-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, TxSKMxIijxHzslqnFvrMf6+6ZIj+z0rwpDfI77qsc7yYSNqFxX49GPSiVmXLQM4O O7mSB4s1TG88/8pw/JrTrw== 0000909518-01-000002.txt : 20010122 0000909518-01-000002.hdr.sgml : 20010122 ACCESSION NUMBER: 0000909518-01-000002 CONFORMED SUBMISSION TYPE: SC 13D/A PUBLIC DOCUMENT COUNT: 3 FILED AS OF DATE: 20010102 GROUP MEMBERS: GENERAL ELECTRIC CAPITAL CORP GROUP MEMBERS: GENERAL ELECTRIC CAPITAL SERVICES INC. GROUP MEMBERS: GENERAL ELECTRIC COMPANY SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: NEFF CORP CENTRAL INDEX KEY: 0001057725 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-EQUIPMENT RENTAL & LEASING, NEC [7359] IRS NUMBER: 650626400 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D/A SEC ACT: SEC FILE NUMBER: 005-55571 FILM NUMBER: 1500716 BUSINESS ADDRESS: STREET 1: 3750 NW 87TH AVE STREET 2: SUITE 400 CITY: MIAMI STATE: FL ZIP: 33178 BUSINESS PHONE: 3055133350 MAIL ADDRESS: STREET 1: 3750 NW 87TH AVE STREET 2: SUITE 400 CITY: MIAMI STATE: FL ZIP: 33178 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: GENERAL ELECTRIC CAPITAL CORP CENTRAL INDEX KEY: 0000040554 STANDARD INDUSTRIAL CLASSIFICATION: PERSONAL CREDIT INSTITUTIONS [6141] IRS NUMBER: 131500700 STATE OF INCORPORATION: NY FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D/A BUSINESS ADDRESS: STREET 1: 260 LONG RIDGE RD CITY: STAMFORD STATE: CT ZIP: 06927 BUSINESS PHONE: 2033574000 MAIL ADDRESS: STREET 1: 260 LONG RIDGE ROAD CITY: STAMFORD STATE: CT ZIP: 06927 FORMER COMPANY: FORMER CONFORMED NAME: GENERAL ELECTRIC CREDIT CORP DATE OF NAME CHANGE: 19871216 SC 13D/A 1 0001.txt ================================================================================ SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 SCHEDULE 13D (Amendment No. 2) Under the Securities Exchange Act of 1934 NEFF CORP. (Name of Issuer) CLASS A COMMON STOCK, $0.01 PAR VALUE 006400941 (Title of class of securities) (CUSIP number) JOAN C. AMBLE GENERAL ELECTRIC CAPITAL CORPORATION 260 LONG RIDGE ROAD STAMFORD, CONNECTICUT 06927 (203) 357-4000 (Name, address and telephone number of person authorized to receive notices and communications) DECEMBER 29, 2000 (Date of event which requires filing of this statement) If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of Rule 13d-1(e), 13d-1(f) or 13d-1(g), check the following box [_]. Note: Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See section 240.13d-7(b) for other parties to whom copies are to be sent. (Continued on following pages) (Page 1 of 11 Pages) ================================================================================
- --------------------------------------------------------------------- ------------------------------------------------- CUSIP No. 006400941 13D Page 2 of 11 - --------------------------------------------------------------------- ------------------------------------------------- - ----------------------------------------------------------------------------------------------------------------------------------- - ----------------------------------------------------------------------------------------------------------------------------------- 1 NAMES OF REPORTING PERSONS: GENERAL ELECTRIC CAPITAL CORPORATION I.R.S. IDENTIFICATION NOS. 13-1500700 OF ABOVE PERSONS: - ----------------------------------------------------------------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP: (A) [_] (B) [X] - ----------------------------------------------------------------------------------------------------------------------------------- 3 SEC USE ONLY - ----------------------------------------------------------------------------------------------------------------------------------- 4 SOURCE OF FUNDS: WC - ----------------------------------------------------------------------------------------------------------------------------------- 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e): [_] - ----------------------------------------------------------------------------------------------------------------------------------- 6 CITIZENSHIP OR PLACE OF ORGANIZATION: NEW YORK - ----------------------------------------------------------------------------------------------------------------------------------- NUMBER OF 7 SOLE VOTING POWER: 5,100,000 (SEE ITEM 5) SHARES ------------------------------------------------------------------------------------------------------- BENEFICIALLY 8 SHARED VOTING POWER: 0 OWNED BY ------------------------------------------------------------------------------------------------------- EACH 9 SOLE DISPOSITIVE POWER: 5,100,000 (SEE ITEM 5) REPORTING ------------------------------------------------------------------------------------------------------- PERSON WITH 10 SHARED DISPOSITIVE POWER: 0 - ----------------------------------------------------------------------------------------------------------------------------------- 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY REPORTING PERSON: 5,100,000 (SEE ITEM 5) - ----------------------------------------------------------------------------------------------------------------------------------- 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES: [_] - ----------------------------------------------------------------------------------------------------------------------------------- 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11): 24.1% (SEE ITEM 5) - ----------------------------------------------------------------------------------------------------------------------------------- 14 TYPE OF REPORTING PERSON: CO - ----------------------------------------------------------------------------------------------------------------------------------- - --------------------------------------------------------------------- ------------------------------------------------- CUSIP No. 006400941 13D Page 3 of 11 - --------------------------------------------------------------------- ------------------------------------------------- - ----------------------------------------------------------------------------------------------------------------------------------- - ----------------------------------------------------------------------------------------------------------------------------------- 1 NAME OF REPORTING PERSON: GENERAL ELECTRIC CAPITAL SERVICES, INC. S.S. OR I.R.S. IDENTIFICATION NO. 06-1109503 OF ABOVE PERSON: - ----------------------------------------------------------------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP: (A) [_] (B) [X] - ----------------------------------------------------------------------------------------------------------------------------------- 3 SEC USE ONLY - ----------------------------------------------------------------------------------------------------------------------------------- 4 SOURCE OF FUNDS: NOT APPLICABLE - ----------------------------------------------------------------------------------------------------------------------------------- 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e): [_] - ----------------------------------------------------------------------------------------------------------------------------------- 6 CITIZENSHIP OR PLACE OF ORGANIZATION: DELAWARE - ----------------------------------------------------------------------------------------------------------------------------------- NUMBER OF 7 SOLE VOTING POWER: DISCLAIMED (SEE 11 BELOW) SHARES ------------------------------------------------------------------------------------------------------- BENEFICIALLY 8 SHARED VOTING POWER: 0 OWNED BY ------------------------------------------------------------------------------------------------------- EACH 9 SOLE DISPOSITIVE POWER: DISCLAIMED (SEE 11 BELOW) REPORTING ------------------------------------------------------------------------------------------------------- PERSON WITH 10 SHARED DISPOSITIVE POWER: 0 - ----------------------------------------------------------------------------------------------------------------------------------- 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY REPORTING PERSON: BENEFICIAL OWNERSHIP OF ALL SHARES DISCLAIMED BY GENERAL ELECTRIC CAPITAL SERVICES, INC. - ----------------------------------------------------------------------------------------------------------------------------------- 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES: [_] - ----------------------------------------------------------------------------------------------------------------------------------- 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11): NOT APPLICABLE (SEE 11 ABOVE) - ----------------------------------------------------------------------------------------------------------------------------------- 