 2008-1 Supplement.

2

IN WITNESS WHEREOF, The Hertz Corporation has executed and delivered this request on this      day of       ,    .

THE HERTZ CORPORATION

By:
	Name:
	Title:

3

EXHIBIT E
TO
SERIES 2008-1 SUPPLEMENT

FORM OF PURCHASER’S LETTER

The Bank of New York Mellon Trust Company, N.A.,
as Registrar
2 North LaSalle Street
Chicago, Illinois 60602
Attention: Corporate Trust Administration—Structured Finance

Re:	Hertz Vehicle Financing LLC
	Series 2008-1 Rental Car Asset Backed Notes

Reference is made to the Series 2008-1 Supplement, dated as of September 12, 2008 (as from time to time amended, supplemented or otherwise modified in accordance with the terms thereof, the “Series 2008-1 Supplement”), between Hertz Vehicle Financing LLC, as Issuer (“HVF”), and The Bank of New York Mellon Trust Company, N.A. (formerly known as The Bank of New York Trust Company, N.A.), as trustee (the “Trustee”), to the Second Amended and Restated Base Indenture, dated as of August 1, 2006 (as from time to time amended, supplemented or otherwise modified in accordance with the terms thereof, the “Base Indenture”), between HVF and the Trustee.  Capitalized terms used herein and not defined herein shall have the meanings given to them in the Series 2008-1 Supplement.

In connection with a proposed purchase of certain Series 2008-1 Notes from [                               ] by the undersigned, the undersigned hereby represents and warrants that:

(1)           it has had an opportunity to discuss HVF’s and the Administrator’s business, management and financial affairs, and the terms and conditions of the proposed purchase, with HVF and the Administrator and their respective representatives;

(2)           it is an “accredited investor” within the meaning of Rule 501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act and has sufficient knowledge and experience in financial and business matters to be capable of evaluating the merits and risks of investing in, and is able and prepared to bear the economic risk of investing in, the Series 2008-1 Notes;

(3)           it is purchasing the Series 2008-1 Notes for its own account, or for the account of one or more “accredited investors” within the meaning of Rule 501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act that meet the criteria described in subsection (b) and for which it is acting with complete

investment discretion, for investment purposes only and not with a view to distribution, subject, nevertheless, to the understanding that the disposition of its property shall at all times be and remain within its control;

(4)           it understands that the Series 2008-1 Notes have not been and will not be registered or qualified under the Securities Act or any applicable state securities laws or the securities laws of any other jurisdiction and is being offered only in a transaction not involving any public offering within the meaning of the Securities Act and may not be resold or otherwise transferred unless so registered or qualified or unless an exemption from registration or qualification is available, that HVF is not required to register the Series 2008-1 Notes, and that any transfer must comply with provisions of Section 2.8 of the Base Indenture;

(5)           it understands that the Series 2008-1 Notes will bear the legend set out in the form of Series 2008-1 Notes attached as Exhibit A to the Series 2008-1 Supplement and be subject to the restrictions on transfer described in such legend;

(6)           it will comply with all applicable federal and state securities laws in connection with any subsequent resale of the Series 2008-1 Notes;

(7)           it understands that the Series 2008-1 Notes may be offered, resold, pledged or otherwise transferred only with HVF’s prior written consent, which consent shall not be unreasonably withheld, and only (A) to HVF, (B) in a transaction meeting the requirements of Rule 144A under the Securities Act, (C) outside the United States to a foreign person in a transaction meeting the requirements of Regulation S under the Securities Act, or (D) in a transaction complying with or exempt from the registration requirements of the Securities Act and in accordance with any applicable securities laws of any state of the United States or any other jurisdiction; notwithstanding the foregoing, it is hereby understood and agreed by HVF that (i) in the case of each Investor Group with respect to which there is a Conduit Investor, the Series 2008-1 Notes will be pledged by each Conduit Investor pursuant to its related commercial paper program documents, and the Series 2008-1 Notes, or interests therein, may be sold, transferred or pledged to the related Committed Note Purchaser or any Program Support Provider or any Affiliate of its related Committed Note Purchaser or any Program Support Provider or, any commercial paper conduit administered by its related Committed Note Purchaser or any Program Support Provider or any affiliate of its related Committed Note Purchaser or any Program Support Provider and (ii) in the case of each Investor Group, the Series 2008-1 Notes, or interests therein, may be sold, transferred or pledged to the related Committed Note Purchaser or any Program Support Provider or any affiliate of its related Committed Note Purchaser or any Program Support Provider or, any commercial paper conduit administered by its related Committed Note Purchaser or any Program Support Provider or any affiliate of its related Committed Note Purchaser or any Program Support Provider;

2

(8)           if it desires to offer, sell or otherwise transfer, pledge or hypothecate the Series 2008-1 Notes as described in clause (B) or (D) of Section 6.03(g) of the Series 2008-1 Note Purchase Agreement, and such sale, transfer or pledge does not fall within the “notwithstanding the foregoing” provision of Section 6.03(g) of the Series 2008-1 Note Purchase Agreement, the transferee of the Series 2008-1 Notes will be required to deliver a certificate, as described in the Series 2008-1 Supplement, that an exemption from the registration requirements of the Securities Act applies to such offer, sale, transfer or hypothecation.  Upon original issuance thereof, and until such time as the same may no longer be required under the applicable requirements of the Securities Act, the certificate evidencing the Series 2008-1 Notes (and all securities issued in exchange therefor or substitution thereof) shall bear a legend substantially in the form set forth in the Series 2008-1 Notes included as an exhibit to the Series 2008-1 Supplement.  The undersigned understands that the registrar and transfer agent for the Series 2008-1 Notes will not be required to accept for registration of transfer the Series 2008-1 Notes acquired by it, except upon presentation of an executed letter in the form required by the Series 2008-1 Supplement; and

(9)           it will obtain from any purchaser of the Series 2008-1 Notes substantially the same representations and warranties contained in the foregoing paragraphs.

This certificate and the statements contained herein are made for your benefit and for the benefit of HVF.

[		]
By:
	Name:
	Title:

Dated:

cc: Hertz Vehicle Financing LLC

3

EXHIBIT F-1
TO
SERIES 2008-1 SUPPLEMENT

FORM OF MONTHLY NOTEHOLDERS’ STATEMENT

HERTZ VEHICLE FINANCING LLC

$[825,000,000] Series 2008-1 Variable Funding Rental Car Asset Backed Notes

The undersigned, Authorized Officers of The Hertz Corporation (“Hertz”), pursuant to each of (i) the Second Amended and Restated Master Motor Vehicle Operating Lease and Servicing Agreement, dated as of August 1, 2006, as amended (as such agreement may be further amended, supplemented, restated or otherwise modified from time to time in accordance with its terms, the “HVF Lease”) between Hertz Vehicle Financing LLC (“HVF”), as Lessor, and Hertz, as Lessee and Servicer, (ii) the Amended and Restated Administration Agreement, dated as of December 21, 2005 (as such agreement may be amended, supplemented, restated or otherwise modified from time to time in accordance with its terms, the “Administration Agreement”) among HVF, The Bank of New York Mellon Trust Company, N.A. (formerly known as The Bank of New York Trust Company, N.A.), and Hertz as Administrator and (iii) the Second Amended and Restated Base Indenture, dated as of August 1, 2006, as amended, between HVF and The Bank of New York Mellon Trust Company, N.A., as trustee (the “Trustee”) and securities intermediary, as supplemented by the Series 2008-1 Supplement thereto, dated as of September 12, 2008 (as such supplement may be further amended, supplemented, restated or otherwise modified from time to time in accordance with its terms, the “Series 2008-1 Supplement”) (as such agreement may be amended, supplemented, restated or otherwise modified from time to time in accordance with its terms, the “Second Amended and Restated Base Indenture”), do hereby certify to the best of their knowledge after reasonable investigation that:

Unless otherwise defined herein, capitalized terms used herein have the respective meanings set forth in the Second Amended and Restated Base Indenture. This statement is delivered pursuant to Section 1(a)(J) of the Administration Agreement and Section 6.2 of the Series 2008-1 Supplement.

(a)           Hertz is the Servicer under the HVF Lease and the Administrator under the Administration Agreement.

(b)           The undersigned are Authorized Officers of Hertz.

(c)           The date of this statement is a Determination Date under the Second Amended and Restated Base Indenture. The first Payment Date after the date of this statement is the “Applicable Payment Date”.

(d)           The attached Schedule I (including Annex A attached thereto) forms and constitutes an integral part of this statement.

(e)           No event which constitutes an Operating Lease Event of Default or Potential Operating Lease Event of Default under the HVF Lease has occurred or is continuing as of the date hereof except as follows: [set forth in detail the (i) nature of each such Operating Lease Event of Default or Potential Operating Lease Event of Default, (ii) action taken by the Lessee, if any, to remedy each such Operating Lease Event of Default or Potential Operating Lease Event of Default and (iii) current status of each such Operating Lease Event of Default or Potential Operating Lease Event of Default]. [If applicable, insert “None”.]

(f)            [No Amortization Event or Potential Amortization Event has occurred with respect to the Series 2008-1 Notes during the Related Month] [An Amortization Event or Potential Amortization Event with respect to the Series 2008-1 Notes did occur on                     ].  [If applicable, set forth in detail the (i) nature of such Amortization Event or Potential Amortization Event, (ii) action, if any, taken by HVF to remedy such Amortization Event or Potential Amortization Event, and (iii) current status of such Amortization Event or Potential Amortization Event.]

IN WITNESS WHEREOF, the undersigned have executed and delivered this certificate this       day of          ,    .

By:
	Name:
	Title:
By:
	Name:
	Title:

2

EXHIBIT F-2
TO
SERIES 2008-1 SUPPLEMENT

FORM OF WEEKLY NOTEHOLDERS’ STATEMENT

HERTZ VEHICLE FINANCING LLC

$[825,000,000] Series 2008-1 Variable Funding Rental Car Asset Backed Notes

The undersigned, Authorized Officers of [The Hertz Corporation (“Hertz”)]* [HVF]†, pursuant to each of (i) the Second Amended and Restated Master Motor Vehicle Operating Lease and Servicing Agreement, dated as of August 1, 2006, as amended (as such agreement may be further amended, supplemented, restated or otherwise modified from time to time in accordance with its terms, the “HVF Lease”) between Hertz Vehicle Financing LLC (“HVF”), as Lessor, and Hertz, as Lessee and Servicer, (ii) the Amended and Restated Administration Agreement, dated as of December 21, 2005 (as such agreement may be amended, supplemented, restated or otherwise modified from time to time in accordance with its terms, the “Administration Agreement”) among HVF, The Bank of New York Mellon Trust Company, N.A. (formerly known as The Bank of New York Trust Company, N.A.), and Hertz as Administrator and (iii) the Second Amended and Restated Base Indenture, dated as of August 1, 2006, as amended, between HVF and The Bank of New York Mellon Trust Company, N.A., as trustee (the “Trustee”) and securities intermediary, as supplemented by the Series 2008-1 Supplement thereto, dated as of September 12, 2008 (as such supplement may be further amended, supplemented, restated or otherwise modified from time to time in accordance with its terms, the “Series 2008-1 Supplement”) (as such agreement may be amended, supplemented, restated or otherwise modified from time to time in accordance with its terms, the “Second Amended and Restated Base Indenture”), do hereby certify to the best of their knowledge after reasonable investigation that:

Unless otherwise defined herein, capitalized terms used herein have the respective meanings set forth in the Second Amended and Restated Base Indenture, or, if not defined therein, in the Series 2008-1 Supplement. This statement is delivered

* Use if delivered by the Administrator.

† Use if delivered by HVF

[pursuant to Section 1(a)(J) of the Administration Agreement]* [and] Section 6.2 of the Series 2008-1 Supplement.

(a)           Hertz is the Servicer under the HVF Lease and the Administrator under the Administration Agreement.

(b)           The undersigned are Authorized Officers of [Hertz]* [HVF]†.

(c)           The attached Schedule I (including Annex A attached thereto) forms and constitutes an integral part of this statement.

IN WITNESS WHEREOF, the undersigned have executed and delivered this certificate this        day of                     ,       .

By:
	Name:
	Title:
By:
	Name:
	Title:

* Use if delivered by the Administrator

† Use if delivered by HVF

2

EXHIBIT G-2

TO
SERIES 2008-1 SUPPLEMENT

FORM OF DEMAND NOTICE

THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A.,
AS TRUSTEE

                           , 20    

The Hertz Corporation
225 Brae Boulevard
Park Ridge, NJ 07656
Attn: Treasury Department

This Demand Notice is being delivered to you pursuant to [Section 3.5(b)(iii)] [Section 3.5(c)(ii)] of that certain Series 2008-1 Supplement, dated as of September 12, 2008 (the “Series 2008-1 Supplement”), between Hertz Vehicle Financing LLC (“HVF”) and The Bank of New York Mellon Trust Company, N.A. (formerly known as The Bank of New York Trust Company, N.A.), as Trustee (the “Trustee”).  Capitalized terms used but not defined in this Demand Note shall have the respective meanings assigned to them in the Series 2008-1 Supplement.

Demand is hereby made for payment in the amount of $[                  ] in immediately available funds by wire transfer to the account set forth below:

Account bank:   [                 ]

Account name:  [                 ]

ABA routing number: [                       ]

Reference:  [                       ]

EXHIBIT G-2

TO
SERIES 2008-1 SUPPLEMENT

FORM OF SERIES 2008-1 DEMAND NOTE

$[                  ]	New York, New York
	September 12, 2008

FOR VALUE RECEIVED, the undersigned, THE HERTZ CORPORATION, a Delaware corporation (“Hertz”), promises to pay to the order of HERTZ VEHICLE FINANCING LLC, a Delaware limited liability company (“HVF”), on any date of demand (the “Demand Date”) the principal sum of $[                  ].

Definitions.  Capitalized terms used but not defined in this Demand Note shall have the respective meanings assigned to them in the Second Amended and Restated Base Indenture, dated as of August 1, 2006, as amended (as the same may be further amended, supplemented, amended and restated or otherwise modified from time to time in accordance with the terms thereof, the “Base Indenture”), between HVF and The Bank of New York Mellon Trust Company, N.A. (formerly known as The Bank of New York Trust Company, N.A.), a national banking association (in such capacity, the “Trustee”), and the Series 2008-1 Supplement thereto dated as of September 12, 2008 (as the same may be amended, supplemented, amended and restated or otherwise modified from time to time in accordance with the terms thereof, the “Series 2008-1 Supplement”) between HVF and the Trustee.

Principal Payment Date.  Any unpaid principal of this Demand Note shall be paid on each Demand Date to the extent demand is made therefor.  No portion of the outstanding principal amount of this Demand Note may be voluntarily prepaid.

Interest.  Interest shall be paid on the weighted average principal balance outstanding during each Interest Period at the Demand Note Rate on the Payment Date for the period from and including the prior Payment Date, or in the case of the first Payment Date, the date of this Demand Note, to but excluding such Payment Date (each period an “Interest Period”).  Interest on the loan shall be calculated based on the actual number of days elapsed in each Interest Period and a year consisting of 360 days.  The “Demand Note Rate” means the London Interbank Offered Rate (LIBOR) appearing on Reuters Screen LIBOR01 (or on any successor or substitute page of such service or any successor to or substitute for such screen, providing rate quotations comparable to those currently provided on such page of such screen) at approximately 11:00 a.m., London time, as the rate for dollar deposits with a one-month maturity that is effective on the Payment Date.  The “Payment Date” means the 25th day of each month, or if such date is not a Business Day, the next succeeding Business Day, commencing on October 25, 2008.  “Business Day” means any day other than a Saturday, Sunday or other day on which banks are authorized or required by law to be closed in New York City, New York.  The maker and endorser waives presentment for payment, protest and notice of dishonor and nonpayment of this Demand Note.  The receipt of interest in advance or the extension of time shall not relinquish or discharge any endorser of this Demand Note.

No Waiver, Amendment.  No failure or delay on the part of HVF in exercising any power or right hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any such power or right preclude any other or further exercise thereof or the exercise of any other power or right.  No amendment, modification or waiver of, or consent with respect to, any provision of this Demand Note shall in any event be effective unless (a) the same shall be in writing and signed and delivered by each of Hertz, HVF and the Trustee and (b) all consents required for such actions under any material contracts or agreements of either Hertz or HVF shall have been received by the appropriate Persons.

Payments.  All payments shall be made in lawful money of the United States of America by wire transfer in immediately available funds and shall be applied first to fees and costs, including collection costs, if any, next to interest and then to principal.  Payments shall be made to the account designated in the written demand for payment.

Collection Costs.  Hertz agrees to pay all costs of collection of this Demand Note, including, without limitation, reasonable attorney’s fees, paralegal’s fees and other legal costs (including court costs) incurred in connection with consultation, arbitration and litigation (including trial, appellate, administrative and bankruptcy proceedings), regardless of whether or not suit is brought, and all other costs and expenses incurred by HVF or the Trustee in exercising its rights and remedies hereunder.  Such costs of collection shall bear interest at the Demand Note Rate until paid.

No Negotiation.  This Demand Note is not negotiable other than to the Trustee for the benefit of the Series 2008-1 Noteholders pursuant to the Series 2008-1 Supplement.  The parties intend that this Demand Note will be pledged to the Trustee for the benefit of the secured parties under the Series 2008-1 Supplement and the other Related Documents and payments hereunder shall be made only to said Trustee.

Reduction of Principal.  The principal amount of this Demand Note may be reduced only in accordance with the provisions of the Series 2008-1 Supplement.

Governing Law.  THIS DEMAND NOTE HAS BEEN DELIVERED IN NEW YORK, NEW YORK AND SHALL BE DEEMED TO BE A CONTRACT MADE UNDER AND GOVERNED BY THE INTERNAL LAWS OF THE STATE OF NEW YORK.

Captions.  Paragraph captions used in this Demand Note are provided solely for convenience of reference only and shall not affect the meaning or interpretation of any provision this Demand Note.

THE HERTZ CORPORATION,
	By:
		Scott Massengill
		Treasurer

3

PAYMENT GRID

Date Principal
Amount Amount of
Principal
Payment Outstanding
Principal
Balance Notation Made
By

4

EXHIBIT H

TO

SERIES 2008-1 SUPPLEMENT

Form of Estimated Interest Adjustment Notice

THE HERTZ CORPORATION,
AS ADMINISTRATOR

                           , 20   

The Bank of New York Mellon Trust Company, N.A., as Trustee
2 North LaSalle Street
Chicago, IL 60602
Attn: Corporate Trust Administration—Structured Finance

ESTIMATED INTEREST ADJUSTMENT NOTICE

This notice is being delivered to you pursuant to Section 3.3(a) of that certain Series 2008-1 Supplement, dated as of September 12, 2008 (the “Series 2008-1 Supplement”), between Hertz Vehicle Financing LLC and The Bank of New York Mellon Trust Company, N.A. (formerly known as The Bank of New York Trust Company, N.A.), as Trustee (the “Trustee”).  The undersigned, being an authorized officer of The Hertz Corporation (the “Administrator”), as Administrator under the Series 2008-1 Supplement, hereby notifies you that in respect of the [                       ] Payment Date, the amount of $                       represents the amount of the adjustment required to be made to the amount of the Series 2008-1 Adjusted Monthly Interest for the related Payment Date as a result of the difference between the amount of Estimated Interest with respect to the related Estimated Interest Period and the actual amount of Series 2008-1 Adjusted Monthly Interest that accrued during the Estimated Interest Period which commenced on the immediately preceding Determination Date.

Capitalized terms used herein and not defined herein shall have the meanings assigned to such terms in the Series 2008-1 Supplement.

IN WITNESS WHEREOF, the undersigned has executed this Certificate as an officer of the Servicer as of the          day of                         , 200      .

THE HERTZ CORPORATION
By:
	Name:
	Title:

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EX-4.9.26.2

Exhibit 4.9.26.2

EXECUTION VERSION

SERIES 2008-1 NOTE PURCHASE AGREEMENT

(SERIES 2008-1 VARIABLE FUNDING RENTAL CAR ASSET BACKED NOTES)

dated as of September 12, 2008,

among

HERTZ VEHICLE FINANCING LLC,

THE HERTZ CORPORATION,

as Administrator,

CERTAIN CONDUIT INVESTORS,

each as a Conduit Investor,

CERTAIN FINANCIAL INSTITUTIONS,

each as a Committed Note Purchaser,

CERTAIN FUNDING AGENTS,

and

DEUTSCHE BANK SECURITIES INC.,

as Administrative Agent

TABLE OF CONTENTS

	Page
ARTICLE I DEFINITIONS	2
SECTION 1.01   Definitions	2
ARTICLE II PURCHASE AND SALE OF SERIES 2008-1 NOTES	11
SECTION 2.01   The Initial Note Purchase	11
SECTION 2.02   Advances	11
SECTION 2.03   Borrowing Procedures	12
SECTION 2.04   The Series 2008-1 Notes	13
SECTION 2.05   Commitment Terms	14
SECTION 2.06   Selection of Interest Rates	14
SECTION 2.07   Reduction in Commitment Amount	14
ARTICLE III INTEREST AND FEES	14
SECTION 3.01   Interest	14
SECTION 3.02   Fees	15
SECTION 3.03   Eurodollar Lending Unlawful	15
SECTION 3.04   Deposits Unavailable	16
SECTION 3.05   Increased or Reduced Costs, etc.	16
SECTION 3.06   Funding Losses	17
SECTION 3.07   Increased Capital Costs	18
SECTION 3.08   Taxes	18
SECTION 3.09   Indenture Carrying Charges; Survival	19
ARTICLE IV OTHER PAYMENT TERMS	20
SECTION 4.01   Time and Method of Payment	20
ARTICLE V THE ADMINISTRATIVE AGENT AND THE FUNDING AGENTS	20
SECTION 5.01   Authorization and Action of the Administrative Agent	20
SECTION 5.02   Delegation of Duties	20
SECTION 5.03   Exculpatory Provisions	21
SECTION 5.04   Reliance	21
SECTION 5.05   Non-Reliance on the Administrative Agent and Other Purchasers	21
SECTION 5.06   The Administrative Agent in its Individual Capacity	22
SECTION 5.07   Successor Administrative Agent	22
SECTION 5.08   Authorization and Action of Funding Agents	22
SECTION 5.09   Delegation of Duties	23
SECTION 5.10   Exculpatory Provisions	23
SECTION 5.11   Reliance	23

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TABLE OF CONTENTS

(continued)

	Page
SECTION 5.12   Non-Reliance on the Funding Agent and Other Purchasers	24
SECTION 5.13   The Funding Agent in its Individual Capacity	24
SECTION 5.14   Successor Funding Agent	24
ARTICLE VI REPRESENTATIONS AND WARRANTIES	24
SECTION 6.01   HVF	24
SECTION 6.02   Administrator	25
SECTION 6.03   Conduit Investors	26
ARTICLE VII CONDITIONS	27
SECTION 7.01   Conditions to Issuance	27
SECTION 7.02   Conditions to Initial Borrowing	29
SECTION 7.03   Conditions to Each Borrowing	29
ARTICLE VIII COVENANTS	30
SECTION 8.01   Covenants	30
ARTICLE IX MISCELLANEOUS PROVISIONS	32
SECTION 9.01   Amendments	32
SECTION 9.02   No Waiver; Remedies	33
SECTION 9.03   Binding on Successors and Assigns	33
SECTION 9.04   Survival of Agreement	34
SECTION 9.05   Payment of Costs and Expenses; Indemnification	34
SECTION 9.06   Characterization as Related Document; Entire Agreement	37
SECTION 9.07   Notices	38
SECTION 9.08   Severability of Provisions	38
SECTION 9.09   Tax Characterization	38
SECTION 9.10   No Proceedings; Limited Recourse	38
SECTION 9.11   Confidentiality	40
SECTION 9.12   Governing Law	40
SECTION 9.13   Jurisdiction	40
SECTION 9.14   Waiver of Jury Trial	41
SECTION 9.15   Counterparts	41
SECTION 9.16   Additional Investor Groups	41
SECTION 9.17   Assignment	42

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TABLE OF CONTENTS

(continued)

		Page
	EXHIBITS
SCHEDULE I	List of Conduit Investors and Committed Note Purchasers
EXHIBIT A	Form of Advance Request
EXHIBIT B	Form of Assignment and Assumption Agreement
EXHIBIT C	Form of Investor Group Supplement
EXHIBIT D	Form of Addendum

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SERIES 2008-1 NOTE PURCHASE AGREEMENT

THIS SERIES 2008-1 NOTE PURCHASE AGREEMENT, dated as of September 12, 2008 (as amended, supplemented, restated or otherwise modified from time to time in accordance with the terms hereof, this “Agreement”), is made among HERTZ VEHICLE FINANCING LLC, a Delaware limited liability company (“HVF”), THE HERTZ CORPORATION, a Delaware corporation (“Hertz” or the “Administrator”), the several commercial paper conduits listed on Schedule I and their respective permitted successors and assigns (the “Conduit Investors”; each, individually, a “Conduit Investor”), the several financial institutions that serve as committed note purchasers set forth on Schedule I hereto and the other financial institutions parties hereto pursuant to Section 9.17 (each a “Committed Note Purchaser”), the financial institution set forth opposite the name of each Conduit Investor, or if there is no Conduit Investor with respect to any Investor Group, the Committed Note Purchaser with respect to such Investor Group, on Schedule I hereto and its permitted successor and assign (the “Funding Agent” with respect to such Conduit Investor or Committed Note Purchaser) DEUTSCHE BANK SECURITIES INC., in its capacity as administrative agent for the Conduit Investors, the Committed Note Purchasers and the Funding Agents (the “Administrative Agent”).

BACKGROUND

1.             Contemporaneously with the execution and delivery of this Agreement, HVF, as issuer, and The Bank of New York Mellon Trust Company, N.A. (formerly known as The Bank of New York Trust Company, N.A.), an Illinois trust company, as trustee (together with its successors in trust thereunder as provided in the Base Indenture referred to below, the “Trustee”) and as Securities Intermediary, entered into the Series 2008-1 Supplement, of even date therewith (as the same may be further amended, supplemented, restated or otherwise modified from time to time in accordance with the terms thereof, the “Series 2008-1 Supplement”), to the Second Amended and Restated Base Indenture, dated as of August 1, 2006 (as the same may be amended, supplemented, restated or otherwise modified from time to time in accordance with the terms thereof, the “Base Indenture” and, together with the Series 2008-1 Supplement, the “Indenture”), between HVF and the Trustee, pursuant to which HVF issued one or more Series 2008-1 Variable Funding Rental Car Asset Backed Notes (the “Series 2008-1 Notes”).

2.             HVF wishes to issue the Series 2008-1 Notes in favor of the Conduit Investors, or if there is no Conduit Investor with respect to any Investor Group, the Committed Note Purchaser with respect to such Investor Group, and obtain the agreement of the Conduit Investors or the Committed Note Purchasers, as applicable, to make loans from time to time (each, an “Advance”) for the purchase of Series 2008-1 Principal Amounts, all of which Advances (including the Initial Advance) will constitute Increases, and all of which Advances (including the Initial Advance) will be evidenced by the Series 2008-1 Notes purchased in connection herewith and will constitute purchases of Series 2008-1 Principal Amounts corresponding to the amount of such Advances.  Subject to the terms and conditions of this Agreement, each Conduit Investor

may make Advances from time to time and each Committed Note Purchaser is willing to commit to make Advances from time to time, to fund purchases of Series 2008-1 Principal Amounts in an aggregate outstanding amount up to the Maximum Investor Group Principal Amount for the related Investor Group until the commencement of the Series 2008-1 Rapid Amortization Period.  Hertz has joined in this Agreement to confirm certain representations, warranties and covenants made by it as Administrator for the benefit of each Conduit Investor and each Committed Note Purchaser.

ARTICLE I

DEFINITIONS

SECTION 1.01   Definitions.  As used in this Agreement and unless the context requires a different meaning, capitalized terms used but not defined herein (including the preamble and the recitals hereto) shall have the meanings assigned to such terms in Article 1 of the Series 2008-1 Supplement or in the Definitions List attached to the Base Indenture as Schedule I, as applicable.  In addition, the following terms shall have the following meanings and the definitions of such terms are applicable to the singular as well as the plural form of such terms and to the masculine as well as the feminine and neuter genders of such terms:

“Acquiring Committed Note Purchaser” has the meaning set forth in Section 9.17(a).

“Acquiring Investor Group” has the meaning set forth in Section 9.17(c).

“Addendum” means an Addendum substantially in the form of Exhibit D.

“Additional Investor Group” means, collectively, a Conduit Investor, if any, and the Committed Note Purchaser(s) with respect to such Conduit Investor or, if there is no Conduit Investor with respect to any Investor Group the Committed Note Purchaser(s) with respect to such Investor Group, in each case, that becomes party hereto as of any date after the Series 2008-1 Closing Date pursuant to Section 9.16 in connection with an increase in the Series 2008-1 Maximum Principal Amount; provided that, for the avoidance of doubt, an Investor Group that is both an Additional Investor Group and an Acquiring Investor Group shall be deemed to be an Additional Investor Group solely in connection with, and to the extent of, the commitment of such Investor Group that increases the Series 2008-1 Maximum Principal Amount when such Additional Investor Group becomes a party hereto and Additional Series 2008-1 Notes are issued pursuant to Sections 2.1 and 5.1 of the Series 2008-1 Supplement, and references herein to such an Investor Group as an “Additional Investor Group” shall not include the commitment of such Investor Group as an Acquiring Investor Group (the Maximum Investor Group Principal Amount of any such “Additional Investor Group” shall not include any portion of the Maximum Investor Group Principal Amount of such Investor Group acquired pursuant to an assignment to such Investor Group as an Acquiring Investor Group, whereas references to the Maximum Investor Group Principal Amount of such “Investor Group” shall include the entire Maximum Investor Group Principal Amount of such Investor Group as both as Additional Investor Group and an Acquiring Investor Group).

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“Additional Investor Group Initial Principal Amount” means, with respect to each Additional Investor Group on the date such Additional Investor Group becomes a party hereto, the initial principal amount on such date of the Series 2008-1 Notes issued to such Additional Investor Group, which shall be an amount equal to such Additional Investor Group’s Commitment Percentage of the principal amount of outstanding Series 2008-1 Notes as of such date (after giving effect to the issuance of such Additional Investor Group’s Series 2008-1 Notes).

“Administrative Agent Fee” has the meaning set forth in the Administrative Agent Fee Letter.

“Administrative Agent Fee Letter” means that certain fee letter, dated as of the date hereof, between the Administrative Agent and HVF setting forth the definition of Administrative Agent Fee.

“Advance” has the meaning set forth in paragraph 2 of the recitals hereto.

“Advance Request” has the meaning set forth in Section 7.03(c).

“Affected Person” has the meaning set forth in Section 3.05.

“Aggregate Unpaids” has the meaning set forth in Section 5.01.

“Assignment and Assumption Agreement” means an Assignment and Assumption Agreement substantially in the form of Exhibit B.

“Borrowing” has the meaning set forth in Section 2.02(c).

“Borrowing Deficit” has the meaning set forth in Section 2.03(b).

“Change in Law” means (a) any law, rule or regulation or any change therein or in the interpretation or application thereof (whether or not having the force of law), in each case, adopted, issued or occurring after the Series 2008-1 Closing Date or (b) any request, guideline or directive (whether or not having the force of law) from any government or political subdivision or agency, authority, bureau, central bank, commission, department or instrumentality thereof, or any court, tribunal, grand jury or arbitrator, or any accounting board or authority (whether or not part of government) which is responsible for the establishment or interpretation of national or international accounting principles, in each case, whether foreign or domestic (each an “Official Body”) charged with the administration, interpretation or application thereof, or the compliance with any request or directive of any Official Body (whether or not having the force of law) made, issued or occurring after the Series 2008-1 Closing Date.

“Commitment” means, the obligation of the Committed Note Purchasers included in each Investor Group to fund Advances pursuant to Section 2.02(a) in an aggregate stated amount up to the Maximum Investor Group Principal Amount for such Investor Group.

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“Commitment Amount” means, as to each Conduit Investor or Committed Note Purchaser, the Maximum Investor Group Principal Amount with respect to the Investor Group of which such Conduit Investor or Committed Note Purchaser is a part.

“Commitment Percentage” means, on any date of determination, with respect to any Investor Group, the ratio, expressed as a percentage, which such Investor Group’s Maximum Investor Group Principal Amount bears to the Series 2008-1 Maximum Principal Amount on such date.

“Committed Note Purchaser” has the meaning set forth in the recitals hereto.

“Committed Note Purchaser Percentage” means, with respect to any Committed Note Purchaser, the percentage set forth opposite the name of such Committed Note Purchaser on Schedule I.

“Conduit Assignee” means, with respect to any Conduit Investor, any commercial paper conduit, whose commercial paper has ratings of at least “A-2” from Standard & Poor’s and “P2” from Moody’s, that is administered by the Funding Agent with respect to such Conduit Investor or any Affiliate of such Funding Agent, in each case, designated by such Funding Agent to accept an assignment from such Conduit Investor of the Investor Group Principal Amount or a portion thereof with respect to such Conduit Investor pursuant to Section 9.17(b).

“Conduit Investors” has the meaning set forth in the recitals hereto.

“Confidential Information” for purposes of this Agreement, has the meaning set forth in Section 9.11.

“CP Rate” means, with respect to each Conduit Investor (i) for any day during any Series 2008-1 Interest Period funded by a Conduit Investor set forth in Schedule I hereto or any other Conduit Investor that elects in its Assignment and Assumption Agreement to make this clause (i) applicable (collectively, the “Conduits”), the per annum rate equivalent to the weighted average of the per annum rates paid or payable by such Conduits from time to time as interest on or otherwise (by means of interest rate hedges or otherwise taking into consideration any incremental carrying costs associated with short term promissory notes issued by such Conduits maturing on dates other than those certain dates on which such Conduits are to receive funds) in respect of the promissory notes issued by such Conduits that are allocated in whole or in part by their respective Funding Agent (on behalf of such Conduits) to fund or maintain the Series 2008-1 Principal Amount or that are issued by such Conduits specifically to fund or maintain the Series 2008-1 Principal Amount, in each case, during such period, as determined by their respective Funding Agent (on behalf of such Conduits), including (x) the commissions of placement agents and dealers in respect of such promissory notes, to the extent such commissions are allocated, in whole or in part, to such promissory notes by the related Committed Note Purchasers (on behalf of such Conduits), (y) all reasonable costs and expenses of any issuing and paying agent or other person

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responsible for the administration of such Conduits’ commercial paper programs in connection with the preparation, completion, issuance, delivery or payment of Series 2008-1 Commercial Paper, and (z) the costs of other borrowings by such Conduits including, without limitation, borrowings to fund small or odd dollar amounts that are not easily accommodated in the commercial paper market; provided, however, that if any component of such rate is a discount rate, in calculating the CP Rate, the respective Funding Agent for such Conduits shall for such component use the rate resulting from converting such discount rate to an interest bearing equivalent rate per annum and (ii) for any Series 2008-1 Interest Period for any portion of the Commitment of the related Investor Group funded by any other Conduit Investor, the “CP Rate” applicable to such Conduit Investor as set forth in its Assignment and Assumption Agreement.

“Domestic Office” means, the office of the related Funding Agent designated as such below its name on the signature page hereof, if any, or such other office of such Funding Agent as designated from time to time by written notice from such Funding Agent to HVF, inside the United States, which shall be making or maintaining Advances other than Eurodollar Advances of the Committed Note Purchasers in its Investor Group hereunder.

“Eurodollar Advance” means, an Advance which bears interest at all times during the Eurodollar Interest Period applicable thereto at a fixed rate of interest determined by reference to the Eurodollar Rate (Reserve Adjusted).

“Eurodollar Interest Period” means, with respect to any Eurodollar Advance, (a) initially, the period commencing on and including the date of such Eurodollar Advance and ending on but excluding the next Payment Date and (b) for each period thereafter, the period commencing on and including the Payment Date on which the immediately preceeding Eurodollar Interest Period ended and ending on but excluding the next Payment Date; provided, however, that

(i)no Eurodollar Interest Period may end subsequent to the August 2010 Payment Date; and

(ii)upon the occurrence and during the continuation of the Series 2008-1 Rapid Amortization Period, any Eurodollar Interest Period may be terminated at the election of the related Funding Agent by notice to HVF and the Administrator, and upon such election the Eurodollar Advances in respect of which interest was calculated by reference to such terminated Eurodollar Interest Period shall be converted to Series 2008-1 Base Rate Tranches or included in the Series 2008-1 CP Tranche until payment in full of the Series 2008-1 Notes.

“Eurodollar Office” means, the office of the related Funding Agent designated as such below its name on the signature page hereof, if any, or such other office of such Funding Agent as designated from time to time by written notice from such Funding Agent to HVF, whether or not outside the United States, which shall be making

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or maintaining Eurodollar Advances of the Committed Note Purchasers in its Investor Group hereunder.

“Eurodollar Rate” means, the rate per annum determined by the related Funding Agent at approximately 11:00 a.m. (London time) on the date which is one (1) Business Day prior to the beginning of the relevant Eurodollar Interest Period by reference to the British Bankers’ Association Interest Settlement Rates for deposits in Dollars (as set forth by any service selected by such Funding Agent which has been nominated by the British Bankers’ Association as an authorized information vendor for the purpose of displaying such rates) for a period equal to such Eurodollar Interest Period; provided that, to the extent that an interest rate is not ascertainable pursuant to the foregoing provisions of this definition, the “Eurodollar Rate” shall be the interest rate per annum determined by such Funding Agent to be the rate per annum at which deposits in Dollars are offered by the Reference Lender in London to prime banks in the London interbank market at or about 11:00 a.m. (London time) one (1) Business Day before the first day of such Eurodollar Interest Period in an amount substantially equal to the amount of the Eurodollar Advances to be outstanding during such Eurodollar Interest Period and for a period equal to such Eurodollar Interest Period.  In respect of any Eurodollar Interest Period which is not thirty (30) days in duration, the Eurodollar Rate shall be determined through the use of straight-line interpolation by reference to two rates calculated in accordance with the preceding sentence, one of which shall be determined as if the maturity of the Dollar deposits referred to therein were the period of time for which rates are available next shorter than the Eurodollar Interest Period and the other of which shall be determined as if such maturity were the period of time for which rates are available next longer than the Eurodollar Interest Period; provided that, if a Eurodollar Interest Period is less than or equal to seven days, the Eurodollar Rate shall be determined by reference to a rate calculated in accordance with the preceding sentence as if the maturity of the Dollar deposits referred to therein were a period of time equal to seven days.

