NATIONSRENT INC, S-1/A, 1998-07-09

NATIONSRENT INC
S-1/A, 1998-07-09
EQUIPMENT RENTAL & LEASING, NEC

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<PAGE> 1

AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JULY 9, 1998

REGISTRATION NO. 333-56233
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------

SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------

AMENDMENT NO. 2

FORM S-1
REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933
------------------------

NATIONSRENT, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)

<TABLE>
<S> <C> <C>
DELAWARE 7353 31-1570069
(STATE OR OTHER JURISDICTION OF
INCORPORATION OR (PRIMARY STANDARD INDUSTRIAL (I.R.S. EMPLOYER
ORGANIZATION) CLASSIFICATION CODE NUMBER) IDENTIFICATION NUMBER)
</TABLE>
450 EAST LAS OLAS BOULEVARD, SUITE 1400
FT. LAUDERDALE, FLORIDA 33301
(954) 760-6550
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE, OF
REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)

JAMES L. KIRK
CHAIRMAN, CHIEF EXECUTIVE OFFICER
AND PRESIDENT
NATIONSRENT, INC.
450 EAST LAS OLAS BOULEVARD
FORT LAUDERDALE, FLORIDA 33301
(954) 760-6550
(NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE,
OF AGENT FOR SERVICE)
------------------------

COPIES OF ALL COMMUNICATIONS TO:
<TABLE>
<S> <C>
STEPHEN K. RODDENBERRY LEIGH P. RYAN
AKERMAN, SENTERFITT & EIDSON, P.A. PAUL, HASTINGS, JANOFSKY & WALKER LLP
ONE S.E. 3RD AVENUE, 28TH FLOOR 399 PARK AVENUE, 31ST FLOOR
MIAMI, FLORIDA 33131-1704 NEW YORK, NEW YORK 10022-4697
(305) 374-5600 (212) 318-6006
</TABLE>

APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO PUBLIC: As soon as
practicable after the effective date of this Registration Statement.

If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, check the following box. [ ]

If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [ ] -------------------

If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ] ---------------------------------------

If this Form is a post-effective amendment filed pursuant to Rule 462(d)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ] ---------------------------------------

If delivery of the Prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]
------------------------

CALCULATION OF REGISTRATION FEE

<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------------------
PROPOSED MAXIMUM PROPOSED
TITLE OF EACH CLASS OF AMOUNT TO OFFERING PRICE MAXIMUM AGGREGATE AMOUNT OF
SECURITIES TO BE REGISTERED BE REGISTERED PER UNIT OFFERING PRICE REGISTRATION FEE
- ---------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, par value $.01 per
share.............................. 12,650,000 $12.00 $151,800,000 $44,781(1)
- ---------------------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------------------
</TABLE>

(1) The registrant previously paid $29,500 of this filing fee on June 5, 1998
with the initial filing of this Registration Statement.

------------------------

THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF
THE SECURITIES ACT OF 1933, AS AMENDED, OR UNTIL THE REGISTRATION STATEMENT
SHALL BECOME EFFECTIVE ON SUCH DATE AS THE SECURITIES AND EXCHANGE COMMISSION,
ACTING PURSUANT TO SAID SECTION 8(a), MAY DETERMINE.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE> 2

INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY
OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES
EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE
SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE SECURITIES
IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR
TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH STATE.

SUBJECT TO COMPLETION, DATED , 1998
PROSPECTUS

11,000,000 SHARES

[LOGO]
NATIONSRENT, INC.
COMMON STOCK

All of the 11,000,000 shares of common stock, $0.01 par value per share
(the "Common Stock"), offered hereby (the "Offering") are being offered by
NationsRent, Inc. ("NationsRent" or the "Company"). Prior to the Offering, there
has been no public market for the Common Stock. It is currently estimated that
the initial public offering price will be between $10.00 and $12.00 per share.
See "Underwriting" for a discussion of the factors to be considered in
determining the initial public offering price. The Company has applied to list
the Common Stock on the New York Stock Exchange ("NYSE") under the symbol "NRI."

------------------------------

SEE "RISK FACTORS" BEGINNING ON PAGE 9 FOR A DISCUSSION OF CERTAIN FACTORS
THAT SHOULD BE CONSIDERED BY PROSPECTIVE PURCHASERS OF THE COMMON STOCK.
------------------------------

THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION, NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS.
ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------
UNDERWRITING
PRICE TO DISCOUNTS AND PROCEEDS TO
PUBLIC COMMISSIONS(1) COMPANY(2)
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<S> <C> <C> <C>
Per Share................................. $ $ $
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Total(3).................................. $ $ $
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- ---------------------------------------------------------------------------------------------------------
</TABLE>

(1) The Company has agreed to indemnify the Underwriters against certain
liabilities, including liabilities under the Securities Act of 1933, as
amended (the "Securities Act"). See "Underwriting."

(2) Before deducting expenses of the Offering payable by the Company estimated
at $ .

(3) The Company has granted to the Underwriters a 30-day option to purchase up
to 1,650,000 additional shares of Common Stock on the same terms and
conditions as set forth above solely to cover over-allotments, if any. If
this option is exercised in full, the Price to Public, Underwriting
Discounts and Commissions and Proceeds to Company will be $ ,
$ and $ , respectively. See "Underwriting."

------------------------------

The shares of Common Stock are offered, subject to prior sale, when, as and
if delivered to and accepted by the Underwriters, subject to certain conditions
including the approval of certain legal matters by counsel for the Underwriters.
The Underwriters reserve the right to withdraw, cancel or modify such offer and
to reject orders in whole or in part. It is expected that delivery of the shares
of Common Stock will be made against payment therefor on or about ,
1998 at the office of Bear, Stearns & Co. Inc., 245 Park Avenue, New York, New
York 10167.
------------------------------

BEAR, STEARNS & CO. INC.
BT ALEX. BROWN

DONALDSON, LUFKIN & JENRETTE
SECURITIES CORPORATION
NATIONSBANC MONTGOMERY SECURITIES LLC

The date of this Prospectus is , 1998.
<PAGE> 3

NATIONSRENT, INC.

[PHOTOS OF LOCATIONS -- INTERIOR AND EXTERIOR]

[MAP OF LOCATIONS]

------------------

CERTAIN PERSONS PARTICIPATING IN THIS OFFERING MAY ENGAGE IN TRANSACTIONS THAT
STABILIZE, MAINTAIN OR OTHERWISE AFFECT THE MARKET PRICE OF THE COMMON STOCK
INCLUDING OVER-ALLOTMENT, STABILIZING AND SHORT-COVERING TRANSACTIONS AND THE
IMPOSITION OF PENALTY BIDS. SEE "UNDERWRITING."
<PAGE> 4

PROSPECTUS SUMMARY

The following summary is qualified in its entirety by, and should be read
in conjunction with, the more detailed information and financial data, including
the consolidated financial statements and the notes thereto ("Consolidated
Financial Statements") and the pro forma consolidated financial statements and
the notes thereto appearing elsewhere in this Prospectus. Unless the context
otherwise requires, all references to "NationsRent" or the "Company" include
NationsRent, Inc. and its subsidiaries. Unless otherwise indicated (i) all
information contained in this Prospectus assumes that the Underwriters'
over-allotment option is not exercised, (ii) the description of the business of
the Company reflects all closed acquisitions and the closing of all pending
acquisitions currently under binding agreements (collectively, the
"Acquisitions") and (iii) all historical share information contained in this
Prospectus has been adjusted to reflect a 2,500 for 1 split of the Common Stock
which occurred on June 2, 1998 (the "Stock Split").

THE COMPANY

NationsRent is one of the fastest growing equipment rental companies in the
United States. The Company has acquired a core platform of equipment rental
businesses concentrated in selected markets and intends to build a network of
nationally branded locations. NationsRent expects to become a leading provider
of rental equipment in each market it enters by acquiring platform businesses
and opening or acquiring additional locations concentrated around those
businesses. The Company believes that this "cluster" strategy enables it to (i)
increase profitability in its acquired stores and (ii) achieve profitability in
its newly opened locations more quickly than its competitors.

The Company's locations offer a comprehensive selection of high quality,
well-maintained rental equipment, including backhoes, bulldozers, skid steer
loaders, aerial lifts and work platforms, compressors and generators. The
Company markets its products and services primarily to a broad range of
construction and industrial customers, including heavy highway contractors,
general contractors, subcontractors, manufacturing plants and distribution
centers. The Company also sells used and new equipment, spare parts and
supplies, and provides maintenance and repair services. Since its formation in
August 1997, the Company has acquired or contracted to acquire 16 equipment
rental businesses operating in Florida, Indiana, Kentucky, Louisiana, Michigan,
Ohio, Pennsylvania, Texas and West Virginia. The Company operates 68 locations
and for the year ended December 31, 1997, on a pro forma basis after giving
effect to the Acquisitions, the Company had revenue of $213.8 million and
operating income of $36.7 million.

NationsRent is capitalizing on the current dynamics in the equipment rental
industry. According to industry sources, the United States equipment rental
industry grew from an estimated $614 million in revenue in 1982 to an estimated
$20 billion in 1997, which represents a compound annual growth rate of more than
26%. This growth has been driven primarily by construction and industrial
companies increasingly outsourcing their equipment needs to reduce investment in
non-core assets and convert costs from fixed to variable. According to industry
sources, the United States equipment rental industry is expected to grow to an
estimated $40 billion in annual revenue over the next five years due to the
overall growth in the economy and a continuing trend from sales to rentals. In
addition, the United States equipment rental industry is highly fragmented, with
more than 20,000 companies. According to industry sources, the 100 largest
equipment rental companies have a combined market share of less than 20%, no
single equipment rental company in the United States has a market share greater
than 3% and more than 90% of equipment rental companies have ten or fewer
locations. NationsRent believes it can take advantage of the fragmentation in
the equipment rental industry and the absence of an equipment rental company
with significant market share to achieve a leading market position by creating
an integrated network of nationally branded locations offering broad product
selection and superior customer service.

3
<PAGE> 5

COMPETITIVE STRENGTHS

NationsRent believes it has several competitive strengths that will enable
it to continue to increase growth and profitability, including the following:

Strong Market Position. The Company believes that, by implementing
its "cluster" strategy in each market it enters, it can achieve a leading
market share and increase revenue from existing customers. The Company
believes this strategy will enable it to more effectively serve its
customers, broaden its customer base, pool rental equipment inventory,
offer a broader selection and greater availability of equipment and
maintain a high utilization rate. By offering a full range of rental
equipment from each location, the Company believes that customers who
currently utilize multiple rental equipment providers will prefer to fill
their rental needs through the NationsRent network of locations. In
addition, NationsRent believes it has other advantages relative to smaller
operators, including greater purchasing power and a lower cost of capital.

National Brand. NationsRent is in the process of entering selected
markets with the goal of establishing a nationally recognized brand
throughout the United States. All NationsRent locations will be supported
by the Company's national branding strategy including a distinctive store
format and marketing program. The Company believes it will be able to
increase revenue by establishing a brand name known for consistent quality
and an extensive supply of rental inventory in a customer-oriented
atmosphere. The Company expects this branding strategy to enable it to
expand its customer base to attract a broader range of customers, including
large customers with operations in a variety of geographic markets.

Focus on Customer Service. NationsRent is differentiating itself from
its competitors with innovations designed to increase customer
satisfaction. The Company seeks to offer more convenient access, faster
check-in and check-out procedures and shorter required lead time for
rentals than its competitors, as well as on-time equipment delivery and
pick-up, on-site repair service, 24-hour customer assistance and a library
of audio, video and written instruction materials for equipment usage and
safety. In addition, as part of the Company's plan to provide one-stop
shopping to customers, each location sells parts and supplies to complement
equipment rentals and sales.

State-of-the-Art Management Information System. The Company is
customizing a state-of-the-art management information system capable of
monitoring operations at several thousand locations. This innovative system
is being designed to track customer purchasing patterns and demographics
for use in gaining market share in new and existing markets, consolidating
equipment purchases, maximizing utilization rates and reducing overhead
expenditures. This system will provide management with real time revenue,
inventory, financial and customer information, facilitating rapid and well
informed decision making. In addition, this system will permit customers to
reserve and rent equipment and access their account information from their
own computer terminals via the Company's internet website. To develop its
customized system, the Company has assembled a team of management
information specialists who have previously developed systems for
Blockbuster Entertainment Corporation ("Blockbuster"), the world's largest
video rental company, and Wal-Mart Stores, Inc. ("Wal-Mart"), the world's
largest retailer.

Distinctive Operating Format. In connection with the development of
the NationsRent national brand, the Company has designed a format for its
locations which it believes will help differentiate NationsRent from its
competitors. Distinguishing characteristics of this format include
drive-through lanes, clearly marked equipment aisles and attractive, well
organized and clean store facilities. The Company expects that its larger
locations will typically be on a 6 to 12 acre site in a heavily-trafficked
area with a 20,000 to 40,000 square foot facility housing a reconditioning
center and a broad selection and extensive inventory of equipment and
supplies. The Company expects that its smaller locations will typically be
on a 2 to 6 acre site in a high-visibility commercial area with a 7,500 to
11,000 square foot facility housing at least one drive-through lane,
maintenance and delivery capabilities and inventory and supplies that are
targeted to the customer base in that area.

Experienced Management Team. The Company believes it has one of the
most experienced and growth-oriented executive management teams among
publicly-traded companies in the equipment rental

4
<PAGE> 6

industry. James L. Kirk, the Company's Chairman, Chief Executive Officer
and President, founded OHM Corporation ("OHM"), a NYSE listed company, in
1969 and served in various senior executive positions with OHM, growing it
into a leading environmental construction company with an inventory of
heavy and light equipment having an original cost of over $100 million. In
addition, the Company will benefit from the experience of H. Wayne
Huizenga, a director of and investor in the Company, who serves as Chairman
and Co-Chief Executive Officer of Republic Industries, Inc. ("Republic")
and who co-founded and served in various senior executive positions with
Waste Management, Inc. ("Waste Management") and Blockbuster, each of which
is a leading consolidator in its respective industry. The other members of
the Company's senior management team have previously worked closely with
Mr. Kirk in senior management positions at OHM, and other key employees and
consultants of the Company have worked with Mr. Huizenga in various
positions at Republic, Waste Management or Blockbuster. The NationsRent
management team is supported by operating, marketing and business
development managers with an average of more than 15 years of experience in
the equipment rental industry.

GROWTH STRATEGY

The Company's objectives are to increase revenue, profitability, market
share and stockholder value by building a nationally branded network of
locations that offer a comprehensive selection of high quality rental equipment
in convenient and accessible locations to customers in the construction and
industrial markets. Key elements of the NationsRent growth strategy are as
follows:

Acquire Leading Companies. NationsRent seeks to acquire leading
companies in each market it enters to implement its "cluster" strategy and
position the Company to achieve significant market share. The Company
targets businesses that have one or more of the following characteristics:
(i) strong positions in their geographic market; (ii) experienced local
management teams that will continue to work with the Company following the
acquisition; (iii) high quality equipment rental inventory; and (iv)
physical and operating characteristics that are suited to conversion to the
NationsRent format. Once the Company has entered a particular market, it
seeks to acquire additional rental businesses in that market or adjacent
markets with locations and equipment selection that complement its existing
operations, thus enabling the Company to further penetrate that market. See
"Business -- Completed and Pending Acquisitions."

Convert Acquired Locations. After making an acquisition, the Company
intends to convert acquired locations to the NationsRent format by (i)
branding acquired locations and rental inventory with the NationsRent logo,
colors and distinctive store appearance, (ii) increasing the breadth and
depth of rental inventory, (iii) linking the location to the Company's
customized management information system and (iv) implementing the
NationsRent customer service approach. For a discussion of the costs
associated with the conversion of acquired locations to the NationsRent
format, see "Management's Discussion and Analysis of Financial Condition
and Results of Operations -- General."

Open New Rental Locations. Once NationsRent has established a
presence in a particular market, it seeks to open new locations in that
geographic area or adjacent areas to enable it to offer a greater selection
and availability of equipment, maximize its equipment inventory utilization
rates and achieve economies of scale. The Company believes that this
strategy will allow its new locations to achieve profitability at a faster
rate than its competitors because these locations should (i) more quickly
generate revenue as a result of the pre-existing market presence, name
recognition and referrals from existing locations and (ii) have lower
overhead costs due to the sharing of service, maintenance, administrative
functions and personnel with the Company's established locations. For a
description of new locations opened by the Company, see "Management's
Discussion and Analysis of Financial Condition and Results of
Operations -- General."

5
<PAGE> 7

nationally branded network of locations, industrial customers will become
increasingly aware of the advantages of equipment rental relative to
ownership, including reduced capital investment, reduced storage and
maintenance expense, and greater access to the most modern equipment. The
recent acquisition of The Bode-Finn Company ("Bode-Finn"), which has served
industrial customers for over 40 years, has established the Company as a
leading provider of rental equipment to industrial customers in several
geographic markets.

COMPLETED AND PENDING ACQUISITIONS

In furtherance of its growth strategy, NationsRent has acquired or
contracted to acquire 16 equipment rental businesses with 65 locations. See
"Business -- Completed and Pending Acquisitions." These locations are
concentrated in regions, as set forth in the following table:

<TABLE>
<CAPTION>
DATE NUMBER
REGION MARKET SERVED ACQUIRED BUSINESS ACQUIRED OF LOCATIONS
- ------ ------------- ----------------- -------- ------------
<S> <C> <C> <C> <C>
Midwest Central/Northern Ohio Sam's 9/97 5
R&R 12/97 2
Central 1/98 8
Bode-Finn 5/98 1
Ohio River Valley Ashland 11/97 2
Titan 12/97 2
Bode-Finn 5/98 1
Indianapolis/Northern Indiana C&E 12/97 6
RFL 4/98 1
U-Rent-It 5/98 1
Jobs 6/98 1
Southwest Ohio/Northern Kentucky Bode-Finn 5/98 4
Jobs 6/98 1
Louisville/Lexington, Kentucky Bode-Finn 5/98 2
Jobs 6/98 1
Southwest Pennsylvania A-Action 6/98 1
Detroit, Michigan J. Kelly * 2
Gulf Coast Southwest Florida Naples 4/98 2
Florida Equipment 4/98 2
Florida Panhandle General Rental * 6
Southeast Texas Associated * 4
General Rental * 7
Louisiana Associated * 3
--
Total: 65
==
</TABLE>

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* Pending acquisition which is subject to customary closing conditions and is
anticipated to be closed in July 1998 prior to consummation of the Offering.

RECENT DEVELOPMENTS

The Company recently entered into letters of intent to acquire three
equipment rental businesses with aggregate annual revenue of approximately $30.0
million and a total of nine equipment rental locations. Each of these
acquisitions is subject to a number of closing conditions, including the
execution of definitive purchase agreements, and there can be no assurance that
any of these acquisitions will be consummated.

The Company was incorporated in the State of Delaware in August 1997. The
Company's principal executive offices are located at 450 East Las Olas
Boulevard, Fort Lauderdale, Florida 33301 and its telephone number is (954)
760-6550.

6
<PAGE> 8

THE OFFERING

<TABLE>
<S> <C>
Common Stock offered by the Company......................... 11,000,000 shares(1)
Common Stock to be outstanding after the Offering........... 41,118,694 shares(1)(2)
Use of proceeds............................................. To repay certain outstanding
indebtedness. See "Use of
Proceeds."
Proposed NYSE Symbol........................................ "NRI"
</TABLE>

- ---------------

(1) Does not include 1,650,000 shares of Common Stock which may be issued by the
Company upon exercise of the Underwriters' over-allotment option.

(2) Does not include (i) 5,000,000 additional shares of Common Stock reserved
for issuance in connection with options that may be granted under the 1998
Stock Option Plan that the Company expects to adopt prior to consummation of
the Offering (the "1998 Stock Option Plan"), (ii) 1,087,571 additional
shares of Common Stock reserved for issuance in connection with certain
outstanding options, (iii) 72,727 additional shares of Common Stock reserved
for issuance in connection with certain outstanding warrants (assuming an
initial public offering price of $11.00 per share, which is the midpoint of
the estimated range set forth on the cover of this Prospectus) and (iv)
4,649,091 additional shares of Common Stock reserved for issuance in
connection with certain convertible promissory notes of the Company
(assuming an initial public offering price of $11.00 per share, which is the
midpoint of the estimated range set forth on the cover of this Prospectus).
See "Management -- Stock Option Plan," "Description of Certain
Indebtedness -- Promissory Notes" and "Description of Capital
Stock -- Warrants and Options."

RISK FACTORS

Prospective purchasers of Common Stock in the Offering should carefully
consider the risk factors set forth under "Risk Factors" beginning on page 9 and
the other information included in this Prospectus prior to making an investment
decision. See "Risk Factors."

7
<PAGE> 9

SUMMARY CONSOLIDATED HISTORICAL AND PRO FORMA FINANCIAL DATA

<TABLE>
<CAPTION>
HISTORICAL(1)
------------- HISTORICAL(1)
------------- PRO FORMA AS
AUGUST 14 PRO FORMA ADJUSTED THREE
(INCEPTION) AS ADJUSTED THREE MONTHS MONTHS ENDED
THROUGH YEAR ENDED ENDED MARCH 31,(2)
DECEMBER 31, DECEMBER 31, MARCH 31, ------------------
1997 1997(2) 1998 1997 1998
------------- ------------ ------------- ------- -------
(UNAUDITED) (UNAUDITED) (UNAUDITED)
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)
<S> <C> <C> <C> <C> <C>
STATEMENT OF OPERATIONS DATA:
Total revenue....................................... $ 9,305 $213,848 $ 9,039 $44,467 $48,398
Gross profit(3)..................................... 3,892 76,632 3,050 13,206 15,138
Operating income(3)................................. 2,527 36,694 845 4,563 5,575
Interest expense.................................... 760 11,371 808 2,379 2,738
Income before provision for income taxes............ 1,767 25,965 160 2,436 3,083
Net income.......................................... $ 1,001 $ 15,061 $ 93 $ 1,414 $ 1,788
Basic earnings per share............................ $ 0.04 $ 0.37 $ 0.00 $ 0.03 $ 0.04
Diluted earnings per share.......................... $ 0.04 $ 0.37 $ 0.00 $ 0.03 $ 0.04
OTHER DATA:
EBITDA(4)........................................... $ 4,337 $ 66,509 $ 2,491 $11,420 $13,387
Net cash provided by (used in):
Operating activities.............................. 3,695 N/A 8,639 N/A N/A
Investing activities.............................. (35,044) N/A (24,663) N/A N/A
Financing activities.............................. 32,842 N/A 15,181 N/A N/A
Gross margin........................................ 41.8% 35.8% 33.7% 29.7% 31.3%
Operating margin.................................... 27.2% 17.2% 9.3% 10.3% 11.5%
EBITDA margin(4).................................... 46.6% 31.1% 27.6% 25.7% 27.7%
Rental equipment purchases(5)....................... 2,461 90,649 19,584 25,158 44,230
Amortization of goodwill(3)......................... 166 3,904 259 934 1,001
</TABLE>

<TABLE>
<CAPTION>
HISTORICAL PRO FORMA
-------------- AS ADJUSTED
AS OF AS OF
MARCH 31, 1998 MARCH 31, 1998(2)
-------------- -----------------
(UNAUDITED) (UNAUDITED)
(DOLLARS IN THOUSANDS)
<S> <C> <C>
SELECTED BALANCE SHEET DATA:
Rental equipment, net....................................... $ 49,063 $201,835
Goodwill.................................................... 41,388 150,084
Total assets................................................ 102,778 404,423
Total debt.................................................. 52,230 178,021
Stockholders' equity........................................ 32,094 187,624
</TABLE>

- ---------------

(1) The Acquisitions have been accounted for as purchases and, accordingly, the
operations of the acquired businesses are included in the statement of
operations data and other data from the date of acquisition.
(2) The pro forma as adjusted statement of operations data for the year ended
December 31, 1997 and the three months ended March 31, 1997 and 1998 and the
pro forma as adjusted selected balance sheet data as of March 31, 1998 give
effect to the Acquisitions, the Founders' Additional Contribution, the
Private Placement, certain borrowings under the Proposed Amended Credit
Facility and the Offering as described in the "Pro Forma Consolidated
Financial Statements" as if such transactions had occurred on the first day
of the period presented, and in the case of the pro forma as adjusted
balance sheet data, as of March 31, 1998. See "Use of Proceeds," "Risk
Factors -- Substantial Leverage," "Capitalization," "Management's Discussion
and Analysis of Financial Condition and Results of Operations," "Certain
Transactions" and the Company's pro forma and historical financial
statements and related notes.

(3) The amortization period for rental equipment depreciation ranges from two to
ten years. The amortization period for goodwill is 40 years.

(4) EBITDA represents net income plus income taxes, interest expense,
depreciation and amortization. EBITDA is not intended to represent cash
flows from operations as defined by generally accepted accounting principles
and should not be considered as an alternative to net income as an indicator
of the Company's operating performance or to cash flows as a measure of
liquidity.

(5) Rental equipment purchases represent the purchase price of rental equipment
inventory acquired during the period.

8
<PAGE> 10

RISK FACTORS

An investment in the shares of Common Stock offered hereby involves a high
degree of risk. In addition to the other information contained in this
Prospectus, prospective investors should consider the following factors
carefully in evaluating an investment in the Common Stock offered hereby. This
Prospectus contains "forward-looking statements" relating to, without
limitation, future economic performance, plans and objectives of management for
future operations, and projections of revenue and other financial items that are
based on the beliefs of, assumptions made by and information currently available
to the Company's management. The words "expect," "estimate," "anticipate,"
"believe," "intend," "plan" and similar expressions and variations thereof are
intended to identify forward-looking statements. The cautionary statements set
forth in this "Risk Factors" section and elsewhere in this Prospectus identify
important factors with respect to such forward-looking statements, including
certain risks and uncertainties, that could cause actual results to differ
materially from those expressed in or implied by such forward-looking
statements.

LIMITED OPERATING HISTORY

The Company was formed in August 1997 and commenced operations in September
1997 with its acquisition of Sam's Equipment Rental, Inc. and Gabriel Trailer
Manufacturing Company, Inc. (collectively, "Sam's"). Accordingly, the Company
has only a limited operating history upon which an evaluation of the Company,
its growth strategy and its prospects can be based. The Company's prospects must
be evaluated in light of the risks, expenses and difficulties frequently
encountered by companies in the early stages of development. Although the
Company has experienced growth in revenue and net income recently, there can be
no assurance that growth or profitability can or will be sustained or that the
Company's strategy of building a network of nationally branded equipment rental
locations will lead to growth or profitability.

ACQUISITION AND INTEGRATION RISKS

Since its inception in August 1997, the Company has acquired or contracted
to acquire 16 equipment rental businesses operating 65 locations in nine states.
The Company intends to continue this rapid growth by continuing to make
acquisitions, opening new locations and converting acquired locations to the
Company's format. There can be no assurance that the Company will be able to
identify acquisition candidates or suitable new locations or obtain financing
for acquisitions or internal expansion on satisfactory terms, or at all. In the
event that suitable acquisition candidates are not identifiable or to the extent
that acquisitions are prohibitively costly, the Company may be forced to alter
its growth strategy. The Company's growth strategy presents the risks inherent
in assessing the value, strengths and weaknesses of growth opportunities, in
evaluating the costs and uncertain returns of expanding the operations of the
Company, and in integrating acquisitions with existing operations. The Company
expects that its growth strategy may affect short-term cash flow and net income
as the Company increases the amount of its indebtedness and incurs expenses to
open new locations, make acquisitions and expand its rental inventory. As a
result, the Company's revenue and operating results may fluctuate. There can be
no assurance that the Company will successfully expand, that any acquired
businesses will be successfully integrated into the Company's operations or that
any expansion will result in profitability. The failure of the Company to
successfully implement its growth strategy may have a material adverse effect on
the Company's business, financial condition, results of operations or prospects
or the market price of the Common Stock.

The Company's anticipated growth will place significant demands on the
Company's management and its operational, financial and marketing resources. In
connection with acquisitions and the opening of new locations, the Company
anticipates experiencing growth in the number of its employees, the scope of its
operating and financial systems and the geographic area of its operations. The
Company believes this growth will increase the operating complexity of the
Company and the level of responsibility exercised by both existing and new
management personnel. To manage this expected growth, the Company intends to
invest further in its operating and financial systems and to continue to expand,
train and manage its employee base. There can be no assurance that the Company
will be able to attract and retain qualified management and employees or that
the Company's current operating and financial systems and controls will be
adequate as the Company grows or that any steps taken to improve such systems
and controls will be sufficient. The failure of
9
<PAGE> 11

the Company to successfully integrate and manage its growth may have a material
adverse effect on the Company's business, financial condition, results of
operations or prospects or the market price of the Common Stock.

There may be liabilities that the Company fails or is unable to discover in
the course of performing due diligence investigations on each company or
business it has acquired or seeks to acquire in the future, including
liabilities arising from non-compliance with applicable federal, state or local
environmental requirements by prior owners and for which the Company, as a
successor owner, may be responsible. The Company seeks to minimize the risk by
conducting such due diligence, including environmental reviews, as it deems
appropriate under the circumstances, but there can be no assurance that
reasonable due diligence efforts will result in the identification of all
existing conditions or risks. The Company also generally seeks to obtain rights
to indemnification from each seller of acquired businesses or properties, which
indemnification obligation may be supported by deferring payment of a portion of
the purchase price or other appropriate security. However, there can no
assurance that such indemnification, even if obtained, will be enforceable,
collectible or sufficient in amount, scope or duration to fully offset the
possible liabilities associated with the business or property acquired. Any such
liabilities, individually or in the aggregate, could have a material adverse
effect on the Company's business, financial condition, results of operations or
prospects.

DEPENDENCE ON ADDITIONAL CAPITAL FOR FUTURE GROWTH

The Company's ability to remain competitive, sustain its growth and expand
its operations through new locations and acquisitions largely depends on its
access to capital. In addition, the Company must make ongoing capital
expenditures to update and maintain the condition of its rental equipment
inventory in order to provide its customers with high-quality equipment. To
date, the Company has financed capital expenditures and acquisitions primarily
through private equity, bank financing, vendor financing and the issuance of
promissory notes. To implement its growth strategy and meet its capital needs,
the Company plans to issue additional equity securities and incur additional
indebtedness in the future. The Company has obtained commitments to increase its
$225 million revolving credit facility, as amended (the "Credit Facility"),
prior to the consummation of the Offering to up to $245 million (the "Proposed
Amended Credit Facility") and may seek to further increase the Proposed Amended
Credit Facility from time to time after consummation of the Offering. The
Company intends to use the net proceeds of the Offering to repay borrowings
under the Proposed Amended Credit Facility and may in the future issue
additional equity or debt securities to repay additional outstanding amounts
under the Proposed Amended Credit Facility. Borrowings under the Credit Facility
mature and must be repaid in full in July 2001. There can be no assurance that
any of such increases or any additional capital, if and when required, will be
available on terms acceptable to the Company, or at all. Failure by the Company
to obtain sufficient additional capital in the future could force the Company to
curtail its growth or delay capital expenditures, which could have a material
adverse effect on the Company's business, financial condition, results of
operations or prospects or the market price of the Common Stock.

The Company's ability to finance future acquisitions, new locations and
internal growth is currently limited by the covenants contained in the Credit
Facility, including a number of covenants that, among other things, restrict the
ability of the Company to dispose of assets or merge, incur debt, pay dividends,
repurchase or redeem capital stock, create liens, make non-rental equipment
capital expenditures and make certain investments or acquisitions and otherwise
restrict corporate activities. The Credit Facility also contains, among other
covenants, requirements that the Company maintain specified financial ratios,
including minimum cash flow levels and interest coverage. See "Management's
Discussion and Analysis of Financial Condition and Results of
Operations -- Liquidity and Capital Resources," "Business -- Growth Strategy"
and "Description of Certain Indebtedness."

SUBSTANTIAL LEVERAGE

The Company has a substantial amount of indebtedness. As of March 31, 1998,
on a pro forma basis after giving effect to the Acquisitions, an additional
equity contribution of $17.4 million from the Company's founders (the "Founders'
Additional Contribution"), a $27.6 million private placement of shares of Common
Stock (the "Private Placement"), certain borrowings under the Proposed Amended
Credit Facility, the
10
<PAGE> 12

Offering and the application of the estimated net proceeds therefrom (assuming
an initial public offering price of $11.00 per share, which is the midpoint of
the estimated range set forth on the cover of this Prospectus), the Company
would have had total indebtedness of approximately $178.0 million.