14 TYPE OF REPORTING PERSON: CO - ----------------------------------------------------------------------------------------------------------------------------------- - --------------------------------------------------------------------- ------------------------------------------------- CUSIP No. 006400941 13D Page 4 of 11 - --------------------------------------------------------------------- ------------------------------------------------- - ----------------------------------------------------------------------------------------------------------------------------------- - ----------------------------------------------------------------------------------------------------------------------------------- 1 NAME OF REPORTING PERSON: GENERAL ELECTRIC COMPANY S.S. OR I.R.S. IDENTIFICATION NO. 14-0689340 OF ABOVE PERSON: - ----------------------------------------------------------------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP: (A) [_] (B) [X] - ----------------------------------------------------------------------------------------------------------------------------------- 3 SEC USE ONLY - ----------------------------------------------------------------------------------------------------------------------------------- 4 SOURCE OF FUNDS: NOT APPLICABLE - ----------------------------------------------------------------------------------------------------------------------------------- 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e): [_] - ----------------------------------------------------------------------------------------------------------------------------------- 6 CITIZENSHIP OR PLACE OF ORGANIZATION: NEW YORK - ----------------------------------------------------------------------------------------------------------------------------------- NUMBER OF 7 SOLE VOTING POWER: DISCLAIMED (SEE 11 BELOW) SHARES ------------------------------------------------------------------------------------------------------- BENEFICIALLY 8 SHARED VOTING POWER: 0 OWNED BY ------------------------------------------------------------------------------------------------------- EACH 9 SOLE DISPOSITIVE POWER: DISCLAIMED (SEE 11 BELOW) REPORTING ------------------------------------------------------------------------------------------------------- PERSON WITH 10 SHARED DISPOSITIVE POWER: 0 - ----------------------------------------------------------------------------------------------------------------------------------- 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY REPORTING PERSON: BENEFICIAL OWNERSHIP OF ALL SHARES DISCLAIMED BY GENERAL ELECTRIC COMPANY - ----------------------------------------------------------------------------------------------------------------------------------- 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES: [_] - ----------------------------------------------------------------------------------------------------------------------------------- 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11): NOT APPLICABLE (SEE 11 ABOVE) - ----------------------------------------------------------------------------------------------------------------------------------- 14 TYPE OF REPORTING PERSON: CO - -----------------------------------------------------------------------------------------------------------------------------------
This Amendment No. 2 (this "Amendment") amends the Schedule 13D filed by General Electric Capital Corporation, a New York corporation ("GE Capital"), for and on behalf of itself, GECFS, Inc. ("GECFS"), General Electric Capital Services, Inc. ("GECS") and General Electric Company ("GE") on April 21, 2000 (as amended by Amendment No. 1 filed on June 2, 2000, the "Original Schedule 13D"), relating to the shares of Class A Common Stock, par value $0.01 per share ("Common Stock"), of Neff Corporation (the "Company"). Capitalized terms used herein but not defined shall have the meanings attributed to them in the Original Schedule 13D. ITEM 2. IDENTITY AND BACKGROUND. Item 2 of the Original Schedule 13D is hereby amended to add the following: During the calendar year 2000, GECFS was dissolved and all of the shares of Class B Common Stock of the Company, par value $0.01 per share (the "Class B Common Stock"), then held by GECFS were acquired, and continue to be held, by GE Capital. ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION. Item 3 of the Original Schedule 13D is hereby amended to add the following: References to the URI Equity Infusion (as defined below) in Item 4 are incorporated herein by reference. ITEM 4. PURPOSE OF TRANSACTION. Item 4 (a-j) is hereby amended to add the following: By letter dated December 29, 2000 (together with the attached term sheet, the "Shareholder Letter") (attached hereto as Exhibit 5), GE Capital, Santos Fund I, L.P. ("Santos"), Jorge Mas, Juan Carlos Mas and Jose Mas each agreed, pursuant to a non-binding letter, to support a transaction involving URI and the Company pursuant to which (i) URI would acquire all of the outstanding shares of Common Stock of the Company (other than shares of Common Stock beneficially owned by Santos, Jorge Mas, Juan Carlos Mas and Jose Mas) and (ii) a subsidiary of URI would merge with and into the Company (the "Company Merger"). Pursuant to the proposed terms of the Company Merger, each holder of Common Stock of the Company (other than Santos, Jorge Mas, Juan Carlos Mas and Jose Mas and any dissenting shareholders) would receive 0.18 (the "Exchange Ratio") of a share of URI Common Stock per share of Common Stock then owned by such holder. In addition, pursuant to the proposed terms of the Company Merger, (i) GE Capital would retain all of the shares of Class B Common Stock held by it, (ii) 900,000 shares of Common Stock held by Santos would be converted into 900,000 shares of Class B Common Stock and (iii) Jorge Mas, Juan Carlos Mas and Jose Mas would exchange all of their shares of Common Stock for shares of new Series C Perpetual Convertible Preferred Stock of URI (the "URI Series C 5 Preferred Stock") with an aggregate liquidation preference equal to the product of (x) the number of shares of Common Stock held by such person, multiplied by the product of (y)(A) the average closing price of URI's common stock on the New York Stock Exchange for the ten consecutive trading days ending on the trading day prior to the closing of the Company Merger, multiplied by (B) the Exchange Ratio, which URI Series C Preferred Stock would be convertible into URI common stock at a price of at least $22.00 per share. After the closing, GE Capital and Santos would own 6 million shares of Class B Common Stock, subject to the right of GE Capital and Santos to sell all or a portion of these shares to URI for an aggregate consideration of $96 million in 2010, and the right of URI to buy all or a portion of these shares for an aggregate consideration of $96 million commencing in 2002. In addition, the term sheet sets forth several other matters which are hereby incorporated by reference. The Company Merger and other transactions contemplated by the Shareholder Letter and the attached term sheet are collectively referred to herein as the "Shareholder Proposed Transactions." In connection with the Shareholder Proposed Transactions, the Common Stock would be delisted from the New York Stock Exchange and would be deregistered under the Exchange Act. In addition, in consideration for and contemporaneously with the consummation of the Shareholder Proposed Transactions, a group of investors including GE Capital would make an investment of $90 million in URI Series C Preferred Stock (the "URI Equity Infusion"). The transactions contemplated by the Shareholder Letter are subject to a number of terms and conditions set forth therein, including, among others, the execution of mutually acceptable documentation and the satisfaction of the conditions set forth in the URI Proposal Letter (as defined below). Immediately following the execution of the Shareholder Letter, URI delivered a non-binding proposal letter to the Company (together with the attached term sheet, the "URI Proposal Letter") (attached hereto as Exhibit 6) proposing the Shareholder Proposed Transactions to the Company. The URI Proposal Letter provides that the Shareholder Proposed Transactions are contingent, among other things, upon the approval of the Special Committee, the Boards of Directors of URI and the Company, URI's senior lenders, the Company's stockholders, and appropriate regulatory agencies. The URI Proposal Letter further provides that the Shareholder Proposed Transactions are also contingent on completion of satisfactory due diligence (including branch due diligence after receiving full access and cooperation by the Company), the signing of a definitive merger agreement and the satisfaction of its terms and conditions, confirmation prior to the signing of a definitive merger agreement that the proposed transaction would not negatively change URI's current credit ratings, and acceptance of URI's exchange offer, pursuant to which URI would offer to exchange newly issued 10.25% Senior Subordinated Notes due 2008 (the "New Notes") for the Company's 10.25% Senior Subordinated Notes due 2008 (the "Old Notes") at an exchange ratio of $750 principal amount of New Notes (which, URI has determined based on current market rates, would represent a value of approximately $600) for each $1,000 principal amount of Old Notes, by holders of at least 95% of the Old Notes. 