“Eurodollar Rate (Reserve Adjusted)” means, for any Eurodollar Interest Period, an interest rate per annum (rounded upward to the nearest 1/100th of 1%) determined pursuant to the following formula:

Eurodollar Rate =	Eurodollar Rate
(Reserve Adjusted)	1.00 – Eurodollar Reserve Percentage

The Eurodollar Rate (Reserve Adjusted) for any Eurodollar Interest Period for Eurodollar Advances will be determined by the related Funding Agent on the basis of the Eurodollar Reserve Percentage in effect one (1) Business Day before the first day of such Eurodollar Interest Period.

“Eurodollar Reserve Percentage” means, for any Eurodollar Interest Period, the reserve percentage (expressed as a decimal) equal to the maximum aggregate reserve requirements (including all basic, emergency, supplemental, marginal and other reserves and taking into account any transitional adjustments or other scheduled changes

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in reserve requirements) specified under regulations issued from time to time by the F.R.S. Board and then applicable to assets or liabilities consisting of and including “Eurocurrency Liabilities,” as currently defined in Regulation D of the F.R.S. Board, having a term approximately equal or comparable to such Eurodollar Interest Period.

“Federal Funds Rate” means for any period, a fluctuating interest rate per annum equal for each day during such period to the weighted average of the overnight federal funds rates as in Federal Reserve Board Statistical Release H.15(519) or any successor or substitute publication selected by the Funding Agent for such Investor Group (or, if such day is not a Business Day, for the next preceding Business Day), or, if, for any reason, such rate is not available on any day, the rate determined, in the sole opinion of the Funding Agent for such Investor Group, to be the rate at which overnight federal funds are being offered in the national federal funds market at 9:00 a.m. New York City time.

“Financial Statements” has the meaning set forth in Section 6.02(b).

“Fleet Report” has the meaning set forth in Section 2.4 of the Collateral Agency Agreement.

“Governmental Authority” means the United States of America, any state, local or other political subdivision thereof and any entity exercising executive, legislative, judicial, regulatory, or administrative functions thereof pertaining thereto.

“Increase Date” shall mean the Business Day on which an Increase in the Series 2008-1 Principal Amount occurs.

“Initial Advance” means the Advances made under this Agreement as part of the initial Borrowings.

“Investor Group” means, (i) collectively, a Conduit Investor, if any, and the Committed Note Purchaser(s) with respect to such Conduit Investor or, if there is no Conduit Investor with respect to any Investor Group, the Committed Note Purchaser(s) with respect to such Investor Group, in each case, party hereto as of the Series 2008-1 Closing date and (ii) any Additional Investor Group.

“Investor Group Increase Amount” means, with respect to any Investor Group, for any Business Day, such Investor Group’s Commitment Percentage of the Increase, if any, on such Business Day.

“Investor Group Principal Amount” means, (a) with respect to any Investor Group other than an Additional Investor Group, (i) when used with respect to the Series 2008-1 Closing Date, such Investor Group’s Commitment Percentage of the Series 2008-1 Initial Principal Amount and (ii) when used with respect to any other date, an amount equal to (w) the Investor Group Principal Amount with respect to such Investor Group on the immediately preceding Business Day plus (x) the Investor Group Increase Amount with respect to such Investor Group on such date minus (y) the amount of principal payments made to such Investor Group pursuant to Section 3.5 of the Series 

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2008-1 Supplement on such date plus (z) the amount of principal payments recovered from such Investor Group by a trustee as a preference payment in a bankruptcy proceeding of the Issuer or otherwise and (b) with respect to any Additional Investor Group, (i) when used with respect to the date such Additional Investor Group becomes a party hereto, such Additional Investor Group’s Additional Investor Group Initial Principal Amount and (ii) when used with respect to any other date, an amount equal to (w) the Investor Group Principal Amount with respect to such Additional Investor Group on the immediately preceding Business Day plus (x) the Investor Group Increase Amount with respect to such Additional Investor Group on such date minus (y) the amount of principal payments made to such Investor Group pursuant to Section 3.5 of the Series 2008-1 Supplement on such date plus (z) the amount of principal payments recovered from such Additional Investor Group by a trustee as a preference payment in a bankruptcy proceeding of the Issuer or otherwise.

“Investor Group Supplement” means an Investor Group Supplement substantially in the form of Exhibit C.

“Majority Program Support Providers” means with respect to the related Investor Group, Program Support Providers holding more than 50% of the aggregate commitments of all Program Support Providers.

“Margin Stock” means “margin stock” as defined in Regulation U of the Board of Governors of the Federal Reserve System, as amended from time to time.

“Maximum Investor Group Principal Amount” means, with respect to each Investor Group, the amount set forth opposite the name of the Committed Note Purchaser included in such Investor Group on Schedule I, as such amount may be increased or modified from time to time by written agreement among the Committed Note Purchasers included in such Investor Group on Schedule I hereto, the Administrator and HVF in accordance with the terms hereof; provided that, on any day after the occurrence and during the continuance of an Amortization Event with respect to the Series 2008-1 Notes, the Maximum Investor Group Principal Amount with respect to each Investor Group shall not exceed the Investor Group Principal Amount for such Investor Group.

“Prime Rate” means the rate announced by the Reference Lender from time to time as its prime rate in the United States, such rate to change as and when such designated rate changes.  The Prime Rate is not intended to be the lowest rate of interest charged by the Reference Lender in connection with extensions of credit to debtors.

“Program Fee” has the meaning set forth in Section 3.02(a).

“Program Fee Letter” means that certain fee letter, dated as of the date hereof, by and among each initial Conduit Purchaser, each initial Committed Note Purchaser, the Administrative Agent and HVF setting forth the definition of Program Fee Rate and the definition of Undrawn Fee.

“Program Fee Rate” has the meaning set forth in the Program Fee Letter.

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“Program Support Agreement” means and includes any agreement entered into by any Program Support Provider in respect of any Series 2008-1 Commercial Paper and/or Series 2008-1 Note providing for the issuance of one or more letters of credit for the account of a Committed Note Purchaser or a Conduit Investor, the issuance of one or more insurance policies for which a Committed Note Purchaser or a Conduit Investor is obligated to reimburse the applicable Program Support Provider for any drawings thereunder, the sale by a Committed Note Purchaser or a Conduit Investor to any Program Support Provider of the Series 2008-1 Notes (or portions thereof or interests therein) and/or the making of loans and/or other extensions of credit to a Committed Note Purchaser or a Conduit Investor in connection with such Conduit Investor’s securitization program, together with any letter of credit, insurance policy or other instrument issued thereunder or guaranty thereof (but excluding any discretionary advance facility provided by a Committed Note Purchaser).

“Program Support Provider” means and includes any financial institutions and any other or additional Person now or hereafter extending credit or having a commitment to extend credit to or for the account of, and/or agreeing to make purchases from, a Committed Note Purchaser or a Conduit Investor in respect of such Committed Note Purchaser’s or Conduit Investor’s Series 2008-1 Commercial Paper and/or Series 2008-1 Note, and/or agreeing to issue a letter of credit or insurance policy or other instrument to support any obligations arising under or in connection with such Conduit Investor’s securitization program as it relates to any Series 2008-1 Commercial Paper issued by such Conduit Investor, in each case pursuant to a Program Support Agreement and any guarantor of any such person.

“Reference Lender” means the related Funding Agent or if such Funding Agent does not have a prime rate, an Affiliate thereof designated by such Funding Agent.

“Regulation S”:  Regulation S under the Securities Act.

“Securities Act”:  The U.S. Securities Act of 1933, as amended.

“Series 2005-3 Rapid Amortization Period” has the meaning set forth in the Series 2005-3 Supplement.

“Series 2005-4 Rapid Amortization Period” has the meaning set forth in the Series 2005-4 Supplement.

“Series 2008-1 Base Rate” means, on any day, a rate per annum equal to the sum of (i) the greater of (a) the Prime Rate in effect on such day and (b) the Federal Funds Rate in effect on such day plus (ii) 0.50%.  Any change in the Series 2008-1 Base Rate due to a change in the Prime Rate or the Federal Funds Rate shall be effective as of the opening of business on the effective day of such change in the Prime Rate or the Federal Funds Rate, respectively.  Changes in the rate of interest on that portion of any Advances maintained as Series 2008-1 Base Rate Tranches will take effect simultaneously with each change in the Series 2008-1 Base Rate.

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 “Series 2008-1 Commitment Termination Date” means August 15, 2010 or such later date designated in accordance with Section 2.05 or such earlier date as the parties hereto may agree in writing to terminate this Agreement.

“Series 2008-1 Related Documents” means the Related Documents relating to the Series 2008-1 Notes (including, without limitation, the Base Indenture, the Series 2008-1 Supplement, the Purchase Agreement, the HVF Lease, the Collateral Agency Agreement and the Administration Agreement); provided that, for the avoidance of doubt, any Related Document that relates solely to a Series of Notes other than the Series 2008-1 Notes shall not be a Series 2008-1 Related Document and any Related Document that relates to the Series 2008-1 Notes and other Series of Notes shall be a Series 2008-1 Related Document.

“Series 2008-1 Supplement” means that certain Series Supplement to the Base Indenture, dated as of the date hereof (as amended, modified, restated or supplemented from time to time in accordance with the terms thereof), by and between HVF and The Bank of New York Mellon Trust Company, N.A. (formerly known as the Bank of New York Trust Company, N.A.), as Trustee, relating to, among other things, the issuance by HVF of its Series 2008-1 Notes.

“Structuring Fee” has the meaning set forth in the Structuring Fee Letter.

“Structuring Fee Letter” means that certain fee letter, dated as of the date hereof, by and among each initial Conduit Purchaser, each initial Committed Note Purchaser, the Administrative Agent and HVF setting forth the definition of Structuring Fee.

“Syndication Agreement” means that certain syndication agreement, dated as of the date hereof, by and among each initial Conduit Purchaser, each initial Committed Note Purchaser and HVF.

“Syndication Fee Letter” means that certain fee letter, dated as of the date hereof, by and among Barclays Bank PLC, Sheffield Receivables Corporation, Deutsche Bank Securities, Inc., Deutsche Bank AG, New York Branch, Nantucket Funding Corp., LLC and HVF setting forth certain defined terms relating to fees payable for syndication.

“Taxes” has the meaning set forth in Section 3.08.

“Term” has the meaning set forth in Section 2.05.

“Undrawn Fee” has the meaning set forth in the Program Fee Letter.

“Weighted Average CP Rate” means, with respect to any Series 2008-1 Interest Period, the weighted average of the CP Rates applicable to each Advance funded or maintained during such Series 2008-1 Interest Period through the issuance of Series 2008-1 Commercial Paper.

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ARTICLE II

PURCHASE AND SALE OF SERIES 2008-1 NOTES

SECTION 2.01   The Initial Note Purchase.  On the terms and conditions set forth in the Indenture and this Agreement, and in reliance on the covenants, representations and agreements set forth herein and therein, HVF will cause the Trustee to issue the Series 2008-1 Notes on the Series 2008-1 Closing Date.  Such Series 2008-1 Notes for each Investor Group will be dated the Series 2008-1 Closing Date, registered in the name of the respective Funding Agent or its nominee, as agent for the related Conduit Investor, if any, and the Committed Note Purchaser(s), or in such other name as the respective Funding Agent may request, and will be duly authenticated in accordance with the provisions of the Indenture.

SECTION 2.02   Advances.  (a)  Subject to the terms and conditions of this Agreement and the Series 2008-1 Supplement, each Conduit Investor, if any may and, if such Conduit Investor determines that it will not make an Advance or any portion of an Advance, its related Committed Note Purchaser(s) or, if there is no Conduit Investor with respect to any Investor Group, the Committed Note Purchaser(s) with respect to such Investor Group, shall, to the extent such Conduit Investor does not make such Advance or there is no such Conduit Investor with respect to an Investor Group, and the Series 2008-1 Commitment Termination Date has not occurred, upon HVF’s request, delivered in accordance with the provisions of Section 2.03, and the satisfaction of all conditions precedent thereto, make Advances from time to time during the Series 2008-1 Revolving Period; provided, that, such Advances shall be made ratably by each Conduit Investor, if any, based on the respective Commitment Percentage of its Investor Group and the portion of any such Advance made by a Committed Note Purchaser shall be its Committed Note Purchaser Percentage of the Commitment Percentage with respect to the related Investor Group; provided, that no Advance shall be required or permitted to be made on any date if, after giving effect to such Advance, (i) such related Investor Group Principal Amount would exceed the Maximum Investor Group Principal Amount, (ii) the Series 2008-1 Principal Amount would exceed the Series 2008-1 Maximum Principal Amount, (iii) a Series 2008-1 Enhancement Deficiency or an Aggregate Asset Amount Deficiency exists or would exist as a result of such Advance, or (iv) an Amortization Event, Potential Amortization Event, Liquidation Event of Default or Limited Liquidation Event of Default, in each case, with respect to the Series 2008-1 Notes exists or would exist as a result of such Advance. If a Conduit Investor elects not to fund the full amount of its Commitment Percentage of the Series 2008-1 Initial Principal Amount (or, in the case of a Conduit Investor in an Additional Investor Group, the Additional Investor Group Initial Principal Amount with respect to such Additional Investor Group) or a requested Increase, such Conduit Investor shall notify the Administrative Agent and the Funding Agent with respect to such Conduit Investor, and each Committed Note Purchaser with respect to such Conduit Investor shall fund its Committed Note Purchaser Percentage of the portion of the Commitment Percentage with respect to such Investor Group of the Series 2008-1 Initial Principal Amount (or, in the case of a Committed Note Purchaser in an Additional Investor Group, the applicable portion of the Additional Investor Group Initial Principal Amount with respect to such Additional Investor Group) or  such Increase, as the case may be, not funded by such Conduit Investor.

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(b)           Subject to Section 9.10(b), each Conduit Investor hereby agrees with respect to itself that it will use commercially reasonable efforts to fund Advances made by its Investor Group through the issuance of Series 2008-1 Commercial Paper; provided, that (i) no Conduit Investor will have any obligation to use commercially reasonable efforts to fund Advances made by its Investor Group through the issuance of Series 2008-1 Commercial Paper at any time (x) an Amortization Event has occurred and is continuing or (y) the funding of such Advance through the issuance of Series 2008-1 Commercial Paper would be prohibited by the program documents governing such Conduit Investor’s commercial paper program, (ii) nothing herein is (or shall be construed) as a commitment by any Conduit Investor to fund any Advance through the issuance of Series 2008-1 Commercial Paper, and (iii) notwithstanding anything herein or in any other Related Document to the contrary, at no time will a Conduit Investor that is not also a Committed Note Purchaser be obligated to make Advances hereunder.

(c)           The proceeds of all Advances on any date shall be allocated according to the provisions of Article III of the Series 2008-1 Supplement.  Each of the Advances to be made on any date shall be made singly as part of a single borrowing (each such single borrowing being a “Borrowing”).  Subject to the terms of this Agreement and the Series 2008-1 Supplement, the aggregate principal amount of the Advances represented by the Series 2008-1 Notes may be increased or decreased from time to time.

SECTION 2.03   Borrowing Procedures.

(a)           Whenever HVF wishes the Conduit Investors, or if there is no Conduit Investor with respect to any Investor Group, the Committed Note Purchaser with respect to such Investor Group, to make an Advance, HVF shall (or shall cause the Administrator to) notify the Administrative Agent, each Funding Agent and the Trustee upon irrevocable written notice delivered to the Administrative Agent and each Funding Agent (with a copy of such notice delivered to the Committed Note Purchasers) no later than 11:30 a.m. New York City time on the Business Day prior to the proposed Borrowing (which Borrowing date shall, except in the case of the Initial Advance, be an Increase Date); provided that no more than three Borrowings shall occur during any calendar week.  Each such notice shall be irrevocable and shall in each case refer to this Agreement and specify the aggregate amount of the requested Borrowing to be made on such date.  HVF shall (or shall cause the Administrator to) ratably allocate the proposed Borrowing among the Investor Groups’ respective Investor Group Principal Amounts.  Each Funding Agent shall promptly advise its related Conduit Investor, or if there is no Conduit Investor with respect to any Investor Group, its related Committed Note Purchaser, of any notice given pursuant to this Section and, if there is a Conduit Investor with respect to any Investor Group, shall promptly thereafter (but in no event later than 11:00 a.m. New York City time on the proposed date of Borrowing), notify HVF and the related Committed Note Purchaser(s), whether such Conduit Investor has determined to make such Advance.  On the date of each Borrowing and subject to the other conditions set forth herein and in the Series 2008-1 Supplement, each Conduit Investor or its related Committed Note Purchaser(s), as the case may be, and each Committed Note Purchaser with respect to any Investor Group that does not include a Conduit Investor, shall make

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available to HVF the amount of such Advance by wire transfer in U.S. dollars of such amount in same day funds to the Series 2008-1 Collection Account no later than 3:00 p.m. (New York time) on the date of such Borrowing.

(b)           If, by 2:00 p.m. (New York time) on the date of any Borrowing, one or more Committed Note Purchasers in an Investor Group (each, a “Defaulting Committed Note Purchaser,” and each Committed Note Purchaser in the related Investor Group other than any Defaulting Committed Note Purchaser being referred to as a “Non-Defaulting Committed Note Purchaser”) fails to make its ratable portion of any Borrowing available to HVF pursuant to Section 2.03(a) (the aggregate amount unavailable to HVF as a result of such failure being herein called in either case the “Borrowing Deficit”), then the Funding Agent for such Investor Group shall, by no later than 2:30 p.m. (New York City time) on the applicable date of such Borrowing instruct each Non-Defaulting Committed Note Purchaser in the same Investor Group as the Defaulting Committed Note Purchaser to pay, by no later than 3:00 p.m. (New York time), in immediately available funds, to the Series 2008-1 Collection Account, an amount equal to the lesser of (i) such Non-Defaulting Committed Note Purchaser’s proportionate share (based upon the relative Committed Note Purchaser Percentage of such Non-Defaulting Committed Note Purchasers) of the Borrowing Deficit and (ii) such Non-Defaulting Committed Note Purchaser’s Committed Note Purchaser Percentage of the amount by which the Maximum Investor Group Investor Amount for such Investor Group exceeds the Investor Group Principal Amount for such Investor Group (determined after giving effect to any Advances already made by such Investor Group on such date).  A Defaulting Committed Note Purchaser shall forthwith, upon demand, pay to the applicable Funding Agent for the ratable benefit of the Non-Defaulting Committed Note Purchasers all amounts paid by each such Non-Defaulting Committed Note Purchaser on behalf of such Defaulting Committed Note Purchaser, together with interest thereon, for each day from the date a payment was made by a Non-Defaulting Committed Note Purchaser until the date such Non-Defaulting Committed Note Purchaser has been paid such amounts in full, at a rate per annum equal to the sum of the Series 2008-1 Base Rate plus 1% per annum.

SECTION 2.04   The Series 2008-1 Notes.  On each date an Advance is funded under the Series 2008-1 Notes pursuant to the Series 2008-1 Supplement, and on each date the amount of outstanding Advances thereunder is reduced, a duly authorized officer, employee or agent of the related Funding Agent shall make appropriate notations in its books and records of the amount of such Advance and the amount of such reduction, as applicable.  HVF hereby authorizes each duly authorized officer, employee and agent of such Funding Agent to make such notations on the books and records as aforesaid and every such notation made in accordance with the foregoing authority shall be prima facie evidence of the accuracy of the information so recorded and shall be binding on HVF absent manifest error;  provided, however, that in the event of a discrepancy between the books and records of such Funding Agent and the records maintained by the Trustee pursuant to the Indenture, such discrepancy shall be resolved by such Funding Agent, the Administrative Agent and the Trustee.

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SECTION 2.05   Commitment Terms.  The “Term” of the Commitment hereunder shall be for a period commencing on the Series 2008-1 Closing Date and ending on the Series 2008-1 Commitment Termination Date, or such later date as each Committed Note Purchaser may agree to in writing.

SECTION 2.06   Selection of Interest Rates.  Following (i) the funding of any Advances by a Committed Note Purchaser or (ii) any assignment by a Conduit Investor to its related liquidity providers pursuant to the applicable liquidity purchase agreement or liquidity loan agreement with respect to the Series 2008-1 Notes or to its related Committed Note Purchaser hereunder, in each case the Advances funded, directly or indirectly, with amounts received from any such provider or Committed Note Purchaser will accrue interest at the Series 2008-1 Base Rate; provided that HVF may, prior to the commencement of the Series 2008-1 Rapid Amortization Period, if HVF gives notice prior to 12:00 p.m. (New York Time) on the date which is one (1) Business Day prior to the commencement of the related Eurodollar Interest Period, elect that such Advances be made as Eurodollar Advances.

SECTION 2.07   Reduction in Commitment Amount.  HVF may, upon three Business Days’ notice to the Administrative Agent, each Funding Agent, each Conduit Investor and each Committed Note Purchaser, effect a permanent reduction in the Series 2008-1 Maximum Principal Amount and a corresponding reduction in the Commitment Amount and the Maximum Investor Group Principal Amount; provided that (x) any such reduction (i) will be limited to the undrawn portion of the Commitment Amounts, although any such reduction may be combined with a Voluntary Decrease effected pursuant to and in accordance with Section 2.2(b) of the Series 2008-1 Supplement, and (ii) must be in a minimum amount of $10,000,000 and (y) after giving effect to such reduction, the Series 2008-1 Maximum Principal Amount equals or exceeds $100,000,000, unless reduced to zero.  Any reduction made pursuant to this Section 2.07 shall be made ratably among the Investor Groups on the basis of their respective Maximum Investor Group Principal Amount.

ARTICLE III
INTEREST AND FEES

SECTION 3.01   Interest.  (a) Each related Advance funded or maintained by an Investor Group during the related Series 2008-1 Interest Period (i) through the issuance of Series 2008-1 Commercial Paper shall bear interest at the CP Rate for such Series 2008-1 Interest Period and (ii) through means other than the issuance of Series 2008-1 Commercial Paper shall bear interest at (A) the Series 2008-1 Base Rate for the related Series 2008-1 Interest Period or (B) if the required notice has been given pursuant to Section 2.06, the Eurodollar Rate (Reserve Adjusted) applicable to such Investor Group for the related Eurodollar Interest Period, in each case except as otherwise provided in the definition of Eurodollar Interest Period or in Section 3.03 or 3.04.  Each Funding Agent shall notify HVF and the Administrator of the applicable interest rate for the Advances made by its Investor Group for the related Series 2008-1 Interest Period or Eurodollar Interest Period, as the case may be (including the applicable CP Rate, Series 2008-1 Base Rate and/or the Eurodollar Rate (Reserve Adjusted), as the case may be) by

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11:00 a.m. (New York time) on the second Business Day immediately preceding each Determination Date and on the Business Day following each Payment Date.

(b)           Interest (including all amounts described in Section 3.01(a) above and any Series 2008-1 Monthly Default Interest Amount) shall be due and payable on each Payment Date in accordance with the provisions of the Series 2008-1 Supplement.

(c)           All computations of interest at the CP Rate and the Eurodollar Rate (Reserve Adjusted) shall be made on the basis of a year of 360 days and the actual number of days elapsed and all computations of interest at the Series 2008-1 Base Rate shall be made on the basis of a 365 (or 366, as applicable) day year and actual number of days elapsed.  Whenever any payment of interest or principal in respect of any Advance shall be due on a day other than a Business Day, such payment shall be made on the next succeeding Business Day (other than as provided in the definition of Eurodollar Interest Period) and such extension of time shall be included in the computation of the amount of interest owed.

SECTION 3.02   Fees.

(a)           On each Payment Date, HVF shall pay to each Funding Agent, for the account of the related Investor Group, a program fee (the “Program Fee”) equal to the product of (x) the Program Fee Rate, (y) the daily average Investor Group Principal Amount for the related Investor Group (or, if applicable, the portion of the Investor Group Principal Amount for the related Conduit Investor and Committed Note Purchaser in such Investor Group, respectively, if each of such Conduit Investor and Committed Note Purchaser is funding a portion of such Investor Group’s Investor Group Principal Amount) for the period from and including the immediately preceding Payment Date (or in the case of the first Payment Date, the Series 2008-1 Closing Date) to but excluding such Payment Date and (z) the number of days in the related Series 2008-1 Interest Period divided by 360 (or in the case of the first Payment Date occurring following the Series 2008-1 Closing Date, the number of days in the period from and including the Series 2008-1 Closing Date to but excluding such first Payment Date).

(b)           On each Payment Date on or prior to the Series 2008-1 Commitment Termination Date, HVF shall pay to each Funding Agent, for the account of the related Investor Group, the Undrawn Fee.

(c)           On each Payment Date, HVF shall pay to the Administrative Agent the applicable Administrative Agent Fee for such Payment Date.

(d)           On the Series 2008-1 Closing Date, HVF shall pay the Structuring Fee to each Funding Agent, for the account of the related Committed Note Purchaser.

SECTION 3.03   Eurodollar Lending Unlawful.  If a Conduit Investor, a Committed Note Purchaser or any Program Support Provider shall reasonably determine (which determination shall, upon notice thereof to the Administrative Agent and the related Funding Agent and HVF, be conclusive and binding on HVF absent manifest error) that the introduction of or any change in or in the interpretation of any law, rule or

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regulation makes it unlawful, or any central bank or other Governmental Authority asserts that it is unlawful, for any such Program Support Provider or Committed Note Purchaser to make, continue, or maintain any Advance as, or to convert any Advance into, the Series 2008-1 Eurodollar Tranche of such Advance, the obligation of such Person to make, continue or maintain or convert any such Advance as the Series 2008-1 Eurodollar Tranche of such Advance shall, upon such determination, forthwith be suspended until such Person shall notify the related Funding Agent and HVF that the circumstances causing such suspension no longer exist, and such Investor Group shall immediately convert all Advances of any such Program Support Provider or Committed Note Purchaser, as applicable, into the Series 2008-1 Base Rate Tranche of such Advance at the end of the then current Eurodollar Interest Periods with respect thereto or sooner, if required by such law or assertion.

SECTION 3.04   Deposits Unavailable.  If a Conduit Investor, a Committed Note Purchaser or any Program Support Provider shall have reasonably determined that:

(a)           Dollar deposits in the relevant amount and for the relevant Eurodollar Interest Period are not available to all Reference Lenders in the relevant market; or

(b)           by reason of circumstances affecting all Reference Lenders’ relevant market, adequate means do not exist for ascertaining the interest rate applicable hereunder to the Series 2008-1 Eurodollar Tranche of any Advance; or

(c)           such Conduit Investor, such Committed Note Purchaser or the related Majority Program Support Providers have notified the related Funding Agent and HVF that, with respect to any interest rate otherwise applicable hereunder to the Series 2008-1 Eurodollar Tranche of any Advance the Eurodollar Interest Period for which has not then commenced, such interest rate will not adequately reflect the cost to such Conduit Investor, such Committed Note Purchaser or such Majority Program Support Providers of making, funding, agreeing to make or fund or maintaining their respective Series 2008-1 Eurodollar Tranche of such Advance for such Eurodollar Interest Period,

then, upon notice from such Conduit Investor, such Committed Note Purchaser or the related Majority Program Support Providers to such Funding Agent and HVF, the obligations of such Conduit Investor, such Committed Note Purchaser and all of the relevant Program Support Providers to make or continue any Advance as, or to convert any Advances into, the Series 2008-1 Eurodollar Tranche of such Advance shall forthwith be suspended until such Funding Agent shall notify HVF that the circumstances causing such suspension no longer exist.

SECTION 3.05   Increased or Reduced Costs, etc.  HVF agrees to reimburse each Conduit Investor and each Committed Note Purchaser and any Program Support Provider (each, an “Affected Person”) for any increase in the cost of, or any reduction in the amount of any sum receivable by any such Affected Person, including

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reductions in the rate of return on such Affected Person’s capital, in respect of making, continuing or maintaining (or of its obligation to make, continue or maintain) any Advances as, or of converting (or of its obligation to convert) any Advances into, the Series 2008-1 Eurodollar Tranche of such Advance that arise in connection with any Changes in Law, except for such Changes in Law with respect to increased capital costs and taxes which are governed by Sections 3.07 and 3.08, respectively.  Each such demand shall be provided to the related Funding Agent and HVF in writing and shall state, in reasonable detail, the reasons therefor and the additional amount required fully to compensate such Affected Person for such increased cost or reduced amount or return.  Such additional amounts shall be payable by HVF to such Funding Agent and by such Funding Agent directly to such Affected Person within five (5) Business Days of HVF’s receipt of such notice, and such notice shall, in the absence of manifest error, be conclusive and binding on HVF.

SECTION 3.06   Funding Losses.  In the event any Affected Person shall incur any loss or expense (including any loss or expense incurred by reason of the liquidation or reemployment of deposits or other funds acquired by such Affected Person to make, continue or maintain any portion of the principal amount of any Advance as a Series 2008-1 CP Tranche or Series 2008-1 Eurodollar Tranche, or to convert any portion of the principal amount of any Advance into, the Series 2008-1 Eurodollar Tranche of such Advance) as a result of:

(i)            any conversion or repayment or prepayment (for any reason, including, without limitation, as a result of the acceleration of the maturity of the Series 2008-1 CP Tranche or Series 2008-1 Eurodollar Tranche of such Advance or the assignment thereof in accordance with the requirements of the applicable Program Support Agreement) of the principal amount of any portion of the Series 2008-1 CP Tranche or Series 2008-1 Eurodollar Tranche on a date other than the scheduled last day of the Series 2008-1 Interest Period or Eurodollar Interest Period applicable thereto;

(ii)           any Advance not being made as an Advance under the Series 2008-1 CP Tranche or Series 2008-1 Eurodollar Tranche after a request for such an Advance has been made in accordance with the terms contained herein;

(iii)          any Advance not being continued as a Series 2008-1 CP Tranche or Series 2008-1 Eurodollar Tranche, or converted into an Advance under the Series 2008-1 Eurodollar Tranche after a request for such an Advance has been made in accordance with the terms contained herein, or

(iv)          any failure of HVF to make a Decrease after giving notice thereof pursuant to Section 2.2(b) of the Series 2008-1 Supplement,

then, upon the written notice of any Affected Person to the related Funding Agent and HVF, HVF shall pay to such Funding Agent and such Funding Agent shall, within five (5) Business Days of its receipt thereof, pay directly to such Affected Person such amount as will (in the reasonable determination of such Affected Person) reimburse such

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Affected Person for such loss or expense.  Such written notice (which shall include calculations in reasonable detail) shall, in the absence of manifest error, be conclusive and binding on HVF.

SECTION 3.07   Increased Capital Costs.  If any Change in Law affects or would affect the amount of capital required or reasonably expected to be maintained by any Affected Person or any Person controlling such Affected Person and such Affected Person reasonably determines (in its sole and absolute discretion) that the rate of return on its or such controlling Person’s capital as a consequence of its commitment or the Advances made by such Affected Person is reduced to a level below that which such Affected Person or such controlling Person would have achieved but for the occurrence of any such circumstance, then, in any such case after notice from time to time by such Affected Person to the related Funding Agent and HVF, HVF shall pay to such Funding Agent and such Funding Agent shall pay an incremental commitment fee to such Affected Person sufficient to compensate such Affected Person or such controlling Person for such reduction in rate of return.  A statement of such Affected Person as to any such additional amount or amounts (including calculations thereof in reasonable detail), in the absence of manifest error, shall be conclusive and binding on HVF; and provided, further, that the initial payment of such increased commitment fee shall include a payment for accrued amounts due under this Section 3.07 prior to such initial payment.  In determining such additional amount, such Affected Person may use any method of averaging and attribution that it (in its reasonable discretion) shall deem applicable so long as it applies such method to other similar transactions.

SECTION 3.08   Taxes.  All payments by HVF of principal of, and interest on, the Advances and all other amounts payable hereunder (including fees) shall be made free and clear of and without deduction for any present or future income, excise, documentary, property, stamp or franchise taxes and other taxes, fees, duties, withholdings or other charges of any nature whatsoever imposed by any taxing authority, but excluding in the case of any Affected Person (x) net income, franchise or similar taxes (including branch profits taxes or alternative minimum tax) imposed or levied on the Affected Person as a result of a connection between the Affected Person and the jurisdiction of the Governmental Authority imposing such tax or any political subdivision or taxing authority thereof or therein (other than any such connection arising solely from such Affected Person having executed, delivered or performed its obligations or received a payment under, or enforced by, this Agreement) and (y) with respect to any Affected Person organized under the laws of the jurisdiction other than the United States (“Foreign Affected Person”), any withholding tax that is imposed on amounts payable to the Foreign Affected Person at the time the Foreign Affected Person becomes a party to this Agreement (or designates a new lending office), except to the extent that such Foreign Affected Person (or its assignor, if any) was already entitled, at the time of the designation of the new lending office (or assignment), to receive additional amounts from HVF with respect to withholding tax (such non-excluded items being called “Taxes”).

Moreover, if any Taxes are directly asserted against any Affected Person with respect to any payment received by such Affected Person or its agent from HVF, such Affected Person or its agent may pay such Taxes and HVF will promptly upon

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receipt of prior written notice stating the amount of such Taxes pay such additional amounts (including any penalties, interest or expenses) as is necessary in order that the net amount received by such person after the payment of such Taxes (including any Taxes on such additional amount) shall equal the amount such person would have received had not such Taxes been asserted.

If HVF fails to pay any Taxes when due to the appropriate taxing authority or fails to remit to the Affected Person or its agent the required receipts or other required documentary evidence, HVF shall indemnify the Affected Person and their agent for any incremental Taxes, interest or penalties that may become payable by any such Affected Person or its agent as a result of any such failure.  For purposes of this Section 3.08, a distribution hereunder by the agent for the relevant Affected Person shall be deemed a payment by HVF.

Upon the request of HVF, each Foreign Affected Person shall execute and deliver to HVF, prior to the initial due date of any payments hereunder and to the extent permissible under then current law, and on or about the first scheduled payment date in each calendar year thereafter, one or more (as HVF may reasonably request) United States Internal Revenue Service Forms W-8BEN, Forms W-8ECI or Forms W-9, or successor applicable forms, or such other forms or documents (or successor forms or documents), appropriately completed, as may be applicable to establish the extent, if any, to which a payment to such Affected Person is exempt from withholding or deduction of Taxes.  HVF shall not, however, be required to pay any increased amount under this Section 3.08 to any Affected Person that is organized under the laws of a jurisdiction other than the United States if such Affected Person fails to comply with the requirements set forth in this paragraph.

If the Affected Person determines, in its sole discretion, that it has received a refund of any Taxes as to which it has been indemnified pursuant to this Section 3.08, it shall pay over such refund to HVF (but only to the extent of indemnity payments made, or additional amounts paid under this Section 3.08 with respect to the Taxes giving rise to such refund), net of all out-of-pocket expenses of the Affected Person and without interest (other than any interest paid by the relevant governmental authority with respect to such refund), provided that HVF, upon the request of the Affected Person, agrees to repay the amount paid over to HVF (plus any penalties, interest or other charges imposed by the relevant Governmental Authority) to the Affected Person in the event the Affected Person is required to repay such refund to such governmental authority. This Section 3.08 shall not be construed to require the Affected Person to make available its tax returns (or any other information relating to its taxes which it deems confidential) to HVF or any other Person.

SECTION 3.09   Indenture Carrying Charges; Survival.  Any amounts payable by HVF under Sections 3.05, 3.06, 3.07 or 3.08 shall constitute Carrying Charges within the meaning of the Base Indenture and Indenture Carrying Charges within the meaning of Series 2008-1 Supplement.  The agreements in Sections 3.05, 3.06, 3.07 and 3.08 shall survive the termination of this Series 2008-1 Note Purchase Agreement, the

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Series 2008-1 Supplement and the Base Indenture and the payment of all amounts payable hereunder and thereunder.

ARTICLE IV
OTHER PAYMENT TERMS

SECTION 4.01   Time and Method of Payment.  All amounts payable to any Funding Agent hereunder or with respect to the Series 2008-1 Notes shall be made to the applicable Funding Agent or upon the order of the applicable Funding Agent by wire transfer of immediately available funds in Dollars not later than 1:00 p.m., New York City time, on the date due.  Any funds received after that time will be deemed to have been received on the next Business Day. HVF’s obligations hereunder in respect of any amounts payable to any Conduit Investor or Committed Note Purchaser shall be discharged to the extent funds are disbursed by HVF to the related Funding Agent as provided herein whether or not such funds are properly applied by such Funding Agent.

ARTICLE V
THE ADMINISTRATIVE AGENT AND THE FUNDING AGENTS

SECTION 5.01   Authorization and Action of the Administrative Agent.  Each of the Conduit Investors, the Committed Note Purchasers and the Funding Agents hereby designates and appoints Deutsche Bank Securities Inc. as the Administrative Agent hereunder, and hereby authorizes the Administrative Agent to take such actions as agent on their behalf and to exercise such powers as are delegated to the Administrative Agent by the terms of this Agreement together with such powers as are reasonably incidental thereto.  The Administrative Agent shall not have any duties or responsibilities, except those expressly set forth herein and in the Series 2008-1 Supplement, or any fiduciary relationship with any Conduit Investor, any Committed Note Purchaser or any Funding Agent, and no implied covenants, functions, responsibilities, duties, obligations or liabilities on the part of the Administrative Agent shall be read into this Agreement or otherwise exist for the Administrative Agent.  In performing its functions and duties hereunder and under the Series 2008-1 Supplement, the Administrative Agent shall act solely as agent for the Conduit Investors, the Committed Note Purchasers and the Funding Agent and does not assume nor shall it be deemed to have assumed any obligation or relationship of trust or agency with or for HVF or any of its successors or assigns.  The Administrative Agent shall not be required to take any action that exposes the Administrative Agent to personal liability or that is contrary to this Agreement, the Series 2008-1 Supplement or Applicable Law.  The appointment and authority of the Administrative Agent hereunder shall terminate upon the indefeasible payment in full of the Series 2008-1 Notes and all other amounts owed by HVF hereunder to the Investor Groups (the “Aggregate Unpaids”).