The degree to which the Company is leveraged could have important
consequences to holders of the Common Stock including, but not limited to, the
following: (i) the Company's ability to obtain additional financing in the
future for working capital, capital expenditures, acquisitions or general
corporate or other purposes may be limited; (ii) a substantial portion of the
Company's cash flow from operations will be dedicated to the payment of the
principal of, and interest on, its indebtedness; (iii) the agreements governing
the Company's long-term indebtedness will contain certain restrictive financial
and operating covenants that could limit the Company's ability to compete and
expand; and (iv) the Company's substantial leverage may make it more vulnerable
to economic downturns, limit its ability to withstand competitive pressures and
reduce its flexibility in responding to changing business and economic
conditions. See "Capitalization," "Management's Discussion and Analysis of
Financial Condition and Results of Operations -- Liquidity and Capital
Resources," "Description of Certain Indebtedness" and the Consolidated Financial
Statements included elsewhere in this Prospectus.

COMPETITION

The equipment rental industry is highly competitive. The Company's
competitors include large national rental companies, equipment manufacturers,
regional corporations, smaller independent businesses, and equipment vendors and
dealers who both sell and rent equipment to customers. Some of the Company's
competitors have greater financial resources, are more geographically diverse,
and have greater name recognition than the Company. There can be no assurance
that the Company will not encounter increased competition from existing
competitors or new market entrants, such as equipment manufacturers, that may be
significantly larger and have greater financial and marketing resources than the
Company. If existing or future competitors reduce prices to gain or retain
market share and the Company must also reduce prices to remain competitive, it
could have a material adverse effect on the Company's business, financial
condition, results of operations or prospects. Additionally, existing or future
competitors may seek to compete with the Company for acquisition candidates or
new locations, which may have the effect of increasing acquisition prices and
reducing the number of suitable acquisition candidates or expansion locations
which could have a material adverse effect on the Company's growth strategy, its
business, financial condition, results of operations or prospects or the market
price of the Common Stock. See "Business -- Competition."

SEASONALITY AND QUARTERLY FLUCTUATIONS IN REVENUE AND OPERATING RESULTS

Many of the Company's current locations are in the Midwest region of the
United States. During the winter months of December through March, the Company
experiences a slowdown in rentals to construction customers as a result of
adverse weather conditions. In addition, the Company's revenue and operating
results have varied throughout the year and are expected to continue to
fluctuate in the future due to a number of factors, including (i) general
economic conditions in the Company's markets, (ii) the timing of acquisitions
and new location openings and related costs, (iii) the effectiveness of
integrating acquired businesses and new locations, (iv) rental patterns of the
Company's customers and (v) price changes in response to competitive factors.
The Company incurs various costs in establishing or integrating newly acquired
or opened locations, and the profitability of a new location is generally
expected to be lower in the initial months of operation.

LIABILITY AND INSURANCE

The Company's business exposes it to possible claims for personal injury or
death resulting from the use of equipment rented or sold by the Company and from
injuries caused in motor vehicle accidents in which Company delivery and service
personnel are involved. The Company carries comprehensive insurance subject to
deductibles at levels it believes are sufficient to cover existing and future
claims. Although the Company has not experienced any material losses that were
not covered by insurance, there can be no assurance that existing or future
claims will not exceed the level of the Company's insurance or that such
insurance will continue to be available on economically reasonable terms, or at
all.
11
<PAGE> 13

ENVIRONMENTAL AND SAFETY REGULATION

In particular, the Company stores and dispenses, or has in the past stored
and dispensed, petroleum products from aboveground storage tanks and, in certain
cases, underground storage tanks at its locations. The Company also uses
hazardous materials, including solvents, to clean and maintain equipment, and
generates and disposes of solid and hazardous wastes, including batteries, used
motor oil, radiator fluid and solvents. In connection with such activities, the
Company has incurred capital expenditures and other compliance costs which are
expensed on a current basis and which, to date, have not been material to the
Company's financial condition. Based on currently available information, the
Company believes that it will not be required to incur material capital
expenditures or other compliance or remediation costs on environmental and
safety matters in the foreseeable future. There can be no assurance, however,
that this will be the case.

DEPENDENCE ON EXECUTIVE OFFICERS AND DIRECTORS

The Company's future success depends to a significant extent on retaining
the services of certain executive officers and directors. The Company does not
maintain key man insurance. The loss of the services of key employees or
directors (whether such loss is through resignation or other causes) or the
inability to attract additional qualified personnel could have a material
adverse effect on the Company's business, financial condition, results of
operations or prospects or the market price of the Common Stock.

SIGNIFICANT STOCKHOLDERS

Following the Offering, the officers and directors of the Company,
including H. Wayne Huizenga, will own approximately 38.2% of the outstanding
Common Stock (36.7% if the Underwriters' over-allotment option is exercised in
full). In addition, H. Family Investments, Inc., a Florida corporation
controlled by H. Wayne Huizenga, Jr., Mr. Huizenga's son, will own approximately
29.2% of the outstanding Common Stock (28.1% if the Underwriter's over-allotment
option is exercised in full). As a result, the officers and directors of the
Company will, together with H. Family Investments, Inc., be able to exercise a
controlling influence over the outcome of matters submitted to the Company's
stockholders for approval, including the election of directors.

SHARES ELIGIBLE FOR FUTURE SALE

12
<PAGE> 14

consummation of the Offering, have agreed with the Underwriters (the "Lock-up
Agreements") not to offer, sell or otherwise dispose of any shares of Common
Stock or any security convertible into, exercisable for or exchangeable for
shares of Common Stock for a period of 180 days after the date of this
Prospectus without the prior written consent of Bear, Stearns & Co. Inc., except
that (i) stockholders may make transfers as gifts if the donee agrees to be
bound by a Lock-up Agreement, (ii) certain security holders will be permitted to
pledge or margin their shares in a bona fide loan transaction with a third party
lender, (iii) the Company may at any time and from time to time issue shares of
Common Stock to third parties as consideration for the Company's acquisition
from such third parties of equipment rental businesses and (iv) the Company may
issue options pursuant to the 1998 Stock Option Plan and shares of Common Stock
upon the exercise of certain options granted to non-employee directors. The
Company may issue shares of Common Stock in connection with acquisitions prior
to the expiration of the 180-day lock-up period.

Following the expiration or waiver of the foregoing restrictions on
dispositions and any applicable holding periods under Rule 144,
outstanding shares of Common Stock owned by existing stockholders will be
available for sale in the public market pursuant to Rule 144 (including the
volume and other limitations set forth therein). In connection with the Private
Placement, the Company agreed to use its reasonable efforts following
commencement of the Offering to register for resale shares of Common Stock
issued in the Private Placement. In addition, in connection with certain of the
Acquisitions, the Company has agreed to register for resale the shares of Common
Stock issuable upon exercise of certain warrants and upon conversion of certain
convertible promissory notes. Prior to the consummation of the Offering, the
Company intends to file a registration statement to register for resale on a
continuous basis from time to time, subject to the Lock-up Agreements,
34,840,512 shares of Common Stock, 30,118,694 shares of which are held by the
Company's existing stockholders and 4,721,818 shares of which are issuable upon
exercise or conversion of outstanding warrants and convertible promissory notes
(assuming an initial public offering price of $11.00 per share, which is the
midpoint of the estimated range set forth on the cover of this Prospectus). The
Company intends to cause this registration statement to become effective prior
to the consummation of the Offering and to maintain its continuous
effectiveness, including through filing post-effective amendments, indefinitely.
In addition, the Company intends to register on a registration statement on Form
S-8 shares of Common Stock reserved for issuance upon exercise of options that
may be granted to certain employees and non-employee directors under the 1998
Stock Option Plan and otherwise. The Company may also from time to time file
registration statements covering the issuance and/or resale of shares of Common
Stock which may be issued in potential future acquisitions. See
"Management -- Stock Option Plan," "Description of Certain
Indebtedness -- Promissory Notes" and "Description of Capital Stock -- Warrants
and Options."

No prediction can be made as to the effect, if any, that market sales of
shares held by the Company's existing stockholders or other stockholders, or the
availability of such shares for future sales, or market sales of shares sold in
the Offering pursuant to this Prospectus or the availability of such shares for
future sales, will have on the market price of the Common Stock prevailing from
time to time. Sales of significant amounts of Common Stock in the public market
could materially adversely affect the market price of the Common Stock or could
materially impair the Company's future ability to realize capital through an
offering of equity securities. See "Shares Eligible for Future Sale."

DILUTION

At an assumed initial public offering price of $11.00 per share (which is
the midpoint of the estimated range set forth on the cover of this Prospectus),
purchasers of shares of Common Stock in the Offering will experience immediate
and substantial dilution of $10.09 per share in the net tangible book value per
share of Common Stock from the initial public offering price. See "Dilution."
Investors may also experience additional dilution as a result of shares of
Common Stock being issued in future business acquisitions and as a result of the
issuance and exercise of stock options. See "Shares Eligible for Future Sale."

NO PRIOR PUBLIC MARKET; POSSIBLE VOLATILITY OF STOCK PRICE

Prior to this Offering, there has been no public market for the Common
Stock, and there can be no assurance that an active trading market will develop
or be sustained after this Offering. The initial public
13
<PAGE> 15

offering price will be determined through negotiations between the Company and
representatives of the Underwriters. There can be no assurance that future
market prices of the Common Stock will equal or exceed the estimated range set
forth on the cover page of this Prospectus. After completion of this Offering,
the market price of the Common Stock could be subject to significant variation
due to fluctuations in the Company's operating results, changes in earnings
estimates by investment analysts, the success or failure of the Company's growth
strategy, and changes in business or regulatory conditions affecting the
Company. In addition, the stock market has from time to time experienced extreme
price fluctuations which have often been unrelated to the operating performance
of the affected companies. Such fluctuations could materially adversely affect
the market price of the Common Stock.

ABSENCE OF DIVIDENDS

The terms of the Credit Facility restrict the Company from paying dividends
on its Common Stock. The Company does not expect to pay dividends on its Common
Stock in the foreseeable future. See "Dividend Policy."

EFFECTS OF YEAR 2000 ISSUE

The Company's management information system is being developed to ensure
that it is Year 2000 compliant. Although the Company does not believe it will
suffer any major effects from the Year 2000 issue, there can be no assurance
that the Company, or any business acquired by the Company, or any of the
Company's customers or vendors will not experience interruptions of operations
because of Year 2000 problems. The Company expects to convert all of the systems
of the businesses it acquires to the Company's system as soon as practicable
after each acquisition is completed. There can be no assurance, however, that
all such systems will be converted prior to December 31, 1999. Although the
Company does not expect to incur significant expense to address the Year 2000
issue, Year 2000 problems might require the Company to incur unanticipated
expenses and such expenses could have a material adverse effect on the Company's
business, financial condition, results of operations or prospects.

USE OF PROCEEDS

The net proceeds to the Company from the Offering (using an assumed
offering price of $11.00 per share and after deducting underwriting discounts
and commissions and estimated expenses of the Offering payable by the Company)
are estimated to be approximately $110.5 million ($127.4 million if the
Underwriters' over-allotment option is exercised in full). The Company intends
to use the net proceeds from the Offering to repay a portion of the outstanding
borrowings under the Proposed Amended Credit Facility. Outstanding borrowings
under the Credit Facility currently bear interest at approximately 8.44% and
will mature and become due and payable in full in July 2001. The funds borrowed
under the Credit Facility were used to complete acquisitions, make capital
expenditures and provide for working capital and general corporate purposes. See
"Description of Certain Indebtedness -- Credit Facility."

DIVIDEND POLICY

The Company has not paid any dividends in the past and presently
anticipates that, following the completion of the Offering, earnings, if any,
will be retained for the development of its business and that no dividends on
the Common Stock will be declared in the foreseeable future. In addition, the
terms of the Credit Facility restrict the Company's ability to declare or pay
dividends. See "Description of Certain Indebtedness -- Credit Facility." Any
future dividends will be subject to the discretion of the Company's Board of
Directors and will depend upon, among other things, future earnings, the
operating and financial condition of the Company, its capital requirements and
general business conditions.

14
<PAGE> 16

CAPITALIZATION

The following table sets forth the unaudited capitalization of the Company
as of March 31, 1998 (i) on a historical basis, (ii) pro forma for the
Acquisitions, the Founders' Additional Contribution, the Private Placement and
certain borrowings under the Proposed Amended Credit Facility and (iii) pro
forma for the Acquisitions, the Founders' Additional Contribution, the Private
Placement and certain borrowings under the Proposed Amended Credit Facility and
as adjusted for the Offering (including the application of the net proceeds
therefrom as set forth in "Use of Proceeds") (assuming an initial public
offering price of $11.00 per share, which is the midpoint of the estimated range
set forth on the cover of this Prospectus). This table should be read in
conjunction with the Pro Forma Consolidated Financial Statements and the
Company's Consolidated Financial Statements included elsewhere in this
Prospectus.

<TABLE>
<CAPTION>
AS OF MARCH 31, 1998
---------------------------------
PRO FORMA
ACTUAL PRO FORMA AS ADJUSTED
------- --------- -----------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C>
Debt:
Notes payable to financial institutions................... $26,100 $168,593 $ 58,063
Senior equipment obligations and other notes.............. 9,097 62,968 62,968
Subordinated promissory notes............................. 5,943 7,500 7,500
Subordinated convertible notes............................ 11,090 49,490 49,490
------- -------- --------
Total debt........................................ 52,230 288,551 178,021
------- -------- --------
Stockholders' equity:
Preferred Stock, $0.01 par value, 5,000,000 shares
authorized; no shares issued and outstanding........... -- -- --
Common Stock, $0.01 par value, 250,000,000 shares
authorized; 25,000,000 shares issued and outstanding,
30,118,694 shares issued and outstanding pro forma, and
41,118,694 shares issued and outstanding pro forma as
adjusted(1)............................................ 250 301 411
Additional paid-in capital................................ 30,750 75,699 186,119
Retained earnings......................................... 1,094 1,094 1,094
------- -------- --------
Total stockholders' equity........................ 32,094 77,094 187,624
------- -------- --------
Total capitalization.............................. $84,324 $365,645 $365,645
======= ======== ========
</TABLE>

- ---------------

(1) Does not include (i) 1,087,571 shares issuable upon the exercise of
outstanding options with exercise prices ranging from $2.96 to $6.69 per
share and a weighted average exercise price of $5.33, (ii) 5,000,000 shares
reserved for issuance in connection with options that may be granted under
the 1998 Stock Option Plan, (iii) 4,649,091 shares issuable upon conversion
of certain convertible promissory notes, (iv) 72,727 shares issuable upon
the exercise of outstanding warrants and (v) 1,650,000 shares of Common
Stock issuable upon exercise of the Underwriters' over-allotment option. See
"Management's Discussion and Analysis of Financial Condition and Results of
Operations", "Management -- Stock Option Plan," "Certain Relationships and
Transactions," "Description of Certain Indebtedness -- Promissory Notes" and
"Description of Capital Stock -- Warrants and Options."

15
<PAGE> 17

DILUTION

DILUTION TO INVESTORS IN COMMON STOCK

As of March 31, 1998, on a pro forma basis, after giving effect to the
Acquisitions, the Founders' Additional Contribution and the Private Placement,
the Company had an aggregate of 30,118,694 shares of Common Stock outstanding.
Net tangible book value per share of Common Stock is equal to the stockholders'
equity less the net book value of goodwill and identified intangible assets,
divided by the number of shares outstanding. After giving effect to the sale of
11,000,000 shares of Common Stock in the Offering and the application of the
estimated net proceeds therefrom (assuming an initial public offering price of
$11.00 per share, which is the midpoint of the estimated range set forth on the
cover of this Prospectus) as described under "Use of Proceeds," the pro forma
net tangible book value of the Company as of March 31, 1998 would have been
approximately $37,406,000 or $0.91 per share. This represents an immediate
increase in net tangible book value of $3.34 per share of Common Stock to
existing stockholders and an immediate dilution in net tangible book value of
$10.09 per share of Common Stock to new investors purchasing shares in the
Offering. The following table illustrates this per share dilution:

<TABLE>
<S> <C>
Assumed initial public offering price per share............. $11.00
Net tangible book value per share before the
Offering.............................................. (2.43)
Increase per share attributable to new
investors(1)(2)....................................... 3.34
Pro forma net tangible book value per share after the
Offering(1)(2)............................................ 0.91
------
Dilution per share to new investors(2)...................... $10.09
======
</TABLE>

- ---------------
(1) After deduction of estimated expenses of the Offering payable by the Company
(including the underwriting discounts and commissions).

(2) Assumes that none of the Company's options, warrants or convertible
promissory notes outstanding at March 31, 1998 is exercised and that the
Underwriters' over-allotment option is not exercised. See
"Management -- Stock Option Plan," "Description of Certain Indebtedness,"
"Description of Capital Stock -- Warrants and Options" and "Underwriting."
If the Underwriters' over-allotment option is exercised in full, the
dilution will be $9.73 per share.

COMPARISON OF CAPITAL CONTRIBUTIONS

The following table summarizes, as of March 31, 1998, on a pro forma basis,
after giving effect to the Founders' Additional Contribution, the Private
Placement and the Offering, the differences between existing stockholders and
new investors in the Offering with respect to (i) the number of shares of Common
Stock purchased from the Company, (ii) the total consideration paid to the
Company and (iii) the average price paid per share.

<TABLE>
<CAPTION>
SHARES PURCHASED TOTAL CONSIDERATION
-------------------- ---------------------- AVERAGE PRICE
NUMBER PERCENT AMOUNT PERCENT PER SHARE
---------- ------- ------------ ------- -------------
<S> <C> <C> <C> <C> <C>
Existing Stockholders..................... 30,118,694 73% $ 76,000,000 39% $ 2.52
New Investors............................. 11,000,000 27 121,000,000 61 11.00
---------- --- ------------ --- ------
Total........................... 41,118,694 100% $197,000,000 100% $ 4.79
========== === ============ === ======
</TABLE>

The table above assumes that none of the Company's options, warrants or
convertible promissory notes outstanding at March 31, 1998 is exercised and that
the Underwriters' over-allotment option is not exercised. See
"Management -- Stock Option Plan," "Description of Certain Indebtedness,"
"Description of Capital Stock -- Warrants and Options" and "Underwriting." If
the Underwriters' over-allotment option is exercised in full, the Average Price
Per Share to Existing Stockholders, New Investors and Total will be $2.52,
$11.00 and $5.03, respectively.

16
<PAGE> 18

SELECTED CONSOLIDATED HISTORICAL AND PRO FORMA
FINANCIAL INFORMATION AND OPERATIONS DATA

The following selected consolidated financial information summarizes (i)
the statement of operations data and balance sheet data for Sam's (the
"Predecessor Company") for the fiscal years ended March 31, 1994 and 1995, and
the selected balance sheet data as of March 31, 1996, which have been derived
from the unaudited consolidated financial statements of the Predecessor Company
not included herein, (ii) the statement of operations data for the Predecessor
Company for the fiscal years ended March 31, 1996 and 1997 and the five months
ended August 31, 1997 and the selected balance sheet data as of March 31, 1997
and August 31, 1997, which have been derived from the audited consolidated
financial statements of the Predecessor Company included elsewhere in this
Prospectus, (iii) the statement of operations data of the Company for the period
from August 14, 1997 (inception) through December 31, 1997, and selected balance
sheet data as of December 31, 1997, which have been derived from the audited
consolidated financial statements of the Company appearing elsewhere in this
Prospectus, (iv) the consolidated statement of operations data of the Company
for the three months ended March 31, 1998 and the selected balance sheet data as
of March 31, 1998, which have been derived from the unaudited consolidated
financial statements of the Company included elsewhere in this Prospectus which,
in the opinion of management, include all adjustments (consisting only of normal
recurring adjustments) necessary to present fairly the Company's results of
operations and financial position at such date and for such period, and (v) the
pro forma consolidated statement of operations data for the twelve months ended
December 31, 1997 and the three months ended March 31, 1997 and 1998 and
selected pro forma balance sheet data as of March 31, 1998, which has been
derived from the unaudited pro forma consolidated financial statements included
elsewhere in this Prospectus. The other data has been derived from the
consolidated financial statements referred to above for the applicable periods.
The selected consolidated historical and pro forma financial information and
operating data presented below should be read in conjunction with the Company's
Consolidated Financial Statements, the unaudited pro forma consolidated
financial statements and the notes thereto and "Management's Discussion and
Analysis of Financial Condition and Results of Operations" appearing elsewhere
in this Prospectus.

17
<PAGE> 19

<TABLE>
<CAPTION>
PREDECESSOR COMPANY THE COMPANY(1)
------------------------------------------------ ------------

AUGUST 14
APRIL 1 (INCEPTION)
FISCAL YEAR ENDED MARCH 31, THROUGH THROUGH
----------------------------------- AUGUST 31, DECEMBER 31,
1994 1995 1996 1997 1997 1997
------ ------ ------- ------- ---------- ------------
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)
<S> <C> <C> <C> <C> <C> <C>
STATEMENT OF OPERATIONS DATA:
Revenue:
Equipment rentals................. $5,376 $7,237 $11,871 $15,328 $ 8,515 $ 7,410
Sales of equipment, parts and
supplies........................ 1,768 2,367 4,302 4,177 1,205 1,895
------ ------ ------- ------- ------- -------
Total revenue............... 7,144 9,604 16,173 19,505 9,720 9,305
Cost of revenue:
Cost of equipment rentals,
excluding depreciation.......... 2,549 3,442 4,380 6,029 2,193 2,196
Rental equipment
depreciation(3)................. 598 1,842 2,053 3,465 1,848 1,526
Cost of sales of equipment, parts
and supplies.................... 1,919 1,156 4,491 2,791 984 1,691
------ ------ ------- ------- ------- -------
Total cost of revenue....... 5,066 6,440 10,924 12,285 5,025 5,413
------ ------ ------- ------- ------- -------
Gross profit....................... 2,078 3,164 5,249 7,220 4,695 3,892
Selling, general and
administrative expenses......... 865 1,634 2,972 3,564 1,683 1,081
Non-rental equipment depreciation
and amortization(3)............. 53 162 180 238 115 284
------ ------ ------- ------- ------- -------
Operating income................... 1,160 1,368 2,097 3,418 2,897 2,527
------ ------ ------- ------- ------- -------
Other (income)/expense:
Interest expense.................. 162 239 583 866 580 760
Other (income)/expense, net....... (96) (353) (196) (203) 62 --
------ ------ ------- ------- ------- -------
66 (114) 387 663 642 760
------ ------ ------- ------- ------- -------
Income before provision for income
taxes............................. 1,094 1,482 1,710 2,755 2,255 1,767
Provision for income taxes........ 438 593 732 1,128 939 766
------ ------ ------- ------- ------- -------
Net income......................... $ 656 $ 889 $ 978 $ 1,627 $ 1,316 $ 1,001
====== ====== ======= ======= ======= =======
Basic earnings per share(4)........ $ 0.04
=======
Diluted earnings per share(4)...... $ 0.04
=======
OTHER DATA:
EBITDA(5)......................... $1,907 $3,725 $ 4,526 $ 7,324 $ 4,798 $ 4,337
Net cash provided by (used in):
Operating activities............ 4,176 6,803 1,648 3,965
Investing activities............ (8,063) (7,273) (1,694) (35,044)
Financing activities............ 3,849 483 178 32,842
Gross margin...................... 29.1% 32.9% 32.5% 37.0% 48.3% 41.8%
Operating margin.................. 16.2% 14.2% 13.0% 17.5% 29.8% 27.2%
EBITDA margin(5).................. 26.7% 38.8% 28.0% 37.5% 49.4% 46.6%
Rental equipment purchases(6)..... 8,799 8,101 1,775 2,461
Amortization of goodwill(3)....... -- -- -- -- -- 166

<CAPTION>
THE COMPANY(1)
-------------------------------------------------
PRO FORMA AS
PRO FORMA ADJUSTED THREE
AS ADJUSTED THREE MONTHS MONTHS ENDED
YEAR ENDED ENDED MARCH 31,(2)
DECEMBER 31, MARCH 31, ------------------
1997(2) 1998 1997 1998
------------ ------------ ------- -------
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)
<S> <C> <C> <C> <C>
STATEMENT OF OPERATIONS DATA:
Revenue:
Equipment rentals................. $112,080 $ 5,911 $19,479 $24,048
Sales of equipment, parts and
supplies........................ 101,768 3,128 24,988 24,350
-------- -------- ------- -------
Total revenue............... 213,848 9,039 44,467 48,398
Cost of revenue:
Cost of equipment rentals,
excluding depreciation.......... 38,210 2,661 8,143 10,172
Rental equipment
depreciation(3)................. 24,313 1,076 5,384 6,274
Cost of sales of equipment, parts
and supplies.................... 74,693 2,252 17,734 16,814
-------- -------- ------- -------
Total cost of revenue....... 137,216 5,989 31,261 33,260
-------- -------- ------- -------
Gross profit....................... 76,632 3,050 13,206 15,138
Selling, general and
administrative expenses......... 35,078 1,758 7,422 8,271
Non-rental equipment depreciation
and amortization(3)............. 4,860 447 1,221 1,292
-------- -------- ------- -------
Operating income................... 36,694 845 4,563 5,575
-------- -------- ------- -------
Other (income)/expense:
Interest expense.................. 11,371 808 2,379 2,738
Other (income)/expense, net....... (642) (123) (252) (246)
-------- -------- ------- -------
10,729 685 2,127 2,492
-------- -------- ------- -------
Income before provision for income
taxes............................. 25,965 160 2,436 3,083
Provision for income taxes........ 10,904 67 1,022 1,295
-------- -------- ------- -------
Net income......................... $ 15,061 $ 93 $ 1,414 $ 1,788
======== ======== ======= =======
Basic earnings per share(4)........ $ 0.37 $ 0.00 $ 0.03 $ 0.04
======== ======== ======= =======
Diluted earnings per share(4)...... $ 0.37 $ 0.00 $ 0.03 $ 0.04
======== ======== ======= =======
OTHER DATA:
EBITDA(5)......................... $ 66,509 $ 2,491 $11,420 $13,387
Net cash provided by (used in):
Operating activities............ N/A 8,639 N/A N/A
Investing activities............ N/A (24,663) N/A N/A
Financing activities............ N/A 15,181 N/A N/A
Gross margin...................... 35.8% 33.7% 29.7% 31.3%
Operating margin.................. 17.2% 9.3% 10.3% 11.5%
EBITDA margin(5).................. 31.1% 27.6% 25.7% 27.7%
Rental equipment purchases(6)..... 90,649 19,584 25,158 44,230
Amortization of goodwill(3)....... 3,904 259 934 1,001
</TABLE>

<TABLE>
<CAPTION>
PREDECESSOR COMPANY THE COMPANY
------------------------------------------------- -----------------------------------------
PRO FORMA
AS ADJUSTED
AS OF MARCH 31, AS OF AS OF AS OF AS OF
------------------------------------ AUGUST 31, DECEMBER 31, MARCH 31, MARCH 31,
1994 1995 1996 1997 1997 1997 1998 1998(2)
------ ------- ------- ------- ---------- ------------ ------------ -----------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
SELECTED BALANCE SHEET DATA:
Rental equipment, net............ $3,244 $ 8,907 $14,722 $21,789 $21,886 $30,619 $ 49,063 $201,835
Goodwill......................... -- -- -- -- -- 36,685 41,388 150,084
Total assets..................... 5,888 10,948 17,423 27,614 29,088 79,157 102,778 404,423
Total debt....................... 3,595 5,871 9,944 16,100 16,559 42,928 52,230 178,021
Stockholders' equity............. 1,206 1,862 2,840 4,467 5,768 26,001 32,094 187,624
</TABLE>

- ---------------

(1) The Acquisitions have been accounted for as purchases and, accordingly, the
operations of the acquired businesses are included in the statement of
operations data and other data from the date of acquisition.
(2) The pro forma as adjusted statement of operations data for the year ended
December 31, 1997 and the three months ended March 31, 1997 and 1998 and the
pro forma as adjusted selected balance sheet data as of March 31, 1998 give
effect to the Acquisitions, the Founders' Additional Contribution, the
Private Placement, certain borrowings under the Proposed Amended Credit
Facility and the Offering as described in the "Pro Forma Consolidated
Financial Statements" as if such transactions had occurred on the first day
of the period presented, and in the case of the pro forma as adjusted
balance sheet data, as of March 31, 1998. See "Use of Proceeds,"
"Capitalization," "Management's Discussion and Analysis of Financial
Condition and Results of Operations," "Certain Transactions" and the
Company's pro forma and historical financial statements and related notes.

(3) The amortization period for rental equipment depreciation ranges from two to
ten years. The amortization period for goodwill is 40 years.

(4) Earnings per share data is not included for the Predecessor Company on a
historical basis as such information would not be representative of the
capital structure of the Company after the Offering.

(5) EBITDA represents net income plus income taxes, interest expense,
depreciation and amortization. EBITDA is not intended to represent cash
flows from operations as defined by generally accepted accounting principles
and should not be considered as an alternative to net income as an indicator
of the Company's operating performance or to cash flows as a measure of
liquidity.

(6) Rental equipment purchases represent the purchase price of rental equipment
inventory acquired during the period.

18
<PAGE> 20

MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion and analysis of the Company's consolidated results
of operations and financial condition should be read in conjunction with the
Consolidated Financial Statements, and the unaudited Pro Forma Consolidated
Financial Information and the "Selected Consolidated Historical and Pro Forma
Consolidated Financial Information and Operating Data" included elsewhere in
this Prospectus.

GENERAL

NationsRent is one of the fastest growing equipment rental companies in the
United States. The Company believes it can take advantage of the fragmentation
in the equipment rental industry and the absence of an equipment rental company
with significant market share to achieve a leading market position by creating
an integrated network of nationally branded locations offering broad product
selection and superior customer service. NationsRent expects to become a leading
provider of rental equipment in each market it enters by acquiring platform
businesses and opening or acquiring new locations concentrated around those
businesses. The Company believes that this "cluster" strategy enables it to (i)
increase profitability in its acquired stores and (ii) achieve profitability in
its newly opened locations more quickly than its competitors.

NationsRent seeks to acquire businesses that have (i) strong positions in
their geographic market, (ii) experienced local management teams that will
continue to work with the Company following the acquisition, (iii) high quality
rental equipment inventory and (iv) physical and operating characteristics that
are suited to conversion to the NationsRent format. Since its formation in
August 1997, NationsRent has acquired or contracted to acquire 16 equipment
rental businesses with 65 locations in Florida, Indiana, Kentucky, Louisiana,
Michigan, Ohio, Pennsylvania, Texas and West Virginia. The aggregate
consideration paid by the Company in the Acquisitions is expected to be $223.4
million and consists of (i) $166.4 million in cash, (ii) $7.5 million of
subordinated promissory notes, (iii) $49.4 million of convertible subordinated
promissory notes and (iv) warrants to purchase approximately $800,000 of Common
Stock at the initial public offering price. The cash portion of the
consideration paid or to be paid has been or is expected to be funded with
equity contributions and borrowings under the Credit Facility or the Proposed
Amended Credit Facility.

After making an acquisition, the Company intends to convert acquired
locations to the NationsRent format. The cost of converting an acquired location
to the NationsRent format will vary depending on the physical properties of the
acquired location and the condition, breadth and depth of rental equipment
inventory at such location, which are factors considered in the selection and
pricing of acquisition candidates. Once NationsRent has established a presence
in a particular market, it may open new locations in that geographic areas or
adjacent areas. Since August 1997, the Company has opened six new locations. The
Company does not plan to open any additional new locations in 1998. However, the
Company continues to evaluate the need for new locations as it acquires
equipment rental companies in new markets. The cost of opening the Company's six
new locations has varied depending on whether the Company has leased or
purchased the underlying real property, the size of the location and the breadth
and depth of inventory at such location. See "-- Liquidity and Capital
Resources." The Company believes that new locations will achieve profitability
within approximately six months of their opening.

The Company derives its revenue from (i) equipment rental (65% of total
revenue for the three months ended March 31, 1998), (ii) sale of used equipment
(13%), (iii) sale of new equipment (11%) and (iv) sale of spare parts and
supplies, maintenance and repair services (11% in the aggregate, no single item
of which accounts for more than 10% of total revenue). The growth of rental
revenue is dependent on several factors including demand for rental equipment,
the amount and quality of equipment available for rent, rental rates and general
economic conditions. Revenue generated from the sale of used equipment is
affected by price, general economic conditions and the condition of the
equipment. Revenue from the sale of new equipment is affected by price and
general economic conditions. Revenue from the sale of spare parts and supplies,
maintenance and repair services is primarily affected by equipment rental and
sales volume.