6 URI's proposal contained in the URI Proposal Letter expires by its terms on January 19, 2001. The Shareholder Letter is not binding on GE Capital, GECS or GE, and GE Capital, GECS and GE reserve the right to change their plans and intentions at any time, as they deem appropriate, and reserve the right to terminate, modify or withdraw the proposal contained in the Shareholder Letter and/or terminate their support for the Shareholder Proposed Transactions contained in the Shareholder Letter. In particular, GE Capital, GECS and GE may at any time and from time to time acquire shares of Common Stock or securities convertible or exchangeable for Common Stock or dispose of shares of capital stock of the Company. Any such transactions may be effected at any time and from time to time subject to any applicable limitations of the Securities Act of 1933, as amended, and the Exchange Act. Other than as described in this Item 4, none of GE Capital, GECS and GE have any plans or proposals which relate to or would result in any of the matters described in subparagraphs (a) through (j) of Item 4 of Schedule 13D (although they reserve the right to develop such plans). The information set forth in response to this Item 4 is qualified in its entirety by reference to the Shareholder Letter (attached hereto as Exhibit 5) and the URI Proposal Letter (attached hereto as Exhibit 6), which are expressly incorporated herein by reference. ITEM 5. INTEREST IN SECURITIES OF THE COMPANY. Item 5 of the Original Schedule 13D is hereby amended by adding the following paragraphs at the end thereof: As a result of the matters described in Item 4 above, GE Capital, GECS and GE together with URI, Santos, Jorge Mas, Juan Carlos Mas and Jose Mas may be deemed to constitute a "group" within the meaning of Section 13(d)(3) of the Exchange Act and GE Capital, GECS and GE may be deemed to have acquired beneficial ownership of the shares of Common Stock and Class B Common Stock owned or deemed to be beneficially owned by each of them. However, GE Capital, GECS and GE disclaim that any such "group" has been formed and also disclaim beneficial ownership of any such shares stock. ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT TO SECURITIES OF THE ISSUER. References to the URI Equity Infusion in Item 4 are incorporated herein by reference. ITEM 7. MATERIAL TO BE FILED AS EXHIBITS. Item 7 of the Original Schedule 13D is hereby amended to add the following documents as exhibits: 7 EXHIBIT 5 Shareholder Letter (including attached term sheet) EXHIBIT 6 URI Proposal Letter (including attached term sheet) 8 SIGNATURE --------- After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this amendment is true, complete and correct. GENERAL ELECTRIC CAPITAL CORPORATION By: /s/ Joan C. Amble ------------------------------------ Name: Joan C. Amble Title: Vice President and Controller Dated: December 29, 2000 9 SIGNATURE --------- After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this amendment is true, complete and correct. GENERAL ELECTRIC CAPITAL SERVICES, INC. By: /s/ Joan C. Amble ----------------------------------- Name: Joan C. Amble Title: Vice President and Controller Dated: December 29, 2000 10 SIGNATURE --------- After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this amendment is true, complete and correct. GENERAL ELECTRIC COMPANY By: /s/ Christopher H. Richmond ------------------------------------------ Name: Christopher H. Richmond Title: Vice President Dated: December 29, 2000 11 EX-99 2 0002.txt EXHIBIT 5 Exhibit 5 --------- [United Rentals Letterhead] December 29, 2000 Ronald F. Carapezzi President and General Manager General Electric Capital Corporation Commercial Equipment Financing 401 Merritt Seven, Second Floor Norwalk, CT 06856 Santos Fund I, L.P. 3155 NW 77 Avenue Miami, FL 33122 Jorge Mas, Jose Ramon Mas and Juan Carlos Mas 3155 NW 77 Avenue Miami, FL 33122 Dear Sirs: United Rentals, Inc. ("United Rentals") is pleased to submit to General Electric Capital Corporation ("GE Capital"), Santos Fund I, L.P. ("Santos") and certain members of the Mas family (the "Mas Family") this letter to pursue a transaction described in a proposal letter of even date, the form of which is attached hereto (the "Proposal Letter"), from United Rentals to the Special Committee (the "Special Committee") of the Board of Directors of Neff Corp. ("Neff"). If you each agree to pursue the transaction, United Rentals will submit the Proposal Letter to the Special Committee. We have no intention of proceeding with any proposal to Neff with respect to the transaction contemplated by the Proposal Letter and the attached term sheet (the "Term Sheet") without the approval of each of you. Capitalized terms used herein shall have the meanings set forth in the Proposal Letter and the Term Sheet. By signing this letter, the parties hereto confirm their support and approval of the transactions described in this letter, the Proposal Letter and the Term Sheet and that (i) after the closing, GE Capital and Santos would own 6 million shares of Neff Class B common stock, (ii) a group of investors including GE Capital would purchase $90 million of United Rentals Series C Perpetual Convertible Preferred Stock ("Series C Preferred Stock"), and (iii) the members Ronald F. Carapezzi Santos Fund I, L.P. Jorge Mas, Jose Ramon Mas and Juan Carlos Mas December 29, 2000 Page 2 of the Mas Family would exchange their Neff shares for shares of Series C Preferred Stock, as more fully described in the Proposal Letter. The proposed transaction is contingent, among other things, upon the approval of the Neff Special Committee, the respective Boards of Directors of United Rentals and Neff, United Rentals' senior lenders, Neff stockholders, and appropriate regulatory agencies. The proposed transaction is also contingent on completion of satisfactory due diligence (including branch due diligence after receiving full access and cooperation by Neff), the signing of a definitive merger agreement and the satisfaction of its terms and conditions, confirmation prior to the signing of a definitive merger agreement that the proposed transaction would not negatively change United Rentals' current credit ratings, and acceptance of United Rentals' exchange offer by holders of at least 95% of the Old Notes. There can be no assurance that these conditions will be met or that this transaction will take place. This letter, including the attached Proposal Letter and the Term Sheet, constitutes a non-binding agreement in principle regarding a transaction on the general terms and conditions outlined herein and in the Proposal Letter and the Term Sheet. The Proposal Letter and the Term Sheet do not purport to summarize all of the terms and conditions upon which any transaction would be based, which terms and conditions would be contained fully only in any final documentation, and indicate only the principal terms and conditions under which an overall transaction would be considered. Each party may for whatever reason or for no reason change the terms of its participation in the proposed transaction, or cease further consideration of any transaction, at any time without liability to any party, and no party shall have any claim that any other party did not act in good faith. The parties will need to make appropriate public filings disclosing this letter in order to comply with their obligations under the federal securities laws. Wherever reasonably possible, the parties will coordinate their public disclosures. If you should have any questions regarding this letter, the Proposed Letter or the Term Sheet, I can be reached at (203) 622-3131. Questions of a legal nature should be directed to our legal counsel, Richard Grossman of Skadden, Arps, Slate, Meagher & Flom LLP at (212) 735-2116. 