SECTION 5.02   Delegation of Duties.  The Administrative Agent may execute any of its duties under this Agreement by or through agents or attorneys-in-fact and shall be entitled to advice of counsel concerning all matters pertaining to such duties.  The Administrative Agent shall not be responsible for the negligence or misconduct of any agents or attorneys-in-fact selected by it with reasonable care.

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SECTION 5.03   Exculpatory Provisions.  Neither the Administrative Agent nor any of its directors, officers, agents or employees shall be (a) liable for any action lawfully taken or omitted to be taken by it or them under or in connection with this Agreement (except for its, their or such Person’s own gross negligence or willful misconduct), or (b) responsible in any manner to any Conduit Investor, any Committed Note Purchaser or any Funding Agent for any recitals, statements, representations or warranties made by HVF contained in this Agreement or in any certificate, report, statement or other document referred to or provided for in, or received under or in connection with, this Agreement for the due execution, legality, value, validity, effectiveness, genuineness, enforceability or sufficiency of this Agreement or any other document furnished in connection herewith, or for any failure of HVF to perform its obligations hereunder, or for the satisfaction of any condition specified in Article VII. The Administrative Agent shall not be under any obligation to any Conduit Investor, any Committed Note Purchaser or any Funding Agent to ascertain or to inquire as to the observance or performance of any of the agreements or covenants contained in, or conditions of, this Agreement, or to inspect the properties, books or records of HVF. The Administrative Agent shall not be deemed to have knowledge of any Amortization Event, Potential Amortization Event, Liquidation Event of Default or Limited Liquidation Event of Default unless the Administrative Agent has received notice from HVF, any Conduit Investor, any Committed Note Purchaser or any Funding Agent.

SECTION 5.04   Reliance.  The Administrative Agent shall in all cases be entitled to rely, and shall be fully protected in relying, upon any document or conversation believed by it to be genuine and correct and to have been signed, sent or made by the proper Person or Persons and upon advice and statements of legal counsel (including, without limitation, counsel to HVF), independent accountants and other experts selected by the Administrative Agent. The Administrative Agent shall in all cases be fully justified in failing or refusing to take any action under this Agreement or any other document furnished in connection herewith unless it shall first receive such advice or concurrence of any Conduit Investor, any Committed Note Purchaser or any Funding Agent as it deems appropriate or it shall first be indemnified to its satisfaction by any Conduit Investor, any Committed Note Purchaser or any Funding Agent, provided that unless and until the Administrative Agent shall have received such advice, the Administrative Agent may take or refrain from taking any action, as the Administrative Agent shall deem advisable and in the best interests of the Conduit Investors, the Committed Note Purchasers and the Funding Agents. The Administrative Agent shall in all cases be fully protected in acting, or in refraining from acting, in accordance with a request of the Required Noteholders and such request and any action taken or failure to act pursuant thereto shall be binding upon the Conduit Investors, the Committed Note Purchasers and the Funding Agents.

SECTION 5.05   Non-Reliance on the Administrative Agent and Other Purchasers.  Each of the Conduit Investors, the Committed Note Purchasers and the Funding Agents expressly acknowledge that neither the Administrative Agent nor any of its officers, directors, employees, agents, attorneys-in-fact or affiliates has made any representations or warranties to it and that no act by the Administrative Agent hereafter taken, including, without limitation, any review of the affairs of HVF, shall be deemed to

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constitute any representation or warranty by the Administrative Agent. Each of the Conduit Investors, the Committed Note Purchasers and the Funding Agents represent and warrant to the Administrative Agent that they have and will, independently and without reliance upon the Administrative Agent and based on such documents and information as they have deemed appropriate, made their own appraisal of and investigation into the business, operations, property, prospects, financial and other conditions and creditworthiness of HVF and made its own decision to enter into this Agreement.

SECTION 5.06   The Administrative Agent in its Individual Capacity.  The Administrative Agent and any of its Affiliates may make loans to, accept deposits from, and generally engage in any kind of business with HVF or any Affiliate of HVF as though the Administrative Agent were not the Administrative Agent hereunder.

SECTION 5.07   Successor Administrative Agent.  The Administrative Agent may, upon 30 days notice to HVF and each of the Conduit Investors, the Committed Note Purchasers and the Funding Agents, and the Administrative Agent will, upon the direction of Investor Groups holding more than 75% of the Series 2008-1 Maximum Principal Amount, resign as Administrative Agent. If the Administrative Agent shall resign, then the Investor Groups, during such 30-day period, shall appoint an Affiliate of a member of the Investor Groups as a successor agent. If for any reason no successor Administrative Agent is appointed by the Investor Groups during such 30-day period, then effective upon the expiration of such 30-day period, HVF shall make all payments in respect of the Aggregate Unpaids or under any fee letter delivered in connection herewith directly to the Funding Agents and for all purposes shall deal directly with the Funding Agents. After any retiring Administrative Agent’s resignation hereunder as Administrative Agent, the provisions of Section 9.05 and this Article V shall inure to its benefit as to any actions taken or omitted to be taken by it while it was the Administrative Agent under this Agreement.

SECTION 5.08   Authorization and Action of Funding Agents.  Each Conduit Investor and each Committed Note Purchaser is hereby deemed to have designated and appointed the Funding Agent set forth next to such Conduit Investor’s name, or if there is no Conduit Investor with respect to any Investor Group, the Committed Note Purchaser’s name with respect to such Investor Group, on Schedule I hereto as the agent of such Person hereunder, and hereby authorizes such Funding Agent to take such actions as agent on its behalf and to exercise such powers as are delegated to such Funding Agent by the terms of this Agreement together with such powers as are reasonably incidental thereto. Each Funding Agent shall not have any duties or responsibilities, except those expressly set forth herein, or any fiduciary relationship with the related Investor Group, and no implied covenants, functions, responsibilities, duties, obligations or liabilities on the part of such Funding Agent shall be read into this Agreement or otherwise exist for such Funding Agent. In performing its functions and duties hereunder, each Funding Agent shall act solely as agent for the related Investor Group and does not assume nor shall it be deemed to have assumed any obligation or relationship of trust or agency with or for HVF or any of its successors or assigns. Each Funding Agent shall not be required to take any action that exposes such Funding Agent to personal liability or that is contrary to this Agreement or Applicable Law. The

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appointment and authority of the Funding Agent hereunder shall terminate upon the indefeasible payment in full of the Aggregate Unpaids.

SECTION 5.09   Delegation of Duties.  Each Funding Agent may execute any of its duties under this Agreement by or through agents or attorneys-in-fact and shall be entitled to advice of counsel concerning all matters pertaining to such duties. Each Funding Agent shall not be responsible for the negligence or misconduct of any agents or attorneys-in-fact selected by it with reasonable care.

SECTION 5.10   Exculpatory Provisions.  Each Funding Agent and any of its directors, officers, agents or employees shall not be (a) liable for any action lawfully taken or omitted to be taken by it or them under or in connection with this Agreement (except for its, their or such Person’s own gross negligence or willful misconduct), or (b) responsible in any manner to the related Investor Group for any recitals, statements, representations or warranties made by HVF contained in this Agreement or in any certificate, report, statement or other document referred to or provided for in, or received under or in connection with, this Agreement, or for the value, validity, effectiveness, genuineness, enforceability or sufficiency of this Agreement or any other document furnished in connection herewith, or for any failure of HVF to perform its obligations hereunder, or for the satisfaction of any condition specified in Article VII. Each Funding Agent shall not be under any obligation to the related Investor Group to ascertain or to inquire as to the observance or performance of any of the agreements or covenants contained in, or conditions of, this Agreement, or to inspect the properties, books or records of HVF. Each Funding Agent shall not be deemed to have knowledge of any Amortization Event, Potential Amortization Event, Liquidation Event of Default or Limited Liquidation Event of Default unless such Funding Agent has received notice from HVF or the related Investor Group.

SECTION 5.11   Reliance.  Each Funding Agent shall in all cases be entitled to rely, and shall be fully protected in relying, upon any document or conversation believed by it to be genuine and correct and to have been signed, sent or made by the proper Person or Persons and upon advice and statements of the Administrative Agent and legal counsel (including, without limitation, counsel to HVF), independent accountants and other experts selected by such Funding Agent. Each Funding Agent shall in all cases be fully justified in failing or refusing to take any action under this Agreement or any other document furnished in connection herewith unless it shall first receive such advice or concurrence of the related Investor Group as it deems appropriate or it shall first be indemnified to its satisfaction by the related Investor Group, provided that unless and until such Funding Agent shall have received such advice, such Funding Agent may take or refrain from taking any action, as such Funding Agent shall deem advisable and in the best interests of the related Investor Group. Each Funding Agent shall in all cases be fully protected in acting, or in refraining from acting, in accordance with a request of the related Investor Group and such request and any action taken or failure to act pursuant thereto shall be binding upon the related Investor Group.

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SECTION 5.12   Non-Reliance on the Funding Agent and Other Purchasers.  The related Investor Group expressly acknowledges that its Funding Agent and any of its officers, directors, employees, agents, attorneys-in-fact or affiliates has not made any representations or warranties to it and that no act by such Funding Agent hereafter taken, including, without limitation, any review of the affairs of HVF, shall be deemed to constitute any representation or warranty by such Funding Agent. The related Investor Group represents and warrants to such Funding Agent that it has and will, independently and without reliance upon such Funding Agent and based on such documents and information as it has deemed appropriate, made its own appraisal of and investigation into the business, operations, property, prospects, financial and other conditions and creditworthiness of HVF and made its own decision to enter into this Agreement.

SECTION 5.13   The Funding Agent in its Individual Capacity.  Each Funding Agent and any of its Affiliates may make loans to, accept deposits from, and generally engage in any kind of business with HVF or any Affiliate of HVF as though such Funding Agent were not a Funding Agent hereunder.

SECTION 5.14   Successor Funding Agent.  Each Funding Agent will, upon the direction of the related Investor Group, resign as such Funding Agent. If such Funding Agent shall resign, then the related Investor Group shall appoint an Affiliate of a member of the related Investor Group as a successor agent. If for any reason no successor Funding Agent is appointed by the related Investor Group, then effective upon the resignation of such Funding Agent, HVF shall make all payments in respect of the Aggregate Unpaids due to such Investor Group or under any fee letter delivered in connection herewith directly to such Investor Group and for all purposes shall deal directly with such Investor Group. After any retiring Funding Agent’s resignation hereunder as Funding Agent, subject to the limitations set forth herein, the provisions of Section 9.05 and this Article V shall inure to its benefit as to any actions taken or omitted to be taken by it while it was the Funding Agent under this Agreement.

ARTICLE VI
REPRESENTATIONS AND WARRANTIES

SECTION 6.01   HVF.  HVF represents and warrants to each Conduit Investor and each Committed Note Purchaser that each of its representations and warranties in the Base Indenture, and the other Related Documents is true and correct and further represents and warrants to such parties that:

(a)           no Amortization Event with respect to any Series of Notes, Liquidation Event of Default or Limited Liquidation Event of Default with respect to any Series of Notes or event which, with the giving of notice or the passage of time or both would constitute any of the foregoing, has occurred and is continuing;

(b)           assuming each Conduit Investor or other purchaser of the Series 2008-1 Notes hereunder is not purchasing with a view toward further distribution

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and there has been no general solicitation or general advertising within the meaning of the Securities Act, and further assuming that the representations and warranties of each Conduit Investor set forth in Section 6.03 of this Agreement are true and correct, the offer and sale of the Series 2008-1 Notes in the manner contemplated by this Agreement is a transaction exempt from the registration requirements of the Securities Act, and the Base Indenture is not required to be qualified under the Trust Indenture Act;

(c)           HVF has furnished to the Administrative Agent true, accurate and complete copies of all other Related Documents (excluding Series Supplements and other Related Documents relating solely to a Series of Notes other than the Series 2008-1 Notes) to which it is a party as of the Series 2008-1 Closing Date, all of which Related Documents are in full force and effect as of the Series 2008-1 Closing Date and no terms of any such agreements or documents have been amended, modified or otherwise waived as of such date, other than such amendments, modifications or waivers about which HVF has informed each Funding Agent; and

(d)           as of the Series 2008-1 Closing Date, no written information furnished by HVF or any of its Affiliates, agents or representatives to the Conduit Investors, the Committed Note Purchasers, the Administrative Agent or the Funding Agents for purposes of or in connection with this Agreement, including, without limitation, any information relating to the Collateral, is inaccurate in any material respect, or contains any material misstatement of fact, or omits to state a material fact or any fact necessary to make the statements contained therein not misleading, in each case as of the date such information was stated or certified.

SECTION 6.02   Administrator.  The Administrator represents and warrants to each Conduit Investor and each Committed Note Purchaser that:

(a)           each representation and warranty made by it in each Related Document (other than a Related Document relating solely to a Series of Notes other than the Series 2008-1 Notes) to which it is a party (including any representations and warranties made by it as Administrator) is true and correct in all material respects as of the date originally made, as of the date hereof and as of the Series 2008-1 Closing Date (unless stated to relate solely to an earlier date, in which  case such representations and warranties shall be true and correct as of such earlier date); and

(b)           (i) the audited consolidated balance sheet of The Hertz Corporation and its Consolidated Subsidiaries as of December 31, 2007 and the related statements of income, stockholders equity and cash flows for the year ending on such date and (ii) the unaudited condensed consolidated balance sheet of The Hertz Corporation and its Consolidated Subsidiaries as of June 30, 2008 and the related statements of income, stockholders equity and cash flows for the six months ending on such date (including in each case the schedules and notes thereto) (the “Financial Statements”), have been prepared in accordance with

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GAAP and  present fairly the financial position of The Hertz Corporation and its Consolidated Subsidiaries as of the date thereof and the results of their operations and their cash flows for the periods covered thereby.

SECTION 6.03   Conduit Investors.  Each of the Conduit Investors and each of the Committed Note Purchasers represents and warrants to HVF and the Administrator, as of the date hereof (or as of a subsequent date on which a successor or assign of a Conduit Investor or a Committed Note Purchaser shall become a party hereto), that:

(a)           it has had an opportunity to discuss HVF’s and the Administrator’s business, management and financial affairs, and the terms and conditions of the proposed purchase, with HVF and the Administrator and their respective representatives;

(b)           it is an “accredited investor” within the meaning of Rule 501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act and has sufficient knowledge and experience in financial and business matters to be capable of evaluating the merits and risks of investing in, and is able and prepared to bear the economic risk of investing in, the Series 2008-1 Notes;

(c)           it is purchasing the Series 2008-1 Notes for its own account, or for the account of one or more “accredited investors” within the meaning of Rule 501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act that meet the criteria described in subsection (b) and for which it is acting with complete investment discretion, for investment purposes only and not with a view to distribution, subject, nevertheless, to the understanding that the disposition of its property shall at all times be and remain within its control;

(d)           it understands that the Series 2008-1 Notes have not been and will not be registered or qualified under the Securities Act or any applicable state securities laws or the securities laws of any other jurisdiction and is being offered only in a transaction not involving any public offering within the meaning of the Securities Act and may not be resold or otherwise transferred unless so registered or qualified or unless an exemption from registration or qualification is available, that HVF is not required to register the Series 2008-1 Notes, and that any transfer must comply with provisions of Section 2.8 of the Base Indenture;

(e)           it understands that the Series 2008-1 Notes will bear the legend set out in the form of Series 2008-1 Notes attached as Exhibit A to the Series 2008-1 Supplement and be subject to the restrictions on transfer described in such legend;

(f)            it will comply with all applicable federal and state securities laws in connection with any subsequent resale of the Series 2008-1 Notes;

(g)           it understands that the Series 2008-1 Notes may be offered, resold, pledged or otherwise transferred only with HVF’s prior written consent, which consent shall not be unreasonably withheld, and only (A) to HVF, (B) in a

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transaction meeting the requirements of Rule 144A under the Securities Act, (C) outside the United States to a foreign person in a transaction meeting the requirements of Regulation S under the Securities Act, or (D) in a transaction complying with or exempt from the registration requirements of the Securities Act and in accordance with any applicable securities laws of any state of the United States or any other jurisdiction; notwithstanding the foregoing, it is hereby understood and agreed by HVF that the Series 2008-1 Notes will be pledged by each Conduit Investor pursuant to its related  commercial paper program documents, and the Series 2008-1 Notes, or interests therein, may be sold, transferred or pledged to its related Committed Note Purchaser or any Program Support Provider or any affiliate of its related Committed Note Purchaser or any Program Support Provider or, any commercial paper conduit administered by its related Committed Note Purchaser or any Program Support Provider or any affiliate of its related Committed Note Purchaser or any Program Support Provider;

(h)           if it desires to offer, sell or otherwise transfer, pledge or hypothecate the Series 2008-1 Notes as described in clause (B) or (D) of Section 6.03(g), and such sale, transfer or pledge does not fall within the “notwithstanding the foregoing” provision of Section 6.03(g), the transferee of the Series 2008-1 Notes will be required to deliver a certificate, as described in the Series 2008-1 Supplement, that an exemption from the registration requirements of the Securities Act applies to such offer, sale, transfer or hypothecation. Upon original issuance thereof, and until such time as the same may no longer be required under the applicable requirements of the Securities Act, the certificate evidencing the Series 2008-1 Notes (and all securities issued in exchange therefor or substitution thereof) shall bear a legend substantially in the form set forth in the Series 2008-1 Notes included as an exhibit to the Series 2008-1 Supplement. Each Conduit Investor understands that the registrar and transfer agent for the Series 2008-1 Notes will not be required to accept for registration of transfer the Series 2008-1 Notes acquired by it, except upon presentation of an executed letter in the form required by the Series 2008-1 Supplement; and

(i)            it will obtain from any purchaser of the Series 2008-1 Notes substantially the same representations and warranties contained in the foregoing paragraphs.

ARTICLE VII
CONDITIONS

SECTION 7.01   Conditions to Issuance.  Each Conduit Investor has no obligation to purchase the Series 2008-1 Notes hereunder on the Series 2008-1 Closing Date unless:

(a)           the Base Indenture and the Series 2008-1 Supplement shall be in full force and effect;

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(b)           The Funding Agents shall have received copies of (i) the Certificate of Incorporation and By-Laws of Hertz and the certificate of formation and limited liability company agreement of each of HVF and the Nominee certified by the Secretary of State of the state of incorporation or organization, as the case may be, (ii) board of directors resolutions of HVF, Hertz and the Nominee with respect to the transactions contemplated by the Series 2008-1 Supplement and this Agreement, and (iii) an incumbency certificate of HVF, Hertz and the Nominee, each certified by the secretary or equivalent officer of the related entity in form and substance reasonably satisfactory to the Administrative Agent;

(c)           on the Series 2008-1 Closing Date, each Conduit Investor, or if there is no Conduit Investor with respect to any Investor Group, the Committed Note Purchaser with respect to such Investor Group, shall have received a letter, in form and substance reasonably satisfactory to it, from each of Moody’s and S&P stating that an explicit public long term credit rating of “A2” (in the case of Moody’s) and “A” (in the case of S&P) has been assigned to the Series 2008-1 Notes;

(d)           each Conduit Investor and each Committed Note Purchaser shall have received opinions of counsel (i) from Weil, Gotshal & Manges LLP, or other counsel acceptable to the Conduit Investors and the Committed Note Purchasers, with respect to such matters as any such Conduit Investor or Committed Note Purchaser shall reasonably request (including, without limitation, regarding non-consolidation, true lease, true-sale and UCC security interest matters, tax and no-conflicts), (ii) from counsel to the Trustee acceptable to the Conduit Investors and the Committed Note Purchasers with respect to such matters as any such Conduit Investor or Committed Note Purchaser shall reasonably request and (iii) from counsel to each Series 2008-1 Letter of Credit Provider, if any, with respect to such matters as any such Conduit Investor or Committed Note Purchaser shall reasonably request;

(e)           each Conduit Investor and each Committed Note Purchaser shall have received copies of the documents specified in Section 2.2(b) of the Base Indenture relating to the issuance of the Series 2008-1 Notes;

(f)            at the time of such issuance, all conditions to the issuance of the Series 2008-1 Notes under the Series 2008-1 Supplement and under Section 2.2 of the Base Indenture shall have been satisfied or waived;

(g)           the Administrative Agent shall have received evidence satisfactory to them of the completion of all UCC filings as may be necessary to perfect or evidence the assignment by HVF to the Trustee or the Collateral Agent on behalf of the Trustee of its interests in the Collateral, the proceeds thereof and the security interests granted pursuant to the Base Indenture and the Collateral Agency Agreement;

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(h)           the Administrative Agent shall have received a written search report listing all effective financing statements that name HVF, HGI, Hertz or the Nominee as debtor or assignor and that are filed in the State of Delaware and in any other jurisdiction that the Administrative Agent determines is necessary or appropriate, together with copies of such financing statements, and tax and judgment lien searches showing no such liens that are not permitted by the Base Indenture, the Series 2008-1 Supplement, this Agreement or the other Related Documents; and

(i)            the Administrative Agent, each Committed Note Purchaser, each Conduit Lender and each Funding Agent, as applicable, shall have received payment of the Structuring Fee and all fees due and payable pursuant to the Syndication Agreement and the Syndication Fee Letter, if any, in each case, as of the Series 2008-1 Closing Date.

SECTION 7.02   Conditions to Initial Borrowing.  The obligation of the Conduit Investors, or if there is no Conduit Investor with respect to any Investor Group, the Committed Note Purchaser with respect to such Investor Group, to fund the initial Borrowing hereunder shall be subject to the satisfaction of the conditions precedent that each Funding Agent shall have received a duly executed and authenticated Series 2008-1 Note registered in its name or in such other name as shall have been directed by the applicable Committed Note Purchaser and stating that the principal amount thereof shall not exceed the Maximum Investor Group Principal Amount of such Funding Agent’s Investor Group and HVF shall have paid all fees required to be paid by it on the Series 2008-1 Closing Date, including all fees required hereunder.

SECTION 7.03   Conditions to Each Borrowing.  The election of each Conduit Investor to fund, and the obligation of each Committed Note Purchaser to fund, any Borrowing on any day (including the initial Borrowing) shall be subject to the conditions precedent that on the date of the Borrowing, before and after giving effect thereto and to the application of any proceeds therefrom, the following statements shall be true:

(a)           (i) the representations and warranties of HVF set out in this Agreement (with the exception of Sections 6.01(a) (to the extent such representations and warranties relate to any Series of Notes other than the Series 2008-1 Notes), 6.01(b) and 6.01(d), which shall have been true and accurate in all respects on the Series 2008-1 Closing Date), (ii) the representations and warranties of the Administrator set out in this Agreement (with the exception of Section 6.02(a), which shall have been true and accurate on the dates specified therein), and (iii) the representations and warranties of HVF, the Nominee and the Administrator set out in the Base Indenture and the other Related Documents (other than Series Supplements and Related Documents relating solely to a Series of Notes other than the Series 2008-1 Notes) to which each is a party, in each such case, shall be true and accurate as of the date of the Borrowing with the same effect as though made on that date (unless stated to relate solely to an earlier date,

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in which case such representations and warranties shall be true and correct as of such earlier date);

(b)           the Series 2008-1 Rapid Amortization Period has not commenced;

(c)           the related Funding Agent shall have received the Monthly Noteholders’ Statement for the Series 2008-1 Notes for the Related Month immediately preceding the date of such Borrowing and an executed advance request in the form of Exhibit A hereto (each such request, an “Advance Request”) certifying as to the current Aggregate Asset Amount and the Series 2008-1 Enhancement Amount;

(d)           all conditions to such Borrowing specified in Section 2.02(a) of this Agreement shall have been satisfied;

(e)           subject to Section 8.7(b) of the Base Indenture, the Series 2008-1 Related Documents shall be in full force and effect; and

(f)            the Series 2008-1 Letter of Credit has been issued and remains outstanding and in full force and effect.

The giving of any notice pursuant to Section 2.03 shall constitute a representation and warranty by HVF and the Administrator that all conditions precedent to such Borrowing have been satisfied.

ARTICLE VIII
COVENANTS

SECTION 8.01   Covenants.  HVF and the Administrator each severally covenants and agrees that, until the Series 2008-1 Notes have been paid in full and the Term has expired, it will:

(a)           duly and timely perform all of its covenants (both affirmative and negative) and obligations under each Related Document to which it is a party;

(b)           not, except as contemplated by Section 3.2(a) of the Base Indenture or clauses (iii) through (viii) of Section 12.1(a) of the Base Indenture, amend, modify, waive or give any approval, consent or permission under, any provision of the Base Indenture or any other Series 2008-1 Related Document to which it is a party or agree to terminate any Series 2008-1 Related Document to which it is a party unless (i) any such amendment, modification, waiver, termination or other action is in writing and made in accordance with the terms of the Base Indenture or such other Series 2008-1 Related Document, as applicable; (ii) Series 2008-1 Noteholders holding more than 50% of the Series 2008-1 Principal Amount have consented thereto and (iii) such amendment shall have satisfied the Series 2008-1 Rating Agency Condition; provided, that in any such case, if the Base Indenture, the Series 2008-1 Supplement or any other Series 2008-1 Related Document requires the consent of each affected Noteholder or a

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higher percentage of Noteholders, such unanimous consent or the consent of such higher percentage of Noteholders shall be obtained prior to such amendment, modification, waiver, approval, consent or permission; provided further that in addition to the rights granted to Noteholders with respect to amendments or modifications described in Section 12.2(i) and 12.2(ii) of the Base Indenture, HVF and the Administrator agree that any amendment or modification described in Section 12.2(iii) of the Base Indenture shall require the consent of Series 2008-1 Noteholders holding 100% of the Series 2008-1 Principal Amount.

(c)           (i) at the same time any report, notice, certificate, opinion (other than any bankruptcy timing memorandum) or other document is provided to the Rating Agencies and/or the Trustee, or caused to be provided, by HVF or the Administrator under the Base Indenture (including, without limitation, under Sections  8.8, 8.9 and/or 8.12 thereof), or under the Series 2008-1 Supplement or this Agreement, provide the Administrative Agent (who shall provide a copy thereof to the Committed Note Purchasers and the Conduit Investors) with a copy of such report, notice, certificate, opinion (other than any bankruptcy timing memorandum) or other document; provided, however, that neither the Administrator nor HVF shall have any obligation under this Section 8.01(c) to deliver to the Administrative Agent copies of any Monthly Noteholders’ Statements which relate solely to a Series of Notes other than the Series 2008-1 Notes and (ii) provide the Administrative Agent and each Funding Agent such other information (including financial information), documents, records or reports respecting the Collateral, HVF or the Administrator as the Administrative Agent or any Funding Agent may from time to time reasonably request;

(d)           at any time and from time to time, following reasonable prior notice from the Administrative Agent or any Funding Agent, and during regular business hours, permit the Administrative Agent or any Funding Agent, or their respective agents or representatives (including any independent public accounting firm or other third party auditors) or permitted assigns, access to the offices of, the Administrator, Hertz, HVF, the Intermediary and the Nominee, as applicable, (i) to examine and make copies of and abstracts from all documentation relating to the Series 2008-1 Collateral on the same terms as are provided to the Trustee under Section 8.6 of the Base Indenture, and (ii) to visit the offices and properties of, the Administrator, Hertz, HVF, the Intermediary and the Nominee for the purpose of examining such materials described in clause (i) above, and to discuss matters relating to the Series 2008-1 Collateral, or the administration and performance of the Base Indenture, the Series 2008-1 Supplement and the other Related Documents with any of the officers or employees of, the Administrator, Hertz, HVF, the Intermediary and/or the Nominee, as applicable, having knowledge of such matters; provided that such visits shall be at HVF’s sole cost and expense (i) prior to the occurrence of an Amortization Event or Potential Amortization Event, in each case, with respect to the Series 2008-1 Notes, for no more than one such visit in the aggregate per annum for the Administrative Agent and each Funding Agent collectively and (ii) after the occurrence and during the continuance of an Amortization Event or Potential Amortization Event, in each

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case, with respect to the Series 2008-1 Notes, for each such visit. Each party making a request pursuant to this Section 8.01(d) shall simultaneously send a copy of such request to each of the Administrative Agent and each Funding Agent, as applicable, so as to allow such other parties to participate in the requested visit.

(e)           not permit any part of the proceeds of any Advance to be (x) used to purchase or carry any Margin Stock or (y) loaned to others for the purpose of purchasing or carrying any Margin Stock;

(f)            not permit any amounts owed with respect to the Series 2008-1 Notes to be secured, directly or indirectly, by any Margin Stock;

(g)           promptly provide such additional financial and other information with respect to the Related Documents (other than Series Supplements and Related Documents relating solely to a Series of Notes other than the Series 2008-1 Notes), HVF, Hertz, the Intermediary or the Manufacturer Programs as the Administrative Agent or any Funding Agent may from time to time reasonably request;

(h)           on and after the Expected Final Payment Date, use all amounts allocated to and available for distribution from each excess collection account in respect of each Series of Notes (other than in respect of the Series 2005-3 Notes and the Series 2005-4 Notes during the Series 2005-3 Rapid Amortization Period or the Series 2005-4 Rapid Amortization Period) to decrease the Series 2008-1 Principal Amount;

(i)            deliver to each Funding Agent within 120 days after the end of each fiscal year of HVF, the financial statements prepared pursuant to Section 8.24(d) of the Base Indenture;

(j)            in the case of the Administrator, for so long as a Liquidation Event of Default or Limited Liquidation Event of Default for any Series of Notes is continuing, furnish or cause the Servicer to furnish to the Administrative Agent and each Series 2008-1 Noteholder, the Fleet Report, prepared in accordance with Section 2.4(d) of the Collateral Agency Agreement (which may be on a diskette or other electronic medium); and

(k)           HVF and the Administrator agree to take any and all acts and to execute any and all further instruments necessary or reasonably requested by the Administrative Agent to more fully effect the purposes of this Agreement.

ARTICLE IX
MISCELLANEOUS PROVISIONS

SECTION 9.01   Amendments.  No amendment to or waiver of any provision of this Agreement, nor consent to any departure by the Administrator or HVF, shall in any event be effective unless the same shall be in writing and signed by the

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Administrator, HVF, the Administrative Agent, each Conduit Investor and each Committed Note Purchaser, and in the case of any material amendments, receipt of written confirmation from each rating agency then rating the Series 2008-1 Notes and the Series 2008-1 Commercial Paper that such amendment will not result in the reduction or withdrawal of the then current ratings in respect of the Series 2008-1 Notes or the Series 2008-1 Commercial Paper, as applicable; provided, however, that, subject to any provision of the Base Indenture or the Series 2008-1 Supplement requiring the consent of each affected Noteholder or of a higher percentage of Noteholders, any amendment hereto that does not adversely affect in any material respect the interests of the Conduit Investors or the Committed Note Purchasers (as evidenced by an Opinion of Counsel (which may be based on an Officer’s Certificate) issued by a law firm of nationally recognized standing to the Trustee and each Funding Agent) shall only require (i) the consent of the Conduit Investors and Committed Note Purchasers holding more than 66²/₃ % of the Series 2008-1 Notes and the Commitment, respectively, and (ii) satisfaction of the Series 2008-1 Rating Agency Condition.

SECTION 9.02   No Waiver; Remedies.  Any waiver, consent or approval given by any party hereto shall be effective only in the specific instance and for the specific purpose for which given, and no waiver by a party of any breach or default under this Agreement shall be deemed a waiver of any other breach or default. No failure on the part of any party hereto to exercise, and no delay in exercising, any right hereunder shall operate as a waiver thereof; nor shall any single or partial exercise of any right hereunder, or any abandonment or discontinuation of steps to enforce the right, power or privilege, preclude any other or further exercise thereof or the exercise of any other right. No notice to or demand on any party hereto in any case shall entitle such party to any other or further notice or demand in the same, similar or other circumstances. The remedies herein provided are cumulative and not exclusive of any remedies provided by law.

SECTION 9.03   Binding on Successors and Assigns.  This Agreement shall be binding upon, and inure to the benefit of, HVF, the Administrator, the Committed Note Purchasers, the Conduit Investors, the Administrative Agent and their respective successors and assigns; provided, however, that neither HVF nor the Administrator may assign or transfer its rights or obligations hereunder or in connection herewith or any interest herein (voluntarily, by operation of law or otherwise) without the prior written consent of each Committed Note Purchaser and each Conduit Investor; provided, that nothing herein shall prevent HVF from assigning its rights to the Trustee under the Base Indenture and the Series 2008-1 Supplement; provided, further, that none of the Conduit Investors or the Committed Note Purchasers may transfer, pledge, assign, sell participations in or otherwise encumber its rights or obligations hereunder or in connection herewith or any interest herein except as permitted under Section 6.03(g), Section 9.17 and this Section 9.03. Nothing expressed herein is intended or shall be construed to give any Person other than the Persons referred to in the preceding sentence any legal or equitable right, remedy or claim under or in respect of this Agreement.

(a)           Notwithstanding any other provision set forth in this Agreement, each Conduit Investor, or if there is no Conduit Investor with respect to any Investor

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Group, the Committed Note Purchaser with respect to such Investor Group, may at any time grant to one or more Program Support Providers a participating interest in or lien on such Conduit Investor’s, or if there is no Conduit Investor with respect to any Investor Group, the related Committed Note Purchaser’s, interests in the Advances made hereunder and such Program Support Provider, with respect to its participating interest, shall be entitled to the benefits granted to such Conduit Investor or Committed Note Purchaser, as applicable, under this Agreement.

(b)           Notwithstanding any other provision set forth in this Agreement, each Conduit Investor may at any time, without the consent of HVF, transfer and assign all or a portion of its rights in the Series 2008-1 Notes (and its rights hereunder and under the Related Documents) to its related Committed Note Purchaser. Furthermore, each Conduit Investor may at any time grant a security interest in and lien on, all or any portion of its interests under this Agreement, its Series 2008-1 Note and all Related Documents to (i) its related Committed Note Purchaser, (ii) its Funding Agent, (iii) any Program Support Provider who, at any time now or in the future, provides program liquidity or credit enhancement, including without limitation, an insurance policy for such Conduit Investor relating to the Series 2008-1 Commercial Paper or the Series 2008-1 Notes, (iv) any other Person who, at any time now or in the future, provides liquidity or credit enhancement for the Conduit Investors, including without limitation, an insurance policy relating to the Series 2008-1 Commercial Paper or the Series 2008-1 Notes or (v) any collateral trustee or collateral agent for any of the foregoing; provided, however, any such security interest or lien shall be released upon assignment of its Series 2008-1 Note to its related Committed Note Purchaser. Each Committed Note Purchaser may assign its Commitment, or all or any portion of its interest under its Series 2008-1 Note, this Agreement and the Related Documents to any Person with the prior written consent of HVF, such consent not to be unreasonably withheld. Notwithstanding any other provisions set forth in this Agreement, each Committed Note Purchaser may at any time create a security interest in all or any portion of its rights under this Agreement, its Series 2008-1 Note and the Related Documents in favor of any Federal Reserve Bank in accordance with Regulation A of the Board of Governors of the Federal Reserve System or any similar foreign entity.

SECTION 9.04   Survival of Agreement.  All covenants, agreements, representations and warranties made herein and in the Series 2008-1 Notes delivered pursuant hereto shall survive the making and the repayment of the Advances and the execution and delivery of this Agreement and the Series 2008-1 Notes and shall continue in full force and effect until all interest on and principal of the Series 2008-1 Notes and all other amounts owed to the Conduit Investors, the Committed Note Purchasers, the Funding Agents and the Administrative Agent hereunder and under the Series 2008-1 Supplement have been paid in full and the commitment of the Committed Note Purchasers hereunder has been terminated. In addition, the obligations of HVF, the Committed Note Purchasers and the Conduit Investors under Sections 3.03, 3.04, 3.05, 3.06, 3.07, 3.08, 9.05, 9.10(b) and 9.11 shall survive the termination of this Agreement.

SECTION 9.05   Payment of Costs and Expenses; Indemnification.  (a)  Payment of Costs and Expenses.  HVF agrees to pay on demand all reasonable

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expenses of the Administrative Agent, each Funding Agent, each Conduit Investor and each Committed Note Purchaser (including the reasonable fees and out-of-pocket expenses of counsel to each Conduit Investor and each Committed Note Purchaser, if any, as well as the fees and expenses of the Rating Agencies providing a rating in respect of any Series 2008-1 Commercial Paper) in connection with

(i)            the negotiation, preparation, execution, delivery and administration of this Agreement and of each other Related Document, including schedules and exhibits, and any liquidity, credit enhancement or insurance documents of a Program Support Provider with respect to a Conduit Investor relating to the Series 2008-1 Notes and any amendments, waivers, consents, supplements or other modifications to this Agreement or any other Related Document as may from time to time hereafter be proposed, whether or not the transactions contemplated hereby or thereby are consummated, and

(ii)           the consummation of the transactions contemplated by this Agreement and the other Related Documents.

HVF further agrees to pay, and to save the Administrative Agent, each Funding Agent, each Conduit Investor and each Committed Note Purchaser harmless from all liability for (i) any breach by HVF of its obligations under this Agreement, (ii) all reasonable costs incurred by the Administrative Agent, such Funding Agent, such Conduit Investor or such Committed Note Purchaser in enforcing this Agreement and (iii) any stamp, documentary or other taxes which may be payable in connection with the execution or delivery of this Agreement, any Borrowing hereunder, or the issuance of the Series 2008-1 Notes or any other Related Documents. HVF also agrees to reimburse the Administrative Agent, each Funding Agent, each Conduit Investor and each Committed Note Purchaser upon demand for all reasonable out-of-pocket expenses incurred by the Administrative Agent, such Funding Agent, such Conduit Investor or such Committed Note Purchaser in connection with (x) the negotiation of any restructuring or “work-out”, whether or not consummated, of the Related Documents and (y) the enforcement of, or any waiver or amendment requested under or with respect to, this Agreement or any other of the Related Documents.