On a pro forma basis after giving effect to the Acquisitions, equipment
rental revenue as a percentage of total revenue increased to 50% in the three
months ended March 31, 1998 from 44% for the three months

19
<PAGE> 21

ended March 31, 1997. The Company expects the proportion of equipment rental
revenue as a percentage of total revenue to continue to increase as it expands
rental equipment inventory at its locations and as it targets acquisition
candidates with equipment rental revenue as a percentage of total revenue of
greater than 60%. On a pro forma basis after giving effect to the Acquisitions,
the percentage of equipment rental revenue to total revenue has been impacted by
the high proportion of new equipment sales generated by Bode-Finn. Equipment
rental revenue as a percentage of total revenue, excluding Bode-Finn, was as
follows:

<TABLE>
<CAPTION>
PRO FORMA
PRO FORMA THREE MONTHS ENDED
YEAR ENDED MARCH 31,
DECEMBER 31, ----------------------
1997 1997 1998
------------ --------- ---------
<S> <C> <C> <C>
Equipment rental revenue................. 60.2% 48.1% 57.5%
Sales of equipment, parts and supplies... 39.8 51.9 42.5
----- ----- -----
100.0% 100.0% 100.0%
===== ===== =====
</TABLE>

The principal components of the Company's cost of revenue include
depreciation of rental equipment, costs of new and used equipment sold,
personnel costs, occupancy costs, repair and maintenance costs and vehicle
operations. Rental equipment depreciation is calculated using the straight-line
method over the estimated useful life of such equipment. The range of useful
lives estimated by management for rental equipment is two to eight years and is
depreciated to a salvage value of zero to ten percent of original cost. Certain
lift equipment is depreciated over a ten-year period.

Selling, general and administrative expense includes management salaries,
advertising and marketing, travel, administrative and clerical salaries and data
processing.

Non-rental equipment depreciation and amortization includes the
depreciation of fixed assets that are not offered for rent, amortization of
leasehold improvements and amortization of intangible assets related to the
acquired businesses.

The acquisitions completed in 1997 have resulted in a significantly altered
cost structure of the Predecessor Company primarily due to changes to owners'
compensation, depreciation methodologies, interest expense and real estate
costs. The Company believes that the pre-acquisition historical results of the
acquired businesses are not indicative of future results. As such, the following
discussion focuses on the historical and pro forma results of the Company.

20
<PAGE> 22

The following table sets forth, for the periods indicated, information
derived from the historical and pro forma consolidated statements of operations
of the Company expressed as a percentage of total revenue.

<TABLE>
<CAPTION>
HISTORICAL
AUGUST 14 PRO FORMA THREE MONTHS ENDED MARCH 31,
(INCEPTION) YEAR ----------------------------
TO ENDED PRO PRO
DECEMBER 31, DECEMBER 31, ACTUAL FORMA FORMA
1997 1997 1998 1997 1998
------------ ------------ ---------- ----- -----
<S> <C> <C> <C> <C> <C>
Revenue:
Equipment rentals.................... 79.6% 52.4% 65.4% 43.8% 49.7%
Sales of equipment, parts and
supplies.......................... 20.4 47.6 34.6 56.2 50.3
------ ------ ------ ----- -----
Total revenue................ 100.0 100.0 100.0 100.0 100.0
Cost of revenue:
Cost of equipment rentals, excluding
depreciation...................... 23.6 17.9 29.4 18.3 21.0
Rental equipment depreciation........ 16.4 11.4 11.9 12.1 13.0
Cost of sales of equipment, parts and
supplies.......................... 18.2 34.9 24.9 39.9 34.7
------ ------ ------ ----- -----
Total cost of revenue........ 58.2 64.2 66.2 70.3 68.7
------ ------ ------ ----- -----
Gross profit........................... 41.8 35.8 33.8 29.7 31.3
Selling, general and administrative
expenses.......................... 11.6 16.4 19.5 16.7 17.1
Non-rental equipment depreciation and
amortization...................... 3.0 2.2 4.9 2.7 2.7
------ ------ ------ ----- -----
Operating income....................... 27.2% 17.2% 9.4% 10.3% 11.5%
====== ====== ====== ===== =====
</TABLE>

PRO FORMA RESULTS OF OPERATIONS

Pro Forma Three Months Ended March 31, 1998 as Compared to
Pro Forma Three Months Ended March 31, 1997

Revenue. Total revenue for the three months ended March 31, 1998 increased
8.8% to $48.4 million from $44.5 million for the three months ended March 31,
1997. This growth in revenue primarily resulted from a $4.6 million or 23.5%
increase in rental equipment revenue, primarily at locations owned by the
Company for the entire first quarter of 1998 and at locations of Associated
Rental Equipment Management Company, Inc. ("Associated"). Rental equipment
revenue at Sam's, R. and R. Rental, Inc. ("R&R"), C&E Rental and Services, Inc.
("C&E") and Titan Rentals, Inc. ("Titan") increased $1.3 million or 32% as a
result of the Company's investment in rental equipment since such businesses
were acquired. Rental equipment revenue at Associated increased $2.9 million or
67% as a result of opening two additional locations during 1997. Such increases
were partially offset by decreases in equipment sales, primarily at the
Associated locations.

Gross Profit. Gross profit for the three months ended March 31, 1998
increased 14.6% to $15.1 million from $13.2 million for the three months ended
March 31, 1997. Gross margin increased from 29.7% to 31.3%. This margin
improvement was primarily the result of the aforementioned increase in equipment
rental revenue, which historically has produced higher margins than sales of
equipment, parts and supplies.

Total Selling, General and Administrative Expenses. Selling, general and
administrative expenses for the three months ended March 31, 1998 increased
10.6% to $9.6 million from $8.6 million for the three months ended March 31,
1997. The increase in selling, general and administrative expenses was primarily
attributable to (i) the addition of the corporate expenses of the Company in
1998, (ii) increased revenue, and (iii) additional locations that were opened by
Associated and Central Rent-All, Inc. ("Central") during 1997.

21
<PAGE> 23

Operating Income. As a result of the foregoing, operating income increased
22.2% from $4.6 million for the three months ended March 31, 1997 to $5.6
million for the three months ended March 31, 1998. Operating income margin
increased from 10.3% to 11.5%.

Pro Forma Year Ended December 31, 1997

Revenue. Total revenue for the year ended December 31, 1997 was $213.8
million.

Gross Profit. Gross profit for the year ended December 31, 1997 was $76.6
million, or 35.8% of total revenue.

Total Selling, General and Administrative Expenses. Selling, general and
administrative expenses for the year ended December 31, 1997 were $39.9 million,
or 18.6% of total revenue.

Operating Income. Operating income for the year ended December 31, 1997
was $36.7 million, or 17.2% of total revenue.

HISTORICAL RESULTS OF OPERATIONS -- PREDECESSOR COMPANY

Fiscal Year Ended March 31, 1997 ("Fiscal 1997") as Compared to
Fiscal Year Ended March 31, 1996 ("Fiscal 1996")

Revenue. Total revenue for Fiscal 1997 increased 20.6% to $19.5 million
from $16.2 million in Fiscal 1996. This increase was primarily attributable to a
29.1% increase in equipment rental revenue. Equipment rental revenue increased
as a result of the increased selection and availability of rental equipment and
from the opening of two new locations during Fiscal 1997.

Gross Profit. Gross profit for Fiscal 1997 increased 37.6% to $7.2 million
from $5.2 million in Fiscal 1996. Gross margin increased from 32.5% in Fiscal
1996 to 37.0% in Fiscal 1997. This improvement primarily resulted from increased
margins on the sale of used equipment.

Total Selling, General and Administrative Expenses. Selling, general and
administrative expenses for Fiscal 1997 increased 20.6% to $3.8 million from
$3.2 million in Fiscal 1996. As a percentage of total revenue, these costs were
19.5% in Fiscal 1996 compared with 19.5% in Fiscal 1997. The increase in
selling, general and administrative expenses was primarily attributable to
additional administrative staff hired and growth in business volume during
Fiscal 1997. In addition, the Company incurred additional non-rental
depreciation expense attributable to an increase in property, plant and
equipment as a result of the two locations opened during Fiscal 1997.

Operating Income. As a result of the foregoing, operating income increased
63.0% from $2.1 million for Fiscal 1996 to $3.4 million in Fiscal 1997.
Operating income margin increased from 13.0% in Fiscal 1996 to 17.5% in Fiscal
1997.

Other Expense. Other expense for Fiscal 1997 increased to $0.7 million
from $0.4 million in Fiscal 1996. This increase was primarily attributable to an
increase in debt and related interest expense which resulted from the Company's
increased financing of rental equipment asset purchases.

Income Tax Expense. Income tax expense was $1.1 million for Fiscal 1997,
compared to $0.7 million in Fiscal 1996. The Company's effective tax rate was
40.9% for Fiscal 1997, compared to 42.8% for the same period in Fiscal 1996.

Net Income. Net income for Fiscal 1997 increased 66.4% to $1.6 million
from $1.0 million for Fiscal 1996 for the aforementioned reasons. Net income as
a percentage of revenue was 8.3% for Fiscal 1997 compared with 6.1% for Fiscal
1996.

LIQUIDITY AND CAPITAL RESOURCES

The Company's primary uses of cash have been the funding of acquisitions
and capital expenditures. To date, the Company has funded its cash requirements
with (i) $48.4 million of equity contributions from the

22
<PAGE> 24

founders of the Company, (ii) $27.6 million of proceeds from the Private
Placement, (iii) the use of equipment leases and (iv) borrowings under its
Credit Facility.

NationsRent's historical net cash provided by operations was $3.7 million
and $8.6 million for the period from August 14, 1997 (inception) to December 31,
1997 and the three months ended March 31, 1998, respectively. On a historical
basis, net cash used in investing activities was $35.0 million and $24.7 million
for the period from August 14, 1997 (inception) to December 31, 1997 and the
three months ended March 31, 1998, respectively. Cash used in investing
activities in 1997 was primarily a result of cash consideration of $34.1 million
for the acquisition of businesses, net of cash acquired. Historical cash used in
investing activities for the three months ended March 31, 1998 was primarily the
result of $19.6 million of purchases of rental equipment. Cash provided by
financing activities was $32.8 million and $15.2 million for the period from
August 14, 1997 (inception) to December 31, 1997 and the three months ended
March 31, 1998, respectively. Historical cash provided by financing activities
during 1997 was primarily a result of a $25 million equity contribution by the
founders of the Company. Cash from financing activities for the three months
ended March 31, 1998 was primarily provided by borrowings under the Credit
Facility and an additional equity contribution by the founders of the Company.

In March 1998, the Company entered into the Credit Facility, as amended in
June 1998, with a syndicate of lenders to provide for up to $225 million of cash
borrowings and letters of credit, and expects to enter into the Proposed Amended
Credit Facility prior to consummation of the Offering. The Credit Facility has a
three-year term scheduled to expire in July 2001. The Credit Facility can be
used to complete permitted acquisitions, make capital expenditures, enter into
standby letters of credit, or for working capital and other general corporate
purposes. Upon consummation of the Offering, borrowings under the Credit
Facility will bear interest at either the BankBoston base rate plus a percentage
ranging from 0.00% to 0.50% or, at the Company's option, the Eurodollar market
rate plus a percentage ranging from 1.50% to 3.00%. The percentage over the
BankBoston base rate or the Eurodollar market rate is based on the Company's
financial performance as measured by the total funded debt ratio (the "Pricing
Ratio"). Prior to consummation of the Offering, the base rate loans bear
interest at the BankBoston base rate plus 0.75% or, at the Company's option, the
Eurodollar market rate plus 3.00%. The Credit Facility is secured by a security
interest in substantially all of the assets of the Company. The Credit Facility
also imposes, among other covenants, a tangible assets to senior debt covenant,
a restriction on all of the Company's retained earnings including the
declaration and payment of cash dividends, consent requirements on certain
acquisitions and a restriction on the ratio of total funded debt to earnings
before interest, income taxes, depreciation and amortization. The proceeds from
the Credit Facility were used to repay substantially all of the notes payable to
financial institutions that were outstanding at December 31, 1997. The Company
plans to use a portion of the net proceeds of the Offering to repay such
indebtedness as described under "Use of Proceeds."

The Company's short-term cash requirements for its existing operations
consist of: (i) capital expenditures to maintain, modernize and expand its
rental equipment inventory, (ii)working capital requirements, and (iii)
operating activities such as repair and maintenance of rental equipment,
merchandise inventory and other operating activities. The Company estimates that
equipment expenditures for its existing locations will be in the range of $90
million to $100 million, net of proceeds from used equipment sales, over the
next 12 months. In addition, the Company believes that it will be required to
make equipment expenditures in connection with new acquisitions. The Company
believes that following the completion of the Offering it will be able to
finance its short-term cash needs through borrowings under the Proposed Amended
Credit Facility, the use of equipment leases and cash generated from operations.
The Company estimates that such sources will be sufficient to fund the cash
required for the Company's existing operations for at least 12 months following
completion of the Offering.

The Company has opened six new locations within identified "clusters." The
Company estimates that the aggregate capital costs associated with each such new
location will be in the range of $2.0 million to $4.5 million. The Company
believes that cash generated from operations and borrowings under the Proposed
Amended Credit Facility will be sufficient to fund these costs without
additional debt or equity financings.

23
<PAGE> 25

The Company plans to continue its acquisition strategy and expects to
finance future acquisitions using cash, capital stock, notes and/or assumption
of indebtedness. To fully implement its growth strategy and meet the resulting
capital requirements, the Company will be required to increase amounts available
under the Credit Facility and the Proposed Amended Credit Facility, issue future
debt instruments or raise additional capital through equity financings. There
can be no assurance that any such increase to the Credit Facility and the
Proposed Amended Credit Facility will be available or, if available, will be on
terms satisfactory to the Company or that the Company will be able to
successfully complete any future debt or equity financings.

The Company is customizing a state-of-the-art management information system
that it expects will be operational in the fourth quarter of 1998. The Company
estimates the total cost of installation of such system at the Company's
existing locations will range between $5.0 million and $7.0 million and believes
cash generated from operations and borrowings under the Proposed Amended Credit
Facility will be sufficient to fund these costs. The Company expects that the
incremental costs of installation of such system at additional locations will
not be significant on a per location basis.

SEASONALITY AND FLUCTUATIONS IN OPERATING RESULTS

The Company's revenue and income are dependent upon activity in the
construction industry in the markets served by the Company. Construction
activity is dependent upon weather and other seasonal factors affecting
construction in the geographic areas where the Company has operations,
particularly in the Midwest. Because of this variability in demand, the
Company's quarterly revenue may fluctuate, and revenue for the first quarter of
each year can be expected to be lower than the remaining quarters. Although the
Company believes that the historical trend in quarterly revenue for the second,
third and fourth quarters of each year is generally higher than the first
quarter, there can be no assurance that this will occur in future periods.
Accordingly, quarterly or other interim results should not be considered
indicative of results to be expected for any other quarter or for a full year.

Operating results may fluctuate due to other factors including, but not
limited to (i) changes in general economic conditions including changes in
national, regional and local construction or industrial activities, (ii) the
timing of acquisitions and opening of new locations, (iii) the timing of
expenditures for new rental equipment and the disposition of used equipment,
(iv) competitive pricing pressures and (v) increases in interest rates.

The Company will incur significant expenses in opening new locations, such
as employee training, marketing and facility set-up costs. Initially, new
locations may generate lower operating margins than established locations and
may operate at a loss. In addition, when the Company purchases new rental
equipment, the depreciation related to such equipment may contribute to
near-term margin decline, because such equipment may not initially generate
revenue at a rate that is sufficient to match such increased depreciation
expense. As such, the opening of new rental locations and the purchase of new
equipment to expand the Company's current rental equipment inventory may reduce
the Company's operating margins during a start-up period.

INFLATION

The Company does not believe that inflation has been a significant factor
to the cost of its operations or the operations of the Predecessor Company.

IMPACT OF RECENTLY ISSUED ACCOUNTING STANDARDS

within a company for making operating decisions and assessing performance. The
Company continues to evaluate the provisions of SFAS No. 131 and, upon adoption,
the Company may report operating segments. In April 1998, the American Institute
of Certified Public Accountants issued Statement of Position No. 98-5 ("SOP
98-5"). SOP 98-5 requires that all non-governmental entities expense costs of
start-up activities, including pre-operating, pre-opening and organization
activities, as those costs are incurred. In the opinion of management, the
adoption of this statement will have no impact on its statement of operations.

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<PAGE> 27

BUSINESS

GENERAL

The Company's locations offer a comprehensive selection of high quality,
well-maintained equipment, including backhoes, bulldozers, skid steer loaders,
aerial lifts and work platforms, compressors and generators. The Company markets
its products and services primarily to a broad range of construction and
industrial customers, including heavy highway contractors, general contractors,
subcontractors, manufacturing plants and distribution centers. The Company also
sells used and new equipment, spare parts and supplies, and provides maintenance
and repair services. Since its formation in August 1997, the Company has
acquired or contracted to acquire 16 equipment rental businesses operating in
Florida, Indiana, Kentucky, Louisiana, Michigan, Ohio, Pennsylvania, Texas and
West Virginia. The Company operates 68 locations and for the year ended December
31, 1997, on a pro forma basis after giving effect to the Acquisitions, the
Company had revenue of $213.8 million and operating income of $36.7 million.

The Company currently serves over 70,000 active accounts primarily in the
construction and industrial segments of the equipment rental industry.
Construction customers include heavy highway contractors, general contractors,
speciality contractors, subcontractors, excavating contractors and trade
contractors (such as electricians and plumbers). Construction customers rent
equipment for all manner of construction activities, typically on a daily,
weekly or monthly basis, with relatively little lead time due to their need to
react quickly to changes in project scheduling. Industrial customers include
operators of manufacturing plants, petrochemical plants, distribution centers
and transportation facilities. Industrial customers typically rent equipment for
maintenance-oriented purposes on a weekly or monthly basis and are more likely
to place orders for rental equipment in advance of their regularly scheduled
maintenance requirements. In addition, the Company rents equipment to homeowners
and other general rental customers.

INDUSTRY OVERVIEW

According to industry sources, the United States equipment rental industry
grew from an estimated $614 million in revenue in 1982 to an estimated $20
billion in 1997, which represents a compound annual growth rate of more than
26%. This growth has been driven primarily by construction and industrial
companies increasingly outsourcing their equipment needs to reduce investment in
non-core assets and convert costs from fixed to variable. According to industry
sources, the United States equipment rental industry is expected to grow to an
estimated $40 billion in annual revenue over the next five years due to the
overall growth in the economy and a continuing trend from sales to rentals. The
Company believes that this trend toward rentals will accelerate as a result of
the many advantages of equipment rental relative to ownership including reduced
capital investment, reduced storage and maintenance expense, increased
flexibility to accept projects due to wide selection of available equipment,
greater access to the most modern equipment without the need to make large
capital expenditures, and improved productivity by having access to equipment
that suits a particular job.

The United States equipment rental industry is highly fragmented, with more
than 20,000 companies. According to industry sources, the 100 largest equipment
rental companies have a combined market share of less than 20%, no single
equipment rental company in the United States has a market share greater than 3%
and more than 90% of equipment rental companies have ten or fewer locations.

The Company believes the recent trend toward rapid consolidation in the
equipment rental industry should continue as a result of (i) increasing
competitive pressure on small, independent operators from the growing number of
regional and national companies with greater access to, and a lower cost of,
capital and
26
<PAGE> 28

other related operating efficiencies, (ii) increasing demand by customers for a
broader selection and greater availability of rental equipment and (iii) limited
number of alternative exit strategies for many of the owners and principals of
smaller independent companies. The Company believes that this consolidation
trend, the fragmented nature of the industry and the absence of an equipment
rental company with a significant market share present substantial opportunities
for the Company to achieve a leading market position by creating an integrated
network of nationally branded locations offering broad product selection and
superior customer service.

COMPETITIVE STRENGTHS

NationsRent believes it has several competitive strengths that will enable
it to continue to increase growth and profitability, including the following:

area with a 20,000 to 40,000 square foot facility housing a reconditioning
center and a broad selection and extensive inventory of equipment and
supplies. The Company expects that its smaller locations will typically be
on a 2 to 6 acre site in a high-visibility commercial area with a 7,500 to
11,000 square foot facility housing at least one drive-through lane,
maintenance and delivery capabilities and inventory and supplies that are
targeted to the customer base in that area.

Experienced Management Team. The Company believes it has one of the
most experienced and growth-oriented executive management teams among
publicly-traded companies in the equipment rental industry. James L. Kirk,
the Company's Chairman, Chief Executive Officer and President, founded OHM,
a NYSE listed company, in 1969 and served in various senior executive
positions with OHM, growing it into a leading environmental construction
company with an inventory of heavy and light equipment having an original
cost of over $100 million. In addition, the Company will benefit from the
experience of H. Wayne Huizenga, a director of and investor in the Company,
who serves as Chairman and Co-Chief Executive Officer of Republic and who
co-founded and served in various senior executive positions with Waste
Management and Blockbuster, each of which is a leading consolidator in its
respective industry. The other members of the Company's senior management
team have previously worked closely with Mr. Kirk in senior management
positions at OHM, and other key employees and consultants of the Company
have worked with Mr. Huizenga in various positions at Republic, Waste
Management or Blockbuster. The NationsRent management team is supported by
operating, marketing and business development managers with an average of
more than 15 years experience in the equipment rental industry.

GROWTH STRATEGY

Acquire Leading Companies. NationsRent seeks to acquire leading
companies in each market it enters to implement its "cluster" strategy and
position the Company to achieve significant market share. The Company
targets businesses that have one or more of the following characteristics:
(i) strong positions in their geographic market; (ii) experienced local
management teams that will continue to work with the Company following the
acquisition; (iii) high-quality equipment rental inventory; and (iv)
physical and operating characteristics that are suited to conversion to the
NationsRent format. Once the Company has entered a particular market, it
seeks to acquire additional rental businesses in that market or adjacent
markets with locations and equipment selection that complement its existing
operations, thus enabling the Company to further penetrate that market. See
"-- Completed and Pending Acquisitions."

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<PAGE> 30

functions and personnel with the Company's established locations. For a
description of new locations opened by the Company, see "Management's
Discussion and Analysis of Financial Condition and Results of
Operations -- General."

Further Penetrate Industrial Rental Market. The Company believes that
the equipment needs of industrial customers are underserved by the United
States equipment rental market and, as a result, there are significant
opportunities to further penetrate this market segment. NationsRent
believes that by offering a comprehensive selection and available supply of
rental equipment throughout an integrated nationally branded network of
locations, industrial customers will become increasingly aware of the
advantages of equipment rental relative to ownership, including reduced
capital investment, reduced storage and maintenance expense, and greater
access to the most modern equipment. The recent acquisition of Bode-Finn,
which has served industrial customers for over 40 years, has established
the Company as a leading provider of rental equipment to industrial
customers in several geographic markets.

COMPLETED AND PENDING ACQUISITIONS

In furtherance of its growth strategy, NationsRent has acquired or
contracted to acquire 16 equipment rental businesses with 65 locations. These
locations are concentrated in the regions set forth below.

THE MIDWEST REGION

Central/Northern Ohio

In September 1997, the Company acquired Sam's, which has five locations in
the Central/Northern Ohio market that rent primarily light to heavy equipment to
construction and industrial customers, and has been operating in this market for
more than 35 years.

In December 1997, the Company acquired certain assets of R&R, which has two
locations in the Central/Northern Ohio market that rent primarily heavy
equipment and generators to construction customers, and has been operating in
this market for more than ten years.

In January 1998, the Company acquired certain assets of Central, which has
eight locations in the Central/Northern Ohio market that rent primarily light to
medium equipment to construction and industrial customers and homeowners, and
has been operating in this market for more than ten years.

In May 1998, the Company acquired Bode-Finn, which has one location in the
Central/Northern Ohio market that rents and sells primarily medium to heavy
equipment to industrial customers, and has been operating in this market for
more than 40 years.

Ohio River Valley

In November 1997, the Company acquired certain assets of Ashland Rental and
Sales, Inc. ("Ashland"), which has two locations in the Ohio River Valley market
that rent primarily tools and loading equipment to construction and industrial
customers, and has been operating in this market for more than 45 years.

In December 1997, the Company acquired Titan, which has two locations in
the Ohio River Valley market that rent primarily construction equipment,
generators, compactors and light towers to construction customers.

In May 1998, as part of the acquisition of Bode-Finn, the Company acquired
one location in the Ohio River Valley market that rents and sells primarily
medium to heavy equipment to industrial customers.

Indianapolis/Northern Indiana

In December 1997, the Company acquired certain assets of C&E, which has six
locations in the Indianapolis/Northern Indiana market that rent primarily light
to medium equipment to construction customers, and has been operating in this
market for approximately 40 years.

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<PAGE> 31

In April 1998, the Company acquired certain assets of R.F.L. Enterprises,
Inc. ("RFL"), which has one location in the Indianapolis/Northern Indiana market
that rents primarily forklifts, scaffolding and dumpsters to construction and
industrial customers, and has been operating in this market for over 35 years.

In May 1998, the Company acquired certain assets of U-Rent-It Company, Inc.
("U-Rent-It"), which has one location in the Indianapolis/Northern Indiana
market that rents primarily light and lift equipment to construction customers,
and has been operating in this market for almost 40 years.

In June 1998, the Company acquired Raymond Equipment Co., doing business as
Jobs Rentals ("Jobs"), which has one location in the Indianapolis/Northern
Indiana market that rents and sells primarily heavy earth-moving equipment to
construction customers, and has been operating in this market for more than 40
years.

Southwest Ohio/Northern Kentucky

In May 1998, as part of the acquisition of Bode-Finn, the Company acquired
four locations in the Southwest Ohio/Northern Kentucky market that rent and sell
primarily medium to heavy lift equipment to construction and industrial
customers.

In June 1998, as part of the acquisition of Jobs, the Company acquired one
location in the Southwest Ohio/Northern Kentucky market that rents primarily
heavy earth-moving equipment to construction customers.

Louisville/Lexington, Kentucky

In May 1998, as part of the acquisition of Bode-Finn, the Company acquired
two locations in the Louisville/Lexington, Kentucky market that rent and sell
primarily medium to heavy equipment to construction and industrial customers.

In June 1998, as part of the acquisition of Jobs, the Company acquired one
location in the Louisville/ Lexington, Kentucky market that rents primarily
heavy earth-moving equipment to construction customers.

Southwest Pennsylvania

In June 1998, the Company acquired A-Action Rentals, Inc. ("A-Action"),
which has one location in the Southwest Pennsylvania market that rents primarily
medium to heavy equipment and compressors to construction customers, and has
been operating in this market for more than 35 years.

Detroit, Michigan

In May 1998, the Company entered into a definitive agreement to acquire J.
Kelly Co. ("J. Kelly"), which has two locations in the Detroit, Michigan market
that rent primarily light to medium equipment to construction and industrial
customers, and has been operating in this market for 25 years.

THE GULF COAST REGION

Southwest Florida

In April 1998, the Company acquired certain assets of Naples Rent-All &
Sales Company, Inc. ("Naples"), which has two locations in the Southwest Florida
market that rent primarily light to medium equipment to construction customers,
and has been operating in this market for approximately 30 years.

In April 1998, the Company acquired certain assets of Revco Equipment
Rentals, Inc., doing business as Florida Equipment Company, Inc. ("Florida
Equipment"), which has two locations in the Southwest Florida market that rent
primarily medium to heavy equipment to construction customers.

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<PAGE> 32

Florida Panhandle

In May 1998, the Company entered into a definitive agreement to acquire
certain assets of General Rental, Inc. ("General Rental"), including six
locations in the Florida Panhandle market that rent primarily light to medium
equipment to construction and industrial customers.

Southeast Texas

In June 1998, the Company entered into a definitive agreement to acquire
certain assets of Associated, which has four locations in the Southeast Texas
market that rent primarily heavy equipment to construction customers.

In addition, General Rental has seven locations in the Southeast Texas
market that rent primarily light to medium equipment to construction customers.

Louisiana

Associated has three locations in the Louisiana market that rent primarily
heavy earth-moving equipment to construction customers.

OPERATIONS

NationsRent is one of the fastest growing equipment rental companies in the
United States. The Company has acquired or contracted to acquire 16 equipment
rental businesses with 65 locations in Florida, Indiana, Kentucky, Louisiana,
Michigan, Ohio, Pennsylvania, Texas and West Virginia, and as of June 30, 1998,
the Company had opened six new locations and had closed three of the locations
it acquired. The Company's operations primarily consist of (i) renting a broad
variety of equipment to construction and industrial customers, (ii) selling its
used equipment inventory, (iii) selling new equipment as a distributor or dealer
on behalf of several nationally known equipment manufacturers and (iv) selling
parts, supplies and merchandise and providing repair and maintenance services to
complement its equipment rentals and sales.

Equipment Rentals. The Company rents on a daily, weekly and monthly basis
a broad variety of equipment primarily to construction and industrial customers.
The Company's rental inventory includes such equipment as aerial lifts and work
platforms, air compressors, backhoes, boom lifts, bulldozers, ditching
equipment, forklifts, generators, high reach equipment, pumps and scissor lifts.
The mix of equipment offered from each of the Company's locations varies based
on the needs of the local market.

The Company is implementing a program to make ongoing capital investments
in new equipment, engage in periodic sales of used equipment and conduct
preventive maintenance. This program is designed to increase equipment
utilization, enhance resale values and extend the useful life of equipment. As
of December 31, 1997, on a pro forma basis for the Acquisitions, the Company's
equipment rental inventory had an original cost of over $250 million and an
average age of less than 36 months.

NationsRent has developed operating initiatives that it plans to introduce
at all of its locations to offer its rental customers more convenient access,
faster check-in and check-out procedures, reduced equipment downtime and shorter
lead times for rentals than its competitors. For example, all of the Company's
new locations are being designed with drive-through lanes to speed up equipment
loading and unloading. In addition, the Company's rental equipment is being
outfitted with universal trailer hitches designed to accept a broad range of
towing mechanisms to ease customer transport of equipment. To reduce the
downtime associated with flat tires, the Company fills the tires of equipment
used in areas prone to flats with foam instead of air. The Company's rental
locations also will offer equipment delivery and pick-up, on-site repair service
within two hours of customer request, 24-hour customer assistance, and a library
of audio, video and written instructional materials for equipment usage and
safety.

Used Equipment Sales. The Company periodically sells used equipment to
adjust the size and composition of its rental equipment in response to changing
market conditions and to maintain the quality and low average age of its rental
equipment. The Company attempts to balance the revenue obtainable from used

31
<PAGE> 33

equipment sales with the revenue obtainable from continued equipment rentals.
The Company is generally able to achieve favorable resale prices for its used
equipment due to a preventive maintenance program and practice of selling used
equipment before it becomes obsolete or irreparable. The Company believes that
the proactive management of new equipment purchases and used equipment sales
allows it to maximize utilization rates and respond to changing economic
conditions.

New Equipment Sales. The Company is a distributor of new equipment on
behalf of several nationally known equipment manufacturers. The Company has
dealership arrangements in certain geographic areas with various equipment
manufacturers as a result of the Acquisitions. Typically, dealership agreements
do not have a specific term and may be terminated by either party upon specific
events and/or written notice. In the future the Company may continue, amend or
terminate dealership arrangements, if any, of businesses it acquires or it may
enter into new dealership agreements or arrangements, depending on market
conditions in the area and other factors.

Parts, Supplies and Service. The Company sells a full complement of parts,
supplies and merchandise to its customers in conjunction with its equipment
rental and sales business. NationsRent provides repair service to rental
customers and, as part of the Company's focus on customer service, it plans to
respond to rental equipment service requests within two hours. The Company also
offers maintenance service to customers that own equipment and generates revenue
from damage waiver charges, delivery charges and warranty income. The Company
believes that revenue from parts and service is more stable than equipment sales
revenue because of the recurring nature of the parts and service business. The
Company also believes that during economic downturns the parts and service
business may increase as customers postpone new equipment purchases and instead
attempt to maintain their existing equipment.

MANAGEMENT INFORMATION SYSTEM

The Company is customizing a state-of-the-art management information system
capable of monitoring operations at several thousand locations. This innovative
system is being designed to track customer purchasing patterns and demographics
for use in gaining market share in new and existing markets, consolidating
equipment purchases, maximizing utilization rates and reducing overhead
expenditures. This system will provide management with real time revenue,
inventory, financial and customer information, facilitating rapid and well
informed decision making. In addition, this system will permit customers to
reserve and rent equipment and access their account information from their own
computer terminals via the Company's internet website. To develop its customized
system, the Company has assembled a team of management information specialists
who have previously developed systems for Blockbuster and Wal-Mart.

CUSTOMERS

NationsRent currently serves over 70,000 active accounts primarily in the
construction and industrial segments of the equipment rental industry. On a pro
forma basis after giving effect to the Acquisitions, the Company's top ten
customers represented approximately 6% of the Company's 1997 revenue and no
single customer accounted for more than 2% of the Company's 1997 revenue. The
Company's customers vary in size from large Fortune 500 companies to small
construction contractors, subcontractors, machine operators and homeowners.

The Company does not provide purchase financing to customers. The Company
rents equipment, sells parts and provides repair services on account to
customers who are screened through a credit application process. Customers can
arrange financing of purchases of large equipment through a variety of creditors
including manufacturers, banks, finance companies and other financial
institutions.