2 Ronald F. Carapezzi Santos Fund I, L.P. Jorge Mas, Jose Ramon Mas and Juan Carlos Mas December 29, 2000 Page 3 This letter may be executed in any number of counterparts, each of which shall be an original, but all of which together shall constitute one instrument. Very truly yours, /s/ John Milne John Milne Agreed and accepted: General Electric Capital Corporation By: /s/ Ronald F. Carapezzi Date: 12/29/00 ----------------------- -------- Name: Ronald F. Carapezzi Title: Vice President Santos Fund I, L.P. By: /s/ Jorge Mas Date: 12/29/00 ----------------------- -------- Name: Jorge Mas Title: President /s/ Jorge Mas Date: 12/29/00 - ----------------------- -------- Jorge Mas /s/ Jose Ramon Mas Date: 12/29/00 - ----------------------- -------- Jose Ramon Mas /s/ Juan Carlos Mas Date: 12/29/00 - ----------------------- -------- Juan Carlos Mas 3 SUMMARY OF TERMS FOR A POSSIBLE TRANSACTION INVOLVING NEFF ("TERM SHEET") ----------------------------------------- I. THE TRANSACTION Merger: Acquisition of the majority of the shares of capital stock of Neff Corp. ("Neff") by United Rentals, Inc. ("United Rentals"), in a one-step merger transaction (the "Merger") in which a newly formed wholly-owned subsidiary of United Rentals would merge with and into Neff pursuant to which (A) each publicly held share of Class A common stock of Neff (the "Class A Common Stock") would be exchanged for 0.18 (the "Exchange Ratio") of a share of United Rentals common stock (the "United Rentals Common Stock"); (B) certain members of the Mas family (the "Mas Family") would exchange pursuant to the Merger their shares of Class A Common Stock for shares of a new convertible preferred stock in United Rentals having characteristics stated in Section II; (C) Santos Fund I, L.P. ("Santos") would exchange its 0.9 million shares of Class A Common Stock in Neff for an equal number of shares of Class B Common Stock of Neff (the "Class B Common Stock"); and (D) General Electric Capital Corporation ("GE Capital") would maintain its 5.1 million shares of Class B Common Stock in Neff and would be the holder of such shares after giving effect to the Merger (with such Class B Common Stock held by GE Capital and Santos having reduced voting rights so that GE Capital and Santos would have less than 20% of the Neff vote upon consummation of the Merger). The Neff employee stock options would roll-over into United Rentals options based on the Exchange Ratio. Variable Forward In connection with the transaction, GE Capital, Contracts: Santos and United Rentals will enter into contracts that set forth terms on which each of GE Capital and Santos can, at their option, require United Rentals to purchase from GE Capital and Santos or United Rentals can, at its option, require GE Capital and Santos to sell to United Rentals, as applicable, all or a portion of the shares of Class B Common Stock retained by GE Capital and received by Santos in the Merger. A summary of the terms of these contracts is set forth in Appendix 1. Subordinated Note United Rentals would offer to exchange newly issued Exchange Offer: 10.25% Senior Subordinated Notes due 2008 (the "New Notes") for Neff's 10.25% Senior Subordinated Notes due 2008 (the "Old Notes"). The exchange offer would be at an exchange ratio of $750 principal amount of New Notes (which, based on current market rates, would represent a value of approximately $600) for each $1,000 principal amount of Old Notes. Voting Agreements: Irrevocable voting agreement by GE Capital, the Mas Family and Santos to vote in favor of the Merger. II. TERMS OF THE UNITED RENTALS SERIES C PERPETUAL CONVERTIBLE PREFERRED STOCK ("SERIES C PREFERRED STOCK") Issuance of Series C The 8.6 million shares of Class A Common Stock Preferred Stock: currently owned by the Mas Family would be exchanged for shares of Series C Preferred Stock with an aggregate liquidation preference equal to the value of a number of shares of United Rentals Common Stock equal to the product of the Exchange Ratio and the number of Class A Common Stock currently owned by the Mas Family. The value of the shares of United Rentals Common Stock will be the average closing price of the United Rentals Common Stock on the NYSE for the ten consecutive trading days ending on the trading day prior to the occurrence of the closing (the "10-day Average United Rentals Closing Price"). If the proposed transaction is completed, an investor group including GE Capital would purchase $90 million of newly issued Series C Preferred Stock. Conversion Price: 15% above the 10-day Average United Rentals Closing Price, but not less than $22 per share. Anti-dilution: Anti-dilution adjustments, primarily on stock splits, stock dividends, sales of stock to affiliates at less than the Conversion Price (other than in bona fide compensation arrangements), and on certain mergers, in each case consistent with United Rentals Series B Perpetual Convertible Preferred Stock ("Series B Preferred Stock"). Must give notice of these events to the holders. Dividends: Series C Preferred Stock does not accrue dividends, and is entitled to dividends on an as-converted basis only if United Rentals declares dividends on its common stock. Other Preferreds: Parity stock can be issued, but not senior stock. Liquidation $1,000 per share, but holders will in no event Preference: receive less than the amount they would have received in liquidation as a common stockholder participating with other common stockholders had the holders of the Preferred Stock converted their Series C Preferred Stock prior to liquidation. Ranking: Pari passu with United Rentals Series A Perpetual Convertible Preferred Stock ("Series A Preferred Stock") and Series B Preferred Stock. Voting: Shares of Series C Preferred Stock vote together with United Rentals common stock as one class on all matters on an as-converted basis, unless required otherwise by Delaware law. However, on matters which require the consent of the holders of Series C Preferred Stock, the holders of Series C Preferred Stock will vote as one class with the holders of Series A Preferred Stock and Series B Preferred Stock, unless otherwise required by Delaware law. Change of Control: On a change of control which is not a pooling, the holders of Series C Preferred Stock can put their Series C Preferred Stock to United Rentals at the Liquidation Preference plus a premium equal to 6.25% of the Liquidation Preference compounded annually from the date of issuance to the date of change of control (the "Put Price"). The Put Price is payable in cash. 2 On a change of control which is a pooling, Series C Preferred Stock automatically converts into United Rentals Common Stock. For this purpose, Series C Preferred Stock will be valued at 109.5% of the Put Price and Series C Preferred Stock will be converted into a number of shares of United Rentals Common Stock equal to (i) such adjusted value, divided by (ii) the Conversion Price. A change of control occurs when any outside group (other than the holders of Series C Preferred Stock) acquires control of more than 50% of the United Rentals Common Stock, either directly or indirectly by way of a merger. Restrictions on Consent of Series C Preferred Stock required for dividends, tender offers annual dividends in excess of 5% of market and stock repurchases: capitalization. Repurchases of stock are limited on an annual basis to 5%, 10% and 15% of market capitalization for successive five-year periods coinciding with the applicable five-year periods in the Series B preferred stock; the restriction lapses at the end of the third period. This restriction shall allow for the existing stock repurchase program and shall authorize United Rentals to acquire an additional $200 million of its issued and outstanding common stock. Registration for Two Demands (plus one clean-up after third year), underlying common subject to certain black-out periods; 45 days to stock: file; United Rentals has certain piggybacks on demand registration. Customary piggyback registration rights, subject to cut-back. United Rentals selects the underwriters. Holders will lock-up for any United Rentals stock offerings (30 days before and 90 days after) and for any United Rentals pooling. Reporting Copies of all SEC filings must be delivered to requirements: holders within three business days; also promptly deliver all materials distributed to shareholders. Materials available on EDGAR will be delivered only on request. III. CLOSING CONDITIONS AND CERTAIN OTHER TERMS A. CONDITIONS TO CLOSING (1) The parties shall have entered into a definitive UNDER DEFINITIVE MERGER merger agreement which among other things sets forth AGREEMENT detailed pre-closing covenants regarding the operation of the business and the condition of the assets at closing. (2) No superior proposal shall have been accepted by the Special Committee. (3) The transaction shall have received HSR approval. (4) A group of investors including GE Capital shall have purchased $90 million of newly issued Series C Preferred Stock. (5) Shareholders of Neff shall have approved the Merger. (6) United Rentals shall have received any required consents from the banks under its existing credit facilities to consummate the transaction contemplated by this Term Sheet. 