Without limiting the foregoing, HVF shall have no obligation to reimburse any Committed Note Purchaser and/or Conduit Investor for any of the fees and/or expenses incurred by such Committed Note Purchaser and/or Conduit Investor with respect to its sale or assignment of all or any part of its respective rights and obligations under this Agreement and the Series 2008-1 Notes pursuant to Section 9.17; provided, however, that HVF shall reimburse each Committed Note Purchaser and/or Conduit Investor who purchased Series 2008-1 Notes on the Series 2008-1 Closing Date for its reasonable legal and administrative fees and expenses (excluding any fees and/or expenses payable to the Rating Agencies) that were incurred by such Committed Note Purchaser or Conduit Investor in connection with its assignment and/or sale of its rights under this Agreement and such Series 2008-1 Notes within 180 days of the Series 2008-1 Closing Date.

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(b)           Indemnification. In consideration of the execution and delivery of this Agreement by the Conduit Investors and the Committed Note Purchasers, HVF hereby indemnifies and holds each Conduit Investor and each Committed Note Purchaser and each of their officers, directors, employees and agents (collectively, the “Indemnified Parties”) harmless from and against any and all actions, causes of action, suits, losses, costs, liabilities and damages, and reasonable expenses incurred in connection therewith (irrespective of whether any such Indemnified Party is a party to the action for which indemnification hereunder is sought and including, without limitation, any liability in connection with the offering and sale of the Series 2008-1 Notes), including reasonable attorneys’ fees and disbursements (collectively, the “Indemnified Liabilities”), incurred by the Indemnified Parties or any of them (whether in prosecuting or defending against such actions, suits or claims) to the extent resulting from, or arising out of, or relating to

(i)            any transaction financed or to be financed in whole or in part, directly or indirectly, with the proceeds of any Advance; or

(ii)           the entering into and performance of this Agreement and any other Related Document by any of the Indemnified Parties,

except for any such Indemnified Liabilities arising for the account of a particular Indemnified Party by reason of the relevant Indemnified Party’s gross negligence or willful misconduct. If and to the extent that the foregoing undertaking may be unenforceable for any reason, HVF hereby agrees to make the maximum contribution to the payment and satisfaction of each of the Indemnified Liabilities which is permissible under applicable law. The indemnity set forth in this Section 9.05(b) shall in no event include indemnification for any taxes (which indemnification is provided in Section 3.08). HVF shall give notice to the Rating Agencies of any claim for Indemnified Liabilities made under this Section.

(c)           Indemnification of the Administrative Agent and each Funding Agent.  (i) In consideration of the execution and delivery of this Agreement by the Administrative Agent and each Funding Agent, HVF hereby indemnifies and holds the Administrative Agent and each Funding Agent and each of their respective officers, directors, employees and agents (collectively, the “Agent Indemnified Parties”) harmless from and against any and all actions, causes of action, suits, losses, costs, liabilities and damages, and reasonable expenses incurred in connection therewith (irrespective of whether any such Agent Indemnified Party is a party to the action for which indemnification hereunder is sought and including, without limitation, any liability in connection with the offering and sale of the Series 2008-1 Notes), including reasonable attorneys’ fees and disbursements (collectively, the “Agent Indemnified Liabilities”), incurred by the Agent Indemnified Parties or any of them (whether in prosecuting or defending against such actions, suits or claims) to the extent resulting from, or arising out of, or relating to the entering into and performance of this Agreement and any other Related Document by any of the Agent Indemnified Parties, except for any such Agent Indemnified Liabilities arising for the account of a particular Agent Indemnified Party by reason of the relevant Agent Indemnified Party’s gross negligence or willful misconduct. If and to the extent that the foregoing undertaking may be unenforceable for any reason,

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HVF hereby agrees to make the maximum contribution to the payment and satisfaction of each of the Agent Indemnified Liabilities which is permissible under applicable law. The indemnity set forth in this Section 9.05(c)(i) shall in no event include indemnification for any taxes (which indemnification is provided in Section 3.08). HVF shall give notice to the Rating Agencies of any claim for Agent Indemnified Liabilities made under this section.

(ii)           In consideration of the execution and delivery of this Agreement by the Administrative Agent, each Funding Agent and each Committed Note Purchaser, ratably according to its respective Commitment, hereby indemnifies and holds the Administrative Agent and each of its officers, directors, employees and agents (collectively, the “Administrative Agent Indemnified Parties”) and each Funding Agent and each of its officers, directors, employees and agents (collectively, the “Funding Agent Indemnified Parties”, and together with the Administrative Agent Indemnified Parties, the “Agent Indemnified Parties”) harmless from and against any and all actions, causes of action, suits, losses, costs, liabilities and damages, and reasonable expenses incurred in connection therewith  (solely to the extent not reimbursed by or on behalf of HVF) (irrespective of whether any such Agent Indemnified Party is a party to the action for which indemnification hereunder is sought and including, without limitation, any liability in connection with the offering and sale of the Series 2008-1 Notes), including reasonable attorneys’ fees and disbursements (collectively, the “Agent Indemnified Liabilities”), incurred by the Agent Indemnified Parties or any of them (whether in prosecuting or defending against such actions, suits or claims) to the extent resulting from, or arising out of, or relating to the entering into and performance of this Agreement and any other Related Document by any of the Agent Indemnified Parties, except for any such Agent Indemnified Liabilities arising for the account of a particular Agent Indemnified Party by reason of the relevant Agent Indemnified Party’s gross negligence or willful misconduct. If and to the extent that the foregoing undertaking may be unenforceable for any reason, each Funding Agent and each Committed Note Purchaser hereby agrees to make the maximum contribution to the payment and satisfaction of each of the Agent Indemnified Liabilities which is permissible under applicable law. The indemnity set forth in this Section 9.05(c)(ii) shall in no event include indemnification for any taxes (which indemnification is provided in Section 3.08). Each Committed Note Purchaser shall give notice to the Rating Agencies of any claim for Agent Indemnified Liabilities made under this section.

SECTION 9.06   Characterization as Related Document; Entire Agreement.  This Agreement shall be deemed to be a Related Document for all purposes of the Base Indenture and the other Related Documents. This Agreement, together with the Base Indenture, the Series 2008-1 Supplement, the documents delivered pursuant to Section 7.01 and the other Related Documents, including the exhibits and schedules thereto, contains a final and complete integration of all prior expressions by the parties hereto with respect to the subject matter hereof and shall constitute the entire agreement among the parties hereto with respect to the subject matter hereof, superseding all previous oral statements and other writings with respect thereto.

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SECTION 9.07   Notices.  All notices, amendments, waivers, consents and other communications provided to any party hereto under this Agreement shall be in writing and addressed, delivered or transmitted to such party at its address or facsimile number set forth below its signature hereto or at such other address or facsimile number as may be designated by such party in a written notice to the other parties. Any notice, if mailed and properly addressed with postage prepaid or if properly addressed and sent by pre-paid courier service, shall be deemed given when received; any notice, if transmitted by facsimile, shall be deemed given when transmitted upon receipt of electronic confirmation of transmission.

SECTION 9.08   Severability of Provisions.  Any covenant, provision, agreement or term of this Agreement that is prohibited or is held to be void or unenforceable in any jurisdiction shall, as to that jurisdiction, be ineffective to the extent of the prohibition or unenforceability without invalidating the remaining provisions of this Agreement.

SECTION 9.09   Tax Characterization.  Each party to this Agreement (a) acknowledges that it is the intent of the parties to this Agreement that, for accounting purposes and for all Federal, state and local income and franchise tax purposes, the Series 2008-1 Notes will be treated as evidence of indebtedness, (b) agrees to treat the Series 2008-1 Notes for all such purposes as indebtedness and (c) agrees that the provisions of the Related Documents shall be construed to further these intentions.

SECTION 9.10   No Proceedings; Limited Recourse.  (a)  HVF. Each of the parties hereto (other than HVF) hereby covenants and agrees that, prior to the date which is one year and one day after the payment in full of any Notes issued by HVF pursuant to the Base Indenture, it will not institute against, or join with any other Person in instituting against, HVF, any bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings, or other proceedings under any Federal or state bankruptcy or similar law, all as more particularly set forth in Section 13.15 of the Base Indenture and subject to any retained rights set forth therein; provided, however, that nothing in this Section 9.10(a) shall constitute a waiver of any right to indemnification, reimbursement or other payment from HVF pursuant to this Agreement, the Series 2008-1 Supplement or the Base Indenture. In the event that a Committed Note Purchaser (solely in its capacity as such) or a Conduit Investor (solely in its capacity as such) takes action in violation of this Section 9.10(a), HVF agrees that it shall file an answer with the bankruptcy court or otherwise properly contest the filing of such a petition by any such Person against HVF or the commencement of such action and raise the defense that such Person has agreed in writing not to take such action and should be estopped and precluded therefrom and such other defenses, if any, as its counsel advises that it may assert. The provisions of this Section 9.10(a) shall survive the termination of this Agreement. Nothing contained herein shall preclude participation by a Committed Note Purchaser or a Conduit Investor in assertion or defense of its claims in any such proceeding involving HVF. The obligations of HVF under this Agreement are solely the limited liability company obligations of HVF. In addition, each of the parties hereto agrees that all fees, expenses and other costs payable hereunder by HVF shall be payable only to the extent set forth in Section 13.16 of the Base Indenture and that all other amounts owed to them by HVF

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shall be payable solely from amounts that become available for payment pursuant to the Base Indenture and the Series 2008-1 Supplement.

(b)           The Conduit Investors. Each of the parties hereto (other than the Conduit Investors) hereby covenants and agrees that it will not, prior to the date which is one year and one day after the payment in full of the latest maturing Series 2008-1 Commercial Paper or other debt securities or instruments issued by a Conduit Investor, institute against, or join with any other Person in instituting against, such Conduit Investor, any bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings, or other proceedings under any Federal or state bankruptcy or similar law, subject to any retained rights set forth therein; provided, however, that nothing in this Section 9.10(b) shall constitute a waiver of any right to indemnification, reimbursement or other payment from such Conduit Investor pursuant to this Agreement, the Series 2008-1 Supplement or the Base Indenture. In the event that HVF, the Administrator, a Committed Note Purchaser (solely in its capacity as such) or Hertz takes action in violation of this Section 9.10(b), such related Conduit Investor may file an answer with the bankruptcy court or otherwise properly contest the filing of such a petition by any such Person against such Conduit Investor or the commencement of such action and raise the defense that such Person has agreed in writing not to take such action and should be estopped and precluded therefrom and such other defenses, if any, as its counsel advises that it may assert. The provisions of this Section 9.10(b) shall survive the termination of this Agreement. Nothing contained herein shall preclude participation by HVF, the Administrator, a Committed Note Purchaser or Hertz in assertion or defense of its claims in any such proceeding involving a Conduit Investor. The obligations of the Conduit Investors under this Agreement are solely the corporate obligations of the Conduit Investors. No recourse shall be had for the payment of any amount owing in respect of this Agreement, including any obligation or claim arising out of or based upon this Agreement, against any stockholder, employee, officer, agent, director, member, affiliate or incorporator of any Conduit Investor; provided, however, nothing in this Section 9.10(b) shall relieve any of the foregoing Persons from any liability which any such Person may otherwise have for its gross negligence or willful misconduct.

Notwithstanding any provisions contained in this Agreement to the contrary, the Conduit Investors shall not, and shall not be obligated to, fund or pay any amount pursuant to this Agreement or the Series 2008-1 Notes unless (i) the respective Conduit Investor has received funds which may be used to make such funding or other payment and which funds are not required to repay any of the commercial paper notes (“CP Notes”) issued by such Conduit Investor when due and (ii) after giving effect to such funding or payment, either (x) such Conduit Investor could issue CP Notes to refinance all of its outstanding CP Notes (assuming such outstanding CP Notes matured at such time) in accordance with the program documents governing its commercial paper program or (y) all of the CP Notes are paid in full. Any amount which a Conduit Investor does not pay pursuant to the operation of the preceding sentence shall not constitute a claim (as defined in Section 101 of the Bankruptcy Code) against or obligation of such Conduit Investor for any such insufficiency.

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SECTION 9.11   Confidentiality.  Each Committed Note Purchaser and each Conduit Investor agrees that it shall not disclose any Confidential Information to any Person without the prior written consent of the Administrator and HVF, other than (a) to their Affiliates and their officers, directors, employees, agents and advisors (including, without limitation, legal counsel and accountants) and to actual or prospective assignees and participants, and then only on a confidential basis, (b) as requested by a court or administrative order or decree, governmental or regulatory authority or self-regulatory organization or required by any statute, law, rule or regulation or judicial process (including any subpoena or similar legal process), (c) to any Rating Agency providing a rating for the Series 2008-1 Notes or the Conduit’s debt, (d) in the course of litigation with HVF, the Administrator or Hertz, (e) any Series 2008-1 Noteholder, any Committed Note Purchaser, any Conduit Investor, any Funding Agent or the Administrative Agent, (f) any Person acting as a placement agent or dealer with respect to any commercial paper (provided that any Confidential Information provided to any such placement agent or dealer does not reveal the identity of HVF or any of its Affiliates), (g) on a confidential basis, to auditors or legal or other professional advisors of any party hereto or (h) to any Person to the extent such Committed Note Purchaser or Conduit Investor reasonably determines such disclosure is necessary or appropriate in connection with the enforcement or for the defense of the rights and remedies under the Series 2008-1 Notes, the Indenture or any other Related Document.

“Confidential Information” means information that HVF or the Administrator furnishes to a Committed Note Purchaser or a Conduit Investor, but does not include (i) any such information that is or becomes generally available to the public other than as a result of a disclosure by a Committed Note Purchaser or a Conduit Investor or other Person to which a Committed Note Purchaser or a Conduit Investor delivered such information, (ii) any such information that was in the possession of a Committed Note Purchaser or a Conduit Investor prior to its being furnished to such Committed Note Purchaser or a Conduit Investor by HVF or the Administrator, or (iii) that is or becomes available to a Committed Note Purchaser or a Conduit Investor from a source other than HVF or the Administrator, provided that, with respect to clauses (ii) and (iii) herein, such source is not (1) known to a Committed Note Purchaser or a Conduit Investor to be bound by a confidentiality agreement with HVF, the Administrator, Hertz, as the case may be, or (2) known to a Committed Note Purchaser or a Conduit Investor to be otherwise prohibited from transmitting the information by a contractual, legal or fiduciary obligation.

SECTION 9.12   Governing Law.  THIS AGREEMENT AND ALL MATTERS ARISING UNDER OR IN ANY MANNER RELATING TO THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HERETO SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAW.

SECTION 9.13   Jurisdiction.  ALL JUDICIAL PROCEEDINGS BROUGHT AGAINST ANY OF THE PARTIES HEREUNDER WITH RESPECT TO THIS SERIES 2008-1 NOTE PURCHASE AGREEMENT MAY BE

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BROUGHT IN ANY STATE OR (TO THE EXTENT PERMITTED BY LAW) FEDERAL COURT OF COMPETENT JURISDICTION SITTING IN THE BOROUGH OF MANHATTAN IN THE CITY OF NEW YORK AND BY EXECUTION AND DELIVERY OF THIS SERIES 2008-1 NOTE PURCHASE AGREEMENT, EACH PARTY HEREUNDER ACCEPTS FOR ITSELF AND IN CONNECTION WITH ITS PROPERTIES, GENERALLY AND UNCONDITIONALLY, THE NONEXCLUSIVE JURISDICTION OF THE AFORESAID COURTS, AND IRREVOCABLY AGREES TO BE BOUND BY ANY JUDGMENT RENDERED THEREBY IN CONNECTION WITH THIS SERIES 2008-1 NOTE PURCHASE AGREEMENT.

SECTION 9.14   Waiver of Jury Trial.  ALL PARTIES HEREUNDER HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE ANY RIGHTS THEY MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH, THIS SERIES 2008-1 NOTE PURCHASE AGREEMENT, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER ORAL OR WRITTEN) OR ACTIONS OF THE PARTIES IN CONNECTION HEREWITH OR THEREWITH. ALL PARTIES ACKNOWLEDGE AND AGREE THAT THEY HAVE RECEIVED FULL AND SIGNIFICANT CONSIDERATION FOR THIS PROVISION AND THAT THIS PROVISION IS A MATERIAL INDUCEMENT FOR ALL PARTIES TO ENTER INTO THIS SERIES 2008-1 NOTE PURCHASE AGREEMENT.

SECTION 9.15   Counterparts.  This Agreement may be executed in any number of counterparts (which may include facsimile) and by the different parties hereto in separate counterparts, each of which when so executed shall be deemed to be an original, and all of which together shall constitute one and the same instrument.

SECTION 9.16   Additional Investor Groups.  Unless an Amortization Event or a Potential Amortization Event, in each case, with respect to the 2008-1 Notes shall have occurred and be continuing, HVF may, upon at least three (3) Business Days’ prior written notice to each Funding Agent, the Administrative Agent and each Rating Agency, cause an Additional Investor Group and its related Funding Agent, Conduit Purchasers, if any, and Committed Note Purchasers to become parties to this Agreement to increase the Series 2008-1 Maximum Principal Amount by complying with the provisions of this Section 9.16 and Sections 2.1 and 5.1 of the Series 2008-1 Supplement. Each such notice shall set forth the name of the Funding Agent, the Conduit Purchasers, if any, and the Committed Note Purchasers which are members of such Additional Investor Group, the Maximum Investor Group Principal Amount with respect to such Additional Investor Group, the related Committed Note Purchaser’s Committed Note Purchaser Percentage and the desired effective date of such Additional Investor Group becoming a party to this Agreement. Each Additional Investor Group shall, upon the execution of an Addendum by such Additional Investor Group, the Administrative Agent and HVF, become a party to this Agreement from and after the date of such execution with the same effect as if such Additional Investor Group had been an original party

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hereunder and the Administrative Agent shall amend Schedule I hereto in accordance with the information provided in the notice described above.

SECTION 9.17   Assignment.  (a)  Any Committed Note Purchaser may at any time sell all or any part of its rights and obligations under this Agreement and the Series 2008-1 Notes, with the prior written consent of HVF, which consent shall not be unreasonably withheld, to one or more financial institutions (an “Acquiring Committed Note Purchaser”) pursuant to an assignment and assumption agreement, substantially in the form of Exhibit B (the “Assignment and Assumption Agreement”), executed by such Acquiring Committed Note Purchaser, such assigning Committed Note Purchaser, the Funding Agent with respect to such Committed Note Purchaser and HVF and delivered to the Administrative Agent; provided that the consent of HVF to any such assignment shall not be required (i) after the occurrence and during the continuance of an Amortization Event with respect to the Series 2008-1 Notes or (ii) if such Acquiring Committed Note Purchaser is an Affiliate of such assigning Committed Note Purchaser.

(b)           Without limiting the foregoing, each Conduit Investor may assign all or a portion of the Investor Group Principal Amount with respect to such Conduit Investor and its rights and obligations under this Agreement and any other Related Documents to which it is a party (or otherwise to which it has rights) to a Conduit Assignee with respect to such Conduit Investor, without the prior written consent of HVF. Upon such assignment by a Conduit Investor to a Conduit Assignee, (i) such Conduit Assignee shall be the owner of the Investor Group Principal Amount or such portion thereof with respect to such Conduit Investor, (ii) the related administrative or managing agent for such Conduit Assignee will act as the Funding Agent for such Conduit Assignee hereunder, with all corresponding rights and powers, express or implied, granted to the Funding Agent hereunder or under the other Related Documents, (iii) such Conduit Assignee and its liquidity support provider(s) and credit support provider(s) and other related parties, in each case relating to the Series 2008-1 Commercial Paper and/or the Series 2008-1 Notes, shall have the benefit of all the rights and protections provided to such Conduit Investor herein and in the other Related Documents (including, without limitation, any limitation on recourse against such Conduit Assignee as provided in this paragraph), (iv) such Conduit Assignee shall assume all of such Conduit Investor’s obligations, if any, hereunder or under the Base Indenture or under any other Related Document with respect to such portion of the Investor Group Principal Amount and such Conduit Investor shall be released from such obligations, (v) all distributions in respect of the Investor Group Principal Amount or such portion thereof with respect to such Conduit Investor shall be made to the applicable Funding Agent on behalf of such Conduit Assignee, (vi) the definition of the term “CP Rate” with respect to the portion of the Investor Group Principal Amount with respect to such Conduit Investor, as applicable funded with commercial paper issued by such Conduit Assignee from time to time shall be determined in the manner set forth in the definition of “CP Rate” applicable to such Conduit Assignee on the basis of the interest rate or discount applicable to commercial paper issued by such Conduit Assignee (rather than any other Conduit Investor), (vii) the defined terms and other terms and provisions of this Agreement and the other Related Documents shall be interpreted in accordance with the foregoing, and (viii) if requested by the Funding Agent with respect to such

42

Conduit Assignee, the parties will execute and deliver such further agreements and documents and take such other actions as the Funding Agent may reasonably request to evidence and give effect to the foregoing. No assignment by any Conduit Investor to a Conduit Assignee of all or any portion of the Investor Group Principal Amount with respect to such Conduit Investor shall in any way diminish the obligation of the Committed Note Purchasers in the same Investor Group as such Conduit Investor under Section 2.03 to fund any Increase not funded by such Conduit Investor or such Conduit Assignee.

(c)           Any Conduit Investor and the Committed Note Purchaser with respect to such Conduit Investor may at any time sell all or any part of their respective rights and obligations under this Agreement and the Series 2008-1 Notes, with the prior written consent of HVF, which consent shall not be unreasonably withheld, to a multi-seller commercial paper conduit, whose commercial paper has ratings of at least “A-2” from S&P and “P2” from Moody’s and one or more financial institutions providing support to such multi-seller commercial paper conduit (an “Acquiring Investor Group”) pursuant to a transfer supplement, substantially in the form of Exhibit C (the “Investor Group Supplement”), executed by such Acquiring Investor Group, the Funding Agent with respect to such Acquiring Investor Group (including the Conduit Investor and the Committed Note Purchasers with respect to such Investor Group), such assigning Conduit Investor and the Committed Note Purchasers with respect to such Conduit Investor, the Funding Agent with respect to such assigning Conduit Investor and Committed Note Purchasers and HVF and delivered to the Administrative Agent; provided that the consent of HVF to any such assignment shall not be required after the occurrence and during the continuance of an Amortization Event with respect to the Series 2008-1 Notes; provided further that it shall not be considered unreasonable for HVF to withhold its consent to an assignment to a potential Acquiring Investor Group that has ratings of at least “A-2” from S&P and “P2” by Moody’s, but does not have ratings of at least “A-1” from S&P or “P1” by Moody’s if such assignment will result in a material increase in HVF’s costs of financing with respect to the applicable Series 2008-1 Notes.

(d)           Any Committed Note Purchaser may, in the ordinary course of its business and in accordance with applicable law, at any time sell to one or more financial institutions or other entities (“Participants”) participations in its Committed Note Purchaser Percentage of the Maximum Investor Group Principal Amount with respect to it and the other Committed Note Purchasers included in the related Investor Group, its Series 2008-1 Note and its rights hereunder (or, in each case, a portion thereof) pursuant to documentation in form and substance satisfactory to such Committed Note Purchaser and the Participant; provided, however, that (i) in the event of any such sale by a Committed Note Purchaser to a Participant, (A) such Committed Note Purchaser’s obligations under this Agreement shall remain unchanged, (B) such Committed Note Purchaser shall remain solely responsible for the performance thereof and (C) HVF and the Administrative Agent shall continue to deal solely and directly with such Committed Note Purchaser in connection with its rights and obligations under this Agreement and (ii) no Committed Note Purchaser shall sell any participating interest under which the Participant shall have rights to approve any amendment to, or any consent or waiver with respect to, this Agreement, the Base Indenture, the Series 2008-1 Supplement or any

43

Related Document, except to the extent that the approval of such amendment, consent or waiver otherwise would require the unanimous consent of all Committed Note Purchasers hereunder. A Participant shall have the right to receive reimbursement for amounts due pursuant to Sections 3.05, 3.06, 3.07 and 3.08 but only to the extent that the related selling Committed Note Purchaser would have had such right absent the sale of the related participation and, with respect to amounts due pursuant to Section 3.08, only to the extent such Participant shall have complied with the provisions of Section 3.08 as if such Participant were a Committed Note Purchaser.

(e)           HVF authorizes each Committed Note Purchaser to disclose to any Participant or Acquiring Committed Note Purchaser (each, a “Transferee”) and any prospective Transferee any and all financial information in such Committed Note Purchaser’s possession concerning HVF, the Collateral, the Administrator and the Related Documents which has been delivered to such Committed Note Purchaser by HVF or the Administrator in connection with such Committed Note Purchaser’s credit evaluation of HVF, the Collateral and the Administrator.

[Remainder of Page Intentionally Blank]

44

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed by their duly authorized officers and delivered as of the day and year first above written.

HERTZ VEHICLE FINANCING LLC
By:	/s/ Scott Massengill
	Name:		Scott Massengill
	Title:		Vice President and Treasurer
Address:		225 Brae Boulevard
		Park Ridge, NJ 07656
Attention:		Treasury Department
Telephone:		(201) 307-2000
Facsimile:		(201)307-2746

Note Purchase Agreement

THE HERTZ CORPORATION
By:	/s/ Scott Massengill
	Name:	Scott Massengill
	Title:	Treasurer
Address:		225 Brae Boulevard
		Park Ridge, NJ 07656
Attention:		Treasury Department
Telephone:		(201) 307-2000
Facsimile:		(201)307-2746

Note Purchase Agreement

DEUTSCHE BANK SECURITIES INC., as the Administrative Agent
By:	/s/ ROBERT SHELDON
	Name:	ROBERT SHELDON
	Title:	DIRECTOR
By:	/s/ CHAWEY WU
	Name:	CHAWEY WU
	Title:	VICE PRESIDENT
Address:		60 Wall Street, 19th Floor
		New York, NY 10005-2858
Attention:		Tina Gu
Telephone:		(212) 250-0357
Facsimile:		(212) 797-5150
With electronic copy to abs.conduits@db.com

Note Purchase Agreement

SHEFFIELD RECEIVABLES CORPORATION, as a Conduit Investor
By: Barclays Bank PLC, as Attorney-in-Fact
By:	/s/ Shailesh S. Deshpande
Name:			Shailesh S. Deshpande
Title:			Director
Address:		200 Park Avenue
		New York, New York 10166
Attention:		Mary Logan
Telephone:		(212) 412-3266
Facsimile:		(212) 412-6846
Email:		mary.logan@barcap.com

Note Purchase Agreement

SHEFFIELD RECEIVABLES CORPORATION, as a Committed Note Purchaser
By:	/s/ Shailesh S. Deshpande
	Name:	Shailesh S. Deshpande
	Title:	Director
Address:		200 Park Avenue
		New York, New York 10166
Attention:		Mary Logan
Telephone:		(212) 412-3266
Facsimile:		(212) 412-6846
Email:		mary.logan@barcap.com
COMMITMENT AMOUNT:
$300,000,000
PERCENTAGE: 36.3636%

Note Purchase Agreement

BARCLAYS BANK PLC., as a Funding Agent
By:	/s/ Fouad S. Onbargi
	Name:	Fouad S. Onbargi
	Title:	Director
Address:		200 Park Avenue
		New York, New York 10166
Attention:		Mary Logan
Telephone:		(212) 412-3266
Facsimile:		(212) 412-6846
Email:		mary.logan@barcap.com

Note Purchase Agreement

NANTUCKET FUNDING CORP., LLC, as a Conduit Investor
By:	/s/ Philip A. Mortone
	Name:	Philip A. Mortone
	Title:	Vice President
Address:		60 Wall Street, 19th Floor
		New York, NY 10005-2858
Attention:		Tina Gu
Telephone:		(212) 250-0357
Facsimile:		(212) 797-5150
With electronic copy to abs.conduits@db.com

Note Purchase Agreement

DEUTSCHE BANK AG, NEW YORK BRANCH, as Committed Note Purchaser
By:	/s/ ROBERT SHELDON
	Name:	ROBERT SHELDON
	Title:	DIRECTOR
By:	/s/ CHAWEY WU
	Name:	CHAWEY WU
	Title:	VICE PRESIDENT
Address:		60 Wall Street, 19th Floor
		New York, NY 10005-2858
Attention:		Tina Gu
Telephone:		(212) 250-0357
Facsimile:		(212) 797-5150
With electronic copy to abs.conduits@db.com
COMMITMENT AMOUNT:
$300,000,000
PERCENTAGE: 36.3636%

Note Purchase Agreement

DEUTSCHE BANK AG, NEW YORK BRANCH, as a Funding Agent
By:		/s/ ROBERT SHELDON
		Name:	ROBERT SHELDON
		Title:	DIRECTOR
By:	/s/ CHAWEY WU
	Name:		CHAWEY WU
	Title:		VICE PRESIDENT
Address:			60 Wall Street, 19th Floor
			New York, NY 10005-2858
Attention:			Tina Gu
Telephone:			(212) 250-0357
Facsimile:			(212) 797-5150
With electronic copy to abs.conduits@db.com

Note Purchase Agreement

MERRILL LYNCH MORTGAGE CAPITAL INC., as Committed Note Purchaser
By:	/s/ Joseph Magnus
	Name:	Joseph Magnus
	Title:	Vice President
Address:		2 World Financial Center
		25th Floor
		New York, New York 10281
Attention:		Mark MacDonald
Telephone:		(212) 236-2560
Facsimile:		(212) 553-2326
Email:		Mark_MacDonald@ml.com
With copies to:
Address:		2 World Financial Center
		25th Floor
		New York, New York 10281
Attention:		Chris Gregory
Telephone:		(212) 236-2563
Facsimile:		(212) 553-2326
Email:		christopher_gregory@ml.com
Address:		4 World Financial Center
		11th Floor
		New York, New York 10080
Attention:		Bill Heskett
Telephone:		(212) 449-9836
Facsimile:		(212) 449-9015
Email:		william_heskett@ml.com
Address:		4 World Financial Center
		11th Floor
		New York, New York 10080
Attention:		Olga Filipenko
Telephone:		(212) 449-4928
Facsimile:		(212) 449-9015
Email:		olga_filipenko@ml.com

Note Purchase Agreement

Address:	4 World Financial Center
	11th Floor
	New York, New York 10080
Attention:	Joseph Magnus
Telephone:	(212) 449-7854
Facsimile:	(212) 449-9015
Email:	joseph_magnus@ml.com
COMMITMENT AMOUNT: $225,000,000
PERCENTAGE: 27.2727%

[SERIES 2008-1 NOTE PURCHASE AGREEMENT]

MERRILL LYNCH MORTGAGE CAPITAL INC., as a Funding Agent
By:	/s/ Joseph Magnus
	Name:	Joseph Magnus
	Title:	Vice President
Address:		2 World Financial Center
		25th Floor
		New York, New York 10281
Attention:		Mark MacDonald
Telephone:		(212) 236-2560
Facsimile:		(212) 553-2326
Email:		Mark_MacDonald@ml.com
With a copies to:
Address:		2 World Financial Center
		25th Floor
		New York, New York 10281
Attention:		Chris Gregory
Telephone:		(212) 236-2563
Facsimile:		(212) 553-2326
Email:		christopher_gregory@ml.com
Address:		4 World Financial Center
		11th Floor
		New York, New York 10080
Attention:		Bill Heskett
Telephone:		(212) 449-9836
Facsimile:		(212) 449-9015
Email:		william_heskett@ml.com
Address:		4 World Financial Center
		11th Floor
		New York, New York 10080
Attention:		Olga Filipenko
Telephone:		(212) 449-4928
Facsimile:		(212) 449-9015
Email:		olga_filipenko@ml.com

Note Purchase Agreement

Address:	4 World Financial Center
	11th Floor
	New York, New York 10080
Attention:	Joseph Magnus
Telephone:	(212) 449-7854
Facsimile:	(212) 449-9015
Email:	joseph_magnus@ml.com

[SERIES 2008-1 NOTE PURCHASE AGREEMENT]

Schedule I

SHEFFIELD RECEIVABLES CORPORATION, as a Conduit Investor

BARCLAYS BANK PLC., as a Committed Note Purchaser

Commitment Amount: $300,000,000

Committed Note Purchaser Percentage: 36.3636%

Maximum Investor Group Principal Amount: $300,000,000

BARCLAYS BANK PLC., as a Funding Agent for SHEFFIELD RECEIVABLES CORPORATION

NANTUCKET FUNDING CORP., LLC, as a Conduit Investor

DEUTSCHE BANK AG NEW YORK BRANCH, as a Committed Note Purchaser

Commitment Amount: $300,000,000

Committed Note Purchaser Percentage: 36.3636%

Maximum Investor Group Principal Amount: $300,000,000

DEUTSCHE BANK AG, NEW YORK BRANCH, as a Funding Agent for NANTUCKET FUNDING CORP., LLC

[SERIES 2008-1 NOTE PURCHASE AGREEMENT]

MERRILL LYNCH MORTGAGE CAPITAL INC., as a Committed Note Purchaser

Commitment Amount: $225,000,000

Committed Note Purchaser Percentage: 27.2727%

Maximum Investor Group Principal Amount: $225,000,000

MERRILL LYNCH MORTGAGE CAPITAL INC., as a Funding Agent for MERRILL LYNCH MORTGAGE CAPITAL INC.

[SERIES 2008-1 NOTE PURCHASE AGREEMENT]

EXHIBIT A
TO
SERIES 2008-1 NOTE PURCHASE AGREEMENT

FORM OF ADVANCE REQUEST

HERTZ VEHICLE FINANCING LLC
SERIES 2008-1 VARIABLE FUNDING RENTAL CAR
ASSET BACKED NOTES

To:  Addressees on Schedule I hereto

Ladies and Gentlemen:

This Advance Request is delivered to you pursuant to Section 7.03 of that certain Series 2008-1 Note Purchase Agreement, dated as of September 12, 2008 (as amended, supplemented, restated or otherwise modified from time to time, the “Series 2008-1 Note Purchase Agreement”) among Hertz Vehicle Financing LLC, the Conduit Investors, the Committed Note Purchasers, the Funding Agents named therein, The Hertz Corporation, as Administrator and Deutsche Bank Securities Inc., as Administrative Agent (in such capacity, the “Administrative Agent”).

Unless otherwise defined herein or as the context otherwise requires, terms used herein have the meaning assigned thereto under Section 1.01 of the Series 2008-1 Note Purchase Agreement, and if not defined therein, shall have the meaning assigned thereto under Schedule I of the Base Indenture.

The undersigned hereby requests that an Advance be made in the aggregate principal amount of $                       on                         , 20      .  The undersigned hereby elects that any Advance that is not funded at the CP Rate by a Conduit Investor or otherwise shall be a Eurodollar Advance and the related Eurodollar Interest Period shall commence on the date of such Eurodollar Advance and end on the next Payment Date.

The undersigned hereby certifies that (i) the Aggregate Asset Amount as of the date hereof is an amount equal to $                             and (ii) the Series 2008-1 Enhancement Amount as of the date hereof is an amount equal to $                            .

The undersigned hereby acknowledges that the delivery of this Advance Request and the acceptance by undersigned of the proceeds of the Advance requested hereby constitute a representation and warranty by the undersigned that, on the date of such Advance, and before and after giving effect thereto and to the application of the proceeds therefrom, all conditions set forth in Section 7.03 of the Series 2008-1 Note Purchase Agreement and Section 2.1(b) of the Series 2008-1 Supplement have been satisfied and all statements set forth in Section 6.01 of the

A-1

Series 2008-1 Note Purchase Agreement are true and correct as required pursuant to Section 7.03(a)(i) of the Series 2008-1 Note Purchase Agreement.

The undersigned agrees that if prior to the time of the Advance requested hereby any matter certified to herein by it will not be true and correct at such time as if then made, it will immediately so notify both you and each Committed Note Purchaser and each Conduit Investor, if any, in your Investor Group.  Except to the extent, if any, that prior to the time of the Advance requested hereby you and each Committed Note Purchaser and each Conduit Investor, if any, in your Investor Group, shall receive written notice to the contrary from the undersigned, each matter certified to herein shall be deemed once again to be certified as true and correct at the date of such Advance as if then made.

Please wire transfer the proceeds of the Advance to the following account pursuant to the following instructions:

[insert payment instructions]

The undersigned has caused this Advance Request to be executed and delivered, and the certification and warranties  contained herein to be made, by its duly Authorized Officer this          day of                     , 20      .

HERTZ VEHICLE FINANCING LLC

By:

Title:

SCHEDULE I:

THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A., as Trustee

2 North LaSalle Street

Chicago, IL 60602

Attention: Corporate Trust Administration — Structured Finance

Telephone: 312-827-8663

Fax: 312-827-8562

Email: john.ask@bnymellon.com

DEUTSCHE BANK SECURITIES INC., as Administrative Agent

60 Wall Street

New York, NY 10005-2858

Attention: Tina Gu

Telephone: (212) 250-0357

Fax: (212) 797-5150

Email: tina.gu@db.com

With an electronic copy to: abs.conduits@db.com

BARCLAYS BANK PLC., as a Funding Agent for SHEFFIELD RECEIVABLES CORPORATION and SALISBURY RECEIVABLES COMPANY

Ms. Mary Logan

Director

Barclays Bank PLC

200 Park Avenue

New York, NY 10166

Tel: (212) 412-3266

Fax: (212) 412-6846

Email:mary.logan@barcap.com

DEUTSCHE BANK AG, NEW YORK BRANCH, as a Funding Agent for NANTUCKET FUNDING CORP., LLC

60 Wall Street

New York, NY 10005-2858

Attention: Tina Gu

Telephone: (212) 250-0357

Fax: (212) 797-5150

Email: tina.gu@db.com

With an electronic copy to: abs.conduits@db.com

MERRILL LYNCH MORTGAGE CAPITAL INC., as a Funding Agent and Committed Note Purchaser

2 World Financial Center, 25^th Floor

New York, NY 10281

Attention: Mark MacDonald

Telephone: (212) 236-2560

Fax: (212) 553-2326

Email: Mark_MacDonald@ml.com

with a copy to:

2 World Financial Center, 25^th Floor

New York, NY 10281

Attention: Chris Gregory

Telephone: (212) 236-2563

Fax: (212) 553-2326

Email: christopher_gregory@ml.com

with a copy to:

4 World Financial Center, 11^th Floor

New York, NY 10080

Attention: Bill Heskett

Telephone: (212) 449-9863

Fax: (212) 449-9015

Email: william_heskett@ml.com

with a copy to:

4 World Financial Center, 11^th Floor

New York, NY 10080

Attention: Olga Filipenko

Telephone: (212) 449-4928

Fax: (212) 449-9015

Email: olga_filipenko@ml.com

with a copy to:

4 World Financial Center, 11^th Floor

New York, New York 10080
Attention:  Joseph Magnus
Telephone: (212) 449-7854
Facsimile: (212) 449-9015

Email: joseph_magnus@ml.com

SCHEDULE II:

Funding Allocation by Funding Agent:
BARCLAYS BANK PLC.	36.3636	%	$
DEUTSCHE BANK AG, NEW YORK BRANCH	36.3636	%	$
MERRILL LYNCH MORTGAGE CAPITAL INC.	27.2727	%	$

EXHIBIT B
TO
SERIES 2008-1 NOTE PURCHASE AGREEMENT

FORM OF ASSIGNMENT AND ASSUMPTION AGREEMENT

ASSIGNMENT AND ASSUMPTION AGREEMENT, dated as of [      ], among [       ] (the “Transferor”), each purchaser listed as an Acquiring Committed Note Purchaser on the signature pages hereof (each, an “Acquiring Committed Note Purchaser”), the Funding Agent with respect to such Acquiring Committed Note Purchaser listed in the signature pages hereof (each, a “Funding Agent”), and Hertz Vehicle Financing LLC, a Delaware limited liability company (the “Company”).