SALES AND MARKETING

NationsRent maintains a strong marketing and sales orientation throughout
its organization in order to better understand and serve its customers and
increase its customer base. The Company undertakes sales and marketing
initiatives designed to increase revenue and market share and build brand
awareness. The Company prepares marketing situation analyses which address key
business issues such as market/industry history,
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<PAGE> 34

opportunities, company philosophy, sales trends, consumer behavior trends,
distribution channels, pricing issues, target markets, advertising and media
analysis, competitive situations and selling strategies. Based on the results of
its analyses, the Company develops marketing and sales strategies. To assist the
Company in implementing its marketing and sales strategies, NationsRent has
retained a store design and merchandising firm and plans to retain a national
advertising agency.

The Company's district operations managers are responsible for training,
supervising and directing the selling activities of the NationsRent salesforce
in their markets. In addition, district operations managers are also responsible
for overseeing the mix of equipment at their locations, keeping abreast of local
construction and industrial activity and monitoring competitors in their
respective markets.

NationsRent employs approximately 95 equipment rental salespeople who
utilize targeted local marketing strategies to address specific customer needs
and respond to competitive pressures. To remain informed of local market
activity, salespeople track new equipment sales and construction projects in
their area through Equipment Data Reports, F.W. Dodge Reports and PEC Reports
(Planning, Engineering and Construction), follow up on referrals and visit
construction sites and potential equipment users who are new to the area.

TRADEMARKS

The Company has applied to the United States Patent and Trademark Office to
register the service mark "NationsRent."

STORE LAYOUT AND DESIGN

Many of the Company's locations are situated in high-visibility commercial
areas and are designed to offer easy and convenient access to customers. The
Company expects that its larger locations will typically be on a 6 to 12 acre
site in a heavily-trafficked area with a 20,000 to 40,000 square foot facility
housing a reconditioning center and a broad selection and extensive inventory of
equipment and supplies. The Company expects that its smaller locations will
typically be on a 2 to 6 acre lot in a high-visibility commercial area with a
7,500 to 11,000 square foot facility housing at least one drive-through lane,
maintenance and delivery capabilities and inventory and supplies that are
targeted to the customer base in that area. Depending on the type of equipment
rented at a particular location and the needs of the local market, the Company's
locations may include (i) sales and administrative offices, (ii) a customer
showroom displaying equipment and parts, (iii) an equipment service area and
(iv) outdoor and indoor equipment storage facilities.

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<PAGE> 35

PURCHASING

The Company purchases equipment from vendors with reputations for product
quality and reliability. The Company's size and the quantity of equipment it
purchases enables it to purchase most equipment directly from manufacturers
pursuant to national purchasing agreements at lower prices and on more favorable
terms than many smaller competitors. The Company seeks to maintain close
relationships with its vendors to ensure the timely delivery of new equipment.
The Company believes that it has sufficient alternative sources of supply for
the equipment it purchases in each of its principal product categories. The
Company primarily acquires its rental equipment inventory by purchase rather
than lease. The Company selects the type and quantity of rental equipment to be
purchased for each of its locations based on the expected needs of the local
market. The Company determines rental rates for each type of equipment based on
the cost and expected utilization of the equipment, and adjusts its rental rates
at each location for demand, length of rental, volume of equipment rented and
other competitive considerations. The following table summarizes the primary
suppliers of certain of the Company's rental equipment:

<TABLE>
<CAPTION>
PRODUCT CATEGORY PRIMARY SUPPLIERS
---------------- -----------------
<S> <C>
HEAVY
Articulated Trucks Caterpillar/Volvo
Bulldozers Caterpillar/Komatsu/John Deere
Excavators Caterpillar/Komatsu/John Deere
Scrapers Caterpillar/John Deere
Track Loaders Caterpillar/John Deere
MEDIUM
Aerial Lift Platforms Terex/Genie
Backhoes New Holland/Caterpillar/Case/John Deere
Compaction Equipment Ingersoll Rand/BOMAG
Forklifts JCB/Ingersoll Rand/Lull
Knuckle Boom Lifts Terex/Genie
Semi-Pneumatic Forklifts Hyster/Komatsu
Wheel Loaders Volvo/Caterpillar
LIGHT
Air Compressors Ingersoll Rand/Multiquip
Concrete Mixers Whiteman/Essick
Light Towers Ingersoll Rand/Coleman
Power Generators MQ Power/Ingersoll Rand
Skid Steer Loaders New Holland/Bobcat/Case
Trenchers Vermeer/Ditch Witch
Troweling Machines Whiteman/Bartell
Vacuum Pumps Thompson/Godwin
GENERAL RENTAL
Arrow Boards Allman Bros./Amida Industries
Concrete Buggies Miller/Whiteman
Concrete Saws Pardener/Stihl/Olympic
Electric Hammers Bosch/Harper
Plate Compactors Multiquip/BOMAG
Sand Blasters Lindsey
Submersible Pumps Surumi/Multiquip
Welders Lincoln/Miller
</TABLE>

COMPETITION

The equipment rental industry is highly fragmented and competitive. The
Company competes with independent third parties in all of the markets in which
it operates. Most of the Company's competitors in the rental business tend to
operate in specific, limited geographic areas, although some larger competitors
compete on a national basis. The Company also competes with equipment
manufacturers which sell and rent equipment directly to customers. Some of the
Company's competitors have greater financial resources and name recognition than
the Company.

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<PAGE> 36

ENVIRONMENTAL AND SAFETY REGULATION

The Company's equipment, facilities and operations are subject to certain
federal, state and local laws and regulations relating to environmental
protection and occupational health and safety, including those governing
wastewater discharges, the use, treatment, storage and disposal of solid and
hazardous wastes and materials, air quality and the remediation of contamination
associated with the release of hazardous substances. For example, the
Comprehensive Environmental Response, Compensation, and Liability Act of 1980,
as amended, provides for, among other things, the remediation of sites from
which there is a release or threatened release of a hazardous substance into the
environment and may impose liability for the costs of cleanup and for damages to
natural resources upon past and current owners and operators of such sites. In
addition, the Federal Water Pollution Control Act of 1972 regulates the
discharge of pollutants into streams, rivers and other waters and may require
the issuance of discharge permits to the Company. In addition, the Occupational
Safety and Health Act of 1970 authorizes the promulgation of occupational safety
and health standards which apply to the Company's facilities and operations. In
addition to federal environmental and safety regulations, the states and certain
localities in which the Company operates have their own laws and regulations
governing solid waste disposal, water pollution and, in most cases, releases and
cleanup of hazardous substances as well as liability for such matters, which may
be applicable to the Company's facilities and operations. Certain of the
Company's existing and former locations use and have used substances, and
currently generate or have generated or disposed of wastes, which are or may be
considered hazardous or otherwise are subject to applicable environmental
requirements, and the Company may incur liability in connection therewith.
Moreover, there can be no assurance that federal, state or local environmental
and safety requirements will not become more stringent or be interpreted and
applied more stringently in the future. Such future changes or interpretations,
or the identification of adverse environmental conditions currently unknown to
the Company, could result in additional environmental compliance or remediation
costs to the Company. Such compliance and remediation costs could be material to
the Company's financial condition or results of operations.

In particular, the Company stores and dispenses, or in the past stored or
dispensed or the facilities at which it operates in the past stored or
dispensed, petroleum products from aboveground storage tanks and, in certain
cases, underground storage tanks. The Company also uses or operates locations
which in the past used, hazardous materials, including solvents, to clean and
maintain equipment, and generates and disposes of solid and hazardous wastes,
including batteries, used motor oil, radiator fluid and solvents. In connection
with such activities, the Company has incurred capital expenditures and other
compliance costs which are expensed on a current basis and which, to date, have
not been material to the Company's financial condition.

Additionally, in connection with acquisitions of equipment rental
businesses, the Company has undertaken Phase I environmental audits of all
locations that the Company will continue to operate following the acquisition
and expects to continue to do so before acquiring any additional sites. Although
the Company does not currently maintain comprehensive insurance covering
environmental liabilities at all of its sites, certain of the acquired
businesses do have coverage on storage tanks located at their sites. Moreover,
each of the equipment rental businesses acquired by the Company was required to
provide indemnification to the Company with respect to environmental liabilities
associated with such businesses. Based on currently available information, the
Company believes that it will not be required to incur material capital
expenditures or other compliance or remediation costs on environmental and
safety matters in the foreseeable future. See "Risk Factors -- Environmental and
Safety Regulation."

EMPLOYEES

As of June 30, 1998, NationsRent employed approximately 1,000 persons. None
of the Company's employees is represented by a union or covered by a collective
bargaining agreement. The Company believes its relations with its employees are
good.

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<PAGE> 37

PROPERTIES

The Company's corporate headquarters are located in Ft. Lauderdale, Florida
in leased premises. Certain of the Company's property and equipment are subject
to liens securing payment of portions of the Company's indebtedness. The Company
leases the real estate for all but two of its locations and also leases certain
of its equipment. The Company believes that all of its facilities are sufficient
for its current needs.

LEGAL PROCEEDINGS

The Company is a party to pending legal proceedings arising in the ordinary
course of business. While the results of such proceedings cannot be predicted
with certainty, the Company does not believe any of these matters are material
to the Company's financial condition or results of operations.

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<PAGE> 38

MANAGEMENT

EXECUTIVE OFFICERS, DIRECTORS AND KEY EMPLOYEES

The table below sets forth the names and ages of the executive officers,
directors and certain key employees of the Company as well as the positions and
offices held by such persons.

<TABLE>
<CAPTION>
NAME AGE POSITION
---- --- --------
<S> <C> <C>
EXECUTIVE OFFICERS AND DIRECTORS
James L. Kirk............................. 48 Chairman of the Board, Chief Executive Officer and
President
Gene J. Ostrow............................ 43 Executive Vice President and Chief Financial
Officer
Philip V. Petrocelli...................... 39 Executive Vice President
Kris E. Hansel............................ 40 Vice President and Controller
Pamela K.M. Beall......................... 41 Vice President, Secretary and Treasurer
H. Wayne Huizenga......................... 60 Director
Harris W. Hudson.......................... 55 Director
Gary L. Gabriel........................... 55 Director
Thomas H. Bruinooge....................... 54 Director

KEY EMPLOYEES
Thomas C. Richardson...................... 38 Manager, District Operations
Randy W. Elliott.......................... 34 Manager, District Operations
Charles J. Raterman....................... 70 Manager, District Operations
William O. Tracy, III..................... 48 Manager, District Operations
Troy L. Gabriel........................... 32 Manager, Business Development
Michael D. Meenan......................... 44 Manager, Business Development
David E. Harris........................... 50 Manager, Business Development
Michael Nordberg.......................... 51 Manager, Business Development
</TABLE>

Executive Officers and Directors

JAMES L. KIRK is a co-founder of the Company, together with H. Family
Investments, Inc. and Mr. Ostrow, and has served as the Chairman of the Board of
the Company since August 1997 and as Chief Executive Officer and President of
the Company since April 1998. From 1985 to February 1998, Mr. Kirk was Chairman
of the Board, President and Chief Executive Officer of OHM, a NYSE listed
company.

GENE J. OSTROW is a co-founder of the Company, together with H. Family
Investments, Inc. and Mr. Kirk, and has served as its Executive Vice President
and Chief Financial Officer since August 1997. From August 1997 to April 1998,
Mr. Ostrow served as Secretary and Treasurer of the Company. From March 1997 to
October 1997, Mr. Ostrow was Vice President of Corporate Development of OHM.
From November 1994 to March 1997, Mr. Ostrow was a Senior Vice President,
Corporate Finance with Raymond James and Associates and from July 1996 to March
1997, Mr. Ostrow was co-head of that firm's mergers and acquisitions practice.
From October 1993 to November 1994, Mr. Ostrow was Vice President and Chief
Financial Officer of Ecoscience Corporation. Mr. Ostrow was employed by OHM and
its affiliates from February 1986 to October 1993 in various positions,
including Vice President and Chief Financial Officer of OHM from February 1986
through September 1991, and as Executive Vice President and Chief Financial
Officer of NSC Corporation (an affiliate of OHM) from July 1988 through October
1993. Mr. Ostrow is also a Certified Public Accountant.

PHILIP V. PETROCELLI joined the Company as Executive Vice President in
February 1998. From August 1993 to February 1998, Mr. Petrocelli was Vice
President -- Western Region of OHM. Before joining OHM, Mr. Petrocelli was a
Regional Director and acting Vice President-Analytical Labs with IT Corporation,
a provider of engineering services, since September 1988.

37
<PAGE> 39

KRIS E. HANSEL joined the Company as Vice President and Controller in March
1998. Prior to joining the Company, Mr. Hansel served in various positions of
increasing responsibility at OHM since 1988, most recently as Vice President and
Controller. Prior to joining OHM, Mr. Hansel was General Accounting Manager of
WearEver-Proctor Silex, Inc.

PAMELA K.M. BEALL joined the Company as Vice President, Secretary and
Treasurer in April 1998. From June 1985 to April 1998, Ms. Beall served as
Treasurer of OHM and in various positions of increasing responsibility at OHM,
most recently as Vice President and Assistant Secretary. Before joining OHM, Ms.
Beall was General Manager, Treasury Services for USX Corporation, and previous
to that she was with Marathon Oil Company. From November 1996 to February 1998,
Ms. Beall served as a director of NSC Corporation, an affiliate of OHM. Since
May 1996, Ms. Beall has served as a director of System One Services, Inc.

H. WAYNE HUIZENGA joined the Company as a director in June 1998. Since May
1998, Mr. Huizenga has served as Chairman of the Board and Chief Executive
Officer of Republic Services, Inc. ("Republic Services"), a leading provider of
non-hazardous solid waste collection and disposal services. Since August 1995,
Mr. Huizenga has served as Chairman of the Board of Republic, which owns the
nation's largest chain of franchised automotive dealerships, is building a chain
of used vehicle megastores and owns National Car Rental and Alamo Rent-A-Car.
Since October 1996, Mr. Huizenga has served as Co-Chief Executive Officer of
Republic and from August 1995 until October 1996, Mr. Huizenga served as Chief
Executive Officer of Republic. Since September 1996, Mr. Huizenga has served as
the Chairman of the Board of Florida Panthers Holdings, Inc. ("Panthers
Holdings"), a leisure, recreation and entertainment company which owns and
operates certain luxury resort hotels and the Florida Panthers professional
sports franchise. Since January 1995, Mr. Huizenga also has served as the
Chairman of the Board of Extended Stay America, Inc. ("Extended Stay"), an
operator of extended stay lodging facilities. From September 1994 until October
1995, Mr. Huizenga served as the Vice Chairman of Viacom Inc. ("Viacom"), a
diversified entertainment and communications company. During the same period,
Mr. Huizenga also served as the Chairman of the Board of Blockbuster
Entertainment Group, a division of Viacom. From April 1987 through September
1995, Mr. Huizenga served as the Chairman of the Board and Chief Executive
Officer of Blockbuster, during which time he helped build Blockbuster from a
19-store chain into the world's largest video rental company. In September 1994,
Blockbuster merged into Viacom. In 1971, Mr. Huizenga co-founded Waste
Management, which he helped build into the world's largest integrated solid
waste services company, and he served in various capacities, including
President, Chief Operating Officer and a director from its inception until 1984.
Mr. Huizenga is the brother-in-law of Mr. Hudson.

HARRIS W. HUDSON joined the Company as a director in June 1998. Since May
1998, Mr. Hudson has served as Vice Chairman and a director of Republic
Services. Mr. Hudson has served as a director of Republic since August 1995 and
as Vice Chairman of Republic and Chairman of Republic's Solid Waste Group since
October 1996. From August 1995 until October 1996, Mr. Hudson served as
President of Republic. From May 1995 until August 1995, Mr. Hudson served as a
consultant to Republic. From 1983 until August 1995, Mr. Hudson founded and
served as Chairman of the Board, Chief Executive Officer and President of Hudson
Management Corporation, a solid waste collection company, which was acquired by
Republic in August 1995. From 1964 to 1982, Mr. Hudson served as Vice President
of Waste Management of Florida, Inc., a subsidiary of Waste Management and its
predecessor. Mr. Hudson also serves as a director of Panthers Holdings. Mr.
Hudson is the brother-in-law of Mr. Huizenga.

GARY L. GABRIEL joined the Company as a director in June 1998. Since
September 1997, Mr. Gabriel has provided consulting services to the Company on
operational and business development matters. From January 1978 to September
1997, Mr. Gabriel served as President of Sam's, which was acquired by the
Company in September 1997. In 1961, Mr. Gabriel co-founded a predecessor company
of Sam's.

THOMAS H. BRUINOOGE joined the Company as a director in June 1998. Mr.
Bruinooge is an attorney who has been in private practice since 1968 and has
practiced with the firm of Bruinooge & Associates since 1987.

38
<PAGE> 40

The executive officers of the Company are selected by and serve at the
discretion of the Board. The directors of the Company hold office until the next
annual meeting of stockholders and until their successors have been duly elected
and qualified.

Key Employees

THOMAS C. RICHARDSON has eight years of equipment rental industry
experience and joined the Company as Manager, District Operations in September
1997. Since February 1990, Mr. Richardson has served as Vice President of
Operations of Sam's.

RANDY W. ELLIOTT has nine years of equipment rental industry experience and
joined the Company as Manager, District Operations in December 1997. Since
January 1989, Mr. Elliott has served in various positions of increasing
responsibility with C&E, most recently as Vice President of C&E, which was
acquired by the Company in December 1997.

CHARLES J. RATERMAN has 42 years of equipment rental industry experience
and joined the Company as Manager, District Operations in May 1998. Since 1956,
Mr. Raterman has served in various positions of increasing responsibility with
Bode-Finn and since 1989, has served as the President of Bode-Finn, which was
acquired by the Company in May 1998.

WILLIAM O. TRACY, III has 27 years of equipment rental industry experience
and joined the Company as Manager, District Operations in December 1997. In
1971, Mr. Tracy founded Titan and served as President until the Company's
acquisition of Titan in December 1997. Since December 1997, Mr. Tracy has served
as Vice President of Titan.

TROY L. GABRIEL has 11 years of equipment rental industry experience and
joined the Company as Manager, Business Development in September 1997. From 1987
to September 1997, Mr. Gabriel served in various positions of increasing
responsibility with Sam's, most recently as Vice President.

MICHAEL D. MEENAN has seven years of equipment rental industry experience
and joined the Company as Manager, Business Development in January 1998. From
August 1991 to January 1998, Mr. Meenan was Chairman of the Board of Directors
and President of Central, which was acquired by the Company in January 1998.

DAVID E. HARRIS has 14 years of equipment rental industry experience and
joined the Company as Manager, Business Development in March 1998. Prior to
joining the Company, Mr. Harris was a Vice President of Sales and
Marketing -- Heavy Compaction of Dynapac USA from July 1996 to March 1998. From
June 1995 to June 1996, Mr. Harris was a Vice President of Sales and Marketing
with CompAir LeROI International and its predecessors. From March 1994 to July
1995, Mr. Harris was a manager of CompAir-Holman Construction Products. Before
joining CompAir, Mr. Harris was President and Chief Operating Officer of Highway
Rental Co., Inc., an equipment rental company based in Cincinnati, Ohio from
April 1984 to March 1994.

MICHAEL NORDBERG has 28 years of equipment rental industry experience and
joined the Company as Manager, Business Development in April 1998. Prior to
joining the Company, Mr. Nordberg served in various positions of increasing
responsibility at Naples, most recently as Chief Executive Officer and
President, from 1984 until the Company's acquisition of Naples in April 1998.

COMMITTEES OF THE BOARD OF DIRECTORS

Prior to completion of the Offering, the Company intends to establish an
Executive Committee that will have the same powers and authority as the Board of
Directors of the Company (the "Board"), subject to the limitations of the
Delaware General Corporation Law (the "DGCL") and the Company's Certificate of
Incorporation, as amended (the "Certificate"), and Bylaws, as amended (the
"Bylaws"). Prior to consummation of the Offering, Messrs. Kirk and Huizenga are
expected to be appointed as the members of the Executive Committee.

39
<PAGE> 41

After completion of the Offering, the Company intends to establish an Audit
Committee and a Compensation Committee, each composed of two independent
directors. The Audit Committee will recommend the annual appointment of the
Company's auditors, with whom the Audit Committee will review the scope of audit
and non-audit assignments and related fees, accounting principles used by the
Company in financial reporting, internal auditing procedures and the adequacy of
the Company's internal control procedures. The Compensation Committee will
administer the 1998 Stock Option Plan and make recommendations to the Board
regarding compensation for the Company's executive officers.

COMPENSATION OF DIRECTORS

The 1998 Stock Option Plan, which the Company intends to adopt prior to
consummation of the Offering, will provide for an automatic grant of options to
purchase 50,000 shares of Common Stock to each member of the Board who is a
non-employee director at the time of the Offering and to each member of the
Board who joins the Board as a non-employee director thereafter. In addition,
the 1998 Stock Option Plan will provide for an additional automatic grant of
options to purchase 10,000 shares of Common Stock at the beginning of each
fiscal year to each non-employee director continuing to serve on the Board at
such time. All options granted automatically to a non-employee director will be
fully vested and immediately exercisable. In addition, each automatic grant of
options to a non-employee director will remain exercisable for a term of ten
years from the date of grant so long as such person remains a member of the
Board. Each automatic grant of options to a non-employee director serving on the
Board at the time of the Offering will have an exercise price per share equal to
the initial public offering price, and each automatic grant thereafter will be
exercisable at a price per share equal to the closing price of a share of Common
Stock on the NYSE, on the date immediately prior to the automatic grant date. In
addition to such automatic option grant, the Company expects to reimburse
directors for their reasonable expenses incurred when attending Board and
Committee meetings.

In September 1997, in connection with the acquisition of Sam's, the Company
entered into an agreement with Gary L. Gabriel pursuant to which Mr. Gabriel
provides certain consulting services to the Company. See "Certain Relationships
and Transactions."

COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION

During fiscal year ended December 31, 1997, the Company had no Compensation
Committee or other committee of the Board performing similar functions.
Decisions concerning compensation of executive officers were made by certain
executive officers of the Company. It is contemplated that the Board will
establish a Compensation Committee consisting of non-employee directors
following consummation of the Offering. See "-- Committees of the Board of
Directors."

40
<PAGE> 42

EXECUTIVE COMPENSATION

The Company was formed in August 1997 and did not pay any compensation to
its Chief Executive Officer and did not pay salary and bonus in excess of
$100,000 to any of its executive officers for the period from August 14, 1997
(inception) to December 31, 1997. The following table sets forth the annual base
salaries that the Company expects to pay for the year ending December 31, 1998
to the named executive officers below (the "Named Officers") and certain options
to purchase Common Stock which the Company has granted or intends to grant to
the Named Officers:

<TABLE>
<CAPTION>
NUMBER OF
SHARES OF
COMMON STOCK
UNDERLYING
NAME ANNUAL BASE SALARY OPTIONS
- ---- ------------------ ------------
<S> <C> <C>
James L. Kirk................................ $250,000 250,000(1)
Gene J. Ostrow............................... 200,000 100,000(1)
Philip V. Petrocelli......................... 200,000 346,472(2)
Kris E. Hansel............................... 125,000 112,569(3)
Pamela K.M. Beall............................ 125,000 117,505(4)
</TABLE>

- ---------------

(1) The Company intends to grant these options upon consummation of the
Offering. These options will have an exercise price per share equal to the
initial public offering price and will vest over a four year period at the
rate of 25% per year commencing on the first anniversary of the date of
grant.
(2) These options have an exercise price of $5.77 per share and vest over a four
year period at the rate of 25% per year commencing on February 24, 1999.
These options become immediately exercisable upon a change of control of the
Company (as defined in the option agreement related to such options).
(3) These options have an exercise price of $6.66 per share and vest over a four
year period at the rate of 25% per year commencing on March 9, 1999. These
options become immediately exercisable upon a change of control of the
Company (as defined in the option agreement related to such options).
(4) These options have an exercise price of $6.38 per share and vest over a four
year period at the rate of 25% per year commencing on March 19, 1999. These
options become immediately exercisable upon a change of control of the
Company (as defined in the option agreement related to such options).

The executive officers of the Company receive health benefits which do not
exceed 10% of their respective salaries. These benefits are also provided to
other employees of the Company. The Company may pay bonuses and issue additional
stock options to the Named Officers during 1998. See "-- Stock Option Plan."

STOCK OPTION PLAN

Prior to consummation of the Offering, the Company intends to adopt the
1998 Stock Option Plan pursuant to which employees, directors (whether or not
employees), independent contractors and consultants of the Company will be
eligible to receive stock options. The 1998 Stock Option Plan is intended to
promote the long-term financial interests of the Company by encouraging eligible
individuals to acquire an ownership position in the Company and to provide
incentives for performance. The 1998 Stock Option Plan, which is expected to be
approved by the Board, will be effective upon consummation of the Offering. Upon
consummation of the Offering, the Company intends to grant to certain employees,
pursuant to the 1998 Stock Option Plan, options to purchase an aggregate of
shares of Common Stock at the initial public offering price.

401(K) PLAN

The Company intends to adopt a 401(k) Retirement Savings Plan (the "401(k)
Plan") to provide retirement and other benefits to employees of the Company and
to permit employees a means to save for their retirement. The 401(k) Plan is
intended to be a tax-qualified plan under Section 401(a) of the Internal Revenue
Code of 1986, as amended.

41
<PAGE> 43

LIMITATION OF DIRECTORS' LIABILITY AND INDEMNIFICATION

The DGCL authorizes corporations to limit or eliminate the personal
liability of directors to corporations and their stockholders for monetary
damages for breach of the directors' fiduciary duty of care. The Certificate
limits the liability of directors of the Company to the Company or its
stockholders to the fullest extent permitted by Delaware law. Specifically,
directors of the Company will not be personally liable for monetary damages for
breach of a director's fiduciary duty as a director, except for liability (i)
for any breach of the director's duty of loyalty to the Company or its
stockholders, (ii) for acts or omissions not in good faith or which involve
intentional misconduct or knowing violations of law, (iii) under Section 174 of
the DGCL or (iv) for any transaction from which the director derived an improper
personal benefit. The inclusion of this provision in the Certificate may have
the effect of reducing the likelihood of derivative litigation against
directors, and may discourage or deter stockholders or management from bringing
a lawsuit against directors for breach of their duty of care, even though such
an action, if successful, might otherwise have benefited the Company and its
stockholders. This provision has no effect on any non-monetary remedies that may
be available to the Company or its stockholders, nor does it relieve the Company
or its directors from compliance with federal or state securities laws.

The Bylaws provide that the Company shall indemnify any person who was or
is a party or is threatened to be made a party to any threatened, pending or
completed action or suit (each, a "Proceeding") by reason of the fact that he is
or was a director or officer of the Company, or is or was serving at the request
of the Company as a director, officer, employee or agent of another entity,
against expenses (including attorneys' fees) actually and reasonably incurred by
such person in connection with such Proceeding. In addition, the Company intends
to obtain director and officer liability insurance that insures the Company's
directors and officers against certain liabilities.

42
<PAGE> 44

PRINCIPAL STOCKHOLDERS

The following table sets forth information with respect to the beneficial
ownership of the Common Stock immediately prior to and immediately following
consummation of the Offering by (i) each person known to the Company to
beneficially own more than 5% of the outstanding shares of Common Stock, (ii)
each director of the Company and each Named Officer, and (iii) all directors and
executive officers of the Company as a group. Unless otherwise indicated, each
such stockholder has sole voting and investment power with respect to the shares
beneficially owned by such stockholder. Percentages of shares beneficially owned
are based upon 30,118,694 shares and 41,118,694 shares of Common Stock to be
outstanding immediately prior to and immediately following the consummation of
the Offering, respectively, plus for each person named below any shares of
Common Stock that may be acquired by such person within 60 days of the
consummation of the Offering upon exercise of outstanding options or other
rights.

<TABLE>
<CAPTION>
SHARES BENEFICIALLY OWNED SHARES BENEFICIALLY OWNED
BEFORE THE OFFERING AFTER THE OFFERING
--------------------------- ---------------------------
NUMBER OF NUMBER OF
SHARES OF PERCENT OF SHARES OF PERCENT OF
NAME COMMON STOCK COMMON STOCK COMMON STOCK COMMON STOCK
---- ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
H. Family Investments, Inc.(1)... 12,000,000 39.8 12,000,000 29.2
450 East Las Olas Blvd.
Ft. Lauderdale, Florida 33301
James L. Kirk.................... 12,000,000(2) 39.8 12,000,000 29.2
Gene J. Ostrow................... 1,000,000 3.3 1,000,000 2.4
Phillip V. Petrocelli............ 111,276 * 111,276 *
Kris E. Hansel................... 37,092 * 37,092 *
Pamela K.M. Beall................ 92,730 * 92,730 *
H. Wayne Huizenga................ 1,632,047(2)(3) 5.4 1,682,047(3)(4) 4.1
Harris W. Hudson................. 463,650 1.5 513,650(4) 1.2
Gary L. Gabriel.................. -- -- 385,455(4)(5) *
Thomas H. Bruinooge.............. 37,092 * 87,092(4) *
All executive officers and
directors as a group (9
persons)....................... 15,373,887 51.0 15,909,342(5)(6) 38.2
</TABLE>

- ---------------
* Less than 1%

(1) H. Family Investments, Inc. is a Florida corporation controlled by H. Wayne
Huizenga, Jr., the son of Mr. Huizenga.
(2) Does not include shares over which Messrs. Kirk and Huizenga have been
granted irrevocable proxies by purchasers of shares in the Private
Placement, which proxies expire upon consummation of the Offering.

(3) These shares are held by Huizenga Investments Limited Partnership, a Nevada
limited partnership controlled by Mr. Huizenga ("HILP"). The number of
shares of Common Stock beneficially owned by Mr. Huizenga does not include
shares of Common Stock held by H. Family Investments, Inc. because he does
not control such entity and disclaims beneficial ownership of such shares.

(4) Includes 50,000 shares of Common Stock issuable upon exercise of options
which the Company expects to grant to non-employee directors of the Company
under the 1998 Stock Option Plan upon consummation of the Offering, which
options will be immediately exercisable.

(5) Includes 335,455 shares of Common Stock issuable upon conversion of
convertible promissory notes in an aggregate principal amount of $3.69
million, which are convertible at the initial public offering price
(assuming an initial public offering price of $11.00 per share, which is the
midpoint of the estimated range set forth on the cover page of this
Prospectus). See "Description of Certain Indebtedness -- Promissory Notes."

(6) Includes 200,000 shares of Common Stock issuable upon exercise of options
which the Company expects to grant to non-employee directors of the Company
under the 1998 Stock Option Plan upon consummation of the Offering, which
will be immediately exercisable.

43
<PAGE> 45

CERTAIN RELATIONSHIPS AND TRANSACTIONS

In August 1997, the Company was founded by H. Family Investments, Inc. and
Messrs. Kirk and Ostrow (collectively, the "Founders"). H. Family Investments,
Inc. is a Florida corporation controlled by H. Wayne Huizenga, Jr., the son of
Mr. Huizenga. The Founders committed an aggregate of $48.4 million in equity
capital to the Company which was funded at various times from September 1997
through June 2, 1998 as required to complete acquisitions. Prior to consummation
of the Offering, the Company intends to register for resale, subject to the
Lock-up Agreements, under the Securities Act and applicable state securities
laws the shares of Common Stock held by the Founders. The Company intends to pay
any registration expenses incidental to such registration, excluding
underwriters' commissions and deductions.

On June 2, 1998, the Company sold an aggregate of 5,118,694 shares of
Common Stock in the Private Placement for aggregate proceeds of $27.6 million.
The table below sets forth the officers and directors of the Company who
participated in the Private Placement and the number of shares of Common Stock
acquired in such transaction:

<TABLE>
<CAPTION>
NUMBER OF
SHARES OF
NAME COMMON STOCK
- ---- ------------
<S> <C>
H. Wayne Huizenga........................................... 1,632,047(1)
Harris W. Hudson............................................ 463,650
Philip V. Petrocelli........................................ 111,276
Pamela K.M. Beall........................................... 92,730
Kris E. Hansel.............................................. 37,092
Thomas H. Bruinooge......................................... 37,092
</TABLE>

(1) These shares are held by HILP.

The Company has agreed to use reasonable efforts following the consummation
of the Offering to register for resale under the Securities Act and applicable
state securities laws the shares of Common Stock issued in the Private
Placement. The purchasers in the Private Placement also have the right to
include in such registration statement other shares of Common Stock, if any,
owned by them on the date of the Private Placement. The Company is obligated to
pay any registration expenses incidental to such registration, excluding
underwriters' commissions and discounts. This description is qualified in its
entirety by reference to the Subscription Agreement entered into by each of the
purchasers in the Private Placement, a copy of the form of which will be filed
as an exhibit to the Registration Statement.