3 (7) United Rentals and GE Capital shall have entered into a shareholders' agreement under which: GE Capital and Santos consent to (i) purchases and sales of assets between United Rentals or affiliates of United Rentals and Neff at fair market value, provided that any purchase or related series of purchases in excess of $25 million would either require the consent of GE Capital or a fairness opinion acceptable to the parties; (ii) administrative and other transactions between Neff and United Rentals or its affiliates that are no less favorable to Neff than United Rentals' policies for such transactions with its other subsidiaries, provided that payment for services may be made only for services actually rendered; (iii) the determination by Neff's board not to make cash or other distributions; provided, that, if there are cash or other distributions, GE Capital and Santos would receive their pro rata share; (iv) the guarantee by Neff of all debt obligations of United Rentals and its subsidiaries and the pledge by Neff of its assets as collateral for such obligations; and (v) the waiver by Neff, GE Capital and Santos of any rights they might otherwise have under doctrines of corporate or business opportunity as against URI, its affiliates, officers, directors, agents or representatives (acting in such capacity). Except as aforesaid, GE Capital and Santos shall retain all other rights as stockholders of Neff which they would otherwise have under law, and, in addition, the consent of GE Capital and Santos shall be required for the following extraordinary actions: amendment of Neff's charter and by-laws; selection of accountants if other than one of the Big Five; and issuances of equity securities. GE Capital and Santos shall also receive customary and proportionate tag-along rights in the event of a sale of shares of Neff by United Rentals to unaffiliated third parties. (8) Neff shall not have indebtedness for money borrowed (other than its subordinated notes) in excess of $160 million. (9) United Rentals' note exchange offer shall have been accepted by holders of at least 95% of the Old Notes. (10) Other customary conditions, including receipt of a tax opinion by Neff's counsel that the Merger is more likely than not to qualify as a tax-free reorganization and the consideration to be received in the Merger is more likely than not to be tax-free to the Neff public stockholders and the Mas Family. B. CERTAIN OTHER MATTERS Credit Ratings Not United Rentals shall not enter into a definitive Impacted: merger agreement until it receives confirmation that the proposed transaction would not negatively change United Rentals' current credit ratings. 4 Nortrax Litigation: Neff currently is engaged in litigation and arbitration proceedings (the "Nortrax Litigation") against Nortrax Equipment Company. Should Neff after the closing recover any amount from Nortrax in the Nortrax Litigation, Neff will pay to GE Capital 50% of any net proceeds after deducting all attorneys' and other fees and disbursements, court costs, and all settlement, damage, award and other costs incurred from and after the closing with respect to the Nortrax Litigation ("Costs"). In the event such net recovery does not occur, or should Neff otherwise incur any Costs for which it has not been made whole by payments from Nortrax, GE Capital and United Rentals would share on a 50/50 basis the first $10 million (the "Shared Portion") of such Costs, and GE Capital will indemnify and hold harmless United Rentals, or Neff as a subsidiary of United Rentals, for any Costs incurred by United Rentals or Neff in excess of the Shared Portion. In addition, to the extent United Rentals incurs any liability or costs in connection with the sharing of the Shared Portion, GE Capital on a quarterly basis (subject to a de minimus exception) will purchase additional shares of Series C Preferred Stock (at a conversion price equal to the greater of $22 or 15% above the United Rentals Common Stock market price at the time of issuance) for a purchase price and with a face amount equal to the Costs incurred by United Rentals. United Rentals will have the right to control the prosecution and defense of the Nortrax Litigation. Indemnification Matters: Without limiting any rights under the officer and director liability insurance policy or any indemnification claim for matters not covered by the following sentence, GE Capital, Santos and the Mas Family (and their representatives) will not bring any direct action or lawsuit against Neff relating to events occurring prior to the closing. GE Capital, Santos and the Mas Family (and their representatives) shall not be indemnified or advanced expenses by Neff or United Rentals in connection with shareholder claims or lawsuits arising in connection with the transaction or any prior proposals or offers made to acquire Neff, except to the extent such indemnification or expense advancement is covered by amounts available under an existing officer and director liability policy of Neff, with Neff responsible for any retention/deductible under such policy up to $150,000 in the aggregate. 5 APPENDIX 1 VARIABLE FORWARD CONTRACTS AND ELECTIONS OF THE PARTIES THEREUNDER Variable Forward United Rentals and each of GE Capital and Santos Contracts Between will enter into a variable forward contract (each, a United Rentals and "Variable Forward Contract") with respect to the Each of GE Capital Class B Common Stock held by each of GE Capital and and Santos: Santos after the Merger. As more fully described below, the Variable Forward Contracts will provide for terms on which parties can elect for the acquisition of all or a portion of such shares by United Rentals from GE Capital and Santos. Settlement Date: The GE Capital Variable Forward Contract will be settled on the earliest of (i) if GE Capital elects, the ninth anniversary of the date of the Variable Forward Contract (the "Latest Settlement Date"), (ii) if GE Capital elects, for 30 days after any consecutive period of 20 trading days in which United Rentals Common Stock closes above $45 per share, (iii) if GE Capital elects, the bankruptcy of United Rentals, (iv) if United Rentals elects, at any time commencing on the second anniversary of the date of the Variable Forward Contract through the Latest Settlement Date, and (v) if either GE Capital or United Rentals elects, a Change-in-Control Event (as defined). Change-in-Control Event means, at any time (a) United Rentals shall cease to beneficially own and control more than 50% on a fully diluted basis of the economic and voting interests in the voting stock of Neff, (b) Neff shall liquidate or dissolve, (c) Neff shall sell all or substantially all of its assets to a third party or (d) Neff shall enter into a merger transaction in which United Rentals shall cease to own a majority of the voting stock of Neff after such merger. The Santos Variable Forward Contract will have corresponding Settlement Date provisions. Termination: If there shall not previously have occurred a Settlement Date, the Variable Forward Contract will terminate on the first day after the Latest Settlement Date. Determination of Neff At the Settlement Date of the GE Capital Variable Shares Delivered: Forward Contract, the number of shares of Class B Common Stock to be delivered by GE Capital to United Rentals will be the excess of 5.1 million over the Retained Appreciation Amount (as defined). The Retained Appreciation Amount will be that number of such shares equal in value, determined for this purpose using the value of the Class B Common Stock as of the Settlement Date, to the lesser of (i) the excess, if any, of the aggregate value, at the Settlement Date, of the 5.1 million shares of such stock, over the Reference Value, and (ii) 20% of the Reference Value. The Santos Variable Forward Contract will have corresponding Settlement Date Provisions. Notwithstanding the foregoing, in the event that the Settlement Date occurs in the first five years after the Closing pursuant to clause (ii) or (v) of the Settlement Date paragraph, there will be no Retained