W I T N E S S E T H:

WHEREAS, this Assignment and Assumption Agreement is being executed and delivered in accordance with subsection 9.17(a) of the Series 2008-1 Note Purchase Agreement, dated as of September 12, 2008 (as from time to time amended, supplemented or otherwise modified in accordance with the terms thereof, the “Series 2008-1 Note Purchase Agreement”; terms defined therein being used herein as therein defined), among the Company, the Conduit Investors, the Committed Note Purchasers, the Funding Agents named therein, The Hertz Corporation, as Administrator and Deutsche Bank Securities Inc., as Administrative Agent (in such capacity, the “Administrative Agent”);

WHEREAS, each Acquiring Committed Note Purchaser (if it is not already an existing Committed Note Purchaser) wishes to become a Committed Note Purchaser party to the Series 2008-1 Note Purchase Agreement; and

WHEREAS, the Transferor is selling and assigning to each Acquiring Committed Note Purchaser, its rights, obligations and commitments under the Series 2008-1 Note Purchase Agreement and the Series 2008-1 Notes;

NOW, THEREFORE, the parties hereto hereby agree as follows:

Upon the execution and delivery of this Assignment and Assumption Agreement by each Acquiring Committed Note Purchaser, each Funding Agent, the Transferor and the Company (the date of such execution and delivery, the “Transfer Issuance Date”), each Acquiring Committed Note Purchaser shall be a Committed Note Purchaser party to the Series 2008-1 Note Purchase Agreement for all purposes thereof.

B-1

The Transferor acknowledges receipt from each Acquiring Committed Note Purchaser of an amount equal to the purchase price, as agreed between the Transferor and such Acquiring Committed Note Purchaser (the “Purchase Price”), of the portion being purchased by such Acquiring Committed Note Purchaser (such Acquiring Committed Note Purchaser’s “Purchased Percentage”) of the Transferor’s Commitment under the Series 2008-1 Note Purchase Agreement and the Transferor’s Investor Group Invested Amount.  The Transferor hereby irrevocably sells, assigns and transfers to each Acquiring Committed Note Purchaser, without recourse, representation or warranty, and each Acquiring Committed Note Purchaser hereby irrevocably purchases, takes and assumes from the Transferor, such Acquiring Committed Note Purchaser’s Purchased Percentage of the Transferor’s Commitment under the Series 2008-1 Note Purchase Agreement and the Transferor’s Investor Group Invested Amount.

The Transferor has made arrangements with each Acquiring Committed Note Purchaser with respect to (i) the portion, if any, to be paid, and the date or dates for payment, by the Transferor to such Acquiring Committed Note Purchaser of any program fees, undrawn facility fee, structuring and commitment fees or other fees (collectively, the “Fees”) [heretofore received] by the Transferor pursuant to Section 3.02 of the Series 2008-1 Note Purchase Agreement prior to the Transfer Issuance Date [and (ii) the portion, if any, to be paid, and the date or dates for payment, by such Acquiring Committed Note Purchaser to the Transferor of Fees received by such Acquiring Committed Note Purchaser pursuant to the Series 2008-1 Supplement from and after the Transfer Issuance Date].

From and after the Transfer Issuance Date, amounts that would otherwise by payable to or for the account of the Transferor pursuant to the Series 2008-1 Supplement or the Series 2008-1 Note Purchase Agreement shall, instead, be payable to or for the account of the Transferor and the Acquiring Committed Note Purchasers, as the case may be, in accordance with their respective interests as reflected in this Assignment and Assumption Agreement, whether such amounts have accrued prior to the Transfer Issuance Date or accrue subsequent to the Transfer Issuance Date.

Each of the parties to this Assignment and Assumption Agreement agrees that at any time and from time to time upon the written request of any other party, it will execute and deliver such further documents and do such further acts and things as such other party may reasonably request in order to effect the purposes of this Assignment and Assumption Agreement.

By executing and delivering this Assignment and Assumption Agreement, the Transferor and each Acquiring Committed Note Purchaser confirm to and agree with each other and the Committed Note Purchasers as follows:  (i) other than the representation and warranty that it is the legal and beneficial owner of the interest being assigned hereby free and clear of any adverse claim, the Transferor makes no representation or warranty and assumes no responsibility with respect to any statements, warranties or representations made in or in connection with the Series 2008-1 Supplement, the Series 2008-1 Note Purchase Agreement or the execution, legality, validity, enforceability, genuineness, sufficiency or value of the Indenture, the Series 2008-1 Notes, the Related Documents or any instrument or document furnished pursuant thereto; (ii) the Transferor makes no representation or warranty and assumes no responsibility with respect to the financial condition of the Company or the performance or observance by the

B-2

Company of any of the Company’s obligations under the Indenture, the Related Documents or any other instrument or document furnished pursuant hereto; (iii) each Acquiring Committed Note Purchaser confirms that it has received a copy of the Indenture, the Series 2008-1 Note Purchase Agreement and such other Related Documents and other documents and information as it has deemed appropriate to make its own credit analysis and decision to enter into this Assignment and Assumption Agreement; (iv) each Acquiring Committed Note Purchaser will, independently and without reliance upon the Administrative Agent, the Transferor or any other Investor Group and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit decisions in taking or not taking action under the Series 2008-1 Note Purchase Agreement; (v) each Acquiring Committed Note Purchaser appoints and authorizes the Administrative Agent to take such action as agent on its behalf and to exercise such powers under the Series 2008-1 Note Purchase Agreement as are delegated to the Administrative Agent by the terms thereof, together with such powers as are reasonably incidental thereto, all in accordance with Article 5 of the Series 2008-1 Note Purchase Agreement; (vi) each Acquiring Committed Note Purchaser appoints and authorizes a Funding Agent to take such action as agent on its behalf and to exercise such powers under the Series 2008-1 Note Purchase Agreement as are delegated to such Funding Agent by the terms thereof, together with such powers as are reasonably incidental thereto, all in accordance with Article 5 of the Series 2008-1 Note Purchase Agreement, (vii) each Acquiring Committed Note Purchaser agrees that it will perform in accordance with their terms all of the obligations which by the terms of the Series 2008-1 Note Purchase Agreement are required to be performed by it as an Acquiring Committed Note Purchaser and (viii) the Acquiring Committed Note Purchaser hereby represents and warrants to HVF and the Administrator that the representations and warranties contained in Section 6.03 of the Series 2008-1 Note Purchase Agreement are true and correct with respect to the Acquiring Committed Note Purchaser on and as of the date hereof and the Acquiring Committed Note Purchaser shall be deemed to have made such representations and warranties contained in Section 6.03 of the Series 2008-1 Note Purchase Agreement on and as of the date hereof.

Schedule I hereto sets forth the revised Commitment Percentages of the Transferor and each Acquiring Committed Note Purchaser as well as administrative information with respect to each Acquiring Committed Note Purchaser and its Funding Agent.

This Assignment and Assumption Agreement and all matters arising under or in any manner relating to this Assignment and Assumption Agreement shall be governed by, and construed in accordance with, the laws of the State of New York, and the obligations, rights and remedies of the parties hereto shall be determined in accordance with such law.

B-3

IN WITNESS WHEREOF, the parties hereto have caused this Assignment and Assumption Agreement to be executed by their respective duly authorized officers as of the date first set forth above.

[          ], as Transferor
By:
	Title:
By:
	Title:
[      ], as Acquiring Committed Note Purchaser
By:
	Title:
[          ], as Funding Agent
By:
	Title:

B-4

CONSENTED AND ACKNOWLEDGED:

HERTZ VEHICLE FINANCING LLC

By:
	Title:

B-5

LIST OF ADDRESSES FOR NOTICES

AND OF COMMITMENT PERCENTAGES

DEUTSCHE BANK SECURITIES INC., as
Administrative Agent

Address:

Attention:
Telephone:
Facsimile:

[               ]

Address:	[          ]
	Attention: [          ]
	Telephone: [          ]
	Facsimile: [          ]

Prior Commitment Percentage:	[          ]
Revised Commitment Percentage:	[          ]
Prior Investor Group Invested Amount:	[          ]
Revised Investor Group Invested Amount:	[          ]
[	]
Address:
Attention:
Telephone:
Facsimile:
Prior Commitment Percentage:	[          ]
Revised Commitment Percentage:	[          ]
Prior Investor Group Invested Amount:	[          ]
Revised Investor Group Invested Amount:	[          ]

EXHIBIT C
TO
SERIES 2008-1 NOTE PURCHASE AGREEMENT

FORM OF INVESTOR GROUP SUPPLEMENT

INVESTOR GROUP SUPPLEMENT, dated as of [   ], among (i) [   ] (the “Transferor Investor Group”), (ii) [   ] (the “Acquiring Investor Group”), (iii) the Funding Agent with respect to the Acquiring Investor Group listed in the signature pages hereof (each, a “Funding Agent”), and (iv) Hertz Vehicle Financing LLC, a Delaware limited liability company (the “Company”).

W I T N E S S E T H:

WHEREAS, this Investor Group Supplement is being executed and delivered in accordance with subsection 9.17(c) of the Series 2008-1 Note Purchase Agreement, dated as of September [12], 2008 (as from time to time amended, supplemented or otherwise modified in accordance with the terms thereof, the “Series 2008-1 Note Purchase Agreement”; terms defined therein being used herein as therein defined), among the Company, the Conduit Investors, the Committed Note Purchasers, the Funding Agents named therein, The Hertz Corporation, as Administrator and Deutsche Bank Securities Inc., as Administrative Agent (in such capacity, the “Administrative Agent”);

WHEREAS, the Acquiring Investor Group wishes to become a Conduit Investor and a Committed Note Purchaser with respect to such Conduit Investor under the Series 2008-1 Note Purchase Agreement; and

WHEREAS, the Transferor Investor Group is selling and assigning to the Acquiring Investor Group its respective rights, obligations and commitments under the Series 2008-1 Note Purchase Agreement and the Series 2008-1 Notes with respect to the percentage of its total commitment specified on Schedule I attached hereto;

NOW, THEREFORE, the parties hereto hereby agree as follows:

Upon the execution and delivery of this Investor Group Supplement by the Acquiring Investor Group, each Funding Agent with respect thereto, the Transferor Investor Group and the Company (the date of such execution and delivery, the “Transfer Issuance Date”), the Conduit Investor and the Committed Note Purchasers with respect to the Acquiring Investor Group shall be parties to the Series 2008-1 Note Purchase Agreement for all purposes thereof.

The Transferor Investor Group acknowledges receipt from the Acquiring Investor Group of an amount equal to the purchase price, as agreed between the Transferor Investor Group and the Acquiring Investor Group (the “Purchase Price”), of the portion being purchased by the Acquiring Investor Group (the Acquiring Investor Group’s “Purchased Percentage”) of

the Commitment Amount with respect to the Committed Note Purchasers included in the Transferor Investor Group under the Series 2008-1 Note Purchase Agreement and the Transferor Investor Group’s Investor Group Principal Amount.  The Transferor Investor Group hereby irrevocably sells, assigns and transfers to the Acquiring Investor Group, without recourse, representation or warranty, and the Acquiring Investor Group hereby irrevocably purchases, takes and assumes from the Transferor Investor Group, the Acquiring Investor Group’s Purchased Percentage of the Commitment with respect to the Committed Note Purchasers included in the Transferor Investor Group under the Series 2008-1 Note Purchase Agreement and the Transferor Investor Group’s Investor Group Principal Amount.

From and after the Transfer Issuance Date, amounts that would otherwise be payable to or for the account of the Transferor Investor Group pursuant to the Series 2008-1 Supplement or the Series 2008-1 Note Purchase Agreement shall, instead, be payable to or for the account of the Transferor Investor Group and the Acquiring Investor Group, as the case may be, in accordance with their respective interests as reflected in this Investor Group Supplement, whether such amounts have accrued prior to the Transfer Issuance Date or accrue subsequent to the Transfer Issuance Date.

Each of the parties to this Investor Group Supplement agrees that at any time and from time to time upon the written request of any other party, it will execute and deliver such further documents and do such further acts and things as such other party may reasonably request in order to effect the purposes of this Investor Group Supplement.

By executing and delivering this Investor Group Supplement, the Transferor Investor Group and the Acquiring Investor Group confirm to and agree with each other as follows:  (i) other than the representation and warranty that it is the legal and beneficial owner of the interest being assigned hereby free and clear of any adverse claim, the Transferor Investor Group makes no representation or warranty and assumes no responsibility with respect to any statements, warranties or representations made in or in connection with the Series 2008-1 Supplement, the Series 2008-1 Note Purchase Agreement or the execution, legality, validity, enforceability, genuineness, sufficiency or value of the Indenture, the Series 2008-1 Notes, the Related Documents or any instrument or document furnished pursuant thereto; (ii) the Transferor Investor Group makes no representation or warranty and assumes no responsibility with respect to the financial condition of the Company or the performance or observance by the Company of any of the Company’s obligations under the Indenture, the Series 2008-1 Note Purchase Agreement, the Related Documents or any other instrument or document furnished pursuant hereto; (iii) the Acquiring Investor Group confirms that it has received a copy of the Indenture, the Series 2008-1 Note Purchase Agreement and such other Related Documents and other documents and information as it has deemed appropriate to make its own credit analysis and decision to enter into this Investor Group Supplement; (iv) the Acquiring Investor Group will, independently and without reliance upon the Administrative Agent, the Transferor Investor Group or any other Person and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit decisions in taking or not taking action under the Series 2008-1 Note Purchase Agreement; (v) the Acquiring Investor Group appoints and authorizes the Administrative Agent to take such action as agent on its behalf and to exercise such powers under the Series 2008-1 Note Purchase Agreement as are delegated to the Administrative Agent by the terms thereof, together with such powers as are reasonably

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incidental thereto, all in accordance with Article 5 of the Series 2008-1 Note Purchase Agreement; (vi) each member of the Acquiring Investor Group appoints and authorizes its respective Funding Agent, listed on Schedule I hereto, to take such action as agent on its behalf and to exercise such powers under the Series 2008-1 Note Purchase Agreement as are delegated to such Funding Agent by the terms thereof, together with such powers as are reasonably incidental thereto, all in accordance with Article 5 of the Series 2008-1 Note Purchase Agreement, (vii) each member of the Acquiring Investor Group agrees that it will perform in accordance with their terms all of the obligations which by the terms of the Series 2008-1 Note Purchase Agreement are required to be performed by it as a member of the Acquiring Investor Group and (viii) each member of the Acquiring Investor Group hereby represents and warrants to HVF and the Administrator that the representations and warranties contained in Section 6.03 of the Series 2008-1 Note Purchase Agreement are true and correct with respect to the Acquiring Investor Group on and as of the date hereof and the Acquiring Investor Group shall be deemed to have made such representations and warranties contained in Section 6.03 of the Series 2008-1 Note Purchase Agreement on and as of the date hereof.

Schedule I hereto sets forth the revised Commitment Percentages of the Transferor Investor Group and the Acquiring Investor Group, as well as administrative information with respect to the Acquiring Investor Group and its Funding Agent.

This Investor Group Supplement and all matters arising under or in any manner relating to this Investor Group Supplement shall be governed by, and construed in accordance with, the laws of the State of New York, and the obligations, rights and remedies of the parties hereto shall be determined in accordance with such law.

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IN WITNESS WHEREOF, the parties hereto have caused this Investor Group Supplement to be executed by their respective duly authorized officers as of the date first set forth above.

[          ], as Transferor Investor Group

By:

Title:

[          ], as Transferor Investor Group

By:

Title:

[          ], as Acquiring Investor Group

By:

Title:

[          ], as Acquiring Investor Group

By:

Title:

[          ], as Funding Agent

By:

Title:

CONSENTED AND ACKNOWLEDGED:

HERTZ VEHICLE FINANCING LLC

By:
	Title:

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LIST OF ADDRESSES FOR NOTICES

AND OF COMMITMENT PERCENTAGES

EXHIBIT D
TO
SERIES 2008-1 NOTE PURCHASE AGREEMENT

ADDENDUM TO AGREEMENT

Each of the undersigned

(i) confirms that it has received a copy of the Series 2008-1 Note Purchase Agreement, dated as of September 12, 2008 (as from time to time amended, supplemented or otherwise modified in accordance with the terms thereof, the “Series 2008-1 Note Purchase Agreement”; terms defined therein being used herein as therein defined), among HVF, the Conduit Investors, the Committed Note Purchasers, the Funding Agents named therein, The Hertz Corporation, as Administrator and Deutsche Bank Securities Inc., as Administrative Agent (in such capacity, the “Administrative Agent”) and such other agreements, documents and information as it has deemed appropriate to make its own credit analysis and decision to enter into this Addendum; (ii) appoints and authorizes the Administrative Agent to take such action as agent on its behalf and to exercise such powers under the Series 2008-1 Note Purchaser Agreement as are delegated to the Administrative Agent by the terms thereof, together with such powers as are reasonably incidental thereto; (iii) agrees to all of the provisions of the Series 2008-1 Note Purchase Agreement; (iv) agrees that the related Maximum Investor Group Principal Amount is $                                   (including any portion of the Maximum Investor Group Principal Amount of such Investor Group acquired pursuant to an assignment to such Investor Group as an Acquiring Investor Group) and the related Committed Note Purchaser’s Committed Note Purchaser Percentage is        percent (    %); (v) designates                        as the Funding Agent for itself, and such Funding Agent hereby accepts such appointment; (iv) becomes a party to the Series 2008-1 Note Purchase Agreement and a Conduit Investor, Committed Note Purchaser or Funding Agent, as the case may be, thereunder with the same effect as if the undersigned were an original signatory to the Series 2008-1 Note Purchase Agreement; and (v) each member of the Additional Investor Group hereby represents and warrants that the representations and warranties contained in Section 6.03 of the Series 2008-1 Note Purchase Agreement are true and correct with respect to the Additional Investor Group on and as of the date hereof and the Additional Investor Group shall be deemed to have made such representations and warranties contained in Section 6.03 of the Series 2008-1 Note Purchase Agreement on and as of the date hereof.  The notice address for each member of the Additional Investor Group is as follows:

[INSERT ADDRESS]

This Addendum shall be effective when a counterpart hereof, signed by the undersigned, HVF and the Administrative Agent has been delivered to the parties hereto.

This Addendum shall be governed by and construed in accordance with the laws of the State of New York.

IN WITNESS WHEREOF, the undersigned have caused this Addendum to be duly executed and delivered by its duly authorized officer or agent as of this          day of                     , 200  .

Schedule II - 1

[NAME OF ADDITIONAL FUNDING AGENT], as Funding Agent
By:
	Name:
	Title:
[NAME OF ADDITIONAL CONDUIT PURCHASER], as Conduit Investor
By:
	Name:
	Title:
[NAME OF ADDITIONAL COMMITTED PURCHASER], as Committed Note Purchaser
By:
	Name:
	Title:

Acknowledged and Agreed to as of the date first above written:
HERTZ VEHICLE FINANCING LLC
By:
	Name:
	Title:

DEUTSCHE BANK SECURITIES INC., as Administrative Agent
By:
	Name:
	Title:

EX-10.37

Exhibit 10.37

Director Stock Option Agreement

This Director Stock Option Agreement, dated as of                              ,           , between Hertz Global Holdings, Inc., a Delaware corporation, and the Director whose name appears on the signature page hereof, is being entered into pursuant to the Hertz Global Holdings, Inc. Omnibus Incentive Plan.  The meaning of capitalized terms used in this Agreement may be found in Section 6.

The Company and the Director hereby agree as follows:

Section 1.Grant of Options

(a)                 Confirmation of Grant.  The Company hereby evidences and confirms, effective as of the date hereof, its grant to the Director of Options to purchase the number of shares of Common Stock specified on the signature page hereof.  The Options are not intended to be incentive stock options under the Code.  This Agreement is entered into pursuant to, and the terms of the Options are subject to, the terms of the Plan.  If there is any inconsistency between this Agreement and the terms of the Plan, the terms of the Plan shall govern.

(b) Option Price.  Each share covered by an Option shall have the Option Price specified on the signature page hereof.  The Option Price per share of Common Stock is equal to the Fair Market Value of a share of Common Stock.

Section 2.Vesting and Exercisability

(a) Vesting.  The Options shall be fully vested as of the Grant Date.

(b) Exercise.  The Options may be exercised at any time and from time to time prior to the date the Options terminate pursuant to Section 3.  The Options may only be exercised with respect to whole shares of Common Stock and must be exercised in accordance with Section 4.

Section 3.Termination of Options.  Unless earlier terminated pursuant to Section 5, the Options shall terminate on the tenth anniversary of the Grant Date (the “Normal Termination Date”), if not exercised prior to such date.

Section 4.Manner of Exercise

(a) General.  Subject to such reasonable administrative regulations as the Committee may adopt from time to time, the Director may exercise the Options by giving at least 10 business days prior written notice to the Secretary of the Company specifying the proposed date on which the Director desires to exercise a vested Option (the “Exercise Date”), the number of whole shares with respect to which the Options are being exercised (the “Exercise Shares”) and the aggregate Option Price for such Exercise Shares (the “Exercise Price”).  Unless otherwise determined by the Committee, (i) on or before the Exercise Date the Director shall deliver to the Company full payment for the Exercise Shares in United States dollars in cash, or cash equivalents satisfactory to the Company, in an amount equal to the Exercise Price plus (if applicable) any required withholding taxes or other similar taxes, charges or fees and (ii) the Company shall register the issuance of the Exercise Shares on its records (or direct such issuance to be registered by the Company’s transfer agent).  In lieu of delivering cash, the Director may tender shares of Common Stock that have been owned by the Director for any minimum period necessary to avoid any adverse accounting treatment, having an aggregate Fair Market Value on the Exercise Date equal to the Exercise Price or may deliver a combination of cash and such shares of Common Stock having an aggregate Fair Market Value equal to the difference between the Exercise Price and the amount of such cash as payment of the Exercise Price, subject to such rules and regulations as may be adopted by the Committee to provide for the compliance of such payment procedure with applicable law, including Section 16(b) of the Exchange Act. If applicable, the Director may pay the exercise price and any applicable withholdings through any other procedures adopted by the Committee, including (if applicable) broker-assisted cashless exercise procedures.  The Company may require the Director to furnish or execute such other documents as the Company shall reasonably deem necessary (i) to evidence such exercise or (ii) to comply with or satisfy the requirements of the Securities Act, applicable state or non-U.S. securities laws or any other law.

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Section 5.Change in Control

(a) In General.  In the event of a Change in Control, the Committee (as constituted immediately prior to the Change in Control) may determine that all then-outstanding Options shall be canceled in exchange for a payment having a value equal to the excess, if any, of (i) the product of the Change in Control Price multiplied by the aggregate number of shares covered by all such Options immediately prior to the Change in Control over (ii) the aggregate Option Price for all such shares, to be paid as soon as reasonably practicable, but in no event later than 30 days following the Change in Control.

(b) Cancellation.  Notwithstanding Section 5(a), the Committee may, in its discretion, terminate any outstanding Options if (i) the Company provides holders of such Options with reasonable advance notice to exercise their outstanding and unexercised Options or (ii) the Committee reasonably determines that the Change in Control Price is equal or less than the Option Price for such Options.

Section 6.Certain Definitions.  As used in this Agreement, capitalized terms that are not defined herein have the respective meaning given in the Plan, and the following additional terms shall have the following meanings:

“Agreement” means this Director Stock Option Agreement, as amended from time to time in accordance with the terms hereof.

“Company” means Hertz Global Holdings, Inc., provided that for purposes of determining the status of Director’s position on the Board of the “Company,” such term shall include the Company and its Subsidiaries.

“Director” means the grantee of the Options, whose name is set forth on the signature page of this Agreement; provided that for purposes of Section 4 and Section 7, following such person’s death “Director” shall be deemed to include such person’s beneficiary or estate and following such Person’s Disability, “Director” shall be deemed to include such person’s legal representative.

“Exchange Act” means the Securities Exchange Act of 1934, as amended, or any successor statute, and the rules and regulations thereunder that are in effect at the time, and any reference to a particular section thereof shall include a reference to the corresponding section, if any, of such successor statute, and the rules and regulations.

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“Exercise Date” has the meaning given in Section 4(a).

“Exercise Price” has the meaning given in Section 4(a).

“Exercise Shares” has the meaning given in Section 4(a).

“Fair Market Value” means, as of any date of determination, and notwithstanding the definition contained in the Plan, the mid-point between the high and the low trading prices for such date per Share on the New York Stock Exchange (or on such other recognized market or quotation system on which the trading prices of Common Stock are traded or quoted at the relevant time).  In the event that there are no Common Stock transactions reported on such exchange or system on such date, Fair Market Value shall mean the closing price of a Share on the immediately preceding day on which Common Stock transactions were so reported.

“Grant Date” means the date hereof, which is the date on which the Options are granted to the Director.

“Normal Termination Date” has the meaning given in Section 3.

“Option” means the right granted to the Director hereunder to purchase one share of Common Stock for a purchase price equal to the Option Price subject to the terms of this Agreement and the Plan.

“Option Price” means, with respect to each share of Common Stock covered by an Option, the purchase price specified in Section 1(b) for which the Director may purchase such share of Common Stock upon exercise of an Option, which shall equal the mid-point between the high and the low trading prices per share on the New York Stock Exchange on the Grant Date.

“Plan” means the Hertz Global Holdings, Inc. Omnibus Incentive Plan.

“Securities Act” means the United States Securities Act of 1933, as amended, or any successor statute, and the rules and regulations thereunder that are in effect at the time, and any reference to a particular section thereof shall include a reference to the corresponding section, if any, of such successor statute, and the rules and regulations thereunder.

Section 7.Capital Adjustments.  Subject to the terms of the Plan, in the event of any Adjustment Event affecting the Common Stock, the Committee shall make an equitable and proportionate anti-dilution adjustment to offset any

4

resultant change in the pre-share price of the Common Stock and preserve the intrinsic value of Options and any other Awards granted under the Plan.  Such mandatory adjustment may include a change in any or all of (a) the number and kind of shares of Common Stock which thereafter may be awarded or optioned and sold under the Plan (including, but not limited to, adjusting any limits on the number and types of Awards that may be made under the Plan), (b) the number and kind of shares of Common Stock subject to outstanding Awards, and (c) the grant, exercise or conversion price with respect to any Award.  In addition, the Committee may make provisions for a cash payment to a Participant or a person who has an outstanding Award.  The number of shares of Common Stock subject to any Award shall be rounded to the nearest whole number.  Any such adjustment shall be consistent with sections 424, 409A and 162(m) of the Code to the extent the Awards subject to adjustment are subject to such sections of the Code.

Section 8.Miscellaneous.

(a) Withholding.  The Company or one of its Subsidiaries may require the Director to remit to the Company an amount in cash sufficient to satisfy any applicable U.S. federal, state and local and non-U.S. tax withholding or other similar charges or fees that may arise in connection with the grant, vesting, exercise or purchase of the Options.

(b) Authorization to Share Personal Data.  The Director authorizes any Affiliate of the Company to which the Director serves on the Board or that otherwise has or lawfully obtains personal data relating to the Director to divulge or transfer such personal data to the Company or to a third party, in each case in any jurisdiction, if and to the extent appropriate in connection with this Agreement or the administration of the Plan.

(c) No Rights as Stockholder; No Voting Rights.  The Director shall have no rights as a stockholder of the Company with respect to any shares of Common Stock covered by the Options until the exercise of the Options and delivery of the shares.  No adjustment shall be made for dividends or other rights for which the record date is prior to the delivery of the shares.

(d) No Right to Continued Services on the Board. Nothing in this Agreement shall be deemed to confer on the Director any right to continue providing services as a Director of the Company or any Subsidiary, or to interfere with or limit in any way the right of the

5

Company or any Subsidiary to terminate the Director’s services on the Board of the Company or any Subsidiary at any time.

(e) Non-Transferability of Options.  The Options may be exercised only by the Director.  The Options are not assignable or transferable, in whole or in part, and they may not, directly or indirectly, be offered, transferred, sold, pledged, assigned, alienated, hypothecated or otherwise disposed of or encumbered (including, but not limited to, by gift, operation of law or otherwise) other than by will or by the laws of descent and distribution to the estate of the Director upon the Director’s death or with the Company’s consent.

(f) Notices.  All notices and other communications required or permitted to be given under this Agreement shall be in writing and shall be deemed to have been given if delivered personally or sent by certified or express mail, return receipt requested, postage prepaid, or by any recognized international equivalent of such delivery, to the Company or the Director, as the case may be, at the following addresses or to such other address as the Company or the Director, as the case may be, shall specify by notice to the other:

(i)if to the Company, to it at:

Hertz Global Holdings, Inc.
c/o The Hertz Corporation

225 Brae Boulevard

Park Ridge, New Jersey  07656

Attention: General Counsel

Fax: (201) 594-3122

(ii)if to the Director, to the Director at his or her most recent address as shown on the books and records of the Company; and

All such notices and communications shall be deemed to have been received on the date of delivery if delivered personally or on the third business day after the mailing thereof.

(g) Binding Effect; Benefits.  This Agreement shall be binding upon and inure to the benefit of the parties to this Agreement and their respective successors and assigns.  Nothing in this Agreement, express or implied, is intended or shall be construed to

6

give any person other than the parties to this Agreement or their respective successors or assigns any legal or equitable right, remedy or claim under or in respect of any agreement or any provision contained herein.

(h) Waiver; Amendment.

(i)Waiver.  Any party hereto or beneficiary hereof may by written notice to the other parties (A) extend the time for the performance of any of the obligations or other actions of the other parties under this Agreement, (B) waive compliance with any of the conditions or covenants of the other parties contained in this Agreement and (C) waive or modify performance of any of the obligations of the other parties under this Agreement.  Except as provided in the preceding sentence, no action taken pursuant to this Agreement, including, without limitation, any investigation by or on behalf of any party or beneficiary, shall be deemed to constitute a waiver by the party or beneficiary taking such action of compliance with any representations, warranties, covenants or agreements contained herein.  The waiver by any party hereto or beneficiary hereof of a breach of any provision of this Agreement shall not operate or be construed as a waiver of any preceding or succeeding breach and no failure by a party or beneficiary to exercise any right or privilege hereunder shall be deemed a waiver of such party’s or beneficiary’s rights or privileges hereunder or shall be deemed a waiver of such party’s or beneficiary’s rights to exercise the same at any subsequent time or times hereunder.

(ii)Amendment.  This Agreement may not be amended, modified or supplemented orally, but only by a written instrument executed by the Director and the Company.

(i)                 Assignability.  Neither this Agreement nor any right, remedy, obligation or liability arising hereunder or by reason hereof shall be assignable by the Company or the Director without the prior written consent of the other party.

(j) Applicable Law.  This Agreement shall be governed by and construed in accordance with the law of the State of Delaware regardless of the application of rules of conflict of law that would apply the laws of any other jurisdiction.

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(k) Section and Other Headings, etc.  The section and other headings contained in this Agreement are for reference purposes only and shall not affect the meaning or interpretation of this Agreement.

(l)  Counterparts.  This Agreement may be executed in any number of counterparts, each of which shall be deemed to be an original and all of which together shall constitute one and the same instrument.

8

IN WITNESS WHEREOF, the Company and the Director have executed this Agreement as of the date first above written.

HERTZ GLOBAL HOLDINGS, INC.
By:
	Name:
	Title:
DIRECTOR:
«Name»
By:
Address of the Director:
«Address»

Total Number of shares of Common Stock for the Purchase of Which Options have been Granted	Option Price
Shares

9

EX-10.38

Exhibit 10.38

Employee Stock Option Agreement

This Employee Stock Option Agreement, dated as of [•], between Hertz Global Holdings, Inc., a Delaware corporation, and the Employee whose name appears on the signature page hereof, is being entered into pursuant to the Hertz Global Holdings, Inc. 2008 Omnibus Incentive Plan. The meaning of capitalized terms used in this Agreement may be found in Section 7.

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

Section 1.Grant of Options

(a)Confirmation of Grant. The Company hereby evidences and confirms, effective as of the date hereof, its grant to the Employee of Options to purchase the number of shares of Common Stock specified on the signature page hereof. The Options are not intended to be incentive stock options under the Code. This Agreement is entered into pursuant to, and the terms of the Options are subject to, the terms of the Plan. If there is any inconsistency between this Agreement and the terms of the Plan, the terms of the Plan shall govern.

(b)Option Price. Each share covered by an Option shall have the Option Price specified on the signature page hereof.

Section 2.Vesting and Exercisability

(a)Except as otherwise provided in Sections 2(b), 3, or 6(a)of this Agreement, the Options shall become vested in four equal annual installments on each of the first through fourth anniversaries of the Grant Date, subject to the continuous employment of the Employee with the Company until the applicable vesting date.

(b)Discretionary Acceleration. The Committee, in its sole discretion, may accelerate the vesting or exercisability of all or a portion of the Options, at any time and from time to time.

(c)Exercise. Once vested in accordance with the provisions of this Agreement, the Options may be exercised at any time and from time to time prior to the date the Options terminate pursuant to Section 3. The Options may only be exercised with respect to whole shares of Common Stock and must be exercised in accordance with Section 4.

Section 3.Termination of Options

(a)Normal Termination Date. Unless earlier terminated pursuant to Section 3(b) or Section 6, the Options shall terminate on the tenth

anniversary of the Grant Date (the “Normal Termination Date”), if not exercised prior to such date.

(b)Termination of Employment.

(i)Special Termination. If the Employee’s employment with the Company terminates due to Special Termination, all unvested Options held by the Employee shall vest and all the Employee’s Options shall remain outstanding until the first to occur of:  (a) the first anniversary of the Employee’s  termination of employment, (b) the Normal Termination Date or (c) the cancellation or termination of the Options pursuant to Section 6(a), after which any unexercised Options shall immediately terminate.

(ii)Retirement.

(A)If the Employee’s employment with the Company terminates due to the Employee’s Retirement and if the Committee in its discretion requests and the Employee agrees to a release of claims and to be bound by restrictive covenants in such form and having such terms as the Committee shall determine, then the unvested Options held by the Employee on the date of his or her Retirement shall remain outstanding and continue to vest in accordance with all of their respective terms as if such Employee’s employment had not terminated until the first to occur of: (a) the third anniversary of the Employee’s Retirement or, if the Employee dies prior to the third anniversary of the Employee’s Retirement, the twelve-month anniversary of the date of the Employee’s death, if earlier, (b) the Normal Termination Date or (c) the cancellation or termination of the Options pursuant to Section 6(a), after which any unexercised Options shall immediately terminate.

(B)If the Employee’s employment with the Company terminates due to the Employee’s Retirement other than in accordance with Section 3(b)(ii)(A), the Employee’s Options shall be treated as set forth in Section 3(b)(iv).

(iii)Termination for Cause. If an Employee’s employment terminates for Cause, all Options, whether vested or unvested, shall be immediately forfeited and canceled, effective as of the date of the Employee’s termination.

(iv)Termination for Any Other Reason. If the Employee’s employment with the Company terminates for any reason other than Special Termination, Cause or Retirement in accordance with Section 3(b)(ii)(A), any unvested Options held by the Employee shall immediately be forfeited and canceled as of the date of termination. All vested Options shall remain exercisable until the first to occur of (a) the 30th day following the effective date of the Employee’s termination of employment, or, if later, the 30th day following expiration of any blackout period in effect with respect to such Options, (b) the Normal Termination Date or (c) the cancellation or termination of the Options pursuant to Section 6(a), after which any unexercised Options shall immediately be forfeited and canceled.

Section 4.Manner of Exercise

(a)General. Subject to such reasonable administrative regulations as the Committee may adopt from time to time, the exercise of vested Options by the Employee shall be pursuant to procedures established by the Company from time to time and shall include the Employee specifying the proposed date on which the Employee desires to exercise a vested Option (the “Exercise Date”), the number of whole shares with respect to which the Options are being exercised (the “Exercise Shares”) and the aggregate Option Price for such Exercise Shares (the “Exercise Price”), or such other or different requirements as may be specified by the Company. Unless otherwise determined by the Committee, (i) on or before the Exercise Date the Employee shall deliver to the Company full payment for the Exercise Shares in United States dollars in cash, or cash equivalents satisfactory to the Company, in an amount equal to the Exercise Price plus (if applicable) any required withholding taxes or other similar taxes, charges or fees, or, pursuant to a broker-assisted exercise program established by the Company, the Employee may exercise vested Options by an exercise and sell procedure (cashless exercise) in which the  Exercise Price (together with any required withholding taxes or other similar taxes, charges or fees) is deducted from the proceeds of the exercise of an Option and (ii) the Company shall register the issuance of the Exercise Shares on its records (or direct such issuance to be registered by the Company’s transfer agent). The Company may require the Employee to furnish or execute such other documents as the Company shall reasonably deem necessary (i) to evidence such exercise or (ii) to comply with or satisfy the requirements of the Securities Act, applicable state or non-U.S. securities laws or any other law.