In May 1998, the Company received an unsecured subordinated loan in the
amount of $17.4 million from HILP. This loan represented bridge financing to
complete certain acquisitions until the Founders could fund the final portion of
their original capital commitments. The principal amount of the loan was repaid
on June 3, 1998 from the Founders' Additional Contribution. Interest in the
amount of approximately $124,000 accrued on this loan and was paid by the
Company on June 3, 1998.

In September 1997, the Company acquired Sam's for $23.4 million from Gary
L. Gabriel, Troy L. Gabriel and certain trusts controlled by them. A portion of
the purchase price was paid by the Company to Gary L. Gabriel and certain trusts
controlled by him in the form of (i) unsecured promissory notes in the aggregate
principal amount of approximately $2.6 million which bear interest at the rate
of 8.5% per annum, (ii) an unsecured convertible promissory note in the
principal amount of approximately $0.7 million which bears interest at the rate
of 6.5% per annum, and (iii) unsecured contingent promissory notes in the
aggregate principal amount of $3.0 million which bear interest at the rate of
6.5% per annum. For a description of certain of the terms of these promissory
notes, see "Description of Certain Indebtedness -- Promissory Notes." As part of
the Sam's acquisition, the Company entered into certain leases on four
properties used in its operations from TTG Properties, an Ohio general
partnership ("TTG"), of which Gary L. Gabriel and Troy L. Gabriel are general
partners. Each of the four leases to which the Company and TTG are a party
commenced on October 1, 1997 and end on September 30, 2002, with three automatic
five-year extensions and grant the Company the option to purchase the leased
premises at any time prior to the lease termination at a fixed price. The
aggregate monthly rental payment to TTG under the leases on the four properties
is $40,000. Also, in
44
<PAGE> 46

connection with the Sam's acquisition, Sam's entered into an agreement with Gary
L. Gabriel pursuant to which Mr. Gabriel provides certain consulting services to
the Company. This agreement has a three year term which automatically renews for
an additional one year term. This agreement provides for an annual salary of
$100,000, and use of a leased vehicle and up to $30,000 of rental equipment per
year. The agreement provides that if Mr. Gabriel's services are terminated at
any time without cause, he will be entitled to receive one year's annual salary
as severance. In addition, the Company intends to enter into leases of certain
facilities in Findlay and Mansfield, Ohio, from TTG.

The Company has entered into certain contracts for building construction
with Alvada Construction, Inc., an entity controlled by Mr. Kirk's brother. The
aggregate amount payable under these contracts is approximately $1.7 million.

The Company currently leases the office space and parking for its corporate
headquarters from Panthers Holdings. The monthly lease amount payable by the
Company is approximately $20,000, which amount includes a share of the operating
expenses for this location based upon estimated usage. In addition, the Company
expects to license from Panthers Holdings the use of an executive suite at the
Broward County Arena, which is operated by Panthers Holdings. The Company may
also enter into a sponsorship agreement with Panthers Holdings for certain
sponsorship, marketing and advertising services. Mr. Huizenga is Chairman of the
Board of Panthers Holdings and controls a majority of the voting interests of
Panthers Holdings. Mr. Hudson is also a director of Panthers Holdings.

With respect to transactions discussed in this section, no independent
determination has been made as to the fairness or reasonableness of the terms
thereof. The Company believes, however, based on its prior experience, that the
terms of each transaction were as favorable to the Company as it could have
obtained from an unaffiliated party.

DESCRIPTION OF CERTAIN INDEBTEDNESS

The following summary description of the Credit Facility, certain
promissory notes and related registration rights is qualified in its entirety by
reference to the Credit Facility, the promissory notes and the registration
rights agreements, copies of which will be filed as exhibits to the Registration
Statement of which this Prospectus is a part.

CREDIT FACILITY

The Company has established the Credit Facility with a syndicate of lenders
and BankBoston, as agent, and expects to enter into the Proposed Amended Credit
Facility prior to consummation of the Offering. Under the Credit Facility, the
Company may borrow up to $225 million on a revolving line of credit which can be
used to complete permitted acquisitions and make capital expenditures and for
working capital and other general corporate purposes. Borrowings under the
Credit Facility may be in the form of base rate loans or at the option of the
Company, eurodollar loans. Upon consummation of the Offering, borrowings under
the Credit Facility will bear interest at either the BankBoston base rate plus a
percentage ranging from 0.00% to 0.50% or, at the Company's option, the
Eurodollar market rate plus a percentage ranging from 1.50% to 3.00%. The
percentage over the BankBoston base rate or the Eurodollar market rate is based
on the Company's financial performance as measured by the total funded debt
ratio (the "Pricing Ratio"). Prior to the consummation of the Offering, the base
rate loans bear interest at the BankBoston base rate plus 0.75% or, at the
Company's option, the Eurodollar market rate plus 3.00%. Interest on the
eurodollar loan is payable on the last day of the applicable interest period
which may be a one, two, three or six month period at the option of the Company.
The Credit Facility is (and the Company expects that the Proposed Amended Credit
Facility will be) secured by a first priority security interest in all assets of
the Company except for purchase money interests, chattel paper and general
intangibles not assignable by law or by terms of license. Borrowings under the
Credit Facility mature and become due and payable in full in July 2001.

45
<PAGE> 47

PROMISSORY NOTES

In connection with certain of the acquisitions completed by the Company,
the Company has issued and, upon the consummation of certain pending
acquisitions the Company will issue, unsecured subordinated promissory notes in
an aggregate principal amount of approximately $56.9 million. An aggregate
principal amount of approximately $49.4 million of such promissory notes are
convertible (the "Convertible Notes") into shares of Common Stock at a
conversion price equal to the initial public offering price and bear interest at
rates ranging between 6.50% and 8.50%. Certain of these convertible promissory
notes become pre-payable by the Company following the Offering based on the
achievement of certain target trading prices of the Common Stock over specified
periods. The remaining promissory notes in the aggregate principal amount of
approximately $7.5 million are not convertible into shares of Common Stock, bear
interest at rates ranging between 6.50% and 8.50% and are pre-payable without
penalty.

Upon consummation of the acquisition of J. Kelly, the Company will issue
Convertible Notes in the aggregate principal amount of $2.5 million (the "Kelly
Notes") and will enter into a registration rights agreement (the "Kelly
Agreement") with the stockholders of J. Kelly (the "Kelly Holders"), granting
piggyback registration rights with respect to the Common Stock into which the
Kelly Notes are convertible. Upon consummation of the acquisition of Associated,
the Company will issue Convertible Notes in the aggregate principal amount of
$10 million (the "Associated Notes") and will enter a registration rights
agreement (the "Associated Agreement") with the stockholders of Associated (the
"Associated Holders"), granting piggyback registration rights with respect to
the Common Stock into which the Associated Notes are convertible. Under the
Kelly Agreement and the Associated Agreement, if the Company proposes to file a
registration statement with respect to the Common Stock (other than in
connection with the Company's initial public offering) anytime after the later
of the first anniversary of the Kelly Agreement or the Associated Agreement, as
applicable, or six months after the date of the Company's initial public
offering (the "IPO Date"), then upon the request of the Kelly Holders or the
Associated Holders, as applicable, the Company will use its reasonable best
efforts to register for resale under the Securities Act and applicable state
securities laws the shares of Common Stock issuable upon conversion of the Kelly
Notes or the Associated Notes, as applicable. The Company has also entered into
a registration rights agreement with the principals of Bode-Finn (the "Bode-Finn
Holders"). See "Description of Capital Stock -- Warrants and Options." The
Company is obligated to pay any registration expenses incidental to such
registration, excluding underwriters' commission and discounts. The Kelly
Holders, the Associated Holders and the Bode-Finn Holders are expected to enter
into Lock-up Agreements with the Underwriters. See "Shares Eligible for Future
Sale."

DESCRIPTION OF CAPITAL STOCK

AUTHORIZED CAPITAL STOCK

The Certificate authorizes capital stock consisting of 5,000,000 shares of
preferred stock, par value $0.01 per share (the "Preferred Stock"), and
250,000,000 shares of Common Stock. Immediately following the Offering,
41,118,694 shares of Common Stock (42,768,694 shares if the Underwriters'
over-allotment option is exercised in full) and no shares of Preferred Stock
will be outstanding. All of the shares of Common Stock that will be outstanding
immediately following the Offering, including the shares of Common Stock sold in
the Offering, will be validly issued, fully paid and nonassessable. The
following summary description of the capital stock of the Company, including
certain warrants, options and convertible promissory notes and related
registration rights, is qualified in its entirety by reference to the
Certificate, the Bylaws and the agreements governing such instruments, copies of
which will be filed as exhibits to the Registration Statement of which this
Prospectus is a part.

COMMON STOCK

The holders of the Common Stock are entitled to one vote for each share on
all matters voted on by stockholders, including elections of directors, and,
except as otherwise required by law or the Certificate, the holders of such
shares will possess all voting power. The Certificate will not provide for
cumulative voting in

46
<PAGE> 48

the election of directors. Subject to any preferential rights of any outstanding
series of Preferred Stock created by the Board from time to time, the holders of
the Common Stock will be entitled to such dividends as may be declared from time
to time by the Board from funds available therefor, and upon liquidation will be
entitled to receive pro rata all assets of the Company available for
distribution to such holders. See "Dividend Policy."

PREFERRED STOCK

The Certificate authorizes the Board to establish one or more series of
Preferred Stock and to determine, with respect to any series of Preferred Stock,
the terms and rights of such series, including (i) the designation of the
series, (ii) the number of shares of the series, which number the Board may
thereafter (except where otherwise provided in the applicable certificate of
designation) increase or decrease (but not below the number of shares thereof
then outstanding), (iii) whether dividends, if any, will be cumulative or
noncumulative, and, in the case of shares of any series having cumulative
dividend rights, the date or dates or method of determining the date or dates
from which dividends on the shares of such series shall be cumulative, (iv) the
rate of any dividends (or method of determining such dividends) payable to the
holders of the shares of such series, any conditions upon which such dividends
will be paid and the date or dates or the method for determining the date or
dates upon which such dividends will be payable, (v) the redemption rights and
price or prices, if any, for shares of the series, (vi) the amount, terms,
conditions and manner of operation of any purchase, retirement or sinking fund
to be provided for the shares of the series, (vii) the rights and the
preferences, if any, of shares of the series in the event of any voluntary or
involuntary liquidation, dissolution or winding up of the affairs of the
Company, (viii) whether the shares of the series will be convertible or
exchangeable into shares of any other class or series, prices or rates of
conversion or exchange and all other terms and conditions upon which such
conversion or exchange may be made, (ix) restrictions on the issuance of shares
of the same series or of any other class or series, (x) the voting rights, if
any, of the holders of the shares of the series and (xi) any other relative
rights, preferences and limitations of such series.

The Company believes that the ability of the Board to issue one or more
series of Preferred Stock will provide the Company with flexibility in
structuring possible future financings and acquisitions, and in meeting other
corporate needs which might arise. The authorized shares of Preferred Stock, as
well as shares of Common Stock, will be available for issuance without further
action by the Company's stockholders, unless such action is required by
applicable law or the rules of any stock exchange or automated quotation system
on which the Company's securities may be listed or traded. Subject to certain
exceptions, the NYSE currently requires stockholder approval as a prerequisite
to listing shares in several instances, including where the present or potential
issuance of shares could result in an increase in the number of shares of common
stock or voting securities outstanding by at least 20%. If the approval of the
Company's stockholders is not required for the issuance of shares of Preferred
Stock or Common Stock, the Board may determine not to seek stockholder approval.

Although the Board has no intention at the present time of doing so, it
could issue a series of Preferred Stock that could, depending on the terms of
such series, impede the completion of a merger, tender offer or other takeover
attempt. The Board will make any determination to issue such shares based on its
judgment as to the best interests of the Company and its stockholders. The
Board, in so acting, could issue Preferred Stock having terms that could
discourage an acquisition attempt through which an acquirer may be able to
change the composition of the Board, including a tender offer or other
transaction that some, or a majority, of the Company's stockholders might
believe to be in their best interests or in which stockholders might receive a
premium for their stock over the then current market price of such stock.

WARRANTS AND OPTIONS

In May 1998, in connection with the acquisition of Bode-Finn, the Company
issued warrants (the "Warrants") to the Bode-Finn Holders to acquire a number of
shares of Common Stock equal to $800,000 divided by the initial public offering
price at an exercise price equal to the initial public offering price. The
Warrants are exercisable for the period commencing 18 months after the IPO Date
and ending on the fifth anniversary of the IPO Date. In addition, in connection
with the acquisition of Bode-Finn, the Company
47
<PAGE> 49

issued Convertible Notes and entered into a registration rights agreement (the
"Bode-Finn Agreement") with the Bode-Finn Holders pursuant to which the Company
has agreed that, if it proposes to file a registration statement with respect to
the Common Stock after the IPO Date, then upon the request of the Bode-Finn
Holders, the Company will use its best efforts to register for resale under the
Securities Act and applicable state securities laws the shares of Common Stock
issuable to the Bode-Finn Holders upon conversion of the Warrants and the
Convertible Notes held by them (the "Registrable Securities"). The Bode-Finn
Agreement also provides that at any time beginning six months after the IPO
Date, Bode-Finn Holders holding at least 25% of the Registrable Securities may
request registration of not less than 50% of the outstanding Registrable
Securities held by each Bode-Finn Holder requesting registration. The Company is
not required to effect more than two registrations pursuant to this provision.
The Company is obligated to pay any registration expenses incidental to such
registration, excluding underwriters' commissions and discounts. The Bode-Finn
Holders are expected to enter into Lock-up Agreements with the Underwriters. See
"Shares Eligible for Future Sale."

The Company has granted to certain employees of the Company options to
purchase an aggregate of 1,087,571 shares of Common Stock, at exercise prices
ranging from $2.96 to $6.69 per share and a weighted average exercise price of
$5.33, which were granted outside of the 1998 Stock Option Plan. These options
vest over a four year period at the rate of 25% per year commencing on the first
anniversary of the date of grant. These options become immediately exercisable
upon a change of the control of the Company (as defined in the option agreements
related to such options).

INDEMNIFICATION

The Certificate provides that the Company shall indemnify each director,
officer, employee or agent of the Company to the fullest extent permitted by
law. The Certificate limits the liability of the Company's directors for
monetary damages in certain circumstances. The Bylaws also provide that the
Company may purchase insurance on behalf of the directors, officers, employees
and agents of the Company against certain liabilities asserted against or
incurred by them in such capacity, whether or not the Company would have the
power to indemnify against such liabilities.

TRANSFER AGENT AND REGISTRAR

The transfer agent and registrar for the Common Stock is Boston EquiServe.

48
<PAGE> 50

SHARES ELIGIBLE FOR FUTURE SALE

Immediately following the consummation of the Offering, the Company will
have 41,118,694 shares of Common Stock outstanding (42,768,694 shares if the
Underwriters' over-allotment option is exercised in full), including 30,118,694
outstanding shares of Common Stock presently beneficially owned by existing
stockholders. The 11,000,000 shares of Common Stock to be sold pursuant to the
Offering (12,650,000 if the Underwriters' over-allotment option is exercised in
full) will be eligible for sale without restriction under the Securities Act in
the public market after the consummation of the Offering by persons other than
Affiliates of the Company. Sales of shares by Affiliates of the Company will be
subject to Rule 144. The Company and the officers, directors and certain
security holders of the Company, who will beneficially own in the aggregate
outstanding shares (or securities convertible into or exercisable for
shares) of Common Stock immediately following the consummation of the Offering,
have agreed with the Underwriters pursuant to Lock-up Agreements not to offer,
sell or otherwise dispose of any shares of Common Stock or any security
convertible into, exercisable for or exchangeable for shares of Common Stock for
a period of 180 days after the date of this Prospectus without the prior written
consent of Bear, Stearns & Co. Inc., except that (i) stockholders may make
transfers as gifts if the donee agrees to be bound by a Lock-up Agreement, (ii)
certain security holders will be permitted to pledge or margin their shares in a
bona fide loan transaction with a third party lender,(iii) the Company may at
any time and from time to time issue shares of Common Stock to third parties as
consideration for the Company's acquisition from such third parties of equipment
rental companies and (iv) the Company may issue options pursuant to the 1998
Stock Option Plan and shares of Common Stock upon the exercise of certain
options granted to non-employee directors. The Company may issue shares of
Common Stock in connection with acquisitions prior to the expiration of the
180-day lock-up period.

The Company has reserved for issuance (i) 5,000,000 shares of Common Stock
issuable in connection with options to be granted under the 1998 Stock Option
Plan, (ii) 1,087,571 shares of Common Stock issuable in connection with certain
outstanding options, (iii) 72,727 shares of Common Stock issuable in connection
with certain outstanding warrants (assuming an initial public offering price of
$11.00 per share, which is the midpoint of the estimated range set forth on the
cover of this Prospectus), and (iv) 4,649,091 shares of Common Stock issuable in
connection with certain outstanding convertible promissory notes (assuming an
initial public offering price of $11.00 per share, which is the midpoint of the
estimated range set forth on the cover of this Prospectus).

Prior to the Offering, there has been no market for the Common Stock of the
Company. The Company can make no predictions as to the effect, if any, that
sales of shares or the availability of shares for sale will have on market
prices prevailing from time to time. Nevertheless, sales of substantial amounts
of the Common Stock of the Company in the public market, or the prospect of such
sales, could adversely affect the market price of the Common Stock.

In general, under Rule 144 as presently in effect, beginning 90 days after
the date of this Prospectus, if a period of at least one year has elapsed since
the later of the date shares of Common Stock that are "restricted securities"
(as that term is defined in Rule 144) were acquired from the Company or the date
they were acquired from an affiliate (as that term is defined in Rule 144) of
the Company, as applicable, then the holder of such restricted shares (including
an Affiliate) is entitled to sell a number of shares within any three-month
period that does not exceed the greater of 1% of the then outstanding shares of
Common Stock (approximately 411,187 shares immediately after the consummation of
the Offering, assuming that the Underwriters' over-allotment option is not
exercised) or the average weekly trading volume of the Common Stock on the NYSE
during the four calendar weeks preceding such sale. The holder may only sell
such shares through unsolicited brokers' transactions. Sales under Rule 144 are
also subject to certain requirements pertaining to the manner of such sales,
notices of such sales and the availability of current public information
concerning the Company. Affiliates may sell shares not constituting restricted
securities in accordance with the foregoing volume limitations and other
requirements but without regard to the two-year holding period requirement.

49
<PAGE> 51

Under Rule 144(k), if a period of at least two years has elapsed since the
later of the date restricted shares were acquired from the Company or the date
they were acquired from an Affiliate of the Company, as applicable, then a
holder of such restricted shares who is not an Affiliate of the Company at the
time of the sale and who has not been an Affiliate of the Company for at least
three months prior to the sale would be entitled to sell the shares immediately
without regard to the volume limitations and other conditions described above.

In connection with the Private Placement, the Company agreed to use its
reasonable efforts following commencement of the Offering to register for resale
shares of Common Stock issued in the Private Placement. Prior to the
consummation of the Offering, the Company intends to file a registration
statement to register for resale on a continuous basis from time to time,
subject to the Lock-up Agreements, 34,840,512 shares of Common Stock, 30,118,694
shares of which are held by the Company's existing stockholders and 4,721,818
shares of which are issuable upon exercise or conversion of outstanding warrants
and convertible promissory notes. The Company intends to cause this registration
statement to become effective prior to the consummation of the Offering and to
maintain its continuous effectiveness, including through filing post-effective
amendments, indefinitely. In addition, the Company intends to register on a
Registration Statement on Form S-8 shares of Common Stock reserved for issuance
upon exercise of options that may be granted to certain employees and
non-employee directors under the 1998 Stock Option Plan. The Company may also
from time to time file registration statements covering the issuance and/or
resale of shares of Common Stock which may be issued in certain potential future
acquisitions.

50
<PAGE> 52

UNDERWRITING

Each of the Underwriters named below (the "Underwriters"), for whom Bear,
Stearns & Co. Inc., BT Alex. Brown, Donaldson, Lufkin & Jenrette Securities
Corporation and NationsBanc Montgomery Securities LLC are acting as
Representatives (the "Representatives"), has agreed, subject to the terms and
conditions of the Underwriting Agreement, to purchase from the Company the
aggregate number of shares of Common Stock set forth opposite its name below:

<TABLE>
<CAPTION>
NUMBER OF
UNDERWRITERS SHARES
------------ ----------
<S> <C>
Bear, Stearns & Co. Inc.....................................
BT Alex. Brown..............................................
Donaldson, Lufkin & Jenrette Securities Corporation.........
NationsBanc Montgomery Securities LLC.......................
----------
Total............................................. 11,000,000
==========
</TABLE>

The Underwriting Agreement provides that the obligations of the
Underwriters thereunder are subject to approval of certain legal matters by
their counsel and to various other conditions. The nature of the obligations of
the Underwriters is such that they are committed to purchase all of the shares
of Common Stock offered hereby if any are purchased.

The Representatives have advised the Company that the Underwriters propose
initially to offer the shares of Common Stock offered hereby directly to the
public at the public offering price set forth on the cover page of this
Prospectus. The Underwriters may allow a selected dealer concession of not more
than $ per share, and the Underwriters may allow, and such dealers may
reallow, concessions not in excess of $ per share, to certain other
dealers. After the Offering, the offering price and concessions and reallowances
to dealers may be changed by the Representatives.

The Company has granted an option to the Underwriters, exercisable at any
time during the 30-day period after the date of this Prospectus, to purchase
from the Company up to 1,650,000 additional shares of Common Stock to cover
over-allotments, if any, at the public offering price set forth on the cover
page of this Prospectus (less underwriting discounts and commissions). To the
extent that the Underwriters exercise this option, each Underwriter will be
committed, subject to certain conditions, to purchase a number of the additional
shares of Common Stock proportionate to such Underwriter's purchase obligations
set forth in the foregoing table.

The Underwriting Agreement provides that the Company will indemnify the
several Underwriters against certain liabilities, including liabilities under
the Securities Act or will contribute to payments the Underwriters may be
required to make in respect thereof.

Each of the Company and the officers, directors and certain security
holders of the Company have entered into Lock-up Agreements with the
Underwriters with respect to the sale of shares of Common Stock. Under these
Lock-up Agreements, each of the Company and the officers, directors and certain
security holders of the Company has agreed not to offer, sell, agree to sell,
grant any option for the sale of or otherwise dispose of, directly or
indirectly, any shares of Common Stock or any security convertible into,
exercisable for or exchangeable for Common Stock without the prior written
consent of Bear, Stearns & Co. Inc. for a period of 180 days after the date of
this Prospectus, except that (i) stockholders may make transfers as gifts if the
donee agrees to be bound by a Lock-up Agreement, (ii) certain security holders
will be permitted to pledge or margin their shares in a bona fide loan
transaction with a third party lender, (iii) the Company may at any time and
from time to time issue shares of Common Stock to third parties as consideration
for the Company's acquisition from such third parties of equipment rental
companies and (iv) the Company may issue options pursuant to the 1998 Stock
Option Plan and shares of Common Stock upon the exercise of certain options
granted to non-employee directors. After the expiration or upon a waiver of the
Lock-up Agreements, such
51
<PAGE> 53

persons will be entitled to sell, distribute or otherwise dispose of the Common
Stock that they hold subject to the provisions of applicable securities laws.

Prior to the Offering, there has been no public market for the Common Stock
of the Company. Consequently, the initial offering price for the Common Stock
was determined by negotiations between the Company and the Representatives.
Among the factors considered in such negotiations were the results of operations
of the Company in recent periods, estimates of the prospects of the Company and
the industry in which the Company competes, an assessment of the Company's
management, the general condition of the securities markets at the time of the
Offering and the prices of similar securities of generally comparable companies.
The Company has applied to list the Common Stock on the NYSE, under the symbol
"NRI." There can be no assurance, however, that an active or orderly trading
market will develop for the Common Stock or that the Common Stock will trade in
the public markets subsequent to the Offering at or above the initial offering
price.

Certain persons participating in the Offering may engage in transactions
that stabilize, maintain, or otherwise affect the price of the Common Stock
during and after the Offering. Specifically, the Underwriters may over-allot or
otherwise create a short position in the Common Stock for their own account by
selling more shares of Common Stock than have been sold to them by the Company.
The Underwriters may elect to cover any such short position by purchasing shares
of Common Stock in the open market or by exercising the over-allotment option
granted to the Underwriters. In addition, such persons may stabilize or maintain
the price of the Common Stock by bidding for or purchasing shares of Common
Stock in the open market and may impose penalty bids, under which selling
concessions allowed to syndicate members or other broker-dealers participating
in the Offering are reclaimed if shares of Common Stock previously distributed
in the Offering are repurchased in connection with stabilization transactions or
otherwise. The effect of these transactions may be to stabilize or maintain the
market price of the Common Stock at a level above that which might otherwise
prevail in the open market. The imposition of a penalty may also affect the
price of the Common Stock to the extent that it discourages resale thereof. No
representation is made as to the magnitude or effect of any such stabilization
or other transactions. Such transactions may be effected on the NYSE or
otherwise and, if commenced, may be discontinued at any time.

LEGAL MATTERS

The validity of the Common Stock offered hereby will be passed upon for the
Company by Akerman, Senterfitt & Eidson, P.A., Miami, Florida. Certain legal
matters in connection with the Common Stock offered hereby will be passed upon
for the Underwriters by Paul, Hastings, Janofsky & Walker LLP, New York, New
York.

EXPERTS

The financial statements of the Company, Gabriel Trailer Manufacturing
Company, Inc., R. and R. Rental, Inc., C & E Rental and Service, Inc., Titan
Rentals, Inc., The Bode-Finn Company, RFL Enterprises, Inc., Naples Rent-All &
Sales Company, Inc., Raymond Equipment Company, Inc., The Florida Panhandle and
Southeast Texas Divisions of General Rental, Inc. and Associated Rental
Equipment Management Company, Inc. included in this Prospectus and the Schedule
of the Company included elsewhere in the Registration Statement have been
audited by Arthur Andersen LLP, independent certified public accountants, as
indicated in their reports with respect thereto, and are included herein in
reliance upon the authority of said firm as experts in giving said reports.

52
<PAGE> 54

ADDITIONAL INFORMATION

The Company has filed with the Securities and Exchange Commission (the
"Commission") a Registration Statement on Form S-1 under the Securities Act with
respect to the shares of Common Stock offered hereby. This Prospectus, which
constitutes part of the Registration Statement, does not contain all of the
information set forth in the Registration Statement and the exhibits and
schedules thereto. For further information with respect to the Company and the
Common Stock, reference is hereby made to such Registration Statement and the
exhibits and schedules thereto. The summaries in this Prospectus of additional
information included in the Registration Statement or any exhibit thereto are
qualified in their entirety by reference to such information or exhibit. The
Registration Statement, including all exhibits thereto and amendments thereof,
has been filed with the Commission through EDGAR.

On the closing date of the Offering, the Company will be subject to the
informational requirements of the Securities Exchange Act of 1934, as amended,
and in accordance therewith, will file reports, proxy statements and other
information with the Commission. Such reports, proxy statements and other
information, as well as the Registration Statement and the exhibits and
schedules thereto, may be inspected, without charge, at the public reference
facility maintained by the Commission at Room 1024, Judiciary Plaza, 450 Fifth
Street, N.W., Washington, D.C. 20549, and at the Commission's regional offices
located at Seven World Trade Center, New York, New York 10048 and Northwestern
Atrium Center, 500 West Madison Street, Suite 1400, Chicago, Illinois
60661-2511. Copies of such material may also be obtained from the Public
Reference Section of the Commission at 450 Fifth Street, N.W., Washington, D.C.
20549, at prescribed rates. Such materials can also be inspected at the offices
of the NYSE, 20 Broad Street, New York, New York 10005 or on the Commission's
site on the Internet at http://www.sec.gov.

53
<PAGE> 55

NATIONSRENT, INC.

INDEX TO PRO FORMA CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)

<TABLE>
<CAPTION>
PAGE
-----
<S> <C>
NATIONSRENT, INC.
Introduction to Pro Forma Consolidated Financial
Statements............................................. PF-2
Pro Forma Consolidated Balance Sheet at March 31, 1998.... PF-3
Pro Forma Consolidated Statements of Operations for the
year ended December 31, 1997........................... PF-4
Predecessor Pro Forma Consolidated Statements of
Operations for the year ended December 31, 1997........ PF-5
Acquisitions Consolidated Statements of Operations for the
year ended December 31, 1997........................... PF-6
Pro Forma Consolidated Statements of Operations for the
three months ended March 31, 1998...................... PF-7
Pro Forma Consolidated Statements of Operations for the
three months ended March 31, 1997...................... PF-8
Notes to Unaudited Pro Forma Consolidated Financial
Statements............................................. PF-9
</TABLE>

PF-1
<PAGE> 56

NATIONSRENT, INC.

INTRODUCTION TO PRO FORMA CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

The following pro forma consolidated financial statements of the Company
present the pro forma consolidated balance sheet at March 31, 1998 and the pro
forma consolidated statements of operations for the year ended December 31, 1997
and the three months ended March 31, 1997 and March 31, 1998. The pro forma
consolidated financial statements give effect to the Acquisitions, the Founders'
Additional Contribution, the Private Placement, certain borrowings under the
Proposed Amended Credit Facility, and the Offering. The pro forma consolidated
balance sheet at March 31, 1998 gives effect to the transactions and events
described above as if they occurred on March 1, 1998. The pro forma consolidated
statements of operations for the year ended December 31, 1997 and three months
ended March 31, 1997 reflect the Acquisitions as if they occurred on January 1,
1997. The pro forma consolidated statements of operations for the three months
ended March 31, 1998 are comprised of the historical results of the Company,
which include the results of operations of all businesses acquired during 1997
and the first quarter of 1998 (consisting of Sam's Equipment Rental, Inc.
("Sam's"), Ashland Rental and Sales, Inc. ("Ashland"), R. and R. Rental, Inc.
("R&R"), C&E Rental and Service, Inc. ("C&E"), Titan Rentals, Inc. ("Titan") and
Central Rent-All, Inc. ("Central")), and reflect the results of operations of
all businesses acquired and to be acquired in the Acquisitions completed and
pending subsequent to March 31, 1998 as if they occurred on January 1, 1998. All
of the businesses acquired and to be acquired by the Company in the Acquisitions
are collectively referred to herein as the "Acquired Businesses."

The pro forma consolidated financial statements are based upon available
information and certain assumptions considered reasonable by management. The pro
forma consolidated financial statements do not reflect the potential cost
savings the Company may have achieved had the Company owned the Acquired
Businesses for the full period. Accordingly, these statements are not
necessarily indicative of the actual results of operations that might have
occurred, nor are they necessarily indicative of expected results in the future.

The pro forma consolidated financial statements should be read in
conjunction with the Company's Consolidated Financial Statements and
management's discussion thereof contained elsewhere in this Prospectus.

PF-2
<PAGE> 57
NATIONSRENT, INC.