Appreciation Amount and the full 5.1 million shares (or 900,000 shares in the case of Santos) will be delivered on the Settlement Date to satisfy the GE Capital Variable Forward Contract (or the Santos Variable Forward Contract, as applicable). Forward Sales Price: On any Settlement Date that is triggered by an election referred to in the Settlement Date paragraph, United Rentals will pay to GE Capital $81,600,000 with respect to the GE Capital Variable Forward Contract. On any Settlement Date that is triggered by an election referred to in the Settlement Date paragraph, United Rentals will pay to Santos $14,400,000 with respect to the Santos Variable Forward Contract. Payment at the Settlement Date shall be made in cash or, at United Rentals' election in the case of a Settlement Date described in clause (ii) of the Settlement Date paragraph, in freely tradable United Rentals Common Stock. Reference Value: Reference Value will equal $11,475,000 in the case of the GE Capital Variable Forward Contract. Reference Value will equal $2,025,000 in the case of the Santos Variable Forward Contract. Settlement Date Value: The parties will establish a mechanism for valuation of Class B Common Stock as of the Settlement Date based on the net worth of Neff. Right to Buy Remaining United Rentals will have the right to purchase at Class B Shares: then fair market value any shares of Class B Common Stock held by GE Capital or Santos after the Settlement Date. 2 EX-99 3 0003.txt EXHIBIT 6 Exhibit 6 --------- [United Rentals Letterhead] December 29, 2000 Special Committee of the Board of Directors Neff Corp. 3750 N.W. 87th Avenue, Suite 400 Miami, FL 33178 Dear Sirs: United Rentals, Inc. ("United Rentals") is pleased to submit this non-binding expression of interest to pursue a transaction in which all shares of the common stock of Neff Corp. ("Neff") not held by General Electric Capital Corporation ("GE Capital") or Santos Fund I, L.P. ("Santos") would be acquired by United Rentals in a merger transaction in accordance with the terms set forth in the attached term sheet (the "Term Sheet"). The proposed transaction is supported by GE Capital, Jorge Mas and certain members of his family (the "Mas Family"), and Santos, all of whom are principal stockholders of Neff. As set forth in the Term Sheet, each of the approximately 6.6 million shares of Neff Class A common stock currently owned by public stockholders would be exchanged for 0.18 (the "Exchange Ratio") of a share of newly issued United Rentals common stock. The approximately 8.6 million shares of Neff Class A common stock currently owned by the Mas Family would be exchanged for shares of newly issued United Rentals Series C Perpetual Convertible Preferred Stock ("Series C Preferred Stock") (which would be convertible into United Rentals common stock at $22 per share, as explained below) with an aggregate liquidation preference equal to the value of approximately 1,548,000 shares of United Rentals common stock (based upon the product of the Exchange Ratio and 8.6 million). The 900,000 shares of Neff Class A common stock currently owned by Santos would be exchanged for 900,000 shares of Neff Class B common stock. After the closing, GE Capital and Santos would own 6 million shares of Neff Class B common stock, subject to the right of GE Capital and Santos to sell all or a portion of these shares to United Rentals for an aggregate consideration of $96 million in 2010, and the right of United Rentals to buy all or a portion of these shares for an aggregate consideration of $96 million commencing in 2002. These periods may be accelerated under certain conditions. Special Committee of the Board of Directors December 29, 2000 Page 2 If the proposed transaction is completed, an investor group including GE Capital would purchase $90 million of newly issued shares of Series C Preferred Stock. Each share of Series C Preferred Stock, face value $1,000 per share, would be convertible into shares of United Rentals common stock at $22.00 per share. The Series C Preferred Stock does not accrue dividends, and would be entitled to dividends only if United Rentals declares dividends on its common stock. In addition, under the proposed transaction, United Rentals would offer to exchange its newly issued 10.25% Senior Subordinated Notes due 2008 (the "New Notes") for Neff's 10.25% Senior Subordinated Notes due 2008 (the "Old Notes"). The exchange offer would be at an exchange ratio of $750 principal amount of New Notes (which, based on current market rates, would represent a value of approximately $600) for each $1,000 principal amount of Old Notes. The proposed transaction is contingent, among other things, upon the approval of the Neff Special Committee, the Boards of Directors of United Rentals and Neff, United Rentals' senior lenders, Neff stockholders, and appropriate regulatory agencies. The proposed transaction is also contingent on completion of satisfactory due diligence (including branch due diligence after receiving full access and cooperation by Neff), the signing of a definitive merger agreement and the satisfaction of its terms and conditions, confirmation prior to the signing of a definitive merger agreement that the proposed transaction would not negatively change United Rentals' current credit ratings, and acceptance of United Rentals' exchange offer by holders of at least 95% of the Old Notes. There can be no assurance that these conditions will be met or that this transaction will take place. We believe that if we are given full access and cooperation, we can complete our due diligence and execute a definitive merger agreement by January 19, 2001. We will deliver a draft merger agreement prepared by our counsel shortly. This letter, including the attached Term Sheet, constitutes a non-binding indication of interest regarding a transaction on the general terms and conditions outlined in this letter and in the Term Sheet. This letter and the Term Sheet do not purport to summarize all of the terms and conditions upon which any transaction would be based, which terms and conditions would be contained fully only in any final documentation, and indicate only the principal terms and conditions under which an overall transaction would be considered. We may for whatever reason or for no reason change the terms of this indication of 2 Special Committee of the Board of Directors December 29, 2000 Page 3 interest, or cease further consideration of any transaction, at any time without liability to any party, and no party shall have any claim that any other party did not act in good faith. The parties will need to make appropriate public filings disclosing this expression of interest in order to comply with their obligations under the federal securities laws. We would respectfully request that the Special Committee coordinate its public disclosures with United Rentals. Please be advised that the expression of interest set forth in this letter and the related Term Sheet will expire on January 19, 2001. While we recognize the Special Committee's fiduciary responsibilities in the event another proposal is received, we request that the Special Committee negotiate with us exclusively until January 19, 2001 or, if earlier, until the Special Committee gives us notice that negotiations with us have been terminated, and not solicit or entertain other proposals until such time. In addition, we request that the Special Committee notify us if it receives any other inquiries or acquisition proposals while it negotiates with us. We and our advisors are prepared to meet with the Special Committee and its advisors in order to answer any questions about this letter or the attached Term Sheet. I can be reached at (203) 622-3131. Questions of a legal nature should be directed to our legal counsel, Richard Grossman of Skadden, Arps, Slate, Meagher & Flom LLP at (212) 735-2116. We look forward to hearing from you soon. Very truly yours, /s/ John Milne John Milne cc: Gerald Eppner 3 SUMMARY OF TERMS FOR A POSSIBLE TRANSACTION INVOLVING NEFF ("TERM SHEET") ----------------------------------------- I. THE TRANSACTION Merger: Acquisition of the majority of the shares of capital stock of Neff Corp. ("Neff") by United Rentals, Inc. ("United Rentals"), in a one-step merger transaction (the "Merger") in which a newly formed wholly-owned subsidiary of United Rentals would merge with and into Neff pursuant to which (A) each publicly held share of Class A common stock of Neff (the "Class A Common Stock") would be exchanged for 0.18 (the "Exchange Ratio") of a share of United Rentals common stock (the "United Rentals Common Stock"); (B) certain members of the