(b)Restrictions on Exercise. Notwithstanding any other provision of this Agreement, the Options may not be exercised in whole or in part, (i) (A) unless all requisite approvals and consents of any

governmental authority of any kind shall have been secured, (B) unless the purchase of the Exercise Shares shall be exempt from registration under applicable U.S. federal and state securities laws, and applicable non-U.S. securities laws, or the Exercise Shares shall have been registered under such laws, and (C) unless all applicable U.S. federal, state and local and non-U.S. tax withholding requirements shall have been satisfied or (ii) if such exercise would result in a violation of the terms or provisions of or a default or an event of default under, any of the Financing Agreements. The Company shall use its commercially reasonable efforts to obtain any consents or approvals referred to in clause (i) (A) of the preceding sentence, but shall otherwise have no obligations to take any steps to prevent or remove any impediment to exercise described in such sentence.

Section 5.Adjustment Event. In the event of any Adjustment Event affecting the Common Stock, the Committee shall make an equitable and proportionate anti-dilution adjustment to offset any resultant change in the pre-share price of the Common Stock and preserve the intrinsic value of Options and any other Awards granted under the Plan. Such mandatory adjustment may include a change in any or all of (a) the number and kind of shares of Common Stock which thereafter may be awarded or optioned and sold under the Plan (including, but not limited to, adjusting any limits on the number and types of Awards that may be made under the Plan), (b) the number and kind of shares of Common Stock subject to outstanding Awards, and (c) the grant, exercise or conversion price with respect to any Award. In addition, the Committee may make provisions for a cash payment to a Participant or a person who has an outstanding Award. The number of shares of Common Stock subject to any Award shall be rounded to the nearest whole number. Any such adjustment shall be consistent with sections 424, 409A and 162(m) of the Code to the extent the Awards subject to adjustment are subject to such sections of the Code.

Section 6.Change in Control

(a)In General. In the event of a Change in Control, any unvested Options shall vest and become exercisable, provided that the Committee (as constituted immediately prior to the Change in Control) may determine that all then-outstanding Options (whether vested or unvested) shall be canceled in exchange for a payment having a value equal to the excess, if any, of (i) the product of the Change in Control Price multiplied by the aggregate number of shares covered by all such Options immediately prior to the Change in Control over (ii) the aggregate Option Price for all such shares, to be paid as soon as reasonably practicable, but in no event later than 30 days following the Change in Control.

(b)Termination. Notwithstanding Section 6(a), in the event of a Change in Control, the Committee may, in its discretion, terminate any outstanding Options if either (i) the Company provides holders of such Options with reasonable advance notice to exercise their outstanding and unexercised Options, or (ii) the Committee reasonably determines that the

Change in Control Price is equal to or less than the exercise price for such Options.

Section 7.Certain Definitions. As used in this Agreement, capitalized terms that are not defined herein have the respective meaning given in the Plan, and the following additional terms shall have the following meanings:

“Agreement” means this Employee Stock Option Agreement, as amended from time to time in accordance with the terms hereof.

 “Company” means Hertz Global Holdings, Inc., provided that for purposes of determining the status of Employee’s employment with the “Company,” such term shall include the Company and its Subsidiaries.

“Covered Options” has the meaning given in Section 3(b).

“Employee” means the grantee of the Options, whose name is set forth on the signature page of this Agreement; provided that for purposes of Section 4 and Section 8, following such person’s death “Employee” shall be deemed to include such person’s beneficiary or estate and following such Person’s Disability, “Employee” shall be deemed to include such person’s legal representative.

“Exercise Date” has the meaning given in Section 4(a).

“Exercise Price” has the meaning given in Section 4(a).

“Exercise Shares” has the meaning given in Section 4(a).

“Grant Date” means the date hereof, which is the date on which the Options are granted to the Employee.

“Normal Termination Date” has the meaning given in Section 3(a).

“Option Price” means, with respect to each share of Common Stock covered by an Option, the purchase price specified in Section 1(b) for which the Employee may purchase such share of Common Stock upon exercise of an Option.

“Securities Act” means the United States Securities Act of 1933, as amended, or any successor statute, and the rules and regulations thereunder that are in effect at the time, and any reference to a particular section thereof shall include a reference to the corresponding section, if any, of such successor statute, and the rules and regulations.

“Special Termination” means a termination of the Employee’s employment as a result of his or her death or Disability.

Section 8.Miscellaneous.

(a)Withholding. The Company or one of its Subsidiaries may require the Employee to remit to the Company an amount in cash sufficient to satisfy any applicable U.S. federal, state and local and non-U.S. tax withholding or other similar charges or fees that may arise in connection with the grant, vesting, exercise or purchase of the Options.

(b)Authorization to Share Personal Data. The Employee authorizes any Affiliate of the Company that employs the Employee or that otherwise has or lawfully obtains personal data relating to the Employee to divulge or transfer such personal data to the Company or to a third party, in each case in any jurisdiction, if and to the extent appropriate in connection with this Agreement or the administration of the Plan.

(c)No Rights as Stockholder; No Voting Rights. The Employee shall have no rights as a stockholder of the Company with respect to any shares of Common Stock covered by the Options until the exercise of the Options and delivery of the Common Stock. No adjustment shall be made for dividends or other rights for which the record date is prior to the delivery of the Common Stock.

(d)No Right to Continued Employment. Nothing in this Agreement shall be deemed to confer on the Employee any right to continue in the employ of the Company or any Subsidiary, or to interfere with or limit in any way the right of the Company or any Subsidiary to terminate such employment at any time.

(e)Non-Transferability of Options. The Options may be exercised only by the Employee. The Options are not assignable or transferable, in whole or in part, and they may not, directly or indirectly, be offered, transferred, sold, pledged, assigned, alienated, hypothecated or otherwise disposed of or encumbered (including, but not limited to, by gift, operation of law or otherwise) other than by will or by the laws of descent and distribution to the estate of the Employee upon the Employee’s death or with the Company’s consent.

(f)Notices. All notices and other communications required or permitted to be given under this Agreement shall be in writing and shall be deemed to have been given if delivered personally or sent by certified or express mail, return receipt requested, postage prepaid, or by any recognized international equivalent of such delivery, to the Company or the Employee, as the case may be, at the following addresses or to such other address as the Company or the Employee, as the case may be, shall specify by notice to the other:

(C)   if to the Company, to it at:

Hertz Global Holdings, Inc.
c/o The Hertz Corporation

225 Brae Boulevard

Park Ridge, New Jersey  07656

Attention: General Counsel

Fax: (201) 594-3122

(D)if to the Employee, to the Employee at his or her most recent address as shown on the books and records of the Company or Subsidiary employing the Employee; and

copies of any notice or other communication given under this Agreement shall also be given to:

The Carlyle Group

1001 Pennsylvania Avenue, NW

Suite 220 South

Washington DC 20004-2505

Attention:  Mr. Gregory S. Ledford

Fax:  (202) 347-1818

and

Clayton, Dubilier & Rice, Inc.

375 Park Avenue, 18^th Floor

New York, New York

Attention: David Wasserman

Fax: (212) 407-5252

and

Merrill Lynch Global Private Equity

4 World Financial Center, 23^rd Floor

New York, NY 10080

Attention:  Mr. George A. Bitar &

Mr. Robert F. End

Fax:  (212) 449-1119

and

Debevoise & Plimpton LLP

919 Third Avenue

New York, New York 10022

Attention:  John M. Allen

Fax:  (212) 909-6836

All such notices and communications shall be deemed to have been received on the date of delivery if delivered personally or on the third business day after the mailing thereof.

(g)Binding Effect; Benefits. This Agreement shall be binding upon and inure to the benefit of the parties to this Agreement and their respective successors and assigns. Nothing in this Agreement, express or implied, is intended or shall be construed to give any person other than the parties to this Agreement or their respective successors or assigns any legal or equitable right, remedy or claim under or in respect of any agreement or any provision contained herein.

(h)Waiver; Amendment.

(i)Waiver. Any party hereto or beneficiary hereof may by written notice to the other parties (A) extend the time for the performance of any of the obligations or other actions of the other parties under this Agreement, (B) waive compliance with any of the conditions or covenants of the other parties contained in this Agreement and (C) waive or modify performance of any of the obligations of the other parties under this Agreement. Except as provided in the preceding sentence, no action taken pursuant to this Agreement, including, without limitation, any investigation by or on behalf of any party or beneficiary, shall be deemed to constitute a waiver by the party or beneficiary taking such action of compliance with any representations, warranties, covenants or agreements contained herein. The waiver by any party hereto or beneficiary hereof of a breach of any provision of this Agreement shall not operate or be construed as a waiver of any preceding or succeeding breach and no failure by a party or beneficiary to exercise any right or privilege hereunder shall be deemed a waiver of such party’s or beneficiary’s rights or privileges hereunder or shall be deemed a waiver of such party’s or beneficiary’s rights to exercise the same at any subsequent time or times hereunder.

(ii)Amendment. This Agreement may not be amended, modified or supplemented orally, but only by a written instrument executed by the Employee and the Company.

(i)Assignability. Neither this Agreement nor any right, remedy, obligation or liability arising hereunder or by reason hereof shall be assignable by the Company or the Employee without the prior written consent of the other party.

(j)Applicable Law. This Agreement shall be governed by and construed in accordance with the law of the State of Delaware regardless of

the application of rules of conflict of law that would apply the laws of any other jurisdiction.

(k)Section and Other Headings, etc. The section and other headings contained in this Agreement are for reference purposes only and shall not affect the meaning or interpretation of this Agreement.

(l)Counterparts. This Agreement may be executed in any number of counterparts, each of which shall be deemed to be an original and all of which together shall constitute one and the same instrument.

IN WITNESS WHEREOF, the Company and the Employee have executed this Agreement as of the date first above written.

HERTZ GLOBAL HOLDINGS, INC.
By:
	Name:
	Title:
THE EMPLOYEE:
«Name»
By:

Total Number of shares of Common Stock for the Purchase of Which Options have been Granted	Option Price
«Options» Shares	$

EX-10.39

Exhibit 10.39

HERTZ GLOBAL HOLDINGS, INC.

SEVERANCE PLAN FOR SENIOR EXECUTIVES

ARTICLE I

BACKGROUND, PURPOSE AND TERM OF PLAN

Section 1.01Purpose of the Plan.  The purpose of the Plan is to provide Participants with certain compensation and benefits as set forth in the Plan in the event the Participant’s employment with the Company or a Subsidiary is terminated in a Qualifying Termination.  The Plan is not intended to be an “employee pension benefit plan” or “pension plan” within the meaning of Section 3(2) of ERISA.  Rather, this Plan is intended to be a “welfare benefit plan” within the meaning of Section 3(1) of ERISA and to meet the descriptive requirements of a plan constituting a “severance pay plan” within the meaning of regulations published by the Secretary of Labor at Title 29, Code of Federal Regulations, Section 2510.3-2(b).

Section 1.02Term of the Plan.  The Plan shall generally be effective as of the Effective Date and shall supersede any prior plan, program or policy under which the Company or any Subsidiary provided severance benefits to any Participant prior to the Effective Date of the Plan.  The Plan shall continue until terminated pursuant to Article VII of the Plan.

ARTICLE II

DEFINITIONS

Section 2.01“Base Salary” shall mean, in the case of a Participant, such Participant’s highest annual base salary in effect at any time within the twelve month period preceding the Participant’s Termination Date.

Section 2.02“Board” shall mean the Board of Directors of the Company, or any successor thereto.

Section 2.03“Bonus” shall mean, in the case of a Participant, the average annual bonus paid (or awarded, if different) in respect of each of the three prior bonus years (exclusive of any special or prorated bonuses).  If a Participant has less than three years of bonus history, “Bonus” shall mean the average annual bonus of the actual years, provided that if a Participant has not had an opportunity to earn or be awarded one full year’s bonus as of his Termination Date, “Bonus” shall mean 100% of the participant’s target bonus for the year in which the Termination Date occurs.

Section 2.04“Cause” shall mean a Participant’s (i) willful and continued failure to perform substantially the Participant’s material duties with the Company (other than any such failure resulting from the Participant’s incapacity due to physical or mental illness) after a written demand for substantial performance specifying the manner in which the Participant has not performed such duties is delivered by the Chief Executive Officer of the Company (the “CEO”) to the Participant, (ii) engaging in willful and serious misconduct that is injurious to the Company or any of its Subsidiaries, (iii) act of fraud or personal dishonesty resulting in or intended to result in personal enrichment at the expense of the Company or any of its Subsidiaries, (iv) substantial abusive use of alcohol, drugs or similar substances that, in the sole judgment of the Company, impairs the Participant’s job performance, (v) material violation of any Company policy that results in harm to the Company or any of its Subsidiaries or (vi) indictment for or conviction of a felony or a crime involving moral turpitude.  A termination for “Cause,” shall include a determination by the Plan Administrator following a Participant’s termination of employment for any other reason that, prior to such termination of employment, circumstances constituting Cause existed with respect to such Participant.

Section 2.05“COBRA” shall mean the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended, and the regulations thereunder.

Section 2.06“Code” shall mean the Internal Revenue Code of 1986, as amended, and the regulations thereunder.

Section 2.07“Committee” shall mean the Compensation Committee of the Board or such other committee appointed by the Board to assist the Company in making determinations required under the Plan in accordance with its terms.  The Committee may delegate its authority under the Plan to an individual or another committee.

Section 2.08“Company” shall mean Hertz Global Holdings, Inc. and any successor to its business and/or assets as set forth in Section 10.05 that assumes and agrees to perform this Plan by operation of law, or otherwise.  Unless it is otherwise clear from the context, Company shall generally include participating Subsidiaries.

Section 2.09“Effective Date” shall mean                      , 2008.

Section 2.10“ERISA” shall mean the Employee Retirement Income Security Act of 1974, as amended, and regulations thereunder.

Section 2.11“Participant” shall mean any senior executive of the Company designated by the Committee as eligible to participate in the Plan.

Section 2.12“Performance Bonus” shall mean such performance bonuses, as applicable, under and in accordance with the Company’s Annual Incentive Plan, as the

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same may be amended from time to time, and any other performance bonus plan(s) that the Company may adopt.

Section 2.13“Permanent Disability” shall mean a termination of employment by the Company or the Participant based on medical opinion of a physician selected by the Participant (and provided to the Plan Administrator) that the Participant has been unable to discharge effectively his material duties with the Company for a period of 180 consecutive calendar days or longer; provided that with respect to any payments that constitute deferred compensation subject to Section 409A of the Code, “Disability” shall have the meaning set forth in Section 409A(a)(2)(c) of the Code.

Section 2.14“Plan” shall mean this Hertz Global Holdings, Inc. Severance Plan for Senior Executives as set forth herein, and as the same may from time to time be amended.

Section 2.15“Plan Administrator” shall mean the individual(s) appointed by the Committee to administer the terms of the Plan as set forth herein and if no individual is appointed by the Committee to serve as the Plan Administrator for the Plan, the Plan Administrator shall be the Senior Vice President of Human Resources (or the equivalent).  Notwithstanding the preceding sentence, in the event the Plan Administrator is entitled to Severance Benefits under the Plan, the Committee or its delegate shall act as the Plan Administrator for purposes of administering the terms of the Plan with respect to the Plan Administrator.  The Plan Administrator may delegate all or any portion of its authority under the Plan to any other person(s).

Section 2.16“Qualifying Termination” shall mean a termination of the Participant’s employment initiated by the Company or a Subsidiary for any reason other than Cause, Permanent Disability or death.  For the avoidance of doubt, a Retirement shall not constitute a Qualifying Termination.

Section 2.17“Release” shall mean the Separation of Employment and General Release Agreement, which shall include a written agreement to abide by the agreement to the confidentiality, non-solicitation, and non-competition provisions in Article V for the periods provided for herein, in the form attached hereto as Exhibit A; provided that the Plan Administrator shall have the discretion to modify the Release if necessary or appropriate under any applicable law to effect a complete and total release of claims by the Participant as of the Termination Date.

Section 2.18“Restriction Period” shall mean the greater of 12 months or the Severance Period, if applicable.

Section 2.19“Retirement” shall mean a Participant’s voluntary termination of employment with the Company under any of the Company’s retirement plans.

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Section 2.20“Separation from Service Date” shall mean, in the case of a Participant, the date of the Participant’s “separation from service” within the meaning of Section 409A(a)(2)(i)(A) of the Code and determined in accordance with the regulations promulgated under Section 409A of the Code.

Section 2.21“Severance Benefit” shall mean the benefits that a Participant is eligible to receive pursuant to Article IV of the Plan, except for those benefits described in Section 4.01 of the Plan.

Section 2.22“Severance Factor” and “Severance Period” shall mean, in the case of a Participant, the amount or period, as the case may be, set forth on Annex A opposite such Participant’s position.

Section 2.23“Specified Employee” shall mean a “specified employee” within the meaning of Section 409A(a)(2)(B)(1) of the Code, as determined in accordance with the uniform methodology and procedures adopted by the Company and then in effect.

Section 2.24“Subsidiary” shall mean any corporation in which the Company owns, directly or indirectly, stock representing 50% or more of the combined voting power of all classes of stock entitled to vote, and any other business organization, regardless of form, in which the Company possesses, directly or indirectly, 50% or more of the total combined equity interests in such organization.

Section 2.25“Termination Date” shall mean the date as of which the active employment of the Participant by the Company and its Subsidiaries is severed.

ARTICLE III

ELIGIBILITY FOR BENEFITS

Section 3.01Eligibility.  Each Participant in the Plan who incurs a Qualifying Termination and who satisfies the conditions of Section 3.02 shall be eligible to receive the Severance Benefits described in the Plan, except that any such Participant who is a party to an employment agreement or Change in Control Severance Agreement (or similar agreement) with the Company pursuant to which such Participant is entitled to severance benefits shall not be eligible to receive the Severance Benefits described in the Plan.

Section 3.02Conditions.

(a)Eligibility for any Severance Benefits is expressly conditioned on (i) execution by the Participant of the Release within 30 days after the Participant’s Termination Date and (ii) compliance by the Participant with all the material terms and conditions of such Release.  If the Participant has not fully

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complied with any of the applicable terms of Article V and/or the Release, the Plan Administrator may deny unpaid Severance Benefits or discontinue the payment of the Participant’s Severance Benefit and may require the Participant, by providing at least 10 days’ prior written notice of such repayment obligation to the Participant during which period the Participant may cure such failure to comply (if capable of being cured), and if not so cured the Participant shall be obligated to repay any portion of the Severance Benefit already received under the Plan.  If the Plan Administrator notifies a Participant that repayment of all or any portion of the Severance Benefit received under the Plan is required, such amounts shall be repaid within thirty (30) calendar days of the date the written notice is sent.  Any remedy under this subsection (a) shall be in addition to, and not in place of, any other remedy, including injunctive relief, that the Company may have.

(b)The Plan Administrator shall determine a Participant’s eligibility to receive Severance Benefits.

ARTICLE IV

DETERMINATION OF BENEFITS

Section 4.01Benefits Upon Any Termination of Employment.  In the event of any termination of employment, regardless of whether the Participant is eligible for benefits under this Plan, the Company shall pay or provide to the Participant the following benefits,  in each case to the extent vested and payable as provided in each applicable plan:  (a) all earned but unpaid compensation through the Termination Date and (b) any other payments or benefits pursuant to any other compensation plans, programs or employment agreements then in effect.

Section 4.02Severance Benefits.  The Severance Benefits to be provided to each Participant who meets the requirements of the Plan (each an “Eligible Participant”) shall be the following:

(a)a pro rata portion of the Performance Bonus that would have been payable to the Eligible Participant, pro rated based on the portion of the year ending on the Termination Date, such pro rata amount to be paid at the same time as such bonuses are otherwise generally paid to the Company’s executives and in any event, no later than March 15 of the year following the end of the performance period;

(b)an amount equal to (x) the sum of the Eligible Participant’s Base Salary plus such Eligible Participant’s Bonus, multiplied by (y) such Eligible Participant’s Severance Factor, payable in equal installments over the Eligible Participant’s Severance Period on the Company’s regular payroll cycles,

5

commencing with the first payroll cycle ending after the Release becomes effective;

(c)outplacement services or executive recruiting services provided by a professional outplacement provider or executive recruiter at a cost to the Company of not more than 10% of such Eligible Participant’s Base Salary (not to exceed $25,000) to be provided within the period ending no later than the end of the year following the year in which the Termination Date occurs; and

(d)all medical, health and accident insurance or other similar health care arrangements for the benefit of such Eligible Participant and his dependants, at the same level and same cost as in effect immediately prior to the Termination Date, through such Eligible Participant’s Severance Period (or, if earlier, the date such Eligible Participant becomes eligible for comparable benefits provided by a subsequent employer).

Notwithstanding the foregoing provisions of this Section 4.02, if, as of the Separation from Service Date, the Eligible Participant is a Specified Employee, then, except to the extent that this Agreement does not provide for a “deferral of compensation” within the meaning of Section 409A of the Code, the following shall apply:  (1) No payments shall be made and no benefits shall be provided to Executive, in each case, during the period beginning on the Separation from Service Date and ending on the six-month anniversary of such date or, if earlier, the date of the Eligible Participant’s death, and  (2) on the first business day of the first month following the month in which occurs the six-month anniversary of the Separation from Service Date or, if earlier, the Eligible Participant’s death, the Company shall make a one-time, lump-sum cash payment to the Eligible Participant in an amount equal to the sum of (x) the amounts otherwise payable to the Eligible Participant under this Plan during the period described in clause (1) above and (y) the amount of interest on the foregoing at the applicable federal rate for instruments of less than one year.

Section 4.03Termination for Cause.  If any Participant’s employment terminates on account of termination by the Company for Cause, the Participant shall not be entitled to receive Severance Benefits under this Plan except as provided under Section 4.01 and shall be entitled only to those benefits that are legally required to be provided to the Participant.  Notwithstanding any other provision of the Plan to the contrary, if a Participant has engaged in conduct that constitutes Cause at any time prior to the Participant’s Termination Date, the Plan Administrator may by written notice to the Participant determine that any Severance Benefit payable to the Participant under Section 4.02 of the Plan shall immediately cease, and that the Participant shall be required to return any Severance Benefits paid to the Participant prior to such determination.  The Company may withhold paying Severance Benefits under the Plan pending resolution of a good faith inquiry that could lead to a finding resulting in Cause.  If the Company has offset other payments owed to the Participant under any other plan or

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program, it may, in its sole discretion, waive its repayment right solely with respect to the amount of the offset so credited.

Section 4.04Reduction of Severance Benefits.  The Plan Administrator reserves the right to make deductions in accordance with applicable law for the stated amount of monies owed to the Company by the Participant or the value of Company property that the Participant has retained in his/her possession.  Any payment made pursuant to the Plan shall be subject to applicable withholding obligations in an amount sufficient to satisfy U.S. or foreign federal, provincial, state and local or other applicable withholding tax requirements.

Section 4.05Other Arrangements.  The Severance Benefits under this Plan are not additive or cumulative to severance or termination benefits that a Participant might also be entitled to receive under the terms of a written employment agreement, a severance agreement or any other arrangement with the Company.  As a condition of participating in the Plan, each individual must expressly agree that this Plan supersedes all prior agreements, and sets forth the entire Severance Benefit to which he or she is entitled to while a Participant in the Plan.  The provisions of this Plan may provide for payments to the Participant under certain compensation or bonus plans under circumstances where such plans would not provide for payment thereof.  It is the specific intention of the Company that the provisions of this Plan shall supersede any provisions to the contrary in such plans, to the extent permitted by applicable law, and such plans shall be deemed to have been amended to correspond with this Plan without further action by the Company or the Board.  However, if the Participant is a party to a Change in Control Agreement (or similar agreement), such agreement, and not this Plan, shall apply under the circumstances described therein.

Section 4.06Termination of Eligibility for Benefits.  All Participants shall cease to be eligible to participate in the Plan, and all Severance Benefit payments shall cease upon the occurrence of the earlier of:

(a)Subject to Article VII, termination or modification of the Plan; or

(b)Completion of payment to the Participant of the Severance Benefit for which the Participant is eligible under Article IV.

ARTICLE V

CONFIDENTIALITY, COVENANT NOT TO COMPETE AND NOT TO SOLICIT

Section 5.01Confidential Information.  At no time during the term of Participant’s Employment or during the 24 month period following Participant’s Termination Date, shall the Participant, without the prior written consent of the Company, use, divulge, disclose or make accessible to any other person, firm,

7

partnership, corporation or other entity any Confidential Information pertaining to the business of the Company or any of its affiliates, except (i) while employed by the Company, in the business of and for the benefit of the Company, or (ii) when required to do so by a court of competent jurisdiction, by any governmental agency having supervisory authority over the business of the Company, or by any administrative body or legislative body (including a committee thereof) with jurisdiction to order the Participant to divulge, disclose or make accessible such information.  For purposes of this Section 5.01, “Confidential Information” shall mean any trade secret or other non-public information concerning the financial data, strategic business plans, product development (or other proprietary product data), customer lists, marketing plans and other non-public, proprietary and confidential information of the Company or its affiliates, that, in any case, is not otherwise available to the public (other than by Participant’s breach of the terms hereof) or known to persons in the industry generally.

Section 5.02Non-Competition.  The Participant agrees that, during the term of his or her employment with the Company, and thereafter during the Restriction Period, he or she shall not directly or indirectly become associated, as an owner, partner, shareholder (other than as a holder of not in excess of 5% of the outstanding voting shares of any publicly traded company), director, officer, manager, employee, agent, consultant or otherwise, with any car or equipment rental or comparable company, which competes with the business, and for the customer base, of the Company (a “Competitive Business”).  This Section 5.02 shall not be deemed to restrict (a) a Participant who is a lawyer from working for or being associated with a law firm as long as the Participant does not provide legal services to a Competitive Business or (b) association with any enterprise that conducts unrelated business or that has material operations outside of the geographic area that encompasses the Company’s customer base (or where the Company had plans at the Termination Date to enter) for so long as the Participant’s role whether direct or indirect (e.g., supervisory), is solely with respect to such unrelated business or other geographic area (as the case may be).

Section 5.03Non-Solicitation.  The Participant agrees that, during the term of his or her employment with the Company, and thereafter during the Restriction Period, he or she shall not directly or indirectly employ or seek to employ, or solicit or contact or cause others to solicit or contact with a view to engage or employ, any person who is or was a managerial level employee of the Company at the time of the Participant’s Termination Date or at any time during the twelve-month period preceding such date.  This Section 5.03 shall not be deemed to be violated solely by (a) placing an advertisement or other general solicitation or (b) serving as a reference.

Section 5.04Non-Disparagement.  The Participant agrees that he or she shall not at any time disparage the Company or any officer or employee of the Company, and shall not, without the prior written consent of the Company, make any written or oral statement concerning the termination of his or her employment or any circumstances,

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terms or conditions relating thereto, which statement is reasonably likely to become generally known to the public.  Nothing in this Section 5.04 shall prevent the lawful filing or prosecution of any claim against the Company in any judicial, arbitration, governmental, or other appropriate forum for adjudication of disputes, any response or disclosure by the Participant compelled by legal process or required by applicable law or any bona-fide exercise by the Participant of any shareholder rights he or she may otherwise have.

Section 5.05Reasonableness.  In the event the provisions of this Article V shall ever be deemed to exceed the time, scope or geographic limitations permitted by applicable laws, then such provisions shall be reformed to the maximum time, scope or geographic limitations, as the case may be, permitted by applicable laws.

Section 5.06Acknowledgment.  The Plan Administrator shall require, as a condition to a Participant’s participation in the Plan, that such Participant enter into a written acknowledgment of the terms of this Article V (and such other provisions hereof as the Plan Administrator determines appropriate), in such form as the Plan Administrator shall determine appropriate from time to time.

Section 5.07Equitable Relief.

(a)By participating in the Plan, the Participant acknowledges that the restrictions contained in this Article V are reasonable and necessary to protect the legitimate interests of the Company, its Subsidiaries and its affiliates, that the Company would not have established this Plan in the absence of such restrictions, and that any violation of any provision of this Article V will result in irreparable injury to the Company.  By agreeing to participate in the Plan, the Participant represents that his or her experience and capabilities are such that the restrictions contained in this Article V will not prevent the Participant from obtaining employment or otherwise earning a living at the same general level of economic benefit as is currently the case.  The Participant further represents and acknowledges that (i) he or she has been advised by the Company to consult his or her own legal counsel in respect of this Plan, and (ii) that he or she has had full opportunity, prior to agreeing to participate in this Plan, to review thoroughly this Plan with his or her counsel.

(b)The Participant agrees that the Company shall be entitled to preliminary and permanent injunctive relief, without the necessity of proving actual damages or posting any bond, and a court or arbitration may also order an equitable accounting of all earnings, profits and other benefits arising from any violation of this Article V, which rights shall be cumulative and in addition to any other rights or remedies to which the Company may be entitled.

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(c)The Participant and the Company irrevocably and unconditionally (i) agree that any suit, action or other legal proceeding arising out of this Article V, including without limitation, any action commenced by the Company for preliminary and permanent injunctive relief or other equitable relief, may be brought in the United States District Court for the District of New Jersey, or if such court does not have jurisdiction or will not accept jurisdiction, in any court of general jurisdiction in New Jersey, (ii) consent to the non-exclusive jurisdiction of any such court in any such suit, action or proceeding, and (iii) waive any objection which Participant may have to the laying of venue of any such suit, action or proceeding in any such court.

Section 5.08Survival of Provisions.  The obligations contained in this Article V shall survive the termination of Participant’s employment with the Company or a Subsidiary and shall be fully enforceable thereafter.

ARTICLE VI

THE PLAN ADMINISTRATOR

Section 6.01Authority and Duties.  It shall be the duty of the Plan Administrator, on the basis of information supplied to it by the Company and the Committee, to properly administer the Plan.  The Plan Administrator shall have the full power, authority and discretion to construe, interpret and administer the Plan, to make factual determinations, to correct deficiencies therein, and to supply omissions.  All decisions, actions and interpretations of the Plan Administrator shall be subject only to determinations by the Named Appeals Fiduciary (as defined in Section 9.04), with respect to denied claims for Severance Benefits, and in the event of any judicial or arbitral proceeding shall be subject to de novo review.  The Plan Administrator may adopt such rules and regulations and may make such decisions as it deems necessary or desirable for the proper administration of the Plan.  Notwithstanding anything else herein to the contrary, all decisions, actions and interpretations of the Named Appeals Fiduciary shall be subject to de novo review by the arbitrator pursuant to Section 9.05 hereof.

Section 6.02Compensation of the Plan Administrator.  The Plan Administrator shall receive no compensation for services as such.  However, all reasonable expenses of the Plan Administrator shall be paid or reimbursed by the Company upon proper documentation.  The Plan Administrator shall be indemnified by the Company against personal liability for actions taken in good faith in the discharge of the Plan Administrator’s duties.

Section 6.03Records, Reporting and Disclosure.  The Plan Administrator shall keep a copy of all records relating to the payment of Severance Benefits to Participants and former Participants and all other records necessary for the proper operation of the Plan.  All Plan records shall be made available to the Committee, the Company and to

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each Participant for examination during business hours except that a Participant shall examine only such records as pertain exclusively to the examining Participant and to the Plan.  The Plan Administrator shall prepare and shall file as required by law or regulation all reports, forms, documents and other items required by ERISA, the Code, and every other relevant statute, each as amended, and all regulations thereunder (except that the Company, as payor of the Severance Benefits, shall prepare and distribute to the proper recipients all forms relating to withholding of income or wage taxes, Social Security taxes, and other amounts that may be similarly reportable).

ARTICLE VII

AMENDMENT, TERMINATION AND DURATION

Section 7.01Amendment, Suspension and Termination.  Except as otherwise provided in this Section 7.01, the Board or the Committee or the delegee of the Board or the Committee shall have the right, at any time and from time to time, to amend, suspend or terminate the Plan in whole or in part, for any reason or without reason, and without either the consent of or the prior notification to any Participant, by a formal written action.  No such amendment shall give the Company the right to recover any amount paid to a Participant prior to the date of such amendment or to cause the cessation of Severance Benefits already approved for a Participant who has executed a Release as required under Section 3.02.

Section 7.02Duration.  Unless terminated sooner by the Board or the Committee or the delegee of the Board or the Committee in accordance with Section 7.01, the Plan shall continue in full force and effect until termination of the Plan pursuant to Section 7.01.

ARTICLE VIII

DUTIES OF THE COMPANY, THE COMMITTEE AND THE PLAN ADMINISTRATOR

Section 8.01Records.  The Company or a Subsidiary thereof shall supply to the Committee and the Plan Administrator, as the case may be, all records and information necessary to the performance of the Committee’s and the Plan Administrator’s duties.

Section 8.02Payment.  Payments of Severance Benefits to Participants shall be made in such amount as determined by the Committee under Article IV, from the Company’s general assets or from a supplemental unemployment benefits trust, in accordance with the terms of the Plan, as directed by the Committee.

Section 8.03Discretion.  Any decisions, actions or interpretations to be made under the Plan by the Board, the Committee and the Plan Administrator, acting on behalf

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of either, (i) shall be made in each of their respective sole discretion, not in any fiduciary capacity, and (ii) need not be uniformly applied to similarly situated individuals.  Notwithstanding anything else herein to the contrary, all decisions, actions and interpretations of the Plan Administrator and the Named Appeals Fiduciary shall be accorded deference by the arbitrator pursuant to Section 9.05 hereof and by a court of competent jurisdiction entering the award of such arbitrator, in each case to the maximum extent permitted by applicable law.

ARTICLE IX

CLAIMS PROCEDURES

Section 9.01Claim.  Each Participant under this Plan may contest the administration of the Severance Benefits awarded by completing and filing with the Plan Administrator a written request for review in the manner specified by the Plan Administrator.  No person may bring an action for any alleged wrongful denial of Plan benefits in a court of law unless the claims procedures described in this Article IX are exhausted and a final determination is made by the Plan Administrator and/or the Named Appeals Fiduciary.

Section 9.02Initial Claim.  Before the date on which payment of a Severance Benefit occurs, any claim relating to the administration of such Severance Benefit must be supported by such information as the Plan Administrator deems relevant and appropriate.  In the event that any such claim is denied in whole or in part, the terminated Participant or his or her beneficiary (“Claimant”) whose claim has been so denied shall be notified of such denial in writing by the Plan Administrator within ninety (90) days after the receipt of the claim for benefits.  This period may be extended an additional ninety (90) days if the Plan Administrator determines such extension is necessary and the Plan Administrator provides notice of extension to the Claimant prior to the end of the initial ninety (90) day period.  The notice advising of the denial shall (i) specify the reason or reasons for denial, (ii) make specific reference to the Plan provisions on which the determination was based, (iii) describe any additional material or information necessary for the Claimant to perfect the claim (explaining why such material or information is needed), and (iv) describe the Plan’s review procedures and the time limits applicable to such procedures, including a statement of the Claimant’s right to bring a civil action under Section 502(a) of ERISA following an adverse benefit determination on review.

Section 9.03Appeals of Denied Administrative Claims.  All appeals shall be made by the following procedure:

(a)A Claimant whose claim has been denied shall file with the Plan Administrator a notice of appeal of the denial.  Such notice shall be filed within sixty (60) calendar days of notification by the Plan Administrator of the denial of

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a claim, shall be made in writing, and shall set forth all of the facts upon which the appeal is based.  Appeals not timely filed shall be barred.

(b)The Named Appeals Fiduciary shall consider the merits of the Claimant’s written presentations, the merits of any facts or evidence in support of the denial of benefits, and such other facts and circumstances as the Named Appeals Fiduciary shall deem relevant.

(c)The Named Appeals Fiduciary shall render a determination upon the appealed claim which determination shall be accompanied by a written statement as to the reasons therefor.  The determination shall be made to the Claimant within sixty (60) days of the Claimant’s request for review, unless the Named Appeals Fiduciary determines that special circumstances require an extension of time for processing the claim.  In such case, the Named Appeals Fiduciary shall notify the Claimant of the need for an extension of time to render its decision prior to the end of the initial sixty (60) day period, and the Named Appeals Fiduciary shall have an additional sixty (60) day period to make its determination.  If the determination is adverse to the Claimant, the notice shall (i) provide the reason or reasons for denial, (ii) make specific reference to the Plan provisions on which the determination was based, (iii) include a statement that the Claimant is entitled to receive, upon request and free of charge, reasonable access to, and copies of, all documents, records and other information relevant to the Claimant’s claim for benefits, and (iv) state that the Claimant has the right to bring an action under Section 502(a) of ERISA, and such determination shall be subject to de novo review by the arbitrator as provided in Section 9.05 hereof.

Section 9.04Appointment of the Named Appeals Fiduciary.  The “Named Appeals Fiduciary” shall be the person or persons named as such by the Board or Committee, or, if no such person or persons be named, then the person or persons named by the Plan Administrator as the Named Appeals Fiduciary.  Named Appeals Fiduciaries may at any time be removed by the Board or Committee, and any Named Appeals Fiduciary named by the Plan Administrator may be removed by the Plan Administrator.  All such removals may be with or without cause and shall be effective on the date stated in the notice of removal.  The Named Appeals Fiduciary shall be a “Named Fiduciary” within the meaning of ERISA, and, unless appointed to other fiduciary responsibilities, shall have no authority, responsibility, or liability with respect to any matter other than the proper discharge of the functions of the Named Appeals Fiduciary as set forth herein.

Section 9.05Arbitration; Expenses.  In the event of any dispute under the provisions of this Plan, other than a dispute in which the primary relief sought is an equitable remedy such as an injunction, the parties shall have the dispute, controversy or claim settled by arbitration in Park Ridge, New Jersey (or such other location as may be mutually agreed upon by the Employer and the Participant) in accordance with the

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National Rules for the Resolution of Employment Disputes then in effect of the American Arbitration Association, before a single arbitrator selected by agreement of the parties (or, in the absence of such agreement, appointed by the American Arbitration Association).  Any award entered by the arbitrator shall be final, binding and nonappealable and judgment may be entered thereon by either party in accordance with applicable law in any court of competent jurisdiction.  This arbitration provision shall be specifically enforceable.  The arbitrator shall have no authority to modify any provision of this Plan or to award a remedy for a dispute involving this Plan other than a benefit specifically provided under or by virtue of the Plan.  If the Participant substantially prevails on any material issue that is the subject of such arbitration or lawsuit, the Company shall be responsible for all of the fees of the American Arbitration Association and the arbitrator and any expenses relating to the conduct of the arbitration (including the Company’s and Participant’s reasonable attorneys’ fees and expenses).  Otherwise, each party shall be responsible for its own expenses relating to the conduct of the arbitration (including reasonable attorneys’ fees and expenses) and shall share the fees of the American Arbitration Association.