PRO FORMA CONSOLIDATED BALANCE SHEET

MARCH 31, 1998

UNAUDITED

(DOLLARS IN THOUSANDS)

<TABLE>
<CAPTION>
COMPLETED ACQUISITIONS PENDING ACQUISITIONS
----------------------------------------------------- -----------------------------------
HISTORICAL OTHER OTHER
COMPANY RFL BODE-FINN NAPLES JOBS ACQUISITIONS GENERAL ASSOCIATED ACQUISITIONS
---------- ------ --------- ------- ------- ------------ ------- ---------- ------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
ASSETS
Cash and cash
equivalents.......... $ 650 $ 390 $ 887 $ 87 $ 1,342 $ 170 $ 6 $ 3,912 $ 189
Accounts receivable,
net.................. 4,214 170 7,250 448 2,198 1,424 1,655 4,888 802
Inventories............ 1,864 181 4,856 957 752 2,065 247 749 1,224
Prepaid expenses and
other assets......... 2,150 -- 849 55 397 485 19 462 268
Rental equipment,
net.................. 49,063 1,333 21,921 866 33,705 8,698 11,610 66,135 1,229
Property and equipment,
net.................. 3,315 198 990 145 2,868 876 374 5,392 179
Intangible assets
related to acquired
business, net........ 41,522 -- -- -- -- -- 3,361 -- --
-------- ------ ------- ------- ------- ------- ------- ------- -------
Total assets..... $102,778 $2,272 $36,753 $ 2,558 $41,262 $13,718 $17,272 $81,538 $ 3,891
======== ====== ======= ======= ======= ======= ======= ======= =======

LIABILITIES AND STOCKHOLDERS' EQUITY
Accounts payable....... $ 10,192 $ 1 $ 3,922 $ 565 $ 883 $ 781 $ 1,315 $ 1,274 $ 1,069
Accrued expenses and
other liabilities.... 4,943 55 5,095 173 328 257 1,893 2,275 295
Debt................... 52,230 743 15,839 171 23,469 9,189 12,338 67,781 534
Income taxes payable... 675 -- -- -- -- -- -- -- --
Deferred taxes......... 2,644 -- -- -- -- 430 -- -- 83
-------- ------ ------- ------- ------- ------- ------- ------- -------
Total
liabilities.... 70,684 799 24,856 909 24,680 10,657 15,546 71,330 1,981
Stockholders' equity
Treasury stock......... -- -- -- (329) -- (295) -- -- --
Common stock........... 250 10 125 51 630 77 -- 1 15
Additional paid-in
capital.............. 30,750 -- -- 7 -- 424 -- 25 14
Retained earnings...... 1,094 1,463 11,772 1,920 15,952 2,855 1,726 10,182 1,881
-------- ------ ------- ------- ------- ------- ------- ------- -------
Total
stockholders'
equity......... 32,094 1,473 11,897 1,649 16,582 3,061 1,726 10,208 1,910
-------- ------ ------- ------- ------- ------- ------- ------- -------
Total liabilities
and
stockholders'
equity......... $102,778 $2,272 $36,753 $ 2,558 $41,262 $13,718 $17,272 $81,538 $ 3,891
======== ====== ======= ======= ======= ======= ======= ======= =======
<CAPTION>
PRO FORMA OFFERING PRO FORMA
ADJUSTMENTS PRO FORMA ADJUSTMENTS AS ADJUSTED
----------- --------- ----------- -----------
<S> <C> <C> <C> <C>
ASSETS
Cash and cash
equivalents.......... $ (2,861)(a) $ 4,772 -- $ 4,772
Accounts receivable,
net.................. -- 23,049 -- 23,049
Inventories............ -- 12,895 -- 12,895
Prepaid expenses and
other assets......... -- 4,685 -- 4,685
Rental equipment,
net.................. 7,275(b) 201,835 -- 201,835
Property and equipment,
net.................. (7,368)(a) 6,969 -- 6,969
Intangible assets
related to acquired
business, net........ 105,335(c) 150,218 -- 150,218
-------- -------- -------- --------
Total assets..... $102,381 $404,423 -- $404,423
======== ======== ======== ========
LIABILITIES AND STOCKHOLD
Accounts payable....... $ (1,315)(a) $ 18,687 -- $ 18,687
Accrued expenses and
other liabilities.... (1,893)(a) 13,421 -- 13,421
Debt................... 106,257(d) 288,551 (110,530)(i) 178,021
Income taxes payable... -- 675 -- 675
Deferred taxes......... 2,838(e) 5,995 -- 5,995
-------- -------- -------- --------
Total
liabilities.... 105,887 327,329 (110,530) 216,799
Stockholders' equity
Treasury stock......... 624(f) -- --
Common stock........... (858)(g) 301 110(i) 411
Additional paid-in
capital.............. 44,479(h) 75,699 110,420(i) 186,119
Retained earnings...... (47,751)(f) 1,094 -- 1,094
-------- -------- -------- --------
Total
stockholders'
equity......... (3,506) 77,094 110,530 187,624
-------- -------- -------- --------
Total liabilities
and
stockholders'
equity......... $102,381 $404,423 $ -- $404,423
======== ======== ======== ========
</TABLE>

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

PF-3
<PAGE> 58

NATIONSRENT, INC.

PRO FORMA CONSOLIDATED STATEMENTS OF OPERATIONS

FOR THE YEAR ENDED DECEMBER 31, 1997

(UNAUDITED)

<TABLE>
<CAPTION>
COMBINED
PRO FORMA COMPLETED
HISTORICAL AND PENDING ACQUISITION PRO FORMA OFFERING PRO FORMA
COMPANY ACQUISITIONS ADJUSTMENTS COMBINED ADJUSTMENTS AS ADJUSTED
---------- ------------ ----------- --------- ----------- -----------
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)
<S> <C> <C> <C> <C> <C> <C>
Revenue:
Equipment rentals........................ $18,367 $ 93,713 -- $112,080 -- $112,080
Sales of equipment, merchandise, parts
and supplies........................... 4,622 97,146 -- 101,768 -- 101,768
------- -------- ------- -------- -------- --------
Total revenue...................... 22,989 190,859 -- 213,848 -- 213,848
Cost of revenue:
Cost of equipment rentals, excluding
depreciation........................... 5,669 32,494 47(a) 38,210 -- 38,210
Rental equipment depreciation............ 3,701 27,659 (7,047)(b) 24,313 -- 24,313
Sales of equipment, merchandise, parts
and supplies........................... 3,538 71,132 23(c) 74,693 -- 74,693
------- -------- ------- -------- -------- --------
Total cost of revenue.............. 12,908 131,285 (6,977) 137,216 -- 137,216
------- -------- ------- -------- -------- --------
Gross profit............................... 10,081 59,574 6,977 76,632 -- 76,632
Operating expenses:
Selling, general and administrative
expenses............................... 3,391 35,313 (3,744)(d) 35,078 -- 35,078
118(e)
Depreciation and amortization of
non-rental property and equipment...... 685 2,060 (693)(f) 4,860 -- 4,860
2,808(g)
------- -------- ------- -------- -------- --------
Total operating expenses........... 4,076 37,373 (1,511) 39,938 -- 39,938
------- -------- ------- -------- -------- --------
Operating income........................... 6,005 22,201 8,488 36,694 -- 36,694
Other (income)/expense
Interest expense......................... 2,487 9,535 8,678(h) 20,700 (9,329)(h) 11,371
Other (income)/expense, net.............. 12 (954) 300(i) (642) -- (642)
------- -------- ------- -------- -------- --------
Total other (income)/expense....... 2,499 8,581 8,978 20,058 (9,329) 10,729
------- -------- ------- -------- -------- --------
Income before provision for income taxes... 3,506 13,620 (490) 16,636 9,329 25,965
Provision for income taxes............... 1,472 5,508 6(j) 6,986 3,918(j) 10,904
------- -------- ------- -------- -------- --------
Net income......................... $ 2,034 $ 8,112 $ (496) $ 9,650 $ 5,411 $ 15,061
======= ======== ======= ======== ======== ========
Basic and diluted net income per
share............................ $ 0.08 $ 0.32 $ 0.37
======= ======== ========
</TABLE>

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

PF-4
<PAGE> 59

NATIONSRENT, INC.

PREDECESSOR PRO FORMA CONSOLIDATED STATEMENTS OF OPERATIONS

FOR THE YEAR ENDED DECEMBER 31, 1997

(UNAUDITED)

<TABLE>
<CAPTION>
HISTORICAL HISTORICAL PRO FORMA
PREDECESSOR PREDECESSOR COMPANY ADJUSTMENTS PRO FORMA
JANUARY 1, 1997 APRIL 1, 1997 TO INCEPTION TO TO PREDECESSOR HISTORICAL
TO MARCH 31, 1997 AUGUST 31, 1997 DECEMBER 31, 1997 AND COMPANY COMPANY
----------------- ---------------- ----------------- -------------- ----------
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)
<S> <C> <C> <C> <C> <C>
Revenue:
Equipment rentals.................. $2,442 $8,515 $7,410 -- $18,367
Sales of equipment, merchandise,
parts and supplies............... 1,522 1,205 1,895 -- 4,622
------ ------ ------ ----- -------
Total revenue................ 3,964 9,720 9,305 -- 22,989
Cost of revenue:
Cost of equipment rentals,
excluding depreciation........... 1,280 2,193 2,196 -- 5,669
Rental equipment depreciation...... 794 1,848 1,526 (467)(b) 3,701
Sales of equipment, merchandise,
parts and supplies sold.......... 863 984 1,691 -- 3,538
------ ------ ------ ----- -------
Total cost of revenue........ 2,937 5,025 5,413 (467) 12,908
------ ------ ------ ----- -------
Gross profit......................... 1,027 4,695 3,892 467 10,081
Operating expenses:
Selling, general and administrative
expenses......................... 970 1,683 1,081 (343)(d) 3,391
Depreciation and amortization of
non-rental property and
equipment........................ 25 115 284 (47)(f) 685
308(g)
------ ------ ------ ----- -------
Total operating expenses..... 995 1,798 1,365 (82) 4,076
------ ------ ------ ----- -------
Operating income..................... 32 2,897 2,527 549 6,005
Other (income)/expense
Interest expense................... 229 580 760 918(h) 2,487
Other (income)/expense, net........ (50) 62 -- -- 12
------ ------ ------ ----- -------
Total other
(income)/expense........... 179 642 760 918 2,499
------ ------ ------ ----- -------
Income before provision for income
taxes.............................. (147) 2,255 1,767 (369) 3,506
Provision for income taxes......... (59) 939 766 (174)(j) 1,472
------ ------ ------ ----- -------
Net income (loss)............ $ (88) $1,316 $1,001 $(195) $ 2,034
====== ====== ====== ===== =======
Basic and diluted net income
per share.................. $ 0.04 $ 0.08
====== =======
</TABLE>

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

PF-5
<PAGE> 60

NATIONSRENT, INC.

ACQUISITIONS CONSOLIDATED STATEMENTS OF OPERATIONS

FOR THE YEAR ENDED DECEMBER 31, 1997

(UNAUDITED)
<TABLE>
<CAPTION>

COMPLETED ACQUISITIONS
--------------------------------------------------------------------------
R & R C & E TITAN RFL BODE-FINN NAPLES JOBS OTHER
------ ------ ------ ------ --------- ------ ------- -------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Revenue:
Equipment rentals................ $2,409 $4,506 $1,927 $ 966 $20,212 $2,262 $12,651 $11,459
Sales of equipment, merchandise,
parts and supplies............. 2,107 2,768 3,042 2,077 41,038 3,805 8,307 9,348
------ ------ ------ ------ ------- ------ ------- -------
Total revenue.............. 4,516 7,274 4,969 3,043 61,250 6,067 20,958 20,807
Cost of revenue:
Cost of equipment rentals,
excluding depreciation......... 1,398 1,846 1,303 463 4,978 1,707 2,423 5,840
Rental equipment depreciation.... 631 766 302 261 7,266 440 4,520 2,669
Sales of equipment, merchandise,
parts and supplies sold........ 1,808 1,791 2,043 1,472 28,584 2,967 6,150 7,182
------ ------ ------ ------ ------- ------ ------- -------
Total cost of revenue...... 3,837 4,403 3,648 2,196 40,828 5,114 13,093 15,691
------ ------ ------ ------ ------- ------ ------- -------
Gross profit....................... 679 2,871 1,321 847 20,422 953 7,865 5,116
Operating expenses:
Selling, general and
administrative expenses........ 715 1,417 824 209 16,597 518 2,373 3,139
Depreciation and amortization of
non-rental property and
equipment...................... 76 157 16 23 257 45 212 266
------ ------ ------ ------ ------- ------ ------- -------
Total operating expenses... 791 1,574 840 232 16,854 563 2,585 3,405
------ ------ ------ ------ ------- ------ ------- -------
Operating income................... (112) 1,297 481 615 3,568 390 5,280 1,711
Other (income)/expense
Interest expense................. 80 101 34 92 1,602 23 1,846 1,057
Other (income)/expense, net...... (30) (61) 7 (15) (348) (52) -- (111)
------ ------ ------ ------ ------- ------ ------- -------
Total other
(income)/expense......... 50 40 41 77 1,254 (29) 1,846 946
------ ------ ------ ------ ------- ------ ------- -------
Income before provision for income
taxes............................ (162) 1,257 440 538 2,314 419 3,434 765
Provision for income taxes....... -- 503 168 215 929 167 1,374 306
------ ------ ------ ------ ------- ------ ------- -------
Net income (loss).......... $ (162) $ 754 $ 272 $ 323 $ 1,385 $ 252 $ 2,060 $ 459
====== ====== ====== ====== ======= ====== ======= =======

<CAPTION>
COMBINED
PENDING ACQUISITIONS COMPLETED
------------------------------ AND PENDING
GENERAL ASSOCIATED OTHER ACQUISITIONS
------- ---------- ------- ------------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C> <C>
Revenue:
Equipment rentals................ $7,238 $24,261 $ 5,822 $ 93,713
Sales of equipment, merchandise,
parts and supplies............. 1,876 16,527 6,251 97,146
------ ------- ------- --------
Total revenue.............. 9,114 40,788 12,073 190,859
Cost of revenue:
Cost of equipment rentals,
excluding depreciation......... 4,018 4,973 3,545 32,494
Rental equipment depreciation.... 942 8,626 1,236 27,659
Sales of equipment, merchandise,
parts and supplies sold........ 1,204 13,464 4,467 71,132
------ ------- ------- --------
Total cost of revenue...... 6,164 27,063 9,248 131,285
------ ------- ------- --------
Gross profit....................... 2,950 13,725 2,825 59,574
Operating expenses:
Selling, general and
administrative expenses........ 1,495 6,143 1,883 35,313
Depreciation and amortization of
non-rental property and
equipment...................... 407 466 135 2,060
------ ------- ------- --------
Total operating expenses... 1,902 6,609 2,018 37,373
------ ------- ------- --------
Operating income................... 1,048 7,116 807 22,201
Other (income)/expense
Interest expense................. 704 3,748 248 9,535
Other (income)/expense, net...... -- (358) 14 (954)
------ ------- ------- --------
Total other
(income)/expense......... 704 3,390 262 8,581
------ ------- ------- --------
Income before provision for income
taxes............................ 344 3,726 545 13,620
Provision for income taxes....... 138 1,490 218 5,508
------ ------- ------- --------
Net income (loss).......... $ 206 $ 2,236 $ 327 8,112
====== ======= ======= ========
</TABLE>

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

PF-6
<PAGE> 61
NATIONSRENT, INC.

PRO FORMA CONSOLIDATED STATEMENTS OF OPERATIONS

FOR THE THREE MONTHS ENDED MARCH 31, 1998

(UNAUDITED)

<TABLE>
<CAPTION>
COMPLETED ACQUISITIONS PENDING ACQUISITIONS
------------------------------------------- -----------------------------
HISTORICAL BODE
COMPANY RFL FINN NAPLES JOBS OTHER GENERAL ASSOCIATED OTHER
---------- ---- --------- ------ ------ ------ ------- ---------- ------
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Revenue:
Equipment rentals............... $5,911 $202 $ 4,687 $ 513 $1,377 $1,510 $2,209 7,153 $ 486
Sales of equipment, merchandise,
parts and supplies............ 3,128 507 10,024 893 2,635 1,501 311 4,290 1,061
------ ---- ------- ------ ------ ------ ------ ------- ------
Total revenue............. 9,039 709 14,711 1,406 4,012 3,011 2,520 11,443 1,547
Cost of revenue:
Cost of equipment rentals,
excluding depreciation........ 2,661 103 1,399 395 1,674 765 1,378 1,282 455
Rental equipment depreciation... 1,076 77 1,833 94 1,161 466 291 2,643 112
Sales of equipment, merchandise,
parts and supplies sold....... 2,252 327 6,754 687 1,142 1,036 204 3,665 747
------ ---- ------- ------ ------ ------ ------ ------- ------
Total cost of revenue..... 5,989 507 9,986 1,176 3,977 2,267 1,873 7,590 1,314
------ ---- ------- ------ ------ ------ ------ ------- ------
Gross profit...................... 3,050 202 4,725 230 35 744 647 3,853 233
Operating expenses:
Selling, general and
administrative expenses....... 1,758 46 3,965 120 343 416 298 1,474 245
Depreciation and amortization of
non-rental property and
equipment..................... 447 2 62 9 57 29 115 123 34
------ ---- ------- ------ ------ ------ ------ ------- ------
Total operating
expenses................ 2,205 48 4,027 129 400 445 413 1,597 279
------ ---- ------- ------ ------ ------ ------ ------- ------
Operating income.................. 845 154 698 101 (365) 299 234 2,256 (46)
Other (income)/expense
Interest expense................ 808 16 380 4 419 207 295 1,226 17
Other (income)/expense, net..... (123) -- (86) (13) -- -- -- (95) 38
------ ---- ------- ------ ------ ------ ------ ------- ------
Total other
(income)/expense........ 685 16 294 (9) 419 207 295 1,131 55
------ ---- ------- ------ ------ ------ ------ ------- ------
Income before provision for income
taxes........................... 160 138 404 110 (784) 92 (61) 1,125 (101)
Provision for income taxes...... 67 55 161 44 (314) 37 -- 450 (40)
------ ---- ------- ------ ------ ------ ------ ------- ------
Net income (loss)................. $ 93 $ 83 $ 243 $ 66 $ (470) $ 55 $ (61) $ 675 $ (61)
====== ==== ======= ====== ====== ====== ====== ======= ======
Basic and diluted net income per
share........................... $ 0.00
======
<CAPTION>
ACQUISITION PRO FORMA OFFERING PRO FORMA
ADJUSTMENTS COMBINED ADJUSTMENTS AS ADJUSTED
----------- --------- ----------- -----------
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)
<S> <C> <C> <C> <C>
Revenue:
Equipment rentals............... -- $24,048 -- $24,048
Sales of equipment, merchandise,
parts and supplies............ -- 24,350 -- 24,350
------- ------- ------- -------
Total revenue............. -- 48,398 -- 48,398
Cost of revenue:
Cost of equipment rentals,
excluding depreciation........ 60(a) 10,172 -- 10,172
Rental equipment depreciation... (1,479)(b) 6,274 -- 6,274
Sales of equipment, merchandise,
parts and supplies sold....... -- 16,814 -- 16,814
------- ------- ------- -------
Total cost of revenue..... (1,419) 33,260 -- 33,260
------- ------- ------- -------
Gross profit...................... 1,419 15,138 -- 15,138
Operating expenses:
Selling, general and
administrative expenses....... (539)(d) 8,271 -- 8,271
145(e)
Depreciation and amortization of
non-rental property and
equipment..................... (124)(f) 1,292 -- 1,292
538(g)
------- ------- ------- -------
Total operating
expenses................ 20 9,563 -- 9,563
------- ------- ------- -------
Operating income.................. 1,399 5,575 -- 5,575
Other (income)/expense
Interest expense................ 1,698(h) 5,070 $(2,332)(k) 2,738
Other (income)/expense, net..... 33(i) (246) -- (246)
------- ------- ------- -------
Total other
(income)/expense........ 1,731 4,824 (2,332) 2,492
------- ------- ------- -------
Income before provision for income
taxes........................... (332) 751 2,332 3,083
Provision for income taxes...... (145)(j) 315 980(j) 1,295
------- ------- ------- -------
Net income (loss)................. $ (187) $ 436 $ 1,352 $ 1,788
======= ======= ======= =======
Basic and diluted net income per
share........................... $ 0.01 $ 0.04
======= =======
</TABLE>

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

PF-7
<PAGE> 62

NATIONSRENT, INC.

PRO FORMA CONSOLIDATED STATEMENTS OF OPERATIONS

FOR THE THREE MONTHS ENDED MARCH 31, 1997

(UNAUDITED)

<TABLE>
<CAPTION>
COMPLETED ACQUISITIONS
-------------------------------------------------------------------
HISTORICAL BODE-
PREDECESSOR R&R C&E TITAN RFL FINN NAPLES JOBS OTHER
----------- ----- ------ ------ ---- ------ ------ ------- ------
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Revenue:
Equipment rentals..................... $2,442 $ 300 $ 794 $ 400 $242 $4,743 $ 510 $ 999 $2,053
Sales of equipment, merchandise, parts
& supplies.......................... 1,522 338 640 719 549 9,077 827 1,712 2,242
------ ----- ------ ------ ---- ------ ------ ------- ------
Total revenue................... 3,964 638 1,434 1,119 791 13,820 1,337 2,711 4,295
Cost of revenue:
Cost of equipment rentals, excluding
equipment rental depreciation....... 1,280 300 365 246 105 1,323 361 473 1,340
Rental equipment depreciation......... 794 148 168 101 58 1,745 93 986 589
Sales of equipment, merchandise, parts
and supplies sold................... 863 268 435 391 335 6,342 628 1,277 1,418
------ ----- ------ ------ ---- ------ ------ ------- ------
Total cost of revenue........... 2,937 716 968 738 498 9,410 1,082 2,736 3,347
------ ----- ------ ------ ---- ------ ------ ------- ------
Gross profit............................ 1,027 (78) 466 381 293 4,410 255 (25) 948
Operating expenses:
Selling, general and administrative
expenses............................ 970 128 302 108 47 3,755 110 377 659
Depreciation and amortization of
non-rental property and equipment... 25 18 23 5 2 73 7 51 68
------ ----- ------ ------ ---- ------ ------ ------- ------
Total operating expenses........ 995 146 325 113 49 3,828 117 428 727
------ ----- ------ ------ ---- ------ ------ ------- ------
Operating income........................ 32 (224) 141 268 244 582 138 (453) 221
Other (income)/expense
Interest expense...................... 229 4 14 11 21 350 5 370 259
Other (income)/expense, net........... (50) (46) (11) (3) (2) (39) (15) -- (64)
------ ----- ------ ------ ---- ------ ------ ------- ------
Total other (income)/expense.... 179 (42) 3 8 19 311 (10) 370 195
------ ----- ------ ------ ---- ------ ------ ------- ------
Income before provision for income
taxes................................. (147) (182) 138 260 225 271 148 (823) 26
Provision for income taxes............ (59) (73) 55 104 90 137 59 (329) 10
------ ----- ------ ------ ---- ------ ------ ------- ------
Net income (loss)....................... $ (88) $(109) $ 83 $ 156 $135 $ 134 $ 89 $ (494) $ 16
====== ===== ====== ====== ==== ====== ====== ======= ======
Basic and diluted net income per
share.................................

<CAPTION>
PENDING ACQUISITIONS
-----------------------------
ACQUISITION PRO FORMA OFFERING PRO FORMA
GENERAL ASSOCIATED OTHER ADJUSTMENTS COMBINED ADJUSTMENTS AS ADJUSTED
------- ---------- ------ ----------- --------- ----------- -----------
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)
<S> <C> <C> <C> <C> <C> <C> <C>
Revenue:
Equipment rentals..................... $646 $ 4,288 $2,062 -- $19,479 -- $19,479
Sales of equipment, merchandise, parts
& supplies.......................... 234 5,905 1,223 -- 24,988 -- 24,988
---- ------- ------ ------- ------- ------- -------
Total revenue................... 880 10,193 3,285 -- 44,467 -- 44,467
Cost of revenue:
Cost of equipment rentals, excluding
equipment rental depreciation....... 386 592 1,321 51(a) 8,143 -- 8,143
Rental equipment depreciation......... 117 1,626 523 (1,564)(b) 5,384 -- 5,384
Sales of equipment, merchandise, parts
and supplies sold................... 157 4,754 866 -- 17,734 -- 17,734
---- ------- ------ ------- ------- ------- -------
Total cost of revenue........... 660 6,972 2,710 (1,513) 31,261 -- 31,261
---- ------- ------ ------- ------- ------- -------
Gross profit............................ 220 3,221 575 1,513 13,206 -- 13,206
Operating expenses:
Selling, general and administrative
expenses............................ 120 951 843 (1,138)(d) 7,422 -- 7,422
190(e)
Depreciation and amortization of
non-rental property and equipment... 27 97 72 (136)(f) 1,221 -- 1,221
889(g)
---- ------- ------ ------- ------- ------- -------
Total operating expenses........ 147 1,048 915 (195) 8,643 -- 8,643
---- ------- ------ ------- ------- ------- -------
Operating income........................ 73 2,173 (340) 1,708 4,563 -- 4,563
Other (income)/expense
Interest expense...................... 42 734 102 2,570(h) 4,711 (2,332)(k) 2,379
Other (income)/expense, net........... -- (12) (15) 5(i) (252) -- (252)
---- ------- ------ ------- ------- ------- -------
Total other (income)/expense.... 42 722 87 2,575 4,459 (2,332) 2,127
---- ------- ------ ------- ------- ------- -------
Income before provision for income
taxes................................. 31 1,451 (427) (867) 104 2,332 2,436
Provision for income taxes............ 12 580 (109) (435)(j) 42 980(j) 1,022
---- ------- ------ ------- ------- ------- -------
Net income (loss)....................... $ 19 $ 871 $ (318) $ (432) $ 62 $ 1,352 $ 1,414
==== ======= ====== ======= ======= ======= =======
Basic and diluted net income per
share................................. $ 0.00 $ 0.03
======= =======
</TABLE>

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

PF-8
<PAGE> 63

NATIONSRENT, INC.

NOTES TO UNAUDITED PRO FORMA CONSOLIDATED FINANCIAL STATEMENTS

(DOLLARS IN THOUSANDS)

1. HISTORICAL FINANCIAL STATEMENTS

The historical financial data presented in these pro forma consolidated
financial statements represents the financial position of the Company and the
Acquired Businesses at March 31, 1998 and their results of operations for the
year ended December 31, 1997 and three months ended March 31, 1997 and March 31,
1998 (except that the financial data for Raymond Equipment Company ("Jobs")
included in the pro forma consolidated statements of operations for the year
ended December 31, 1997 consists of the combined six months ended June 30, 1997
and December 31, 1997 and the financial data for J. Kelly Co. ("J. Kelly")
included in the pro forma consolidated statements of operations for the year
ended December 31, 1997 is for the year ended March 31, 1998 and includes $1,546
in revenue also included in the pro forma consolidated statements of operations
for the three months ended March 31, 1998).

2. ACQUISITIONS

During the year ended December 31, 1997 the Company completed five
acquisitions. Following year-end but prior to March 31, 1998, the Company
completed one acquisition and subsequent to March 31, 1998, the Company
completed eight additional acquisitions. The Company has also entered into
definitive agreements to acquire an additional three businesses. These
acquisitions are subject to customary closing conditions. The Company expects to
close such acquisitions in July 1998 prior to consummation of the Offering. Each
of these was accounted for in the unaudited pro forma consolidated financial
statements using the purchase method of accounting. Preliminary purchase
accounting values for the Acquired Businesses prior to March 31, 1998 have been
recorded based on estimated fair values of the assets and liabilities acquired.
Final adjustments will be recorded when final information as to fair values of
the net assets acquired is available. The purchase accounting adjustments for
the completed and pending acquisitions subsequent to March 31, 1998 were based
on the respective companies' March 31, 1998 balance sheets using estimates as to
the fair values of assets and liabilities acquired. As a result, final
allocation could be different.

The following table summarizes the acquisitions completed by the Company at
June 12, 1998:

<TABLE>
<CAPTION>
ACQUISITION
ACQUISITION DATE PURCHASE OF CONSIDERATION ASSETS LIABILITIES INTANGIBLES
----------- ----------- ----------- ------------- -------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
Sam's.................................. 9/1/97 Stock $ 23,431 $ 28,553 $23,956 $ 18,834
R&R.................................... 12/10/97 Assets 8,000 5,374 212 2,838
C&E.................................... 12/23/97 Assets 12,250 4,401 979 8,828
Titan.................................. 12/31/97 Stock 5,900 2,409 1,067 4,558
R.F.L. Enterprises, Inc. .............. 4/15/98 Assets 2,350 2,152 83 281
Naples Rent-All & Sales Co. Inc........ 4/30/98 Assets 4,150 2,583 754 2,321
The Bode-Finn Company.................. 5/4/98 Stock 43,000 37,849 25,225 30,376
Jobs................................... 6/5/98 Stock 36,489 40,557 25,338 21,270
Other Acquisitions..................... Various Various 20,196 16,285 10,925 14,836
-------- -------- ------- --------
Combined Total..................... $155,766 $140,163 $88,539 $104,142
======== ======== ======= ========
</TABLE>

PF-9
<PAGE> 64
NATIONSRENT, INC.

NOTES TO UNAUDITED PRO FORMA CONSOLIDATED
FINANCIAL STATEMENTS -- (CONTINUED)

(DOLLARS IN THOUSANDS)

3. PRO FORMA ADJUSTMENTS

<TABLE>
<S> <C>
BALANCE SHEET:
a. To eliminate the assets not acquired and the liabilities not
assumed in the Acquisitions.
b. Represents the preliminary estimate of the adjustment to
fair market value for rental equipment acquired.
c. Represents the excess purchase price over the estimated fair
value of the net assets acquired of $108,696, net of
historical goodwill and other intangibles of $3,361.
d. Represents borrowings for the Acquisitions of $126,586 and
$39,799 funded by the Credit Facility and the Proposed
Amended Credit Facility and through the issuance of
convertible notes to the sellers, respectively. Also
reflected are reductions for pre-acquisition debt not
assumed in the Acquisitions of $15,128 and repayment on the
Credit Facility from the proceeds of the Founders'
Additional Contribution of $17,400 and the Private Placement
of $27,600.
e. Represents the estimated deferred income tax liability
related to the purchase accounting adjustments recorded for
the Acquisitions.
f. To eliminate the equity accounts reflected in the historical
financial statements of the Acquired Businesses.
g. Represents the elimination of the equity accounts of
Acquired Businesses of $909 and the issuance of Common Stock
in the Private Placement of $51.
h. Represents the elimination of the equity accounts of
Acquired Businesses of $470 and additional paid-in capital
related to the Founders' Additional Contribution of $17,400
and the Private Placement of $27,549.
i. Represents the application of net proceeds from the Offering
for repayment of the Proposed Amended Credit Facility
(assuming an initial public offering price of $11.00 per
share, which is the midpoint of the estimated range set
forth on the cover page of this Prospectus).

STATEMENTS OF OPERATIONS:
a. Adjustment to eliminate historical lease expense on rental
equipment resulting from the termination of certain leases
which occurred in connection with the purchase of one of the
Acquired Businesses.
b. Adjustment to the historical rental equipment depreciation
recorded to conform to the Company's accounting policies.
Adjustment is based on the estimated fair value of rental
equipment acquired using estimated useful lives ranging from
2 to 10 years on the straight-line method with salvage
values ranging from zero to ten percent of cost.
c. Adjustment to conform the historical accounting for
inventory of the Acquired Businesses from the LIFO method to
FIFO method, where applicable.
d. Adjustment to reduce historical compensation and benefits of
certain former owners and executives of the Acquired
Businesses to amounts consistent with employment
arrangements entered into between the certain owners and
executives and the Company, as well as the elimination of
certain private company business expenses that will not be
incurred by the Company.
e. Adjustment to historical facility lease expense to reflect
the increase in current lease payments in excess of
historical amounts.
f. Adjustment to historical property and equipment depreciation
recorded to conform to the Company's accounting policies.
Adjustment is based on the estimated fair value of property
and equipment acquired using estimated useful lives ranging
from 3 to 39 years on the straight-line method.
</TABLE>

PF-10
<PAGE> 65
NATIONSRENT, INC.

NOTES TO UNAUDITED PRO FORMA CONSOLIDATED
FINANCIAL STATEMENTS -- (CONTINUED)

(DOLLARS IN THOUSANDS)

<TABLE>
<S> <C>
g. Adjustment to recognize the amortization of goodwill and
non-compete agreements using an estimated useful life of 40
and five years, respectively. Management believes that 40
years is a reasonable life for goodwill in light of the
characteristics of the equipment rental industry such as the
lack of dependence on technological change, the many years
that the industry has been in existence, the current trend
towards the outsourcing of equipment, the recent double
digit annual growth rate and the stable nature of the
customer base. In addition, the Company has focused on
acquiring well established companies that have been in
existence for many years.
h. Adjustment to record interest on borrowings under the Credit
Facility and the Proposed Amended Credit Facility and notes
issued to former owners of Acquired Businesses, net of
interest related to debt not assumed or paid off at
acquisition. The interest rate on the Proposed Amended
Credit Facility is determined using a base rate plus a
spread based on certain financial performance ratios. Based
on current market rates, an incremental borrowing rate of
8.44% was used to determine interest expense. A change of
one-eighth of a percent would result in a $107 reduction or
increase in the pro forma adjustment to annual interest
expense.
i. To eliminate historical gains related to assets not
acquired.
j. To record a provision (benefit) for income taxes at an
expected effective rate of 42%.
k. Adjustment to record the reduction in interest giving effect
to the use of the proceeds of the Offering to repay a
portion of the Proposed Amended Credit Facility (assuming an
initial public offering price of $11.00 per share, which is
the midpoint of the estimated range set forth on the cover
page of this Prospectus).
</TABLE>

4. PRO FORMA DILUTED EARNINGS PER SHARE

Pro forma diluted earnings per share is calculated based on the shares
outstanding at December 31, 1997, March 31, 1997 and March 31, 1998, as well as
giving effect to the Private Placement and the Offering as if these shares were
outstanding at the beginning of the respective periods. The shares used to
calculate pro forma diluted earnings per share are as follows:

<TABLE>
<CAPTION>
DECEMBER 31, 1997 MARCH 31, 1997 MARCH 31, 1998
----------------- -------------- --------------
(IN THOUSANDS)
<S> <C> <C> <C>
Shares outstanding........................ 25,000 25,000 25,000
Shares issued in Private Placement........ 5,119 5,119 5,119
Shares issued in Offering................. 11,000 11,000 11,000
Common Stock equivalents.................. 7 -- 69
------ ------ ------
41,126 41,119 41,188
====== ====== ======
</TABLE>

PF-11
<PAGE> 66

NATIONSRENT, INC.