Mas family (the "Mas Family") would exchange pursuant to the Merger their shares of Class A Common Stock for shares of a new convertible preferred stock in United Rentals having characteristics stated in Section II; (C) Santos Fund I, L.P. ("Santos") would exchange its 0.9 million shares of Class A Common Stock in Neff for an equal number of shares of Class B Common Stock of Neff (the "Class B Common Stock"); and (D) General Electric Capital Corporation ("GE Capital") would maintain its 5.1 million shares of Class B Common Stock in Neff and would be the holder of such shares after giving effect to the Merger (with such Class B Common Stock held by GE Capital and Santos having reduced voting rights so that GE Capital and Santos would have less than 20% of the Neff vote upon consummation of the Merger). The Neff employee stock options would roll-over into United Rentals options based on the Exchange Ratio. Variable Forward In connection with the transaction, GE Capital, Contracts: Santos and United Rentals will enter into contracts that set forth terms on which each of GE Capital and Santos can, at their option, require United Rentals to purchase from GE Capital and Santos or United Rentals can, at its option, require GE Capital and Santos to sell to United Rentals, as applicable, all or a portion of the shares of Class B Common Stock retained by GE Capital and received by Santos in the Merger. A summary of the terms of these contracts is set forth in Appendix 1. Subordinated Note Exchange United Rentals would offer to exchange newly issued Offer: 10.25% Senior Subordinated Notes due 2008 (the "New Notes") for Neff's 10.25% Senior Subordinated Notes due 2008 (the "Old Notes"). The exchange offer would be at an exchange ratio of $750 principal amount of New Notes (which, based on current market rates, would represent a value of approximately $600) for each $1,000 principal amount of Old Notes. Voting Agreements: Irrevocable voting agreement by GE Capital, the Mas Family and Santos to vote in favor of the Merger. II. TERMS OF THE UNITED RENTALS SERIES C PERPETUAL CONVERTIBLE PREFERRED STOCK ("SERIES C PREFERRED STOCK") Issuance of Series C The 8.6 million shares of Class A Common Stock Preferred Stock: currently owned by the Mas Family would be exchanged for shares of Series C Preferred Stock with an aggregate liquidation preference equal to the value of a number of shares of United Rentals Common Stock equal to the product of the Exchange Ratio and the number of Class A Common Stock currently owned by the Mas Family. The value of the shares of United Rentals Common Stock will be the average closing price of the United Rentals Common Stock on the NYSE for the ten consecutive trading days ending on the trading day prior to the occurrence of the closing (the "10-day Average United Rentals Closing Price"). If the proposed transaction is completed, an investor group including GE Capital would purchase $90 million of newly issued Series C Preferred Stock. Conversion Price: 15% above the 10-day Average United Rentals Closing Price, but not less than $22 per share. Anti-dilution: Anti-dilution adjustments, primarily on stock splits, stock dividends, sales of stock to affiliates at less than the Conversion Price (other than in bona fide compensation arrangements), and on certain mergers, in each case consistent with United Rentals Series B Perpetual Convertible Preferred Stock ("Series B Preferred Stock"). Must give notice of these events to the holders. Dividends: Series C Preferred Stock does not accrue dividends, and is entitled to dividends on an as-converted basis only if United Rentals declares dividends on its common stock. Other Preferreds: Parity stock can be issued, but not senior stock. Liquidation $1,000 per share, but holders will in no event Preference: receive less than the amount they would have received in liquidation as a common stockholder participating with other common stockholders had the holders of the Preferred Stock converted their Series C Preferred Stock prior to liquidation. Ranking: Pari passu with United Rentals Series A Perpetual Convertible Preferred Stock ("Series A Preferred Stock") and Series B Preferred Stock. Voting: Shares of Series C Preferred Stock vote together with United Rentals common stock as one class on all matters on an as-converted basis, unless required otherwise by Delaware law. However, on matters which require the consent of the holders of Series C Preferred Stock, the holders of Series C Preferred Stock will vote as one class with the holders of Series A Preferred Stock and Series B Preferred Stock, unless otherwise required by Delaware law. Change of Control: On a change of control which is not a pooling, the holders of Series C Preferred Stock can put their Series C Preferred Stock to United Rentals at the Liquidation Preference plus a premium equal to 6.25% of the Liquidation Preference compounded annually from the date of issuance to the date of change of control (the "Put Price"). The Put Price is payable in cash. 2 On a change of control which is a pooling, Series C Preferred Stock automatically converts into United Rentals Common Stock. For this purpose, Series C Preferred Stock will be valued at 109.5% of the Put Price and Series C Preferred Stock will be converted into a number of shares of United Rentals Common Stock equal to (i) such adjusted value, divided by (ii) the Conversion Price. A change of control occurs when any outside group (other than the holders of Series C Preferred Stock) acquires control of more than 50% of the United Rentals Common Stock, either directly or indirectly by way of a merger. Restrictions on Consent of Series C Preferred Stock required for dividends, tender offers annual dividends in excess of 5% of market and stock repurchases: capitalization. Repurchases of stock are limited on an annual basis to 5%, 10% and 15% of market capitalization for successive five-year periods coinciding with the applicable five-year periods in the Series B preferred stock; the restriction lapses at the end of the third period. This restriction shall allow for the existing stock repurchase program and shall authorize United Rentals to acquire an additional $200 million of its issued and outstanding common stock. Registration for Two Demands (plus one clean-up after third year), underlying common subject to certain black-out periods; 45 days to stock: file; United Rentals has certain piggybacks on demand registration. Customary piggyback registration rights, subject to cut-back. United Rentals selects the underwriters. Holders will lock-up for any United Rentals stock offerings (30 days before and 90 days after) and for any United Rentals pooling. Reporting Copies of all SEC filings must be delivered to requirements: holders within three business days; also promptly deliver all materials distributed to shareholders. Materials available on EDGAR will be delivered only on request. III. CLOSING CONDITIONS AND CERTAIN OTHER TERMS A. CONDITIONS TO (1) The parties shall have entered into a definitive CLOSING UNDER merger agreement which among other things sets forth DEFINITIVE MERGER detailed pre-closing covenants regarding the AGREEMENT operation of the business and the condition of the assets at closing. (2) No superior proposal shall have been accepted by the Special Committee. (3) The transaction shall have received HSR approval. (4) A group of investors including GE Capital shall have purchased $90 million of newly issued Series C Preferred Stock. (5) Shareholders of Neff shall have approved the Merger. (6) United Rentals shall have received any required consents from the banks under its existing credit facilities to consummate the transaction contemplated by this Term Sheet. 