ARTICLE X

MISCELLANEOUS

Section 10.01Nonalienation of Benefits.  None of the payments, benefits or rights of any Participant shall be subject to any claim of any creditor of any Participant, and, in particular, to the fullest extent permitted by law, all such payments, benefits and rights shall be free from attachment, garnishment (if permitted under applicable law), trustee’s process, or any other legal or equitable process available to any creditor of such Participant.  No Participant shall have the right to alienate, anticipate, commute, plead, encumber or assign any of the benefits or payments that he may expect to receive, contingently or otherwise, under this Plan, except for the designation of a beneficiary as contemplated in Section 10.02.

Section 10.02Beneficiary Designation.  Each Participant under the Plan may from time to time name any beneficiary or beneficiaries (who may be named contingently or successively) to whom any benefit under the Plan is to be paid or by whom any right under the Plan is to be exercised in case of his or her death.  Each designation will revoke all prior designations by the same Participant, shall be in a form prescribed by the Plan Administrator, and will be effective only when filed by the Participant in writing with the Plan Administrator during his lifetime.  In the absence of any such designation, benefits remaining unpaid at the Participant’s death shall be paid to or exercised by the Participant’s surviving spouse, if any, or otherwise to or by his or her estate.

Section 10.03Notices.  All notices and other communications required hereunder shall be in writing and shall be delivered personally or mailed by registered or certified mail, return receipt requested, or by overnight express courier service.  In the case of the

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Participant, mailed notices shall be addressed to him or her at the home address that he or she most recently communicated to the Company in writing.  In the case of the Company, mailed notices shall be addressed to the Plan Administrator, with copies to the Senior Vice President, Human Resources and the General Counsel of the Company.

Section 10.04409A Compliance.  The Plan is intended to be administered in a manner consistent with the requirements, where applicable, of Section 409A of the Code.  Where reasonably possible and practicable, the Plan shall be administered in a manner to avoid the imposition on Participants of immediate tax recognition and additional taxes pursuant to such Section 409A.  Notwithstanding the foregoing, neither the Company nor the Plan Administrator shall have any liability to any person in the event such Section 409A applies to any such Award in a manner that results in adverse tax consequences for the Participant or any of his beneficiaries or transferees.

Section 10.05Successors and Assigns.  The rights under this Plan are personal to the Participant and without the prior written consent of the Company shall not be assignable by the Participant otherwise than by will or the laws of descent and distribution.  This Plan shall inure to the benefit of and be enforceable by the Participant’s legal representatives.  This Plan shall inure to the benefit of and be binding upon the Company and its successors and assigns.  The Company will require any successor (whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or substantially all of the business and/or assets of the Company to assume expressly and agree to perform this Plan in the same manner and to the same extent that the Company would be required to perform it if no such succession had taken place (with a copy of such assumption provided to the Participant).

Section 10.06No Impact On Benefits.  Except as may otherwise be specifically stated under any employee benefit plan, policy or program, no amount payable under the Plan shall be treated as compensation for purposes of calculating a Participant’s right under any such plan, policy or program.

Section 10.07Timing of Reimbursements; Effect on Other Payments.  Except as otherwise provided in this Plan, no Participant shall be entitled to any cash payments or other severance benefits under any of the Company’s then current severance pay policies for a termination that is covered by this Plan for the Participant.  Anything in this Plan to the contrary notwithstanding, no reimbursement payable to Participant pursuant to any provisions of this Plan or pursuant to any plan or arrangement of the Company covered by this Plan shall be paid later than the last day of the calendar year following the calendar year in which the related expense was incurred, and no such reimbursement during any calendar year shall affect the amounts eligible for reimbursement in any other calendar year, except, in each case, to the extent that the right to reimbursement does not provide for a “deferral of compensation” within the meaning of Section 409A of the Code.

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Section 10.08No Mitigation.  A Participant shall not be required to mitigate the amount of any Severance Benefit provided for in this Plan by seeking other employment or otherwise, nor shall the amount of any Severance Benefit provided for herein be reduced by any compensation earned by other employment or otherwise or subject to offset except as otherwise expressly provided for herein.

Section 10.09No Contract of Employment.  Neither the establishment of the Plan, nor any modification thereof, nor the creation of any fund, trust or account, nor the payment of any benefits shall be construed as giving any Participant or any person whosoever, the right to be retained in the service of the Company.

Section 10.10Severability of Provisions.  If any provision of this Plan shall be held invalid or unenforceable by a court of competent jurisdiction, such invalidity or unenforceability shall not affect any other provisions hereof, and this Plan shall be construed and enforced as if such provisions had not been included.

Section 10.11Heirs, Assigns, and Personal Representatives.  This Plan shall be binding upon the heirs, executors, administrators, successors and assigns of the parties, including each Participant, present and future.

Section 10.12Headings and Captions.  The headings and captions herein are provided for reference and convenience only, shall not be considered part of the Plan, and shall not be employed in the construction of the Plan.

Section 10.13Gender and Number.  Where the context admits, words in any gender shall include any other gender, and, except where otherwise clearly indicated by context, the singular shall include the plural, and vice versa.

Section 10.14Unfunded Plan.  The Plan shall not be funded.  No Participant shall have any right to, or interest in, any assets of the Company that may be applied by the Company to the payment of Severance Benefits.

Section 10.15Payments to Incompetent Persons.  Any benefit payable to or for the benefit of a minor, an incompetent person or other person incapable of receipting therefor shall be deemed paid when paid to such person’s guardian or to the party providing or reasonably appearing to provide for the care of such person, and such payment shall fully discharge the Company, the Committee and all other parties with respect thereto.

Section 10.16Lost Payees.  A benefit shall be deemed forfeited if the Plan Administrator is unable to locate a Participant to whom a Severance Benefit is due.  Such Severance Benefit shall be reinstated if application is made by the Participant for the forfeited Severance Benefit while this Plan is in operation.

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Section 10.17Controlling Law.  This Plan shall be construed and enforced according to the laws of the State of New Jersey to the extent not superseded by Federal law.

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Annex A

Position	Severance Factor	Severance Period
Business Leads	2.0	24 months
Chief Financial Officer	1.5	18 months
Senior Vice Presidents and Executive Vice President, Global Supply Chain	1.5	18 months

Exhibit A

SEPARATION AGREEMENT
and
GENERAL RELEASE OF ALL CLAIMS

This Separation Agreement and General Release of All Claims (the “Agreement”) is entered into as of [·] by and among [·] (the “Executive”), Hertz Global Holdings, Inc. and The Hertz Corporation (hereinafter “Hertz” or the “Companies”), duly acting under authority of their officers and directors.

WHEREAS, Executive is a participant in the Hertz Global Holdings, Inc. Severance Plan for Senior Executives (the “Plan”);

WHEREAS, Executive’s employment with Hertz will end effective as of [·];

WHEREAS, in connection with Executive’s separation from employment, Executive is entitled to certain payments and other benefits under the Plan, so long as Executive executes and does not revoke this Agreement; and

WHEREAS, the parties desire to fully and finally resolve any disputes, claims or controversies that have arisen or may arise with respect to Executive’s employment with and subsequent separation from the Companies.

NOW, THEREFORE, in consideration of the mutual promises, covenants and agreements stated herein and in the Plan, which Executive and the Companies agree constitute good and valuable consideration, receipt of which is acknowledged, the parties stipulate and do mutually agree as follows:

1.In exchange for receiving the payments and benefits described in Section 4 of the Plan, Executive does for himself and his heirs, executors, administrators,

successors, and assigns, hereby release, acquit, and forever discharge and hold harmless the Companies and the divisions, subsidiaries and affiliated companies of each of the Companies, the officers, directors, shareholders, employees, benefit and retirement plans (as well as trustees and administrators thereof), agents and heirs of each of the foregoing, and the predecessors, assigns and successors, past and present of each of the foregoing, and any persons, firms or corporations in privity with any of them (collectively, the “Company Released Parties”), of and from any and all actions, causes of action, claims, demands, attorneys’ fees, compensation, expenses, promises, covenants, and damages of whatever kind or nature, in law or in equity, which Executive has, had or could have asserted, known or unknown, at common law or under any statute, rule, regulation, order or law, whether federal, state or local, or on any grounds whatsoever from the beginning of the world to the date of execution of this Agreement, including, without limitation, (1) any and all claims for any additional severance pay, vacation pay, bonus or other compensation; (2) any and all claims of discrimination or harassment based on race, color, national origin, ancestry, religion, marital status, sex, sexual orientation, disability, handicap, age or other unlawful discrimination; any claims arising under Title VII of the Federal Civil Rights Act; the Federal Civil Rights Act of 1991; the Americans with Disabilities Act; the Age Discrimination in Employment Act; the New Jersey Law Against Discrimination; or under any other state, federal, local law or regulation or under the common law; and (3) any and all claims with respect to any event, matter, damage or injury arising out of his employment relationship with any Company Released Party,

2

and/or the separation of such employment relationship, and/or with respect to any other event or matter.

The only exceptions to this Separation Agreement and General Release of All Claims are with respect to retirement benefits which may have accrued and vested as of the date of Executive’s employment termination, COBRA rights, enforcement of Executive’s rights under this Agreement and the Plan, and any claims under applicable workers’ compensation laws.

Nothing in this Agreement shall be construed to prohibit Executive from filing any future charge or complaint with the U.S. Equal Employment Opportunity Commission (the “EEOC”) or participating in any investigation or proceeding conducted by the EEOC, nor shall any provision of this Agreement adversely affect Executive’s right to engage in such conduct. Notwithstanding the foregoing, Executive waives the right to obtain any relief from the EEOC or recover any monies or compensation as a result of filing a charge or complaint. In addition to agreeing herein not to bring suit against any Company Released Party, Executive agrees not to seek damages from any Company Released Party by filing a claim or charge with any state or governmental agency.

2.Executive shall return to the Companies all Company property and Confidential Information (as defined in the Plan) of any Company Released Party in Executive’s possession or control, including without limitation, business reports and records, client reports and records, customer information, personally identifiable information relating to others, business strategies, contracts and proposals, files, a listing

3

of customers or clients, lists of potential customers or clients, technical data, testing or research data, research and development projects, business plans, financial plans, internal memoranda concerning any of the above, and all credit cards, cardkey passes, door and file keys, computer access codes, software, and other physical or personal property which Executive received, had access to or had in his possession, prepared or helped prepare in connection with Executive’s employment with any Company Released Party, and Executive shall not make or retain any copies, duplicates, reproductions, or excerpts thereof.  Executive acknowledges that in the course of employment with any one or more Company Released Party, Executive has acquired Confidential Information and that such Confidential Information has been disclosed to Executive in confidence and for his use only during and with respect to his employment with one or more of the Company Released Parties.

3.Executive acknowledges and agrees that he has agreed to be bound by the confidentiality provision in the Plan for 24 months following Executive’s separation of employment, the non-competition and non-solicitation covenants in the Plan for the greater of 12 months or the Severance Period (as defined in the Plan) and the non-disparagement covenant in the Plan at all times.

4.Executive declares and represents that he has not filed or otherwise pursued any charges, complaints, lawsuits or claims of any nature against any Company Released Party arising out of or relating to events occurring prior to the date of this Agreement, with any federal, state or local governmental agency or court with respect to any matter covered by this Agreement. In addition to agreeing herein not to bring suit

4

against any Company Released Party, Executive agrees not to seek damages from any Company Released Party by filing a claim or charge with any state or governmental agency.

5.Executive further declares and represents that no promise, inducement, or agreement not herein expressed has been made to him, that this Agreement contains the entire agreement between the parties hereto, and that the terms of this Agreement are contractual and not a mere recital.

6.Executive understands and agrees that this Agreement shall not be considered an admission of liability or wrongdoing by any party hereto, and each of the parties denies any liability and agrees that nothing in this Agreement can or shall be used by or against either party with respect to claims, defenses or issues in any litigation or proceeding except to enforce rights under the Agreement itself or under the Plan.

7.Executive understands and agrees that should any provision of this Agreement be declared or be determined by any court to be illegal or invalid, the validity of the remaining parts, terms or provisions shall not be affected thereby, and said invalid part, term, or provision shall be deemed not a part of this Agreement.

8.Executive acknowledges that he understands that he has the right to consult with an attorney of his choice at his expense to review this Agreement and has been encouraged by the Companies to do so.

9.Executive further acknowledges that he has been provided twenty-one days to consider and accept this Agreement from the date it was first given to him, although Executive may accept it at any time within those twenty-one days.

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10.Executive further understands that he has seven days after signing the Agreement to revoke it by delivering to the Senior Vice President, Chief Human Resource Officer, The Hertz Corporation, 225 Brae Boulevard, Park Ridge, New Jersey 07656, written notification of such revocation within the seven day period. If Executive does not revoke the Agreement, the Agreement will become effective and irrevocable by him on the eighth day after he signs it.

11.Executive acknowledges that this Agreement sets forth the entire agreement between the parties with respect to the subject matters hereof and supersedes any and all prior agreements between the parties as to such matters, be they oral or in writing, and may not be changed, modified, or rescinded except in writing signed by all parties hereto, and any attempt at oral modification of this Agreement shall be void and of no force or effect.

12.Executive acknowledges that he has carefully read this Agreement and understands all of its terms, including the full and final release of claims set forth above and enters into it voluntarily.

WITH EXECUTIVE’S SIGNATURE HEREUNDER, EXECUTIVE ACKNOWLEDGES THAT EXECUTIVE HAS CAREFULLY READ THIS AGREEMENT AND UNDERSTANDS ALL OF ITS TERMS INCLUDING THE FULL AND FINAL RELEASE OF CLAIMS SET FORTH ABOVE.  EXECUTIVE FURTHER ACKNOWLEDGES THAT EXECUTIVE HAS VOLUNTARILY ENTERED INTO THIS AGREEMENT; THAT EXECUTIVE HAS NOT RELIED UPON ANY REPRESENTATION OR STATEMENT, WRITTEN OR UNWRITTEN, NOT SET FORTH IN THIS AGREEMENT; THAT

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EXECUTIVE HAS BEEN GIVEN THE OPPORTUNITY TO HAVE THIS AGREEMENT REVIEWED BY HIS ATTORNEY; AND THAT EXECUTIVE HAS BEEN ENCOURAGED BY THE COMPANIES TO DO SO.

EXECUTIVE ALSO ACKNOWLEDGES THAT EXECUTIVE HAS BEEN AFFORDED 21 DAYS TO CONSIDER THIS AGREEMENT AND THAT EXECUTIVE HAS 7 DAYS AFTER SIGNING THIS AGREEMENT TO REVOKE IT BY DELIVERING TO THE SENIOR VICE PRESIDENT, CHIEF HUMAN RESOURCES OFFICER, AS SET FORTH ABOVE, WRITTEN NOTIFICATION OF EXECUTIVE’S REVOCATION.

IN WITNESS WHEREOF, the parties have caused this Agreement to be duly executed as of the date set forth above.

	Date:
EXECUTIVE
THE HERTZ CORPORATION	HERTZ GLOBAL HOLDINGS, INC.
By:	By:
Date:	Date:

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EX-10.40

Exhibit 10.40

CHANGE IN CONTROL SEVERANCE AGREEMENT

FOR EXECUTIVE OFFICERS AND CERTAIN NEW KEY EMPLOYEES

This Severance Agreement (this “Agreement”) is made as of                                  by and between Hertz Global Holdings, Inc., a Delaware corporation, and any successor to the business and/or assets of the Company that assumes this Agreement (the “Company”), and                                   (“Executive”).

RECITALS

WHEREAS the Compensation Committee of the Board of Directors of the Company (the “Board”) has approved this severance agreement to provide Executive with certain benefits upon certain terminations of employment;

NOW THEREFORE, the parties hereto agree as follows:

1.Term of Agreement.  This Agreement shall commence on the date hereof and shall continue in effect through December 31, 2010; provided, that the term of this Agreement shall automatically be extended for one additional year beyond 2010 (and successive one year periods thereafter), unless, not later than September 30, 2008 (for the additional year ending on December 31, 2011) or September 30 of each year thereafter (for each subsequent extension), the Company shall have given notice that it does not wish to extend this Agreement for an additional year, in which event this Agreement shall continue to be effective until the end of its then remaining term; provided, however, that, notwithstanding any such notice by the Company not to extend, if a Change in Control (as defined in Section 2 below) shall have occurred during the original or any extended term of this Agreement, this Agreement shall continue in effect for a period of twenty-four months beyond such Change in Control. Notwithstanding the foregoing, this Agreement shall terminate if Executive ceases to be an employee of the Company and its subsidiaries for any reason prior to a Change in Control which, for these purposes, shall include cessation of such employment as a result of the sale or other disposition of the division, subsidiary or other business unit by which Executive is employed.

2.Change in Control.  No benefits shall be payable hereunder unless there shall have been a Change in Control of the Company. For purposes of this Agreement, a “Change in Control” shall mean the first to occur of any of the following after the date of this Agreement:

(A)the acquisition by any person, entity or “group” (as defined in Section 13(d) of the Securities Exchange Act of 1934, as amended), other than any such acquisition by the Company, any of its subsidiaries, any employee benefit plan of the Company or any of its subsidiaries, or any of the Investors (as

defined below), of 50% or more of the combined voting power of the Company’s then outstanding voting securities;

(B)within any 24-month period, the Incumbent Directors (as defined below) shall cease to constitute at least a majority of the Board or the board of directors of any successor to the Company, provided that any director elected to the Board, or nominated for election, by a majority of the Incumbent Directors then still in office shall be deemed to be an Incumbent Director for purposes of this clause (B); or

(C)the merger or consolidation of the Company as a result of which persons who were owners of the voting securities of the Company immediately prior to such merger or consolidation, or any of the Investors, do not, immediately thereafter, own, directly or indirectly, more than 50% of the combined voting power entitled to vote generally in the election of directors of the merged or consolidated company;

(D)the approval by the Company’s shareholders of the liquidation or dissolution of the Company other than a liquidation of the Company into any subsidiary of the Company or a liquidation a result of which persons who were stockholders of the Company immediately prior to such liquidation, or any or all of the Investors, own, directly or indirectly, more than 50% of the combined voting power entitled to vote generally in the election of directors of the entity that holds substantially all of the assets of the Company following such event; and

(E)the sale, transfer or other disposition of all or substantially all of the assets of the Company to one or more persons or entities that are not, immediately prior to such sale, transfer or other disposition, affiliates of the Company.

Notwithstanding the foregoing, a Change in Control shall not be deemed to occur if the Company files for bankruptcy, liquidation or reorganization under the United States Bankruptcy Code.

For purposes of the foregoing definition, the following terms shall have the following meanings:

“Incumbent Director” means the persons who were members of the Board as of the date of this Agreement; provided, that a director elected, or nominated for election, to the Board in connection with a proxy contest after the date of this Agreement shall not be considered an Incumbent Director.

“Investors” means collectively (i) the Initial Investors, (ii) TC Group L.L.C. (which operates under the trade name The Carlyle Group), (iii) Clayton,

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Dubilier & Rice, Inc., (iv) Merrill Lynch Global Partners, Inc., (v) any affiliate of any of the foregoing, including any investment fund or vehicle managed, sponsored or advised by any of the foregoing, (vi) any successor in interest to any of the foregoing.

“Initial Investors” means, collectively, the Carlyle Investors, the CDR Investors and the Merrill Lynch Investors.

“Carlyle Investors” means, collectively, (i) Carlyle Partners IV, L.P., (ii) CEP II Participations S.àr.l., (iii) CP IV Co-investment, L.P., and (iv) CEP II U.S. Investments, L.P.

“CDR Investors” means, collectively, (i) Clayton, Dubilier & Rice Fund VII, L.P., (ii) CDR CCMG Co-Investor L.P., and (iii) CD&R Parallel Fund VII, L.P.

“Merrill Lynch Investors” means, collectively, (i) ML Global Private Equity Fund, L.P., (ii) Merrill Lynch Ventures L.P. 2001, (iii) CMC-Hertz Partners, L.P., and (iv) ML Hertz Co-Investor, L.P.

3.Termination Following Change In Control.  If a Change in Control shall have occurred, Executive shall be entitled to the benefits provided in Section 4(iv) upon the subsequent termination of Executive’s employment with the Company and its subsidiaries during the two year period following such Change in Control (the “Protected Period”) unless such termination is (A) a result of Executive’s death, Retirement or Disability (except as provided in Section 3(i) below), (B) by Executive without Good Reason (as defined in Section 3(iii) below), or (C) by the Company or any of its subsidiaries for Cause (as defined in Section 3(ii) below). In addition, Executive shall be entitled to the compensation provided for in Section 4(iv) hereof (and without regard to Section 4(vii) hereof) payable only upon the occurrence of an event constituting a Section 409A Change in Control (as if his termination had occurred after the Section 409A Change in Control) if, after an agreement has been signed which, if consummated, would result in a Section 409A Change in Control, (x) Executive is terminated without Cause by the Company and its subsidiaries prior to the Section 409A Change in Control, and (y) such termination was at the instigation or request of the party to the agreement evidencing the transaction that will result in the Section 409A Change in Control or otherwise occurs in connection with the anticipated Section 409A Change in Control. “Section 409A Change in Control” means any event described in Section 2 of this Agreement if such event also is a “change in control event” within the meaning of the regulations under Section 409A(a)(2)(A)(v) of the Code determined in accordance with the uniform methodology and procedures adopted by the Company.

(i)Disability; Retirement. For purposes of this Agreement, “Disability” shall mean permanent and total disability as such term is defined

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under Section 22(e)(3) of the Internal Revenue Code of 1986, as amended (the “Code”), without regard to whether Executive is subject to the Code. Any question as to the existence of Executive’s Disability upon which Executive and the Company cannot agree shall be determined by a qualified independent physician selected by Executive (or, if Executive is unable to make such selection, such selection shall be made by any adult member of Executive’s immediate family or Executive’s legal representative), and approved by the Company, said approval not to be unreasonably withheld. The determination of such physician made in writing to the Company and to Executive shall be final and conclusive for all purposes of this Agreement. For purposes of this Agreement, “Retirement” and corollary terms shall mean Executive’s voluntary termination of employment with the Company under any of the Company’s retirement plans that occurs prior to delivery of a Notice of Termination pursuant to Section 3(iv) below; provided, that notwithstanding the foregoing, no Retirement that occurs after any other termination of employment shall adversely affect, interfere with or otherwise impair in any way Executive’s right to receive the payments and benefits to which he is entitled on account of a termination without Cause or with Good Reason. Accordingly, and for the avoidance of doubt, if Executive provides a Notice of Termination for Good Reason, and otherwise satisfies the conditions for Good Reason pursuant to this Agreement, and also Retires, such Retirement shall not adversely affect, interfere with or otherwise impair in any way his right to receive payments and benefits hereunder. Conversely, if Executive terminates his employment on account of Retirement and at such time is not (x) terminating his employment for Good Reason pursuant to this Agreement or (y) being terminated by the Company without Cause pursuant to this Agreement, he shall not be entitled to the payments and benefits provided in this Agreement.

(ii)Cause. For purposes of this Agreement, “Cause” shall mean (i) willful and continued failure to perform substantially the Executive’s material duties with the Company (other than any such failure resulting from the Executive’s incapacity due to physical or mental illness) after a written demand for substantial performance specifying the manner in which the Executive has not performed such duties is delivered by the Chief Executive Officer of the Company to the Executive, (ii) engaging in willful and serious misconduct that is injurious to the Company or any of its subsidiaries, (iii) one or more acts of fraud or personal dishonesty resulting in or intended to result in personal enrichment at the expense of the Company or any of its subsidiaries, (iv) substantial abusive use of alcohol, drugs or similar substances that, in the sole judgment of the Company, impairs the Executive’s job performance, (v) material violation of any material Company policy that results in material harm to the Company or any of its subsidiaries or (vi) indictment for or conviction of a felony or of any crime (whether or not a felony) involving moral turpitude. Notwithstanding the foregoing, Executive shall not be deemed to have been terminated for Cause

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unless and until there shall have been delivered to Executive a copy of a resolution duly adopted by the affirmative vote of not less than three-quarters (3/4) of the Incumbent Directors of the Board at a meeting of the Board called and held for such purpose (after reasonable notice to Executive and an opportunity for Executive, together with Executive’s counsel, to be heard before the Board), finding that, in the good faith opinion of the Board, Executive was guilty of conduct set forth above in this Section 3(ii) and specifying the particulars thereof in detail.

(iii)Good Reason. Executive shall be entitled to terminate employment with Good Reason. For the purpose of this Agreement, “Good Reason” shall mean the occurrence, without Executive’s express written consent, of any of the following circumstances during the Protected Period unless, in the case of Sections 3(iii)(A), (E), or (F), such circumstances are fully corrected prior to the date specified as the Date of Termination (as defined in Section 3(v)) in the Notice of Termination (as defined in Section 3(iv)) given in respect thereof:

(A)the assignment to Executive of any duties or responsibilities not comparable to Executive’s position (as it existed immediately prior to the Change in Control) and that results in a substantial diminution or material adverse change in such duties or responsibilities from those in effect immediately prior to the Change in Control other than a change in title or reporting relationships;

(B)a reduction by the Company or any of its subsidiaries in Executive’s annual base salary as in effect on the date hereof or as the same may be increased from time to time;

(C)the relocation of Executive’s place of business to a location more than fifty miles from Executive’s principal place of employment immediately preceding the Change in Control that materially increases Executive’s commute compared to Executive’s commute as in effect immediately prior to the Change in Control;

(D)a reduction by the Company or any of its subsidiaries in Executive’s annual bonus opportunity as in effect on the date hereof or as the same may be increased from time to time;

(E)the failure by the Company or any of its subsidiaries to continue Executive’s participation in any long-term incentive compensation plan on a level comparable to other senior executives;

(F)except as required by law, a reduction by the Company or any of its subsidiaries of 5% or more in the aggregate benefits provided by

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Executive (excluding changes to such benefits that occur in the ordinary course, are of general application, and increase co-payments, deductibles or premiums which must be paid by Executive) as those enjoyed by Executive under the employee benefit and welfare plans of the Company and its subsidiaries, including, without limitation, the pension, life insurance, medical, dental, health and accident, retiree medical, disability, deferred compensation and savings plans, in which Executive was participating at the time of the Change in Control;

(G)the failure of the Company to obtain an agreement from any successor to assume and agree to perform this Agreement, as contemplated in Section 6 hereof; or

(H)any purported termination of Executive’s employment by the Company or its subsidiaries which is not effected pursuant to a Notice of Termination satisfying the requirements of Section 3(iv) below (and, if applicable, the requirements of Section 3(ii) above); for purposes of this Agreement, no such purported termination shall be effective.

Executive’s continued employment shall not constitute consent to, or a waiver of rights with respect to, any circumstances constituting Good Reason hereunder. Executive must provide the Notice of Termination not later than 180 days following the date he or she had actual knowledge of the event constituting Good Reason.

(iv)Notice of Termination. Any purported termination of Executive’s employment by the Company and its subsidiaries or by Executive shall be communicated by written Notice of Termination to the other party hereto in accordance with Section 7 hereof. For purposes of this Agreement, a “Notice of Termination” shall mean a notice which shall indicate the specific termination provision in this Agreement relied upon and shall set forth in reasonable detail (other than with respect to a Good Reason termination pursuant to Section 3(iii)(H)) the facts and circumstances claimed to provide a basis for termination of Executive’s employment under the provision so indicated.

(v)Date of Termination. “Date of Termination” shall mean (A) if Executive’s employment is terminated for Disability, 30 days after Notice of Termination is given (provided that Executive shall not have returned to the full-time performance of Executive’s duties during such 30 day period), and (B) if Executive’s employment is terminated pursuant to Section 3(ii) or (iii) above or for any reason (other than Disability), the date specified in the Notice of Termination (which, in the case of a termination pursuant to Section 3(ii) above shall not be less than 30 days, and in the case of a termination pursuant to Section 3(iii) above shall not be less than 30 nor more than 60 days, respectively,

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from the date such Notice of Termination is given); provided, that, if within 30 days after any Notice of Termination is given the party receiving such Notice of Termination notifies the other party that a dispute exists concerning the grounds for termination, the Date of Termination shall be the date on which the dispute is finally determined, either by mutual written agreement of the parties, by a binding arbitration award or by a final judgment, order or decree of a court of competent jurisdiction (which is not appealable or the time for appeal therefrom having expired and no appeal having been perfected); provided, further, that the Date of Termination shall be extended by a notice of dispute only if such notice is given in good faith and the party giving such notice pursues the resolution of such dispute with reasonable diligence. Notwithstanding the pendency of any such dispute, the Company and its subsidiaries will continue to pay Executive’s full compensation in effect when the notice giving rise to the dispute was given (including, but not limited to, base salary and bonus) and continue Executive as a participant in all incentive compensation, benefit and insurance plans in which Executive was participating when the notice giving rise to the dispute was given, until the dispute is finally resolved in accordance with this Section 3(v). Amounts paid under this Section 3(v) are in addition to all other amounts due under this Agreement and shall not be offset against or reduce any other amounts due under this Agreement. In the event that the Company is terminating Executive the Company may, if it so chooses, pay Executive the base salary which he would have received in lieu of waiting for the expiration of any notice period otherwise required hereby and bar Executive from any of the Company’s premises, offices or properties, subject to any rights set forth herein for Executive to contest such termination.

4.Compensation upon Termination or During Disability. Upon termination of Executive’s employment or during a period of Disability, in either case, during the Protected Period, Executive shall be entitled to the following benefits:

(i)During any period that Executive fails to perform Executive’s full-time duties with the Company and its subsidiaries as a result of the Disability, Executive shall continue to receive an amount equal to Executive’s base salary at the rate in effect at the commencement of any such period, and Bonus (as defined in Section 4(iv)(B)), through the Date of Termination for Disability; provided, that if any such period of Disability ends during the Protected Period, Executive shall have the right to resume active employment with the Company immediately following the end of such period of Disability, unless, prior to the end of such period of Disability, the Company has terminated Executive’s employment. Thereafter, Executive’s benefits shall be determined in accordance with the employee benefit programs of the Company and its subsidiaries then in effect.

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(ii)If Executive’s employment is terminated by the Company or any of its subsidiaries for Cause or by Executive without Good Reason (excluding death, Disability or Retirement) the Company (or one of its subsidiaries, if applicable) shall pay through the Date of Termination Executive’s full base salary at the rate in effect at the time Notice of Termination is given and shall pay any amounts otherwise payable to Executive on or immediately prior to the Date of Termination pursuant to any other compensation plans, programs or employment agreements then in effect, and the Company shall have no further obligations to Executive under this Agreement.

(iii)If Executive’s employment is terminated by reason of Executive’s death or Retirement, Executive’s benefits shall be determined in accordance with the retirement and other benefit programs of the Company and its subsidiaries then in effect, except as otherwise provided in Section 3(i).

(iv)If Executive’s employment by the Company and its subsidiaries is terminated (other than for death or Disability) by (a) the Company and its subsidiaries other than for Cause or (b) Executive with Good Reason, then, subject to Executive executing, delivering and not revoking the Release of Claims attached to this Agreement as Exhibit A (the “Release”) within 30 days following the Separation from Service Date (as defined in Section 4(vii)), Executive shall be entitled to the benefits provided below:

(A)The Company (or one of its subsidiaries, if applicable) shall pay any unpaid portion of Executive’s full base salary, at the rate in effect at the time of the Change in Control (the “Base Salary”), and a pro-rated annual bonus at target level, in each case, calculated through the Date of Termination, no later than the thirtieth day following the Date of Termination, plus all other amounts to which Executive is entitled under any compensation plan of the Company applicable to Executive, at the time such payments are due.

(B)The Company shall pay Executive, not later than 10 days following the date on which the Release has become effective and irrevocable, as severance pay to Executive, a severance payment equal to        times the sum of (i) Executive’s Base Salary, and (ii) Bonus. For purposes of this Agreement, the “Bonus” shall mean the average annual cash bonus paid (or awarded, if different) in respect of each of the three prior bonus years (exclusive of any special or prorated bonuses). If Executive has less than three years of bonus history, “Bonus” shall mean the target bonus of the year of termination.

(C)The Company shall credit the Executive with an additional        years of age and an additional        “Years of Service” for all purposes

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under The Hertz Corporation Supplemental Executive Retirement Plan (“SERP II”) (the length of such additional years of service, the “Severance Period”) with the benefit under the SERP II to be provided at the time or times set forth under the terms of SERP II without regard to Section 4(vii), and the averaging period over which “Final Average Earnings” (as defined in SERP II) is determined shall include the Severance Period (and, for this purpose, the payment made pursuant to Section 4(iv)(B) shall be deemed to be compensation earned ratably over the Severance Period); provided that, if Executive does not at the Date of Termination have at least five “Vesting Years of Service” under the “Retirement Plan” (as these terms are used or defined in SERP II), the following additional provisions shall apply to Executive: (1) Executive shall, notwithstanding the second paragraph of Section 3.2 of SERP II, be fully vested in his benefit under SERP II (as increased pursuant to this Section 4(ii)); (2) if Executive’s actual years of service plus the years of service credited pursuant to this Section 4(iv)(C) equal less than five, then, notwithstanding Section 1.10 of SERP II, the averaging period over which Final Average Earnings shall be determined shall be the period of such actual and credited service; (3) Executive’s benefit under SERP II and this Agreement shall be reduced applying the reduction factors set forth in the SERP II to reflect the timing of payment of such benefit; and (4) such benefit shall be paid at the same time as the payment set forth in Section 4(iv)(B) is paid.

(D)From the Date of Termination, until the earlier of (i) the last day of the Severance Period or (ii) the date upon which Executive becomes eligible to participate in plans of another employer (such period, the “Benefit Continuation Period”), the Company will continue Executive’s participation and coverage in all the Company’s life, medical, dental plans and other welfare benefit plans (but excluding the Company’s disability plans) (“Insurance Benefits”); provided that if any other Company plan, arrangement or agreement provides for continuation of Insurance Benefits, then Executive shall receive such coverage under such other plan, arrangement or agreement, and if the period of such coverage is shorter than the Benefit Continuation Period, then Executive shall receive pursuant to this Section 4(iv)(D), such coverage for the remainder of the Benefit Continuation Period.

(E)The Company shall provide to Executive outplacement services or executive recruiting services provided by a professional outplacement provider or executive recruiter at a cost to the Company of not more than 10% of Executive’s Base Salary (not to exceed $25,000) to be provided within the period ending no later than the end of the year following the year in which the Date of Termination occurs.

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(v)To the extent outstanding following a Change in Control, Executive’s stock options and other equity awards shall be governed by the terms of the equity incentive plans and award agreements under which such stock options and other equity awards were awarded.

(vi)The Company shall also pay to Executive, no less frequently than monthly, all legal fees and expenses reasonably incurred by Executive in connection with this Agreement (including all such fees and expenses, if any, incurred in contesting or disputing the nature of any such termination for purposes of this Agreement or in seeking to obtain or enforce any right or benefit provided by this Agreement); provided, that if a determination is made by the arbitrator selected under Section 12 hereof that Executive has failed to prevail on at least one material claim, the Company shall not be liable to pay such legal fees or expenses otherwise provided for thereunder and the Company shall be entitled to recover from Executive any such amounts so paid (either directly or, except as would violate the requirements of Section 409A(a)(3) of the Code, by setoff against any amounts then owed Executive by the Company). Notwithstanding the penultimate sentence of Section 8, no reimbursement pursuant to this Section 4(vi) shall be paid later than the last day of the 10th calendar year following the calendar year in which the applicable statute of limitations for breach of contract claims expires or, if later, the last day of the calendar year following the calendar year in which there is a settlement or other final and nonappealable resolution of the related contest or dispute.

(vii)Notwithstanding the foregoing provisions of this Section 4, if, as of the Separation from Service Date, Executive is a Specified Employee, then, except to the extent that this Agreement does not provide for a “deferral of compensation” within the meaning of Section 409A of the Code, the following shall apply:

1)No payments shall be made and no benefits shall be provided to Executive, in each case, during the period beginning on the Separation from Service Date and ending on the six-month anniversary of such date or, if earlier, the date of Executive’s death.

2)On the first business day of the first month following the month in which occurs the six-month anniversary of the Separation from Service Date or, if earlier, Executive’s death, the Company shall make a one-time, lump-sum cash payment to the Executive in an amount equal to the sum of (x) the amounts otherwise payable to the Executive under this Agreement during the period described in Section 4(vii)1) above and (y) the amount of interest on the foregoing at the applicable federal rate for instruments of less than one year.

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For purposes of this Agreement, “Separation from Service Date” shall mean the date of the Executive’s “separation from service” within the meaning of Section 409A(a)(2)(i)(A) of the Code and determined in accordance with the default rules under regulations promulgated under Section 409A of the Code. “Specified Employee” shall mean a “specified employee” within the meaning of Section 409A(a)(2)(B)(1) of the Code, as determined in accordance with the uniform methodology and procedures adopted by the Company and then in effect.

5.Excise Taxes.

(i)(A)  In the event that any payment or benefit received or to be received by Executive pursuant to the terms of this Agreement (the “Contract Payments”) or in connection with Executive’s termination of employment or contingent upon a Change in Control of the Company pursuant to any plan or arrangement or other agreement with the Company (or any affiliate) (“Other Payments” and, together with the Contract Payments, the “Payments”) would be subject to the excise tax (the “Excise Tax”) imposed by Section 4999 of the Code, as determined as provided below, the Company shall pay to Executive, at the time specified in Section 5(ii) below, an additional amount (the “Gross-Up Payment”) such that the net amount retained by Executive, after deduction of all taxes required to be paid upon the payment provided for by this Section 5(i), and any interest, penalties or additions to tax payable by Executive with respect thereto, shall be equal to the total present value of the Excise Taxes imposed upon the Payments; provided, that if Executive’s Payment is, when calculated on a net-after-tax basis, less than 110% of the amount of the Payment which could be paid to Executive under Section 280G of the Code without causing the imposition of the Excise Tax, then the Payment shall be limited to the largest amount payable (as described above) without resulting in the imposition of any Excise Tax (such amount, the “Capped Amount”).