INDEX TO FINANCIAL STATEMENTS

<TABLE>
<CAPTION>
PAGE
-----
<S> <C>
THE REGISTRANT
NATIONSRENT, INC.
Report of Independent Certified Public Accountants........ F-4
Consolidated Balance Sheets as of December 31, 1997 and
March 31, 1998 (unaudited)............................. F-5
Consolidated Statements of Income for the period from
inception (August 14, 1997) to December 31, 1997 and
for the three months ended March 31, 1998
(unaudited)............................................ F-6
Consolidated Statements of Stockholders' Equity for the
period from inception (August 14, 1997) to December 31,
1997 and for the three months ended March 31, 1998
(unaudited)............................................ F-7
Consolidated Statements of Cash Flows for the period from
inception (August 14, 1997) to December 31, 1997 and
for the three months ended March 31, 1998
(unaudited)............................................ F-8
Notes to Consolidated Financial Statements................ F-9
THE PREDECESSOR COMPANY
GABRIEL TRAILER MANUFACTURING COMPANY, INC. ("SAM'S")
Report of Independent Certified Public Accountants........ F-19
Consolidated Balance Sheets as of March 31, 1997 and
August 31, 1997........................................ F-20
Consolidated Statements of Income for the years ended
March 31, 1996 and 1997 and the period from April 1,
1997 to August 31, 1997................................ F-21
Consolidated Statements of Stockholders' Equity for the
years ended March 31, 1996 and 1997 and the period from
April 1, 1997 to August 31, 1997....................... F-22
Consolidated Statements of Cash Flows for the years ended
March 31, 1996 and 1997 and the period from April 1,
1997 to August 31, 1997................................ F-23
Notes to Consolidated Financial Statements................ F-24
BUSINESSES ACQUIRED
R. AND R. RENTAL, INC.
Report of Independent Certified Public Accountants........ F-29
Balance Sheet as of December 10, 1997..................... F-30
Statement of Operations for the period from January 1,
1997 to December 10, 1997.............................. F-31
Statement of Stockholder's Equity for the period from
January 1, 1997 to December 10, 1997................... F-32
Statement of Cash Flows for the period from January 1,
1997 to December 10, 1997.............................. F-33
Notes to Financial Statements............................. F-34
C&E RENTAL AND SERVICE, INC.
Report of Independent Certified Public Accountants........ F-37
Balance Sheets as of December 31, 1996 and December 22,
1997................................................... F-38
Statements of Income for the year ended December 31, 1996
and the period from January 1, 1997 to December 22,
1997................................................... F-39
Statements of Stockholder's Equity for the year ended
December 31, 1996 and the period from January 1, 1997
to December 22, 1997................................... F-40
Statements of Cash Flows for the year ended December 31,
1996 and the period from January 1, 1997 to December
22, 1997............................................... F-41
Notes to Financial Statements............................. F-42
TITAN RENTALS, INC.
Report of Independent Certified Public Accountants........ F-46
Balance Sheet as of December 30, 1997..................... F-47
</TABLE>

F-1
<PAGE> 67

<TABLE>
<CAPTION>
PAGE
-----
<S> <C>
Statement of Income for the period from January 1, 1997 to
December 30, 1997...................................... F-48
Statement of Stockholders' Equity for the period from
January 1, 1997 to December 30, 1997................... F-49
Statement of Cash Flows for the period from January 1,
1997 to December 30, 1997.............................. F-50
Notes to Financial Statements............................. F-51
THE BODE-FINN COMPANY
Report of Independent Certified Public Accountants........ F-55
Balance Sheets as of December 31, 1996 and 1997 and March
31, 1998 (unaudited)................................... F-56
Statements of Income for the years ended December 31,
1995, 1996 and 1997 and for the three month periods
ended March 31, 1997 and 1998 (unaudited).............. F-57
Statements of Stockholders' Equity for the years ended
December 31, 1995, 1996 and 1997 and for the three
month period ended March 31, 1998 (unaudited).......... F-58
Statements of Cash Flows for the years ended December 31,
1995, 1996 and 1997 and for the three month periods
ended March 31, 1997 and 1998 (unaudited).............. F-59
Notes to Financial Statements............................. F-60
RFL ENTERPRISES, INC.
Report of Independent Certified Public Accountants........ F-67
Balance Sheets as of December 31, 1997 and March 31, 1998
(unaudited)............................................ F-68
Statements of Income for the year ended December 31, 1997
and for the three month periods ended March 31, 1997
and 1998 (unaudited)................................... F-69
Statements of Stockholder's Equity for the year ended
December 31, 1997 and for the three month period ended
March 31, 1998 (unaudited)............................. F-70
Statements of Cash Flows for the year ended December 31,
1997 and for the three month periods ended March 31,
1997 and 1998 (unaudited).............................. F-71
Notes to Financial Statements............................. F-72
NAPLES RENT-ALL & SALES COMPANY, INC.
Report of Independent Certified Public Accountants........ F-76
Balance Sheets as of December 31, 1997 and March 31, 1998
(unaudited)............................................ F-77
Statements of Income for the year ended December 31, 1997
and for the three month periods ended March 31, 1997
and 1998 (unaudited)................................... F-78
Statements of Stockholder's Equity for the year ended
December 31, 1997 and for the three month period ended
March 31, 1998 (unaudited)............................. F-79
Statements of Cash Flows for the year ended December 31,
1997 and for the three month periods ended March 31,
1997 and 1998 (unaudited).............................. F-80
Notes to Financial Statements............................. F-81
RAYMOND EQUIPMENT COMPANY, INC. ("JOBS")
Report of Independent Certified Public Accountants........ F-86
Balance Sheets as of June 30, 1996 and 1997 and March 31,
1998 (unaudited)....................................... F-87
Statements of Income for the years ended June 30, 1996 and
1997 and for the nine month periods ended March 31,
1997 and 1998 (unaudited).............................. F-88
Statements of Stockholders' Equity for the years ended
June 30, 1996 and 1997 and for the nine month period
ended March 31, 1998 (unaudited)....................... F-89
Statements of Cash Flows for the years ended June 30, 1996
and 1997 and for the nine month periods ended March 31,
1997 and 1998 (unaudited).............................. F-90
Notes to Financial Statements............................. F-91
</TABLE>

F-2
<PAGE> 68

<TABLE>
<CAPTION>
PAGE
-----
<S> <C>
BUSINESSES TO BE ACQUIRED
THE FLORIDA PANHANDLE AND SOUTHEAST TEXAS DIVISIONS OF
GENERAL RENTAL, INC.
Report of Independent Certified Public Accountants........ F-95
Division Balance Sheets as of December 31, 1997 and March
31, 1998 (unaudited)................................... F-96
Statements of Division Operations for the year ended
December 31, 1997 and for the three month periods ended
March 31, 1997 and 1998 (unaudited).................... F-97
Statements of Division Equity for the year ended December
31, 1997 and for the three month period ended March 31,
1998 (unaudited)....................................... F-98
Statements of Division Cash Flows for the year ended
December 31, 1997 and for the three month periods ended
March 31, 1997 and 1998 (unaudited).................... F-99
Notes to Financial Statements............................. F-100
ASSOCIATED RENTAL EQUIPMENT MANAGEMENT COMPANY, INC.
Report of Independent Certified Public Accountants........ F-106
Balance Sheets as of December 31, 1996 and 1997 and March
31, 1998 (unaudited)................................... F-107
Statements of Income for the years ended December 31,
1995, 1996 and 1997 and for the three month periods
ended March 31, 1997 and 1998 (unaudited).............. F-108
Statements of Stockholder's Equity for the years ended
December 31, 1995, 1996 and 1997 and for the three
month period ended March 31, 1998 (unaudited).......... F-109
Statements of Cash Flows for the years ended December 31,
1995, 1996 and 1997 and for the three month periods
ended March 31, 1997 and 1998 (unaudited).............. F-110
Notes to Financial Statements............................. F-111
</TABLE>

F-3
<PAGE> 69

REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS

To NationsRent, Inc.:

We have audited the accompanying consolidated balance sheet of NationsRent,
Inc. (a Delaware corporation) and subsidiaries as of December 31, 1997, and the
related consolidated statements of income, stockholders' equity and cash flows
for the period from August 14, 1997 (inception) to December 31, 1997. These
financial statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audit.

We conducted our audit in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audit provides a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly,
in all material respects, the consolidated financial position of NationsRent,
Inc. and subsidiaries as of December 31, 1997, and the results of their
operations and their cash flows for the period from August 14, 1997 (inception)
to December 31, 1997 in conformity with generally accepted accounting
principles.

ARTHUR ANDERSEN LLP

Fort Lauderdale, Florida,
June 3, 1998 (except with respect to
the matter referred to in the
third paragraph of Note 10,
as to which the date is June 8, 1998).

F-4
<PAGE> 70

NATIONSRENT, INC.

CONSOLIDATED BALANCE SHEETS

(IN THOUSANDS, EXCEPT SHARE DATA)

<TABLE>
<CAPTION>
MARCH 31,
DECEMBER 31, MARCH 31, 1998
1997 1998 PRO FORMA
------------ ------------ ------------
(UNAUDITED) (UNAUDITED)
<S> <C> <C> <C>
ASSETS
Cash and cash equivalents................................. $ 1,493 $ 650
Accounts receivable, net of allowance for doubtful
accounts of $587 and $492 (unaudited) at December 31,
1997 and March 31, 1998, respectively................... 5,008 4,214
Inventories............................................... 1,840 1,864
Prepaid expenses and other assets......................... 755 2,150
Rental equipment, net..................................... 30,619 49,063
Property and equipment, net............................... 2,334 3,315
Intangible assets related to acquired businesses, net..... 37,108 41,522
------- --------
Total Assets.................................... $79,157 $102,778
======= ========

LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities:
Accounts payable........................................ $ 2,303 $ 10,192
Accrued repair and maintenance expenses................. 950 905
Accrued compensation and related taxes.................. 328 436
Accrued expenses and other liabilities.................. 2,579 3,602
Debt.................................................... 42,928 52,230
Income taxes payable.................................... 1,523 675
Deferred income taxes................................... 2,545 2,644
------- --------
Total liabilities............................... 53,156 70,684
------- --------
Commitments and Contingencies (Notes 9 and 10)
Stockholders' Equity:
Preferred stock -- $0.01 par value, 5,000,000 shares
authorized, no shares issued and outstanding......... -- -- $ --
Common stock -- $0.01 par value, 100,000,000 shares
authorized, 25,000,000 shares and 30,118,694 shares
(pro forma) issued and outstanding................... 250 250 301
Additional paid-in capital.............................. 24,750 30,750 75,699
Retained earnings....................................... 1,001 1,094 1,094
------- -------- --------
Total stockholders' equity...................... 26,001 32,094 $ 77,094
------- -------- ========
Total Liabilities and Stockholders' Equity...... $79,157 $102,778
======= ========
</TABLE>

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

F-5
<PAGE> 71

NATIONSRENT, INC.

CONSOLIDATED STATEMENTS OF INCOME

(IN THOUSANDS, EXCEPT PER SHARE DATA)

<TABLE>
<CAPTION>
FOR THE THREE
AUGUST 14 MONTHS
(INCEPTION) TO ENDED
DECEMBER 31, MARCH 31,
1997 1998
-------------- -------------
(UNAUDITED)
<S> <C> <C>
Revenue:
Equipment rentals......................................... $ 7,410 $ 5,911
Sales of equipment, parts and supplies.................... 1,895 3,128
------- -------
Total revenue..................................... 9,305 9,039
------- -------
Cost of revenue:
Cost of equipment rentals, excluding depreciation......... 2,196 2,661
Rental equipment depreciation............................. 1,526 1,076
Cost of sales of equipment, parts and supplies............ 1,691 2,252
------- -------
Total cost of revenue............................. 5,413 5,989
------- -------
Gross profit................................................ 3,892 3,050
Operating expenses:
Selling, general and administrative expenses.............. 1,081 1,758
Non-rental equipment depreciation and amortization........ 284 447
------- -------
Operating income............................................ 2,527 845
------- -------
Other (income)/expense:
Interest expense.......................................... 760 808
Interest income........................................... (29) (21)
Other, net................................................ 29 (102)
------- -------
760 685
------- -------
Income before provision for income taxes.................... 1,767 160
Provision for income taxes................................ 766 67
------- -------
Net income.................................................. $ 1,001 $ 93
======= =======
Net income per share -- basic and diluted................... $ 0.04 $ 0.00
======= =======
Weighted average common shares outstanding:
Basic..................................................... 25,000 25,000
======= =======
Diluted................................................... 25,007 25,069
======= =======
</TABLE>

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

F-6
<PAGE> 72

NATIONSRENT, INC.

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

FOR THE PERIOD FROM AUGUST 14, 1997 (INCEPTION) TO DECEMBER 31, 1997

AND THE THREE MONTHS ENDED MARCH 31, 1998

(IN THOUSANDS, EXCEPT SHARE DATA)

<TABLE>
<CAPTION>
COMMON STOCK
------------------- ADDITIONAL
NUMBER OF PAID-IN RETAINED
SHARES AMOUNT CAPITAL EARNINGS TOTAL
---------- ------ ---------- -------- -------
<S> <C> <C> <C> <C> <C>
BALANCE, August 14, 1997 (Inception)............ -- $ -- $ -- $ -- $ --
Issuance of common stock (after giving effect
to the stock split discussed in Note 1).... 25,000,000 250 24,750 -- 25,000
Net income.................................... -- -- -- 1,001 1,001
---------- ---- ------- ------ -------
BALANCE, December 31, 1997...................... 25,000,000 250 24,750 1,001 26,001
Capital contribution (unaudited).............. -- -- 6,000 -- 6,000
Net income (unaudited)........................ -- -- -- 93 93
---------- ---- ------- ------ -------
BALANCE, March 31, 1998 (unaudited)............. 25,000,000 $250 $30,750 $1,094 $32,094
========== ==== ======= ====== =======
</TABLE>

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

F-7
<PAGE> 73

NATIONSRENT, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(IN THOUSANDS)

<TABLE>
<CAPTION>
AUGUST 14 FOR THE THREE
(INCEPTION) TO MONTHS ENDED
DECEMBER 31, MARCH 31,
1997 1998
-------------- -------------
(UNAUDITED)
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income.................................................. $ 1,001 $ 93
Adjustments to reconcile net income to net cash provided by
operating activities:
Depreciation and amortization.......................... 1,810 1,523
Gain on sale of rental equipment....................... (59) (200)
Deferred income tax provision.......................... 357 420
Changes in operating assets and liabilities:
Accounts receivable............................... 334 904
Inventories....................................... 83 262
Prepaid expenses and other assets................. (296) (1,411)
Accounts payable.................................. 776 7,547
Accrued expenses and other liabilities............ (428) 349
Income taxes payable.............................. 117 (848)
-------- --------
Net cash provided by operating activities......... 3,695 8,639
-------- --------
CASH FLOWS FROM INVESTING ACTIVITIES, NET OF ACQUISITIONS:
Acquisitions of businesses, net of cash acquired....... (34,137) (5,221)
Purchases of rental equipment.......................... (2,461) (19,584)
Purchases of property and equipment.................... (963) (1,113)
Proceeds from sale of rental equipment................. 1,159 1,255
Decrease in notes receivable affiliates................ 1,358 --
-------- --------
Net cash used in investing activities............. (35,044) (24,663)
-------- --------
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from issuance of common stock................. 25,000 --
Capital contribution................................... -- 6,000
Proceeds from debt..................................... 21,917 31,638
Repayments of debt..................................... (14,075) (22,457)
-------- --------
Net cash provided by financing activities......... 32,842 15,181
-------- --------
Net increase (decrease) in cash and cash equivalents........ 1,493 (843)
Cash and cash equivalents, beginning of period.............. -- 1,493
-------- --------
Cash and cash equivalents, end of period.................... $ 1,493 $ 650
======== ========
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid for interest................................. $ 621 $ 551
======== ========
Cash paid for income taxes............................. $ 390 $ 604
======== ========
SUPPLEMENTAL SCHEDULE OF NONCASH INVESTING AND FINANCING
ACTIVITIES:
The Company acquired the net assets and assumed
certain liabilities of certain businesses as
follows:
Total assets, net of cash acquired................ $ 78,629 $ 6,099
Total liabilities assumed......................... (27,311) (878)
Amounts paid through the issuance of debt......... (17,181) --
-------- --------
Net cash paid..................................... $ 34,137 $ 5,221
======== ========
</TABLE>

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

F-8
<PAGE> 74

NATIONSRENT, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 1997

1. ACCOUNTING POLICIES

Basis of presentation

NationsRent, Inc. (the "Company") was incorporated in the state of Delaware
on August 14, 1997 for the purpose of creating a nationally branded network of
equipment rental locations offering a broad selection of equipment primarily to
the construction and industrial segments of the equipment rental industry in the
United States. The Company also sells used and new equipment, spare parts,
merchandise and supplies, and provides maintenance and repair services.

The nature of the Company's business is such that short-term obligations
are typically met by cash flow generated from long-term assets. Consequently,
consistent with industry practice, the accompanying consolidated balance sheets
are presented on an unclassified basis.

The accompanying consolidated financial statements include the accounts of
the Company and its wholly-owned subsidiaries. All significant intercompany
accounts and transactions have been eliminated.

Cash equivalents

The Company considers all highly liquid instruments with a maturity of
three months or less when purchased to be cash equivalents. The Company had no
cash equivalents at December 31, 1997 and March 31, 1998 (unaudited).

Use of estimates

The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the amounts reported in the financial statements and
accompanying notes. Actual results could differ from those estimates.

Inventories

Inventories, which consist of equipment, tools, parts and related
merchandise supply items, are stated at the lower of cost or market. Cost is
determined using the first-in, first-out (FIFO) method. Provision is made to
reduce excess or obsolete inventories to their estimated net realizable value.

Rental equipment

Rental equipment purchased new by the Company is recorded at cost and
depreciated over the estimated useful life of the equipment using the
straight-line method. Rental equipment that is obtained through the acquisition
of a business is valued at its estimated fair market value at the time of
acquisition. The range of useful lives estimated by management for rental
equipment is two to ten years. Rental equipment is depreciated to a salvage
value of zero to ten percent of cost. Rental equipment having a cost of $500 or
less is charged to expense at the time of purchase. Accumulated depreciation on
rental equipment was $1,526,000 and $2,592,000 (unaudited) at December 31, 1997
and March 31, 1998, respectively. Ordinary maintenance and repair costs are
charged to operations as incurred.

F-9
<PAGE> 75
NATIONSRENT, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

Property and equipment

Property and equipment purchased new by the Company is recorded at cost.
Property and equipment obtained through the acquisition of a business is
recorded at the estimated fair market value at the time of acquisition.
Depreciation and amortization are recorded on a straight-line basis over the
following estimated useful lives:

<TABLE>
<S> <C>
Buildings and improvements........................ 10-39 years, not to exceed lease term
Furniture, fixtures and office equipment.......... 3-7 years
Vehicles, delivery and shop equipment............. 5-10 years
</TABLE>

Ordinary maintenance and repair costs are charged to expense as incurred.

Intangible assets

Intangible assets are recorded at cost and are amortized using the
straight-line method over their estimated useful lives of five years for
covenants not to compete and 40 years for goodwill. The accumulated amortization
of intangible assets, including goodwill, relating to acquired businesses, was
approximately $180,000 at December 31, 1997.

Long-lived assets

The carrying value of long-lived assets, including goodwill, is reviewed if
the facts and circumstances suggest that it may be impaired. If this review
indicates that long-lived assets will not be recoverable, as determined based on
the undiscounted cash flows of the entity acquired over the remaining
amortization period, the Company's carrying value of the long-lived assets will
be reduced by the amount by which carrying value exceeds fair value.

Fair value of financial instruments

The carrying amounts reported in the accompanying consolidated balance
sheets for accounts receivable, accounts payable and accrued expenses and other
liabilities approximate fair value due to the short-term nature of these
accounts. The fair value of debt is determined using current interest rates for
similar instruments at December 31, 1997 and approximates the carrying value of
these notes due to the fact that the underlying instruments include provisions
to adjust note balances and interest rates to approximate fair market value.

Revenue recognition

Rental revenue is recognized as earned during the rental agreement period.
Equipment rentals in the consolidated statements of operations includes revenue
earned on equipment rentals, rental equipment delivery and pick-up fees and fuel
sales. Revenue from the sale of used equipment, parts and supplies and retail
merchandise is recognized at the time of delivery to, or pick-up by, the
customer. When rental equipment is sold, the related cost and accumulated
depreciation are removed from the respective accounts. Proceeds from the sale
and the related book value of the equipment sold are reported as revenue from
rental equipment sales and cost of rental equipment sales, respectively, in the
statements of operations.

Advertising

Advertising costs are charged to expense as incurred. For the period from
August 14, 1997 (inception) to December 31, 1997, the Company incurred $171,000
of advertising costs.

F-10
<PAGE> 76
NATIONSRENT, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

Income taxes

The Company accounts for income taxes under the liability method pursuant
to Statement of Financial Accounting Standards ("SFAS") No. 109, Accounting for
Income Taxes. Under the liability method, deferred tax assets and liabilities
are determined based on differences between the financial reporting and tax
bases of assets and liabilities using the enacted tax rates and laws that will
be in effect when the differences are expected to reverse. The Company and its
wholly owned subsidiaries file a consolidated federal income tax return.

Computation of earnings per share

In February 1997, the Financial Accounting Standards Board ("FASB") issued
SFAS No. 128, Earnings Per Share. SFAS No. 128 replaced the calculation of
primary and fully diluted earnings per share with basic and diluted earnings per
share. Under SFAS No. 128, basic earnings per share excludes any dilutive
effects of options, warrants and convertible securities. Earnings per share
amounts for all periods have been presented to conform with SFAS No. 128 and
Staff Accounting Bulletin No. 98 (issued by the Securities and Exchange
Commission in February 1998), which amends the determination of and accounting
for "cheap stock" in periods prior to an initial public offering. The effect of
dilutive securities is computed using the treasury stock method.

Stock split

During June 1998, the Company effected a 2,500-for-one split of its common
stock. The accompanying consolidated financial statements reflect the stock
split on a retroactive basis from the beginning of the periods presented.

Concentrations of credit risk

Financial instruments that potentially subject the Company to significant
concentrations of credit risk consist principally of cash investments and
accounts receivable. The Company maintains cash and cash equivalents with high
quality financial institutions. Concentrations of credit risk with respect to
accounts receivable are limited because a large number of diverse customers make
up the Company's customer base. No single customer represents greater than 10%
of total accounts receivable. The Company controls credit risk through credit
approvals, credit limits, and monitoring procedures.

Stock based compensation

The Company accounts for stock compensation arrangements in accordance with
APB Opinion No. 25, "Accounting for Stock Issued to Employees," ("APB No. 25")
and accordingly, recognizes no compensation expense for the stock compensation
arrangements since the stock options are granted at exercise prices at or
greater than the fair value of the shares at the date of grant.

Unaudited interim consolidated financial statements

The accompanying consolidated balance sheet at March 31, 1998 and the
consolidated statements of income, stockholders' equity and cash flows for the
three months ended March 31, 1998 are unaudited and have been prepared on the
same basis as the audited consolidated financial statements included herein.
Such unaudited consolidated financial statements reflect all adjustments of a
normal recurring nature which are, in the opinion of management, necessary for a
fair presentation of financial results for the three months ended March 31,
1998, in accordance with generally accepted accounting principles for interim
financial reporting.

F-11
<PAGE> 77
NATIONSRENT, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

Seasonality

The Company's initial acquisitions have been in the Midwest region of the
United States. The Company's revenue and income are dependent upon the activity
in the construction industry in the markets served by the Company. Construction
activity is dependent upon weather and the traditional seasons for construction
work. Because of this variability in demand, the Company's quarterly revenue may
fluctuate, and revenue for the first quarter of each year can be expected to be
lower than the remaining quarters. Although the Company believes that the
historical trend in quarterly revenue for the second, third and fourth quarters
of each year is generally higher than the first quarter, there can be no
assurance that this will occur in future periods. Accordingly, quarterly or
other interim results should not be considered indicative of results to be
expected for any quarter or for the full year.

Impact of recently issued accounting standards

In June 1997, the FASB issued SFAS No. 130, "Reporting Comprehensive
Income," and SFAS No. 131, "Disclosures about Segments of an Enterprise and
Related Information." The Company is required to adopt the provisions of these
Statements in fiscal year 1998. SFAS No. 130 establishes standards for reporting
and display of comprehensive income and its components in a primary financial
statement. The Company is currently evaluating the reporting formats recommended
under this Statement. SFAS No. 131 establishes a new method by which companies
will report operating segment information. This method requires disclosure of
information which is based on the manner in which management organizes the
segments within a company for making operating decisions and assessing
performance. The Company continues to evaluate the provisions of SFAS No. 131
and, upon adoption, the Company may report operating segments. In April 1998,
the American Institute of Certified Public Accountants issued Statement of
Position No. 98-5 ("SOP 98-5"). SOP 98-5 requires that all non-governmental
entities expense costs of start-up activities, including pre-operating,
pre-opening and organization activities, as those costs are incurred. In the
opinion of management, the adoption of this statement will have no impact on its
statement of operations.

2. ACQUISITIONS

The Company is building a nationally branded network of equipment rental
locations. Pursuant to this strategy, the Company has made five acquisitions
during 1997. Consideration for these acquisitions has consisted of cash and debt
payable to former owners. The acquisitions have been accounted for using the
purchase method and, accordingly, the acquired assets and assumed liabilities,
including goodwill, have been recorded at their estimated fair values as of the
date of acquisition. Purchase accounting values for all acquisitions have been
assigned on a preliminary basis, and are subject to adjustment when final
information as to the fair values of the nets assets acquired is available. The
operations of the acquired businesses have been included in the Company's
consolidated statement of income since the date of each respective acquisition.

The following table sets forth businesses acquired during 1997 and the
consideration paid:

<TABLE>
<CAPTION>
TOTAL
NAME OF BUSINESS DATE OF ACQUISITION CONSIDERATION
- ---------------- ------------------- --------------
(IN THOUSANDS)
<S> <C> <C>
Sam's Equipment Rental, Inc......................... August 31, 1997 $23,431
Ashland Rental and Sales, Inc. ..................... November 18, 1997 2,221
R. and R. Rental, Inc. ............................. December 10, 1997 8,000
C & E Rental and Service, Inc. ..................... December 23, 1997 12,250
Titan Rentals, Inc. ................................ December 31, 1997 5,900
-------
Total..................................... $51,802
=======
</TABLE>

F-12
<PAGE> 78
NATIONSRENT, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

The following table sets forth the estimated fair value of the assets
acquired and liabilities assumed for the above acquisitions (in thousands):

<TABLE>
<S> <C>
Assets, including cash...................................... $41,828
Goodwill.................................................... 36,686
Other intangibles........................................... 599
Liabilities................................................. 27,311
</TABLE>

The following table sets forth the unaudited pro forma consolidated results
of operations for the year ended December 31, 1997 giving effect to the above
acquisitions as if such acquisitions had occurred on January 1, 1997 (in
thousands, except per share data):

<TABLE>
<S> <C>
Revenue..................................................... $42,085
Net income.................................................. 2,816
Basic and diluted earnings per share........................ $ 0.11
</TABLE>

The above unaudited pro forma consolidated results are based upon certain
assumptions and estimates which the Company believes are reasonable. The
unaudited pro forma consolidated results of operations may not be indicative of
the operating results that actually would have been reported had the Company
been in existence and had the acquisitions been consummated on January 1, 1997,
nor are they necessarily indicative of results which will be reported in the
future.

3. PROPERTY AND EQUIPMENT

Property and equipment, net consists of the following:

<TABLE>
<CAPTION>
DECEMBER 31, MARCH 31,
1997 1998
------------ -----------
(UNAUDITED)
(IN THOUSANDS)
<S> <C> <C>
Buildings and improvements.................................. $ 96 $ 60
Furniture, fixtures and office equipment.................... 514 849
Vehicles, delivery and shop equipment....................... 906 1,207
Construction in process..................................... 923 1,435
------ ------
2,439 3,551
Less -- accumulated depreciation and amortization........... (105) (236)
------ ------
Property and equipment, net............................... $2,334 $3,315
====== ======
</TABLE>

F-13
<PAGE> 79
NATIONSRENT, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

4. DEBT

Debt consists of the following:

<TABLE>
<CAPTION>
DECEMBER 31, MARCH 31,
1997 1998
------------ -----------
(UNAUDITED)
(IN THOUSANDS)
<S> <C> <C>
Subordinated promissory notes, bearing interest at 8.5%,
interest payable quarterly and maturities through December
2000...................................................... $ 6,091 $ 5,943
Subordinated convertible notes, bearing interest at 6.5%,
interest payable quarterly and maturities through December
2002...................................................... 11,090 11,090
Mortgage payable, bearing interest at 9.5%, payable in
monthly installments through July 2007.................... 112 110
Note payable, with interest at 8.25%, payable in monthly
installments through August 1998.......................... 33 16
Equipment notes, bearing interest at 6.0% to 9.25%, payable
in various monthly installments through June 2000, secured
by equipment.............................................. 5,144 8,971
Notes payable to financial institutions..................... 20,458 26,100
------- -------
Total debt........................................ $42,928 $52,230
======= =======
</TABLE>

The subordinated promissory notes and the subordinated convertible notes
were issued in connection with the acquisitions of certain businesses. The
convertible notes have features that allow the holder to convert the principal,
or portion thereof, of the note into common stock in the event the Company
completes an initial public offering ("IPO") of its common stock. Such principal
would be converted into common stock at the IPO price. Certain convertible notes
have provisions that prospectively increase the interest rates to 8.5% if the
Company does not complete an IPO of its common stock before March 1999.

Notes payable to financial institutions at December 31, 1997 consist of
amounts due under: (i) a $12,500,000 interest bearing term loan, with interest
equal to the prime rate less 0.25%, payable in equal monthly installments of
$20,833 and a final payment of $12,000,000 on September 22, 1999, (ii) a
$6,000,000 interest bearing term loan, with interest equal to the prime rate
less 0.25%, payable in equal monthly installments of $83,333 and a final payment
of $5,500,000 on June 18, 1998 and (iii) a $2,000,000 revolving credit
agreement, bearing interest equal to the prime rate less 0.25%, with the
principal due on September 22, 1999. Each of the above notes imposes, among
other covenants, an earnings to fixed charges covenant, a minimum net worth
covenant and a liabilities to worth covenant, as defined. The notes also provide
the financial institution with a security interest in all of the assets of the
Company.

In March 1998, the Company entered into a $165,000,000 Credit Facility, as
amended, with a syndicate of lenders to provide for cash borrowings and letters
of credit. The Credit Facility has a three year term scheduled to expire on May
15, 2001. The Credit Facility can be used to complete permitted acquisitions,
make capital expenditures, enter into standby letters of credit, or for working
capital and other general corporate purposes. Cash borrowings bear interest at
either the BankBoston base rate plus a percentage ranging from 0.00% to 0.50%
or, at the Company's option, the Eurodollar market rate plus a percentage
ranging from 1.50% to 2.75%. The percentage over the BankBoston base rate or the
Eurodollar market rate is based on the Company's financial performance as
measured by a total funded debt ratio (as defined in the Credit Facility). The
Credit Facility provides the banks with a security interest in substantially all
of the assets of the Company. The Credit Facility also imposes, among other
covenants, a tangible assets to senior debt covenant, a restriction on all of
the Company's retained earnings including the declaration and payment of cash
dividends, consent requirements on certain acquisitions and a restriction on the
ratio of total funded debt to earnings before interest, income taxes,
deprecation and amortization. The proceeds from the Credit Facility

F-14
<PAGE> 80
NATIONSRENT, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

were used to repay substantially all of the notes payable to financial
institutions that were outstanding at December 31, 1997.

The aggregate maturity of debt at December 31, 1997 for the five years
ending December 31 is: 1998, $13,892,000; 1999, $17,039,000; 2000, $9,521,000;
2001, $184,000; 2002, $2,197,000; 2003 and thereafter, $95,000.

5. STOCKHOLDERS' EQUITY

Preferred stock

The Company has authorized 5,000,000 shares of $0.01 par value preferred
stock. No shares of preferred stock have been issued at December 31, 1997 or
March 31, 1998 (unaudited). The rights and preferences of the preferred stock
will be fixed by the Board of Directors at the time such shares are issued. The
preferred stock, when issued, will have dividend and liquidation preferences
over those of the common stockholders.