3 (7) United Rentals and GE Capital shall have entered into a shareholders' agreement under which: GE Capital and Santos consent to (i) purchases and sales of assets between United Rentals or affiliates of United Rentals and Neff at fair market value, provided that any purchase or related series of purchases in excess of $25 million would either require the consent of GE Capital or a fairness opinion acceptable to the parties; (ii) administrative and other transactions between Neff and United Rentals or its affiliates that are no less favorable to Neff than United Rentals' policies for such transactions with its other subsidiaries, provided that payment for services may be made only for services actually rendered; (iii) the determination by Neff's board not to make cash or other distributions; provided, that, if there are cash or other distributions, GE Capital and Santos would receive their pro rata share; (iv) the guarantee by Neff of all debt obligations of United Rentals and its subsidiaries and the pledge by Neff of its assets as collateral for such obligations; and (v) the waiver by Neff, GE Capital and Santos of any rights they might otherwise have under doctrines of corporate or business opportunity as against URI, its affiliates, officers, directors, agents or representatives (acting in such capacity). Except as aforesaid, GE Capital and Santos shall retain all other rights as stockholders of Neff which they would otherwise have under law, and, in addition, the consent of GE Capital and Santos shall be required for the following extraordinary actions: amendment of Neff's charter and by-laws; selection of accountants if other than one of the Big Five; and issuances of equity securities. GE Capital and Santos shall also receive customary and proportionate tag-along rights in the event of a sale of shares of Neff by United Rentals to unaffiliated third parties. (8) Neff shall not have indebtedness for money borrowed (other than its subordinated notes) in excess of $160 million. (9) United Rentals' note exchange offer shall have been accepted by holders of at least 95% of the Old Notes. (10) Other customary conditions, including receipt of a tax opinion by Neff's counsel that the Merger is more likely than not to qualify as a tax-free reorganization and the consideration to be received in the Merger is more likely than not to be tax-free to the Neff public stockholders and the Mas Family. B. CERTAIN OTHER MATTERS Credit Ratings Not United Rentals shall not enter into a definitive Impacted: merger agreement until it receives confirmation that the proposed transaction would not negatively change United Rentals' current credit ratings. 4 Nortrax Litigation: Neff currently is engaged in litigation and arbitration proceedings (the "Nortrax Litigation") against Nortrax Equipment Company. Should Neff after the closing recover any amount from Nortrax in the Nortrax Litigation, Neff will pay to GE Capital 50% of any net proceeds after deducting all attorneys' and other fees and disbursements, court costs, and all settlement, damage, award and other costs incurred from and after the closing with respect to the Nortrax Litigation ("Costs"). In the event such net recovery does not occur, or should Neff otherwise incur any Costs for which it has not been made whole by payments from Nortrax, GE Capital and United Rentals would share on a 50/50 basis the first $10 million (the "Shared Portion") of such Costs, and GE Capital will indemnify and hold harmless United Rentals, or Neff as a subsidiary of United Rentals, for any Costs incurred by United Rentals or Neff in excess of the Shared Portion. In addition, to the extent United Rentals incurs any liability or costs in connection with the sharing of the Shared Portion, GE Capital on a quarterly basis (subject to a de minimus exception) will purchase additional shares of Series C Preferred Stock (at a conversion price equal to the greater of $22 or 15% above the United Rentals Common Stock market price at the time of issuance) for a purchase price and with a face amount equal to the Costs incurred by United Rentals. United Rentals will have the right to control the prosecution and defense of the Nortrax Litigation. Indemnification Matters: Without limiting any rights under the officer and director liability insurance policy or any indemnification claim for matters not covered by the following sentence, GE Capital, Santos and the Mas Family (and their representatives) will not bring any direct action or lawsuit against Neff relating to events occurring prior to the closing. GE Capital, Santos and the Mas Family (and their representatives) shall not be indemnified or advanced expenses by Neff or United Rentals in connection with shareholder claims or lawsuits arising in connection with the transaction or any prior proposals or offers made to acquire Neff, except to the extent such indemnification or expense advancement is covered by amounts available under an existing officer and director liability policy of Neff, with Neff responsible for any retention/deductible under such policy up to $150,000 in the aggregate. 5 APPENDIX 1 VARIABLE FORWARD CONTRACTS AND ELECTIONS OF THE PARTIES THEREUNDER Variable Forward United Rentals and each of GE Capital and Santos Contracts Between will enter into a variable forward contract (each, a United Rentals and Each "Variable Forward Contract") with respect to the of GE Capital and Class B Common Stock held by each of GE Capital and Santos: Santos after the Merger. As more fully described below, the Variable Forward Contracts will provide for terms on which parties can elect for the acquisition of all or a portion of such shares by United Rentals from GE Capital and Santos. Settlement Date: The GE Capital Variable Forward Contract will be settled on the earliest of (i) if GE Capital elects, the ninth anniversary of the date of the Variable Forward Contract (the "Latest Settlement Date"), (ii) if GE Capital elects, for 30 days after any consecutive period of 20 trading days in which United Rentals Common Stock closes above $45 per share, (iii) if GE Capital elects, the bankruptcy of United Rentals, (iv) if United Rentals elects, at any time commencing on the second anniversary of the date of the Variable Forward Contract through the Latest Settlement Date, and (v) if either GE Capital or United Rentals elects, a Change-in-Control Event (as defined). Change-in-Control Event means, at any time (a) United Rentals shall cease to beneficially own and control more than 50% on a fully diluted basis of the economic and voting interests in the voting stock of Neff, (b) Neff shall liquidate or dissolve, (c) Neff shall sell all or substantially all of its assets to a third party or (d) Neff shall enter into a merger transaction in which United Rentals shall cease to own a majority of the voting stock of Neff after such merger. The Santos Variable Forward Contract will have corresponding Settlement Date provisions. Termination: If there shall not previously have occurred a Settlement Date, the Variable Forward Contract will terminate on the first day after the Latest Settlement Date. Determination of Neff At the Settlement Date of the GE Capital Variable Shares Delivered: Forward Contract, the number of shares of Class B Common Stock to be delivered by GE Capital to United Rentals will be the excess of 5.1 million over the Retained Appreciation Amount (as defined). The Retained Appreciation Amount will be that number of such shares equal in value, determined for this purpose using the value of the Class B Common Stock as of the Settlement Date, to the lesser of (i) the excess, if any, of the aggregate value, at the Settlement Date, of the 5.1 million shares of such stock, over the Reference Value, and (ii) 20% of the Reference Value. The Santos Variable Forward Contract will have corresponding Settlement Date Provisions. Notwithstanding the foregoing, in the event that the Settlement Date occurs in the first five years after the Closing pursuant to clause (ii) or (v) of the Settlement Date paragraph, there will be no Retained Appreciation Amount and the full 5.1 million shares (or 900,000 shares in the case of Santos) will be delivered on the Settlement Date to satisfy the GE Capital Variable Forward Contract (or the Santos Variable Forward Contract, as applicable). Forward Sales Price: On any Settlement Date that is triggered by an election referred to in the Settlement Date paragraph, United Rentals will pay to GE Capital $81,600,000 with respect to the GE Capital Variable Forward Contract. On any Settlement Date that is triggered by an election referred to in the Settlement Date paragraph, United Rentals will pay to Santos $14,400,000 with respect to the Santos Variable Forward Contract. Payment at the Settlement Date shall be made in cash or, at United Rentals' election in the case of a Settlement Date described in clause (ii) of the Settlement Date paragraph, in freely tradable United Rentals Common Stock. Reference Value: Reference Value will equal $11,475,000 in the case of the GE Capital Variable Forward Contract. Reference Value will equal $2,025,000 in the case of the Santos Variable Forward Contract. Settlement Date Value: The parties will establish a mechanism for valuation of Class B Common Stock as of the Settlement Date based on the net worth of Neff. Right to Buy Remaining United Rentals will have the right to purchase at Class B Shares: then fair market value any shares of Class B Common Stock held by GE Capital or Santos after the Settlement Date. 2 -----END PRIVACY-ENHANCED MESSAGE-----