(B)For purposes of determining the Capped Amount, whether any of the Payments will be subject to the Excise Tax and the amounts of such Excise Tax, (1) the total amount of the Payments shall be treated as “parachute payments” within the meaning of Section 280G(b)(2) of the Code, and all “excess parachute payments” within the meaning of Section 280G(b)(1) of the Code shall be treated as subject to the Excise Tax, except to the extent that, in the opinion of independent tax counsel selected by the Company’s independent auditors and reasonably acceptable to Executive (“Tax Counsel”), a Payment (in whole or in part) does not constitute a “parachute payment” within the meaning of Section 280G(b)(2) of the Code, or such “excess parachute payments” (in whole or in part) are not subject to the Excise Tax, (2) the amount of the Payments that shall be treated as subject to the Excise Tax shall be equal to the lesser of (A) the total amount of the Payments or (B) the amount of “excess parachute payments” within the meaning of Section 280G(b)(1) of the Code (after applying clause (1) hereof), and (3) the value of any noncash benefits or any deferred payment or benefit shall be determined by Tax Counsel in accordance with the principles of Sections 280G(d)(3) and

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(4) of the Code. For purposes of determining the amount of the Gross-Up Payment, Executive shall be deemed to pay federal income tax at the highest marginal rates of federal income taxation applicable to individuals in the calendar year in which the Gross-Up Payment is to be made and state and local income taxes at the highest effective rates of taxation applicable to individuals as are in effect in the state and locality of Executive’s residence in the calendar year in which the Gross-Up Payment is to be made, net of the maximum reduction in federal income taxes that can be obtained from deduction of such state and local taxes, taking into account any limitations applicable to individuals subject to federal income tax at the highest marginal rates.

(C)If the Tax Counsel determines that any Excise Tax is payable by Executive and that the criteria for reducing the Payments to the Capped Amount (as described in Section 5(i)(A) above) is met, then the Company shall reduce the Payments by the amount which, based on the Tax Counsel’s determination and calculations, would provide Executive with the Capped Amount, and pay to Executive such reduced Payments; provided that the Company shall first reduce the severance payment under Section 4(iv)(B) and shall next reduce the benefits described in Section 4(iv)(C). If the Tax Counsel determines that no Excise Tax is payable by Executive, it shall, at the same time as it makes such determination, furnish Executive with an opinion that he has substantial authority not to report any Excise Tax on his/her federal, state, local income or other tax return. Any determination by the Tax Counsel as to the amount of the Gross-Up Payment shall be binding upon the Company and Executive absent a contrary determination by the Internal Revenue Service or a court of competent jurisdiction; provided, that no such determination shall eliminate or reduce the Company’s obligation to provide any Gross-Up Payment that shall be due as a result of such contrary determination.

(ii)The Gross-Up Payments provided for in Section 5(i) hereof shall be made upon the earlier of (i) the payment to Executive of any Contract Payment or Other Payment or (ii) the imposition upon Executive or payment by Executive of any Excise Tax.

(iii)Executive shall notify the Company in writing of any claim by the Internal Revenue Service that, if successful, would require the payment by the Company of a Gross-Up Payment. Such notification shall be given as soon as practicable but no later than 10 business days after Executive is informed in writing of such claim and shall apprise the Company of the nature of such claim and the date on which such claim is requested to be paid. Executive shall not pay such claim prior to the expiration of the 30 day period following the date on which Executive gives such notice to the Company (or such shorter period ending on the date that any payment of taxes with respect to such claim is due). If the Company notifies Executive in writing prior to the expiration of such period that it desires to contest such claim, Executive shall:

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1)give the Company any information reasonably requested by the Company relating to such claim;

2)take such action in connection with contesting such claim as the Company shall reasonably request in writing from time to time, including, without limitation, accepting legal representation with respect to such claim by an attorney reasonably selected by the Company and reasonably satisfactory to Executive;

3)cooperate with the Company in good faith in order to effectively contest such claim; and

4)permit the Company to participate in any proceedings relating to such claim;

provided, that the Company shall bear and pay directly all costs and expenses (including, but not limited to, additional interest and penalties and related legal, consulting or other similar fees) incurred in connection with such contest and shall indemnify and hold Executive harmless, on an after-tax basis, for any Excise Tax or other tax (including interest and penalties with respect thereto) imposed as a result of such representation and payment of costs and expenses.

(iv)The Company shall control all proceedings taken in connection with such contest and, at its sole option, may pursue or forego any and all administrative appeals, proceedings, hearings and conferences with the taxing authority in respect of such claim and may, at its sole option, either direct Executive to pay the tax claimed and sue for a refund or contest the claim in any permissible manner, and Executive agrees to prosecute such contest to a determination before any administrative tribunal, in a court of initial jurisdiction and in one or more appellate courts, as the Company shall determine; provided, that if the Company directs Executive to pay such claim and sue for a refund, the Company shall advance the amount of such payment to Executive on an interest-free basis, and shall indemnify and hold Executive harmless, on an after-tax basis, from any Excise Tax or other tax (including interest or penalties with respect thereto) imposed with respect to such advance or with respect to any imputed income with respect to such advance; and provided, further, that if Executive is required to extend the statute of limitations to enable the Company to contest such claim, Executive may limit this extension solely to such contested amount. The Company’s control of the contest shall be limited to issues with respect to which a Gross-Up Payment would be payable hereunder and Executive shall be entitled to settle or contest, as the case may be, any other issue raised by the Internal Revenue Service or any other taxing authority. In addition, no position may be taken nor any final resolution be agreed to by the Company without Executive’s consent if such position or resolution could reasonably be expected to adversely affect Executive (including any other tax position of Executive unrelated to the matters covered hereby).

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(v)As a result of the uncertainty in the application of Section 4999 of the Code at the time of the initial determination by the Company or the Tax Counsel hereunder, it is possible that Gross-Up Payments which will not have been made by the Company should have been made (“Underpayment”), consistent with the calculations required to be made hereunder. In the event that the Company exhausts its remedies and Executive thereafter is required to pay to the Internal Revenue Service an additional amount in respect of any Excise Tax, the Company or the Tax Counsel shall determine the amount of the Underpayment that has occurred and any such Underpayment shall promptly be paid by the Company to or for the benefit of Executive.

(vi)If, after the receipt by Executive of the Gross-Up Payment or an amount advanced by the Company in connection with the contest of an Excise Tax claim, Executive becomes entitled to receive any refund with respect to such claim, Executive shall promptly pay to the Company the amount of such refund (together with any interest paid or credited thereon after taxes applicable thereto). If, after the receipt by Executive of an amount advanced by the Company in connection with an Excise Tax claim, a determination is made that Executive shall not be entitled to any refund with respect to such claim and the Company does not notify Executive in writing of its intent to contest the denial of such refund prior to the expiration of 30 days after such determination, such advance shall be forgiven and shall not be required to be repaid.

(vii)Notwithstanding the other provisions of this Section 5 and the penultimate sentence of Section 9, all Gross-Up Payments shall be made to the Executive not later than the end of the calendar year following the year in which the Executive remits the related taxes and any reimbursement of the costs and expenses described in Section 5(iii) shall be paid not later than the end of the calendar year following the year in which there is a final and nonappealable resolution of, or the taxes are remitted that are the subject of, the related claim.

6.Successors; Binding Agreement.

(i)The Company will require any successor (whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or substantially all of the business and/or assets of the Company to expressly assume and agree to perform this Agreement in the same manner and to the same extent that the Company is required to perform it. Failure of the Company to obtain such assumption and agreement prior to the effectiveness of any such succession shall be a breach of this Agreement and shall entitle Executive to compensation from the Company in the same amount and on the same terms as Executive would be entitled hereunder if Executive had terminated Executive’s employment with Good Reason following a Change in Control, except that for purposes of implementing the foregoing, the date on which any such succession becomes effective shall be deemed the Date of Termination.

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(ii)This Agreement shall inure to the benefit of and be enforceable by Executive’s personal or legal representatives, executors, administrators, successors, heirs, distributees, devisees and legatees. If Executive should die while any amount would still be payable to Executive hereunder if Executive had continued to live, all such amounts, unless otherwise provided herein, shall be paid in accordance with the terms of this Agreement to Executive’s devisee, legatee or other designee or, if there is no such designee, to Executive’s estate.

7.Notice. For the purpose of this Agreement, notices and all other communications provided for in this Agreement shall be in writing and shall be deemed to have been duly given when delivered or mailed by United States registered mail, return receipt requested, postage prepaid (or its international equivalent)

if to the Company to:

Hertz Global Holdings, Inc.

225 Brae Boulevard

Park Ridge, New Jersey 07656

Attention: Senior Vice President, Chief Human Resource Officer

With a separate duplicate copy of such notice to be provided to the General Counsel of the Company

if to the Executive, to the to the Executive at his or her most recent address as shown on the books and records of the Company or any subsidiary of the Company employing the Executive.

8.Miscellaneous. No provision of this Agreement may be modified, waived or discharged unless such waiver, modification or discharge is agreed to in writing and signed by Executive and such officer as may be specifically designated by the Board. No waiver by either party hereto at any time of any breach by the other party hereto of, or compliance with, any conditions or provision of this Agreement to be performed by such other party shall be deemed a waiver of similar or dissimilar provisions or conditions at the same or at any prior or subsequent time. The validity, interpretation, construction and performance of this Agreement shall be governed by the internal laws of the State of New Jersey, without regard to its conflict of law provisions. This Agreement is intended to satisfy the requirements of Section 409A of the Code with respect to amounts subject thereto and shall be interpreted and construed and shall be performed by the parties consistent with such intent, and the Company shall have no right to accelerate any payment or the provision of any benefits under this Agreement or to make or provide any such payment or benefits if such payment or provision of such benefits would, as a result, be subject to tax under Section 409A of the Code. All references to sections of the Code shall be deemed also to refer to any successor provisions to such sections and the applicable regulations and guidance thereunder. Any payments provided for hereunder shall be paid net of any applicable withholding required under federal, state, local or

15

other applicable law. Anything in this Agreement to the contrary notwithstanding, no reimbursement payable to Executive pursuant to any provisions of this Agreement or pursuant to any plan or arrangement of the Company covered by this Agreement shall be paid later than the last day of the calendar year following the calendar year in which the related expense was incurred, and no such reimbursement during any calendar year shall affect the amounts eligible for reimbursement in any other calendar year, except, in each case, to the extent that the right to reimbursement does not provide for a “deferral of compensation” within the meaning of Section 409A of the Code. The obligations of the Company under Sections 4 and 5 shall survive the expiration of the term of this Agreement.

9.Other Arrangements. The severance benefits under this Agreement are not additive or cumulative to severance or termination benefits that Executive might also be entitled to receive under the terms of a written employment agreement, a severance agreement or any other arrangement with the Company. As a condition of the Company entering into this Agreement, Executive expressly agrees that this Agreement supersedes all prior agreements, and sets forth the entire severance benefit to which he or she is entitled while this Agreement remains in effect. The provisions of this Agreement may provide for payments to Executive under certain compensation or bonus plans under circumstances where such plans would not provide for payment thereof. It is the specific intention of the Company that the provisions of this Agreement shall supersede any provisions to the contrary in such plans, to the extent permitted by applicable law, and such plans shall be deemed to have been amended to correspond with this Agreement without further action by the Company or the Board.

10.Validity. The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement, which shall remain in full force and effect.

11.Counterparts. This Agreement may be executed in several counterparts, each of which shall be deemed to be an original but all of which together will constitute one and the same instrument.

12.Arbitration; Indemnification.

(i)In the event of any dispute under the provisions of this Agreement, other than a dispute in which the primary relief sought is an equitable remedy such as an injunction, the parties shall have the dispute, controversy or claim settled by arbitration in Park Ridge, New Jersey (or such other location as may be mutually agreed upon by the Company and the Executive) in accordance with the National Rules for the Resolution of Employment Disputes then in effect of the American Arbitration Association, before a single arbitrator selected by agreement of the parties (or, in the absence of such agreement, appointed by the American Arbitration Association). Any award entered by the arbitrator shall be final, binding and nonappealable and judgment may be entered

16

thereon by either party in accordance with applicable law in any court of competent jurisdiction. This arbitration provision shall be specifically enforceable. The arbitrator shall have no authority to modify any provision of this Agreement or to award a remedy for a dispute involving this Agreement other than a benefit specifically provided under or by virtue of this Agreement. Fees of the American Arbitration Association and the arbitrator and any expenses relating to the conduct of the arbitration (including the Company’s and Executive’s reasonable attorneys’ fees and expenses) shall be paid in accordance with Section 4(vi).

(ii)Following any termination of employment of Executive (other than a termination by the Company for Cause), the Company shall indemnify and hold harmless Executive to the fullest extent permitted under the Company’s by-laws (as in effect prior to the Change in Control) and applicable law for any claims, costs and expenses arising out of or in connection with Executive’s employment with the Company (without regard to when such claim is asserted or issue is raised, so long as it relates to conduct or events that occurred while Executive was employed with the Company) and shall, for a period of not less than six years following a Change in Control, maintain directors’ and officers’ liability insurance coverage for the benefit of Executive which provides him with coverage, if any, no less favorable than that in effect prior to the Change in Control; provided, that if the Company maintains directors’ and officers’ liability insurance coverage for other current or former officers or directors of the Company following such six-year period, Executive shall also be provided with such insurance coverage.

13.Confidentiality, Covenant Not to Compete and Not to Solicit.

(i)Nondisclosure of Confidential Information. At no time during the term of Executive’s employment or the 24 month period following the Executive’s Date of Termination, shall Executive, without the prior written consent of the Company, use, divulge, disclose or make accessible to any other person, firm, partnership, corporation or other entity any Confidential Information pertaining to the business of the Company or any of its affiliates, except (i) while employed by the Company, in the business of and for the benefit of the Company, or (ii) when required to do so by a court of competent jurisdiction, by any governmental agency having supervisory authority over the business of the Company, or by any administrative body or legislative body (including a committee thereof) with jurisdiction to order Executive to divulge, disclose or make accessible such information. For purposes of this Section 13, “Confidential Information” shall mean any trade secret or other non-public information concerning the financial data, strategic business plans, product development (or other proprietary product data), customer lists, marketing plans and other non-public, proprietary and confidential information of the Company or its affiliates, that, in any case, is not otherwise available to the public (other than by Executive’s breach of the terms hereof) or known to persons in the industry generally.

17

(ii)Non Competition. During the term of Executive’s employment and during the 12 month period immediately following the date of any termination of Executive’s employment with the Company, Executive shall not directly or indirectly become associated, as an owner, partner, shareholder (other than as a holder of not in excess of 5% of the outstanding voting shares of any publicly traded company), director, officer, manager, employee, agent, consultant or otherwise, with any partnership, corporation or other entity that competes with the car or equipment rental business, and for the customer base, of the Company or any of its subsidiaries. This Section 13(ii) shall not be deemed to restrict Executive’s association with any enterprise that conducts unrelated business or that has material operations outside of the geographic area that encompasses the Company’s customer base (or where the Company had plans at the Date of Termination to enter) for so long as the Executive’s role whether direct or indirect (e.g., supervisory), is solely with respect to such unrelated business or other geographic area (as the case may be).

(iii)Non Solicitation. During the term of Executive’s employment and during the 12 month period immediately following the date of any termination of Executive’s employment with the Company, Executive shall not directly or indirectly employ or seek to employ, or solicit or contact or cause others to solicit or contact with a view to engage or employ, any person who is or was a managerial level employee of the Company at the time of the Executive’s Date of Termination or at any time during the twelve-month period preceding such date. This Section 13(iii) shall not be deemed to be violated solely by (a) placing an advertisement or other general solicitation or (b) serving as a reference.

(iv)Reasonableness. If any provision of this Section 13 shall ever be deemed to exceed the time, scope or geographic limitations permitted by applicable laws, then such provisions shall be reformed to the maximum time, scope or geographic limitations, as the case may be, permitted by applicable laws. Because Executive’s services are unique and because Executive has had access to Confidential Information, the parties hereto agree that money damages will be an inadequate remedy for any breach of this Agreement. In the event of a breach or threatened breach of this Agreement, the Company or its successors or assigns may, in addition to other rights and remedies existing in their favor, stop making any additional payments hereunder to Executive and apply to any court of competent jurisdiction for specific performance and/or injunctive relief in order to enforce, or prevent any violations of, the provisions hereof (without the posting of a bond or other security).

14.Amendment and Waiver. The Company may amend this Agreement at any time and from time to time; provided that any amendment that is adverse to the Executive shall be effective only with respect to a Change in Control that occurs one year or more following the date of such amendment. The provisions of this Agreement may be waived only with the prior written consent of the Company and the Executive, and no course of conduct or failure or delay in enforcing the provisions of this Agreement shall

18

affect the validity, binding effect or enforceability of this Agreement or any provision hereof.

15.Entire Agreement. No agreements or representations, oral or otherwise, express or implied, with respect to the subject matter hereof have been made by either party which are not expressly set forth in this Agreement. This Agreement constitutes the entire understanding between the parties with respect to Executive’s severance pay in the event of a termination of Executive’s employment with the Company, superseding all negotiations, prior discussions and preliminary agreements, written or oral, concerning said severance pay; provided, that any payments or benefits provided in respect of severance, or indemnification for loss of employment, pursuant to any severance, employment or similar agreement between the Company or any of its subsidiaries and Executive, or as required by applicable law outside the United States, shall reduce any payments or benefits provided pursuant to this Agreement, except that the payments or benefits provided pursuant to this Agreement shall not be reduced below zero. Notwithstanding any provision of this Agreement:  (i) Executive shall not be required to mitigate the amount of any payment provided by this Agreement by seeking other employment or otherwise, nor (except as provided for in Section 4(iv)(D) above) shall the amount of any payment or benefit provided by this Agreement be reduced by any compensation earned by Executive as the result of employment by another employer or by retirement benefits received after the Date of Termination or otherwise, and (ii) except as otherwise provided in this Agreement, the obligations of the Company to make payments to Executive and to make the arrangements provided for herein are absolute and unconditional and may not be reduced by any circumstances, including without limitation any set-off, counterclaim, recoupment, defense or other right which the Company may have against Executive or any third party at any time.

19

16.Further Action. The Company shall take any further action necessary or desirable to implement the provisions of this Agreement or perform its obligations hereunder.

HERTZ GLOBAL HOLDINGS, INC.
By:
	Name:
	Title:
By:
	Executive
Date:

20

Exhibit A

SEPARATION AGREEMENT

and

GENERAL RELEASE OF ALL CLAIMS(1)

This Separation Agreement and General Release of All Claims (the “Agreement”) is entered into as of [·] by and among [·] (the “Executive”), Hertz Global Holdings, Inc. and The Hertz Corporation (hereinafter “Hertz” or the “Companies”), duly acting under authority of their officers and directors.

WHEREAS, Hertz Global Holdings, Inc. and the Executive have entered into a Change in Control Severance Agreement, dated as of [·] (the “Severance Agreement”);

WHEREAS, Executive’s employment with Hertz will end effective as of [·];

WHEREAS, in connection with Executive’s separation from employment, Executive is entitled to certain payments and other benefits under the Severance Agreement, so long as Executive executes and does not revoke this Agreement; and

WHEREAS, the parties desire to fully and finally resolve any disputes, claims or controversies that have arisen or may arise with respect to Executive’s employment with and subsequent separation from the Companies.

NOW, THEREFORE, in consideration of the mutual promises, covenants and agreements stated herein and in the Severance Agreement, which Executive and the

(1) To be revised if necessary or appropriate under any applicable law to effect a complete and total release of claims by the Executive as of the effective date of the Agreement.

Companies agree constitute good and valuable consideration, receipt of which is acknowledged, the parties stipulate and do mutually agree as follows:

1.In exchange for receiving the payments and benefits described in Sections 4 and 5 of the Severance Agreement, Executive does for himself and his heirs, executors, administrators, successors, and assigns, hereby release, acquit, and forever discharge and hold harmless the Companies and the divisions, subsidiaries and affiliated companies of each of the Companies, the officers, directors, shareholders, employees, benefit and retirement plans (as well as trustees and administrators thereof), agents and heirs of each of the foregoing, and the predecessors, assigns and successors, past and present of each of the foregoing, and any persons, firms or corporations in privity with any of them (collectively, the “Company Released Parties”), of and from any and all actions, causes of action, claims, demands, attorneys’ fees, compensation, expenses, promises, covenants, and damages of whatever kind or nature, in law or in equity, which Executive has, had or could have asserted, known or unknown, at common law or under any statute, rule, regulation, order or law, whether federal, state or local, or on any grounds whatsoever from the beginning of the world to the date of execution of this Agreement, including, without limitation, (1) any and all claims for any additional severance pay, vacation pay, bonus or other compensation; (2) any and all claims of discrimination or harassment based on race, color, national origin, ancestry, religion, marital status, sex, sexual orientation, disability, handicap, age or other unlawful discrimination; any claims arising under Title VII of the Federal Civil Rights Act; the Federal Civil Rights Act of

22

1991; the Americans with Disabilities Act; the Age Discrimination in Employment Act; the New Jersey Law Against Discrimination; or under any other state, federal, local law or regulation or under the common law; and (3) any and all claims with respect to any event, matter, damage or injury arising out of his employment relationship with any Company Released Party, and/or the separation of such employment relationship, and/or with respect to any other event or matter.

The only exceptions to this Separation Agreement and General Release of All Claims are with respect to retirement benefits which may have accrued and vested as of the date of Executive’s employment termination, COBRA rights, enforcement of Executive’s rights under this Agreement and the Severance Agreement, and any claims under applicable workers’ compensation laws.

Nothing in this Agreement shall be construed to prohibit Executive from filing any future charge or complaint with the U.S. Equal Employment Opportunity Commission (the “EEOC”) or participating in any investigation or proceeding conducted by the EEOC, nor shall any provision of this Agreement adversely affect Executive’s right to engage in such conduct. Notwithstanding the foregoing, Executive waives the right to obtain any relief from the EEOC or recover any monies or compensation as a result of filing a charge or complaint. In addition to agreeing herein not to bring suit against any Company Released Party, Executive agrees not to seek damages from any Company Released Party by filing a claim or charge with any state or governmental agency.

23

2.Executive shall return to the Companies all Company property and Confidential Information (as defined in the Severance Agreement) of any Company Released Party in Executive’s possession or control, including without limitation, business reports and records, client reports and records, customer information, personally identifiable information relating to others, business strategies, contracts and proposals, files, a listing of customers or clients, lists of potential customers or clients, technical data, testing or research data, research and development projects, business plans, financial plans, internal memoranda concerning any of the above, and all credit cards, cardkey passes, door and file keys, computer access codes, software, and other physical or personal property which Executive received, had access to or had in his possession, prepared or helped prepare in connection with Executive’s employment with any Company Released Party, and Executive shall not make or retain any copies, duplicates, reproductions, or excerpts thereof. Executive acknowledges that in the course of employment with any one or more Company Released Party, Executive has acquired Confidential Information and that such Confidential Information has been disclosed to Executive in confidence and for his use only during and with respect to his employment with one or more of the Company Released Parties.

3.Executive acknowledges and agrees that he has agreed to be bound by the confidentiality provision in the Severance Agreement for 24 months following Executive’s separation of employment and the non-competition and non-solicitation

24

covenants in the Severance Agreement for 12 months following Executive’s separation of employment.

4.Executive declares and represents that he has not filed or otherwise pursued any charges, complaints, lawsuits or claims of any nature against any Company Released Party arising out of or relating to events occurring prior to the date of this Agreement, with any federal, state or local governmental agency or court with respect to any matter covered by this Agreement. In addition to agreeing herein not to bring suit against any Company Released Party, Executive agrees not to seek damages from any Company Released Party by filing a claim or charge with any state or governmental agency.

5.Executive further declares and represents that no promise, inducement, or agreement not herein expressed has been made to him, that this Agreement contains the entire agreement between the parties hereto, and that the terms of this Agreement are contractual and not a mere recital.

6.Executive understands and agrees that this Agreement shall not be considered an admission of liability or wrongdoing by any party hereto, and each of the parties denies any liability and agrees that nothing in this Agreement can or shall be used by or against either party with respect to claims, defenses or issues in any litigation or proceeding except to enforce rights under the Agreement itself or under the Severance Agreement.

25

7.Executive understands and agrees that should any provision of this Agreement be declared or be determined by any court to be illegal or invalid, the validity of the remaining parts, terms or provisions shall not be affected thereby, and said invalid part, term, or provision shall be deemed not a part of this Agreement.

8.Executive acknowledges that he understands that he has the right to consult with an attorney of his choice at his expense to review this Agreement and has been encouraged by the Companies to do so.

9.Executive further acknowledges that he has been provided twenty-one days to consider and accept this Agreement from the date it was first given to him, although Executive may accept it at any time within those twenty-one days.

10.Executive further understands that he has seven days after signing the Agreement to revoke it by delivering to the Senior Vice President, Chief Human Resource Officer, The Hertz Corporation, 225 Brae Boulevard, Park Ridge, New Jersey 07656, written notification of such revocation within the seven day period. If Executive does not revoke the Agreement, the Agreement will become effective and irrevocable by him on the eighth day after he signs it.

11.Executive acknowledges that this Agreement sets forth the entire agreement between the parties with respect to the subject matters hereof and supersedes any and all prior agreements between the parties as to such matters, be they oral or in writing, and may not be changed, modified, or rescinded except in writing signed by all

26

parties hereto, and any attempt at oral modification of this Agreement shall be void and of no force or effect.

12.Executive acknowledges that he has carefully read this Agreement and understands all of its terms, including the full and final release of claims set forth above and enters into it voluntarily.

WITH EXECUTIVE’S SIGNATURE HEREUNDER, EXECUTIVE ACKNOWLEDGES THAT EXECUTIVE HAS CAREFULLY READ THIS AGREEMENT AND UNDERSTANDS ALL OF ITS TERMS INCLUDING THE FULL AND FINAL RELEASE OF CLAIMS SET FORTH ABOVE. EXECUTIVE FURTHER ACKNOWLEDGES THAT EXECUTIVE HAS VOLUNTARILY ENTERED INTO THIS AGREEMENT; THAT EXECUTIVE HAS NOT RELIED UPON ANY REPRESENTATION OR STATEMENT, WRITTEN OR UNWRITTEN, NOT SET FORTH IN THIS AGREEMENT; THAT EXECUTIVE HAS BEEN GIVEN THE OPPORTUNITY TO HAVE THIS AGREEMENT REVIEWED BY HIS ATTORNEY; AND THAT EXECUTIVE HAS BEEN ENCOURAGED BY THE COMPANIES TO DO SO.

EXECUTIVE ALSO ACKNOWLEDGES THAT EXECUTIVE HAS BEEN AFFORDED 21 DAYS TO CONSIDER THIS AGREEMENT AND THAT EXECUTIVE HAS 7 DAYS AFTER SIGNING THIS AGREEMENT TO REVOKE IT BY DELIVERING TO THE SENIOR VICE PRESIDENT, CHIEF HUMAN RESOURCES OFFICER, AS SET FORTH ABOVE, WRITTEN NOTIFICATION OF EXECUTIVE’S REVOCATION.

IN WITNESS WHEREOF, the parties have caused this Agreement to be duly executed as of the date set forth above.

27

	Date:
EXECUTIVE
THE HERTZ CORPORATION	HERTZ GLOBAL HOLDINGS, INC.
By:	By:
Date:	Date:

28

EX-10.41

Exhibit 10.41

MARK P. FRISSORA	THE HERTZ CORPORATION
CHAIRMAN OF THE BOARD	225 BRAE BOULEVARD, PARK RIDGE, NI 07656-0713
CHIEF EXECUTIVE OFFICER	PHONE:	(201) 307-2800
	FAX:	(201) 307-2603
	E-MAIL: mfrissora@hertz.com
	February 1, 2008

Mr. Joseph R. Nothwang

Executive Vice President and President Vehicle Rental

and Leasing, The Americas & Pacific

The Hertz Corporation

225 Brae Boulevard

Park Ridge, NJ 07656

Dear Joe:

This is to acknowledge our discussions, and the understandings we have reached, regarding the Change In Control Agreement between Ford Motor Company and you (“CIC”). As you are aware, because of the expiration of the CIC, the Compensation Committee has approved a new Change In Control Agreement (“New CIC”) for you and other executives and key employees to replace it. The New CIC, like its predecessor, is intended to incentivize executives to continue supporting the organization during a change in control. It also serves to provide financial protection to the executives whose employment ends following a change in control under certain circumstances. To that end, the basic features of the CIC and the New CIC are similar.

Under the terms of the CIC, the period beginning December 21, 2005, and ending on December 21, 2007 is defined as a “Protected Period.” During the protected period, the agreement further provides that an executive who terminates his employment for “Good Reason” will receive the benefits set forth in the agreement. The circumstances which qualify as “Good Reason” are defined in the agreement.

Over the past year, we have discussed the organizational changes at Hertz as we worked together to restructure the organization and create more value for our shareholders. One aspect of the changes we have worked on recently is increasing the role of our global supply chain management team in the acquisition and disposition of our fleet, a function that has resided within RAC in the past. We have also discussed whether and to what extent these changes impacted your responsibilities in a manner that would provide “Good Reason” for you to voluntarily terminate your employment and receive the benefits outlined in the Ford agreement. I appreciate your commitment to this organization and willingness to move forward with our change process notwithstanding the concerns you have raised regarding fleet acquisition and disposition.

It is important to me, our sponsors and other stakeholders that you have comfort regarding the critically important role you play in this organization as we move forward with the change process. Our mutual commitment to the successful implementation of the change process goes without saying. I understand the concerns you have expressed in our discussions and the fact that the time period for you to voluntarily terminate your employment with “Good Reason” under the CIC will expire on January 18, 2008.

In order to accommodate your concerns, for purposes of the New CIC, the Company will deem your employment to be under a “Protected Period” through June 21, 2009. If during the eighteen month period ending on June 21, 2009, you resign because you have determined that we cannot implement the revised responsibilities for fleet acquisition and disposition without disrupting your leadership of RAC, the Company will waive any right it might have under the New CIC to dispute whether your resignation is for “Good Reason” as defined in the New CIC. Accordingly, you will be entitled to receive the benefits outlined in the New CIC in connection with such a resignation regardless of whether there is a change in control of the Company. Similarly, if the Company terminates your employment for any reason other than “cause” as defined in the New CIC during the period ending June 21, 2009, you will be entitled to receive the benefits outlined in the New CIC in connection with such termination, regardless of whether there is a change in control of the Company. Notwithstanding the foregoing, if your employment ends due to your disability or death during the Protected Period, your benefits shall be determined in accordance with the terms of the New CIC in Section 4(i) if you become disabled or Section 4(iii) in the event of your death.

In the event of your resignation or termination (other than a termination due to disability or death), you will also be entitled to the following benefits in addition to the benefits set forth in the New CIC:

(A)     You shall receive payment of all accrued but unused vacation and unreimbursed business expenses.

(B)     You shall receive the payments for 2007 and 2008 in accordance with the Hertz Corporation Long Term Incentive Plan (“LTIP”) in effect on the date of this letter which may not be modified, suspended or terminated with respect to you. You shall receive the maximum LTIP payments based upon the performance of the Company as set forth in the LTIP, which may not be reduced at the discretion of the Company. Further, if any additional long term incentive compensation plan should become effective on or before June 21, 2009, you will also be entitled to receive the payments, if any, under such plan for 2008 and 2009 in accordance with such plan’s provisions which may not be modified, suspended or terminated with respect to you. You shall receive the maximum payments based upon the performance of the Company as set forth in any such plan and those payments may not be reduced at the discretion of the Company. The LTIP payments will be paid to you at the time that they are paid to the Hertz executives employed by the Company, but in no event later than March 30 of the year following the year upon which the Company’s performance was measured.

2

(C)     At all times following your resignation or termination, the Company shall (i) maintain in full force and effect, without any change in terms that is adverse to you, any retirement plan of, or provided by, the Company as of the date of this letter in which you participated or would, upon normal retirement (as such term is defined in the applicable retirement plan), be entitled to participate, including without limitation, the Company’s Account Balance Defined Benefit Pension Plan, SERP I, SERP II, and the Company’s Benefit Equalization Plan (“BEP”).

(D)     The Company shall maintain in full force and effect the Hertz Corporation Key Officer-Assigned Car Benefit according to the terms of that program in effect as of the date of this letter, which may not be modified, suspended or terminated with respect to you, with the exception that the car assigned to you shall be selected from the highest level of vehicle available, up to and including the Prestige Fleet. You will also be provided with all rental car privileges according to the terms of the W2-48 Hertz Retiree Rental Program in existence as of the date of this letter, which may not be modified, suspended or terminated with respect to you.

(E)     You hold vested options to purchase common stock of Ford Motor Company (“Ford”) under the Company’s 1997 Long-Term Equity Compensation Plan (“the 1997 Plan”) and Ford’s 1998 Long-Term Incentive Plan (“the 1998 Plan”). The Company agrees that your rights under the 1997 Plan and any option agreements entered into between the Company and you pursuant thereto shall remain in effect as if you had remained an employee of the Company through the scheduled expiration date of such options. We further agree that your rights under the 1998 Plan and any option agreements entered into between you and Ford pursuant thereto, shall be as provided under the 1998 Plan, such option agreements and Section 3 of the CIC (it being understood that Section 3 of the CIC is binding on Ford by its being a predecessor in interest to Hertz Global Holdings under the CIC). Consequently, you shall have until December 20, 2010 to exercise your options.

(F)     If your employment is terminated by the Company (other than a termination due disability or death), and to the extent that they have not already vested, those of your options that would have vested in May 2008 and May 2009, shall vest as of the date of your termination and you shall have 180 days to exercise any vested, unexercised options. For the avoidance of doubt, the immediately preceding sentence shall not apply in the event of your decision to resign from your employment during the Protected Period and any rights you may have shall be governed by the terms of the relevant award agreements and the plans under which the options were issued.

Joe, on behalf of The Hertz Corporation and Hertz Global Holdings, Inc., I trust that this will address your near and longer term concerns and allow for a seamless implementation of the New CIC.

Sincerely,

Mark P. Frissora

3

EX-15

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EXHIBIT 15

November 7, 2008

Securities and Exchange Commission
100 F Street, N.E.
Washington, DC 20549

Commissioners:

We are aware that our report dated November 7, 2008, on our review of interim financial information of Hertz Global Holdings, Inc. and its subsidiaries (the "Company") for the three and nine month periods ended September 30, 2008 and September 30, 2007 and included in the Company's quarterly report on Form 10-Q for the quarter ended September 30, 2008 is incorporated by reference in its Registration Statement on Form S-8 (File No. 333-138812).

Very truly yours,

/s/ PricewaterhouseCoopers LLP
Florham Park, New Jersey

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EXHIBIT 15

EX-31.1

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EXHIBIT 31.1

CERTIFICATION OF CHIEF EXECUTIVE OFFICER
PURSUANT TO RULE 13a-14(a)/15d-14(a)

I, Mark P. Frissora, certify that:

1.

I have reviewed this quarterly report on Form 10-Q for the quarter ended September 30, 2008 of Hertz Global Holdings, Inc.;



2.

Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;



3.

Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;



4.

The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and internal control over financing reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:



a)

Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;



b)

Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;



c)

Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and



d)

Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and



5.

The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):



a)

All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and



b)

Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: November 7, 2008

By:	/s/ MARK P. FRISSORA
	Mark P. Frissora Chief Executive Officer

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EXHIBIT 31.1

CERTIFICATION OF CHIEF EXECUTIVE OFFICER PURSUANT TO RULE 13a-14(a)/15d-14(a)

EX-31.2

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EXHIBIT 31.2

CERTIFICATION OF CHIEF FINANCIAL OFFICER
PURSUANT TO RULE 13a-14(a)/15d-14(a)

I, Elyse Douglas, certify that:

1.

I have reviewed this quarterly report on Form 10-Q for the quarter ended September 30, 2008 of Hertz Global Holdings, Inc.;



2.

Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;



3.

Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;



4.

The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and internal control over financing reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:



a)

Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;



b)

Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;



c)

Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and



d)

Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and



5.

The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):



a)

All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and



b)

Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: November 7, 2008

By:	/s/ ELYSE DOUGLAS
	Elyse Douglas Chief Financial Officer

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EXHIBIT 31.2

CERTIFICATION OF CHIEF FINANCIAL OFFICER PURSUANT TO RULE 13a-14(a)/15d-14(a)

EX-32.1

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EXHIBIT 32.1

CERTIFICATION OF CHIEF EXECUTIVE OFFICER
PURSUANT TO 18 U.S.C. SECTION 1350

In connection with the quarterly report of Hertz Global Holdings, Inc. (the "Company") on Form 10-Q for the period ending September 30, 2008 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Mark P. Frissora, Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to my knowledge:

(1)

the Report, to which this statement is furnished as an Exhibit, fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and



(2)

the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: November 7, 2008

By:	/s/ MARK P. FRISSORA
	Mark P. Frissora Chief Executive Officer

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EXHIBIT 32.1

CERTIFICATION OF CHIEF EXECUTIVE OFFICER PURSUANT TO 18 U.S.C. SECTION 1350

EX-32.2

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EXHIBIT 32.2

CERTIFICATION OF CHIEF FINANCIAL OFFICER
PURSUANT TO 18 U.S.C. SECTION 1350

In connection with the quarterly report of Hertz Global Holdings, Inc. (the "Company") on Form 10-Q for the period ending September 30, 2008 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Elyse Douglas, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to my knowledge:

(1)

the Report, to which this statement is furnished as an Exhibit, fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and



(2)

the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: November 7, 2008

By:	/s/ ELYSE DOUGLAS
	Elyse Douglas Chief Financial Officer

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EXHIBIT 32.2

CERTIFICATION OF CHIEF FINANCIAL OFFICER PURSUANT TO 18 U.S.C. SECTION 1350