Stock options

During 1997, the Company granted to certain employees options to purchase
an aggregate of 282,527 shares of common stock, at exercise prices ranging from
$2.96 to $4.40 per share. At December 31, 1997 all options granted during the
year were outstanding and had a weighted average remaining contractual life of
9.93 years. The weighted average exercise price per share for these stock
options was $3.54. The exercise price per share was based on the estimated fair
value of the Company's common stock at the time of the grant. As such, no
compensation cost will be recognized for these stock options. The above options
become exercisable in equal 25% increments commencing on the first anniversity
of date of the grant, and expire 10 years from the date of grant. Accordingly,
no options were exercisable at December 31, 1997.

Pro forma information regarding net income and earnings per share is
required by SFAS No. 123, which also requires that the information be determined
as if the Company had accounted for its employee stock options granted
subsequent to December 31, 1994 under the fair value method of that Statement.
The fair value for these options was estimated at the date of grant using a
Black-Scholes option pricing model. The following assumptions were used in the
valuation: average expected life 7 years, expected volatility 0.75, risk free
interest rate 6% and no dividends. The weighted average fair value of options
granted during the year was $2.86.

For purposes of pro forma disclosures of net income and earnings per share,
the estimated fair value of the options is amortized to expense over the
options' vesting period, resulting in pro forma compensation expense of
approximately $23,000 for the period from August 14, 1997 (inception) to
December 31, 1997. The Company's pro forma net income for the period from August
14, 1997 (inception) to December 31, 1997 was $978,000 with pro forma diluted
and basic net income per share of $0.04.

6. INCOME TAXES

The components of the provision for federal and state income taxes for the
period from August 14, 1997 (inception) to December 31, 1997 are as follows (in
thousands):

<TABLE>
<S> <C>
Current..................................................... $409
Deferred.................................................... 357
----
$766
====
Federal..................................................... $602
State....................................................... 164
----
$766
====
</TABLE>

F-15
<PAGE> 81
NATIONSRENT, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

A reconciliation of the difference between the expected provision for
income taxes using the statutory federal income tax rate of 34% and the
Company's actual provision for the period from August 14, 1997 (inception) to
December 31, 1997 is as follows:

<TABLE>
<S> <C>
Federal statutory income tax rate........................... 34.0%
Add:
Non-deductible goodwill amortization...................... 3.0
State income taxes, net of federal tax benefit............ 6.1
Other, net................................................ 0.3
----
43.4%
====
</TABLE>

The components of deferred income tax liabilities (assets) at December 31,
1997 are as follows (in thousands):

<TABLE>
<S> <C>
Depreciation and amortization differences................... $2,766
Accrued liabilities not deductible until paid............... (761)
Bad debt provision not currently deductible................. (233)
Change from cash to accrual basis for income tax reporting
purposes.................................................. 773
------
Net deferred income tax liabilities....................... $2,545
======
</TABLE>

The provision for income taxes for the three months ended March 31, 1998 is
calculated based on the Company's expected effective tax rate for the year
ending December 31, 1998.

7. EARNINGS PER SHARE

The following table sets forth the computation of basic and diluted
earnings per share:

<TABLE>
<CAPTION>
PERIOD FROM
AUGUST 14, 1997
(INCEPTION) TO THREE MONTHS
DECEMBER 31, ENDED
1997 MARCH 31, 1998
--------------- --------------
(UNAUDITED)
(IN THOUSANDS, EXCEPT
PER SHARE DATA)
<S> <C> <C>
Numerator:
Net income............................................ $ 1,001 $ 93
======= =======
Denominator:
Denominator for basic earnings per
share -- weighted-average shares................... 25,000 25,000
Effect of dilutive securities:
Employee stock options............................. 7 69
------- -------
Denominator for diluted earnings per share -- adjusted
weighted-average shares............................ 25,007 25,069
======= =======
Basic earnings per share................................ $ 0.04 $ 0.00
======= =======
Diluted earnings per share.............................. $ 0.04 $ 0.00
======= =======
</TABLE>

Options to purchase 113,752 shares of common stock at $4.40 per share were
outstanding at December 31, 1997 but were not included in the computation of
diluted earnings per share because the options' exercise price was greater than
the average fair value of the common shares and, therefore, the effect would be
antidilutive.

F-16
<PAGE> 82
NATIONSRENT, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

See Note 10 for a description of certain transactions occurring in 1998
that would have significantly changed the number of common shares outstanding at
December 31, 1997 if these transactions had occurred before December 31, 1997.

8. RELATED PARTY TRANSACTIONS

The Company rents certain buildings from a related party. Such rental
expense totaled $160,000 for the period from August 14, 1997 (inception) to
December 31, 1997. One of the principal owners of the related party is an
officer and director of the Company.

9. COMMITMENTS AND CONTINGENCIES

Operating leases

The Company leases rental equipment, real estate and certain office
equipment under operating leases. Certain real estate leases require the Company
to pay maintenance, insurance, taxes and certain other expenses in addition to
the stated rentals. Future minimum lease payments under noncancelable operating
leases, including the related party lease discussed above, at December 31, 1997
total $1,108,000, $867,000, $555,000, $518,000 and $398,000 for the years ending
December 31, 1998, 1999, 2000, 2001 and 2002, respectively. There are no
payments under noncancelable operating leases subsequent to the year ending
December 31, 2002. Rent expense under noncancellable operating leases for the
period from August 14, 1997 (inception) to December 31, 1997 was $410,000,
including the related party lease discussed above.

Legal matters

The Company is subject to claims and lawsuits in the ordinary course of its
business. In the opinion of management, the Company has either adequate legal
defense, indemnification for such matters from previous owners or is adequately
covered by insurance. If not insured, such matters will not, in the aggregate,
have a material adverse impact upon the Company's consolidated financial
position, results of future operations or cash flows.

Environmental matters

The Company and its operations are subject to various laws and related
regulations governing environmental matters. Under such laws, an owner or lessee
of real estate may be liable for the costs of removal or remediation of certain
hazardous or toxic substances located on or in, or emanating from, such
property, as well as investigation of property damage. As part of the Company's
acquisition due diligence, the Company performs extensive environmental
analysis. The remediation has typically been the responsibility of the prior
owner and is addressed prior to closing. The Company does not believe there are
currently any environmental liabilities which should be recorded or disclosed in
its financial statements. The Company anticipates that its compliance with
various laws and regulations relating to the protection of the environment will
not have a material effect on its capital expenditures, future earnings or
financial position.

10. SUBSEQUENT EVENTS

In June 1998, the founding stockholders of the Company made an additional
capital contribution of $17,400,000. Also, in June 1998, the Company sold an
aggregate of 5,118,694 shares of common stock in a private placement for
aggregate proceeds of $27,600,000. Investors in the private placement include
Company employees and associates of the founding stockholders of the Company.
The March 31, 1998 pro forma column included in the accompanying consolidated
balance sheets gives effect to the above transactions as if they occurred on
March 31, 1998.

In May 1998, the Company received an unsecured subordinated loan in the
amount of $17,400,000 (the "Huizenga Note") from Huizenga Investments Limited
Partnership, an entity controlled by a current director and stockholder of the
Company. The loan accrued interest at the prevailing prime rate which was
payable

F-17
<PAGE> 83
NATIONSRENT, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

quarterly. The loan had a maturity date of January 19, 2001. The loan was
repaid, without any prepayment penalty, in its entirety on June 3, 1998 using
the proceeds from the aforementioned additional capital contribution.

The Company has completed eight acquisitions of rental equipment businesses
since December 31, 1997 for aggregate consideration of $103,974,000. Such
consideration consisted of $77,165,000 of cash, $26,809,000 of subordinated
convertible debt and warrants to purchase approximately $800,000 of the
Company's common stock at the IPO price. The cash portion of the consideration
was funded through borrowings under the Credit Facility and the Huizenga Note.
Each of the acquisitions has been accounted for using the purchase method. In
addition, the Company has entered into either letters of intent or definitive
purchase agreements to acquire an additional five businesses. The Company
expects to close such acquisitions prior to June 30, 1998. As only one of the
1998 acquisitions was completed prior to March 31, 1998, unaudited pro forma
consolidated results of operations for the three months ended March 31, 1998,
giving effect to that acquisition as if such acquisition occurred on January 1,
1998, would not be materially different than the unaudited historical results
reported herein.

Subsequent to December 31, 1997, through April 20, 1998, the Company
granted to certain employees options to purchase an aggregate of 805,044 shares
of common stock, at exercise prices ranging from $4.40 to $6.69 per share. The
weighted average exercise price per share for these stock options was $5.95. The
exercise prices per share were based on the estimated fair value of the
Company's common stock at the time of the grants. As such, no compensation cost
will be recognized for these stock options.

F-18
<PAGE> 84

REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS

To Gabriel Trailer Manufacturing Company, Inc.:

We have audited the accompanying consolidated balance sheets of Gabriel Trailer
Manufacturing Company, Inc. and subsidiary (an Ohio corporation) as of March 31,
1997 and August 31, 1997, and the related consolidated statements of income,
stockholders' equity and cash flows for the years ended March 31, 1996 and 1997
and for the period from April 1, 1997 through August 31, 1997. These financial
statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audits.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Gabriel Trailer Manufacturing
Company, Inc. and subsidiary as of March 31, 1997 and August 31, 1997, and the
results of their operations and their cash flows for the years ended March 31,
1996 and 1997 and for the period from April 1, 1997 through August 31, 1997 in
conformity with generally accepted accounting principles.

ARTHUR ANDERSEN LLP

Fort Lauderdale, Florida,
May 8, 1998.

F-19
<PAGE> 85

GABRIEL TRAILER MANUFACTURING COMPANY, INC.

CONSOLIDATED BALANCE SHEETS

<TABLE>
<CAPTION>
MARCH 31, AUGUST 31,
1997 1997
----------- -----------
<S> <C> <C>
ASSETS
Cash and cash equivalents................................... $ 17,186 $ 149,742
Accounts receivable, net of allowances for doubtful accounts
of $265,000 and $330,000 as of March 31, and August 31,
1997, respectively........................................ 2,044,590 3,335,663
Inventories................................................. 947,322 991,902
Due from affiliates......................................... 1,421,199 1,357,990
Rental equipment, net....................................... 21,788,980 21,885,967
Property, plant and equipment, net.......................... 1,208,147 1,145,612
Other assets................................................ 186,704 221,186
----------- -----------
Total assets...................................... $27,614,128 $29,088,062
=========== ===========

LIABILITIES AND STOCKHOLDERS' EQUITY
LIABILITIES:
Accounts payable.......................................... $ 1,739,231 $ 422,591
Accrued expenses and other liabilities.................... 1,667,030 1,759,464
Debt...................................................... 16,100,269 16,558,863
Income taxes payable...................................... 1,491,129 1,423,026
Deferred income taxes..................................... 2,149,565 3,156,458
----------- -----------
Total liabilities................................. 23,147,224 23,320,402
----------- -----------
COMMITMENTS AND CONTINGENCIES (Notes 7, 8 and 10)
STOCKHOLDERS' EQUITY:
Common stock -- no par value, 10,000 shares authorized,
issued and outstanding................................. 500 500
Retained earnings......................................... 4,466,404 5,767,160
----------- -----------
Total stockholders' equity........................ 4,466,904 5,767,660
----------- -----------
Total liabilities and stockholders' equity........ $27,614,128 $29,088,062
=========== ===========
</TABLE>

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

F-20
<PAGE> 86

GABRIEL TRAILER MANUFACTURING COMPANY, INC.

CONSOLIDATED STATEMENTS OF INCOME

<TABLE>
<CAPTION>
FOR THE
PERIOD FROM
FOR THE YEAR ENDED MARCH 31, APRIL 1, 1997
---------------------------- TO
1996 1997 AUGUST 31, 1997
------------ ------------ ---------------
<S> <C> <C> <C>
REVENUE:
Equipment rentals................................ $11,871,114 $15,327,802 $8,514,810
Sales of equipment, parts and supplies........... 4,301,865 4,177,194 1,204,708
----------- ----------- ----------
16,172,979 19,504,996 9,719,518
COST OF REVENUE:
Cost of equipment rentals, excluding
depreciation.................................. 4,379,534 6,029,585 2,192,790
Rental equipment depreciation.................... 2,052,534 3,465,293 1,847,567
Cost of sales of equipment, parts and supplies... 4,490,975 2,790,666 984,147
----------- ----------- ----------
10,923,043 12,285,544 5,024,504
----------- ----------- ----------
Gross profit............................. 5,249,936 7,219,452 4,695,014
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES....... 2,972,337 3,563,930 1,683,311
NONRENTAL DEPRECIATION............................. 180,101 237,905 114,993
----------- ----------- ----------
Operating income......................... 2,097,498 3,417,617 2,896,710
OTHER INCOME (EXPENSE):
Interest expense................................. (582,807) (866,284) (580,107)
Interest income.................................. 71,103 15,941 15,710
Other, net....................................... 125,468 187,044 (77,597)
----------- ----------- ----------
Total other income (expense), net........ (386,236) (663,299) (641,994)
----------- ----------- ----------
Income before provision for income
taxes.................................. 1,711,262 2,754,318 2,254,716
PROVISION FOR INCOME TAXES......................... 732,793 1,127,416 938,790
----------- ----------- ----------
NET INCOME......................................... $ 978,469 $ 1,626,902 $1,315,926
=========== =========== ==========
</TABLE>

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

F-21
<PAGE> 87

GABRIEL TRAILER MANUFACTURING COMPANY, INC.

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

<TABLE>
<CAPTION>
COMMON STOCK
------------------
NUMBER OF TREASURY RETAINED
SHARES AMOUNT STOCK EARNINGS TOTAL
--------- ------ --------- ---------- ----------
<S> <C> <C> <C> <C> <C>
BALANCE, April 1, 1995.................... 10,000 $500 $(190,000) $2,051,033 $1,861,533
Retirement of treasury stock............ -- -- 190,000 (190,000) --
Net income.............................. -- -- -- 978,469 978,469
------ ---- --------- ---------- ----------
BALANCE, March 31, 1996................... 10,000 500 -- 2,839,502 2,840,002
Net income.............................. -- -- -- 1,626,902 1,626,902
------ ---- --------- ---------- ----------
BALANCE, March 31, 1997................... 10,000 500 -- 4,466,404 4,466,904
Distribution............................ -- -- -- (15,170) (15,170)
Net income.............................. -- -- -- 1,315,926 1,315,926
------ ---- --------- ---------- ----------
BALANCE, August 31, 1997.................. 10,000 $500 $ -- $5,767,160 $5,767,660
====== ==== ========= ========== ==========
</TABLE>

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

F-22
<PAGE> 88

GABRIEL TRAILER MANUFACTURING COMPANY, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>
FOR THE
PERIOD FROM
FOR THE YEAR ENDED MARCH 31, APRIL 1, 1997
---------------------------- TO AUGUST 31,
1996 1997 1997
------------ ------------ -------------
<S> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income........................................ $ 978,469 $ 1,626,902 $ 1,315,926
Adjustments to reconcile net income to net cash
provided by operating activities --
Depreciation................................... 2,232,635 3,703,200 1,962,560
(Gain) loss on sale of assets.................. 16,202 (68,548) 84,020
Deferred income taxes.......................... 486,450 809,283 1,006,893
Changes in operating assets and liabilities:
Accounts receivable.......................... (309,761) (688,006) (1,291,073)
Inventories.................................. (122,582) (187,075) (44,580)
Other assets................................. (41,962) 8,601 (93,296)
Accounts payable............................. 244,241 777,122 (1,316,640)
Accrued expenses and other liabilities....... 446,252 503,630 92,434
Income taxes payable......................... 246,343 318,133 (68,103)
----------- ----------- -----------
Net cash provided by operating
activities.............................. 4,176,287 6,803,242 1,648,141
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property and equipment............... (494,684) (516,029) (63,792)
Proceeds from sale of property and equipment...... 314,097 17,560 8,733
Purchases of rental equipment..................... (8,799,248) (8,101,137) (1,775,155)
Proceeds from sale of rental equipment............ 916,403 1,326,510 136,685
----------- ----------- -----------
Net cash used in investing activities..... (8,063,432) (7,273,096) (1,693,529)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from debt................................ 12,823,899 17,922,405 4,843,858
Repayments of debt................................ (8,658,333) (14,417,413) (3,651,766)
Payments of equipment financings.................. -- (1,928,097) (1,045,871)
(Advances to) repayments from affiliates, net..... (316,721) (1,094,105) 31,723
----------- ----------- -----------
Net cash provided by financing
activities.............................. 3,848,845 482,790 177,944
----------- ----------- -----------
NET INCREASE (DECREASE) IN CASH AND CASH
EQUIVALENTS....................................... (38,300) 12,936 132,556
CASH AND CASH EQUIVALENTS, beginning of period...... 42,550 4,250 17,186
----------- ----------- -----------
CASH AND CASH EQUIVALENTS, end of period............ $ 4,250 $ 17,186 $ 149,742
=========== =========== ===========
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid for interest............................ $ 553,206 $ 821,349 $ 546,085
=========== =========== ===========
SUPPLEMENTAL SCHEDULE OF NONCASH INVESTING AND
FINANCING ACTIVITIES:
Equipment financing............................... $ -- $ 4,637,084 $ 387,503
=========== =========== ===========
Property dividends................................ $ -- $ -- $ 15,170
=========== =========== ===========
</TABLE>

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

F-23
<PAGE> 89

GABRIEL TRAILER MANUFACTURING COMPANY, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

MARCH 31, 1997 AND AUGUST 31, 1997

1. ORGANIZATION AND BASIS OF PRESENTATION:

Gabriel Trailer Manufacturing Company, Inc. ("Gabriel") (together with its
subsidiary, the "Company") was incorporated in March 1970 to manufacture, buy,
sell and deal in trailer equipment, other related equipment and parts and
accessories. Gabriel's wholly-owned subsidiary, Sam's Equipment Rental, Inc. was
formed for the purpose of renting and leasing construction related equipment.
The Company currently rents a broad array of equipment to a diverse customer
base including construction industry participants, industrial companies,
homeowners and others. The Company also engages in related activities such as
selling used equipment, acting as a distributor for certain new and used
equipment, and selling related merchandise and parts. The nature of the
Company's business is such that short-term obligations are typically met by cash
flow generated from long-term assets. Consequently, consistent with industry
practice, the accompanying balance sheets are presented on an unclassified
basis.

The accompanying consolidated financial statements include the accounts of
the Company and its wholly-owned subsidiary. All significant intercompany
accounts and transactions have been eliminated.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:

Cash equivalents

The Company considers all highly liquid instruments with an original
maturity of three months or less when purchased to be cash equivalents. At March
31, 1997 and August 31, 1997, the Company had no cash equivalents.

Inventories

Inventories consist of equipment, tools, parts, fuel and related rental
equipment supplies and accessories. Inventories are stated at the lower of cost
or market.

Rental equipment

Revenue recognition

Revenue related to the sale of equipment, parts and supplies is recognized
at the point of sale. Revenue related to the rental of equipment is recognized
over the contract term.

Property, plant and equipment

Property, plant and equipment is recorded at cost and depreciated over the
estimated useful life using the straight-line method. The range of useful lives
estimated by management for property, plant and equipment is three to forty
years. Ordinary maintenance and repair costs are charged to operations as
incurred.

Impairment of long-lived assets

The Company periodically reviews its valuation for long-lived assets used
in operations when indicators of impairment are present. If the undiscounted
cash flows estimated to be generated by those assets are less than the assets'
carrying amount, the Company records impairment as required under generally
accepted accounting principles. No such impairment losses were incurred for the
periods presented.

F-24
<PAGE> 90
GABRIEL TRAILER MANUFACTURING COMPANY, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

Fair value of financial instruments

The carrying amounts reported in the accompanying consolidated balance
sheets for cash and cash equivalents, accounts receivable, accounts payable,
accrued expenses and other liabilities approximate fair value as of March 31,
1997 and August 31, 1997.

Income taxes

The Company follows Statement of Financial Accounting Standards No. 109,
"Accounting for Income Taxes," which requires, among other things, recognition
of future tax effects measured at enacted rates attributable to deductible
temporary differences between financial statement and income tax bases of assets
and liabilities to the extent that realization of said effects is more likely
than not.

Use of estimates

The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts in the financial statements and
accompanying notes. Actual results could differ from those estimates.

Concentrations of credit risk

3. RENTAL EQUIPMENT:

Rental equipment and related accumulated depreciation consist of the
following:

<TABLE>
<CAPTION>
MARCH 31, AUGUST 31,
1997 1997
----------- -----------
<S> <C> <C>
Rental equipment.......................................... $28,790,435 $30,641,146
Less -- accumulated depreciation.......................... 7,001,455 8,755,179
----------- -----------
Rental equipment, net................................ $21,788,980 $21,885,967
=========== ===========
</TABLE>

4. PROPERTY, PLANT AND EQUIPMENT:

Property, plant and equipment consists of the following:

<TABLE>
<CAPTION>
MARCH 31, AUGUST 31,
1997 1997
----------- -----------
<S> <C> <C>
Land...................................................... $ 49,863 $ 49,863
Building.................................................. 757,816 757,816
Furniture and fixtures.................................... 355,131 339,593
Vehicles.................................................. 1,134,204 1,113,193
----------- -----------
2,297,014 2,260,465
Less -- accumulated depreciation.......................... (1,088,867) (1,114,853)
----------- -----------
Property, plant and equipment, net.............. $ 1,208,147 $ 1,145,612
=========== ===========
</TABLE>

F-25
<PAGE> 91
GABRIEL TRAILER MANUFACTURING COMPANY, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

5. ACCRUED EXPENSES AND OTHER LIABILITIES:

Accrued expenses and other liabilities consists of the following:

<TABLE>
<CAPTION>
MARCH 31, AUGUST 31,
1997 1997
---------- ----------
<S> <C> <C>
Personal property taxes..................................... $1,044,423 $1,172,905
Payroll-related............................................. 231,274 188,246
Tax penalties and interest.................................. 248,000 248,000
Other....................................................... 143,333 150,313
---------- ----------
Accrued expenses and other liabilities............ $1,667,030 $1,759,464
========== ==========
</TABLE>

6. DEBT:

Debt consists of the following:

<TABLE>
<CAPTION>
MARCH 31, AUGUST 31,
1997 1997
----------- -----------
<S> <C> <C>
Lines of credit, with borrowings up to $6.3 million,
secured by substantially all of the Company's assets,
interest ranging from 8.25% to 8.50%, payable in
monthly installments through September 1997.......... $ 4,091,315 $ 5,497,095
Revolving term loans, secured by substantially all of
the Company's assets, interest ranging from 8.25% to
8.90%, payable in monthly installments through
January 2000......................................... 6,444,444 6,233,334
Equipment notes, secured by rental equipment, interest
ranging from 6.90% to 9.00%, payable in monthly
installments through June 2000....................... 5,312,900 4,656,172
Mortgages payable, secured by real estate, interest
ranging from 6.75% to 9.50%, payable in monthly
installments through August 2005..................... 161,798 113,936
Note payable to related party, secured by life insurance
policy on officer, interest at 8.25%, payable in
monthly installments through August 1998............. 89,812 58,326
----------- -----------
Total debt...................................... $16,100,269 $16,558,863
=========== ===========
</TABLE>

Maturities of the Company's debt at August 31, 1997, for the years ended
August 31, are as follows:

<TABLE>
<S> <C>
1998........................................................ $14,155,433
1999........................................................ 1,677,753
2000........................................................ 636,277
2001........................................................ 9,853
2002........................................................ 10,831
Thereafter.................................................. 68,716
-----------
$16,558,863
===========
</TABLE>

F-26
<PAGE> 92
GABRIEL TRAILER MANUFACTURING COMPANY, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

7. INCOME TAXES:

The provision for Federal and state income taxes is as follows:

<TABLE>
<CAPTION>
FOR THE
FOR THE YEAR ENDED PERIOD FROM
MARCH 31, APRIL 1, 1997
---------------------- TO AUGUST 31,
1996 1997 1997
-------- ---------- -------------
<S> <C> <C> <C>
Current......................................... $246,343 $ 318,133 $ (68,103)
Deferred........................................ 486,450 809,283 1,006,893
-------- ---------- ----------
$732,793 $1,127,416 $ 938,790
======== ========== ==========
Federal......................................... $575,542 $ 885,481 $ 737,333
State........................................... 157,251 241,935 201,457
-------- ---------- ----------
$732,793 $1,127,416 $ 938,790
======== ========== ==========
</TABLE>

A reconciliation of the difference between the expected provision for
income taxes using the statutory Federal income tax rate of 34% and the
Company's actual provision is as follows:

<TABLE>
<CAPTION>
FOR THE
FOR THE YEAR ENDED PERIOD FROM
MARCH 31, APRIL 1, 1997
---------------------- TO AUGUST 31,
1996 1997 1997
-------- ---------- -------------
<S> <C> <C> <C>
Provision at the statutory tax rate............. $581,829 $ 936,468 $766,603
State income taxes.............................. 103,786 159,677 132,962
Nondeductible expenses.......................... 47,178 31,271 39,225
-------- ---------- --------
$732,793 $1,127,416 $938,790
======== ========== ========
</TABLE>

Deferred income taxes arise primarily due to temporary differences in
recognizing certain revenues and expenses for tax purposes and the use of
accelerated depreciation for tax purposes. The components of the deferred income
tax liabilities are as follows:

<TABLE>
<CAPTION>
MARCH 31, AUGUST 31,
1997 1997
---------- ----------
<S> <C> <C>
Depreciation of property and equipment and rental
equipment................................................. $2,211,443 $2,708,783
Accrued liabilities......................................... (871,739) (349,825)
Accounts receivable......................................... 809,861 (118,830)
Section 481 cash to accrual election change................. -- 916,330
---------- ----------
Deferred income tax liability............................. $2,149,565 $3,156,458
========== ==========
</TABLE>

The Company's income tax returns and related payments for the years ended
March 31, 1995, 1996 and 1997 were not filed on a timely basis. It is not
possible to predict the ultimate outcome of the Company's penalties for failure
to file, and pay on a timely basis and underpayment. The Company has estimated
an approximate liability of $175,000, which is included in accrued expenses and
other liabilities.

8. COMMITMENTS AND CONTINGENCIES:

Operating Leases

F-27
<PAGE> 93
GABRIEL TRAILER MANUFACTURING COMPANY, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

year and in the aggregate, at August 31, 1997 for noncancelable operating leases
with initial or remaining terms of one year or more are as follows:

<TABLE>
<CAPTION>
RELATED PARTY OTHER TOTAL
------------- -------- ----------
<S> <C> <C> <C>
1998............................................ $ 480,000 $328,322 $ 808,322
1999............................................ 368,000 228,866 596,866
2000............................................ 256,000 67,821 323,821
2001............................................ 192,000 -- 192,000
2002............................................ 8,000 -- 8,000
---------- -------- ----------
Total $1,304,000 $625,009 $1,929,009
========== ======== ==========
</TABLE>

Rent expense under noncancelable operating leases for the years ended March
31, 1996 and 1997 and the period from April 1, 1997 through August 31, 1997 is
$784,354, $1,098,234 and $423,798, respectively. Included in total rent expense
is rent to a related party of approximately $280,000, $357,000 and $200,000 for
the years ended March 31, 1996 and 1997 and the period from April 1, 1997
through August 31, 1997, respectively.

Litigation, Claims and Assessments

From time to time, the Company may be engaged in routine litigation and
disputes incidental to its business. The Company does not believe that the
ultimate resolution of any of these matters will have a material adverse effect
on the accompanying financial statements.

9. EMPLOYEE BENEFIT PLAN:

The Company has a 401(k) defined contribution profit-sharing plan under
which employees having worked a minimum of twelve months are eligible to
participate. Employer contributions, which are discretionary and depend on the
Company's profitability, were approximately $54,600, $70,100 and $47,700 for the
years ended March 31, 1996 and 1997 and for the period from April 1, 1997
through August 31, 1997, respectively.

10. SUBSEQUENT EVENT:

Effective September 1, 1997, all of the outstanding stock of the Company
was purchased by NationsRent, Inc., an unrelated third party, in exchange for
cash and debt.

F-28
<PAGE> 94

REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS

To R. and R. Rental, Inc.:

We have audited the accompanying balance sheet of R. and R. Rental, Inc. (an
Ohio S corporation) at December 10, 1997, and the related statements of
operations, stockholder's equity and cash flows for the period from January 1,
1997 through December 10, 1997. These financial statements are the
responsibility of the Company's management. Our responsibility is to express an
opinion on these financial statements based on our audit.

We conducted our audit in accordance with generally accepted auditing standards.
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audit provides a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of R. and R. Rental, Inc. at
December 10, 1997, and the results of its operations and its cash flows for the
period from January 1, 1997 through December 10, 1997 in conformity with
generally accepted accounting principles.

ARTHUR ANDERSEN LLP

Fort Lauderdale, Florida,
May 8, 1998.

F-29
<PAGE> 95

R. AND R. RENTAL, INC.

BALANCE SHEET

AS OF DECEMBER 10, 1997

<TABLE>
<S> <C>
ASSETS
Cash and cash equivalents................................... $ 193,714
Accounts receivable, net of allowance for doubtful accounts
of $150,000............................................... 649,193
Inventories................................................. 928,962
Rental equipment, net....................................... 4,002,825
Property and equipment, net................................. 267,903
Other assets................................................ 3,400
----------
Total assets...................................... $6,045,997
==========

LIABILITIES AND STOCKHOLDER'S EQUITY
LIABILITIES:
Accounts payable.......................................... $ 15,354
Accrued expenses and other liabilities.................... 108,996
Note payable.............................................. 1,523,139
----------
Total liabilities................................. 1,647,489
----------
COMMITMENTS AND CONTINGENCIES (Notes 7 and 9)
STOCKHOLDER'S EQUITY:
Common stock -- no par value, 250 shares authorized,
issued and outstanding................................. 500
Additional paid-in capital................................ 5,327,477
Accumulated deficit....................................... (929,469)
----------
Total stockholder's equity........................ 4,398,508
----------
Total liabilities and stockholder's equity........ $6,045,997
==========
</TABLE>

The accompanying notes to financial statements are an integral part of this
balance sheet.

F-30
<PAGE> 96

R. AND R. RENTAL, INC.

STATEMENT OF OPERATIONS

FOR THE PERIOD FROM JANUARY 1, 1997 THROUGH DECEMBER 10, 1997

<TABLE>
<S> <C>
REVENUE:
Equipment rentals......................................... $2,409,518
Sales of equipment, parts and supplies.................... 2,106,695
----------
4,516,213
COST OF REVENUE:
Cost of equipment rentals, excluding depreciation......... 1,398,174
Rental equipment depreciation............................. 630,548
Cost of sales of equipment, parts and supplies............ 1,808,076
----------
3,836,798
----------
Gross profit...................................... 679,415
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES................ 715,140
NONRENTAL DEPRECIATION...................................... 76,630
----------
Operating loss.................................... (112,355)
OTHER INCOME (EXPENSE):
Interest expense.......................................... (79,579)
Other income.............................................. 29,829
----------
Total other income (expense), net................. (49,750)
----------
NET LOSS.......................................... $ (162,105)
==========
</TABLE>

The accompanying notes to financial statements are an integral part of this
statement.

F-31
<PAGE> 97

R. AND R. RENTAL, INC.

STATEMENT OF STOCKHOLDER'S EQUITY

FOR THE PERIOD FROM JANUARY 1, 1997 THROUGH DECEMBER 10, 1997

<TABLE>
<CAPTION>
COMMON STOCK
------------------ ADDITIONAL
NUMBER PAID-IN ACCUMULATED
OF SHARES AMOUNT CAPITAL DEFICIT TOTAL
--------- ------ ---------- ------------ ----------
<S> <C> <C> <C> <C> <C>
BALANCE, January 1, 1997.................. 250 $500 $3,761,380 $(767,364) $2,994,516
Capital contributions................... -- -- 1,566,097 -- 1,566,097
Net loss................................ -- -- -- (162,105) (162,105)
--- ---- ---------- --------- ----------
BALANCE, December 10, 1997................ 250 $500 $5,327,477 $(929,469) $4,398,508
=== ==== ========== ========= ==========
</TABLE>

The accompanying notes to financial statements are an integral part of this
statement.

F-32
<PAGE> 98

R. AND R. RENTAL, INC.

STATEMENT OF CASH FLOWS

FOR THE PERIOD FROM JANUARY 1, 1997 THROUGH DECEMBER 10, 1997

<TABLE>
<S> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss.................................................. $ (162,105)
Adjustments to reconcile net loss to net cash used in
operating activities:
Depreciation and amortization.......................... 707,178
Loss on sale of rental equipment....................... 65,326
Changes in operating assets and liabilities:
Accounts receivable.................................. (40,271)
Inventories.......................................... (298,639)
Other assets......................................... 4,523
Accounts payable..................................... (382,070)
Accrued expenses and other liabilities............... 28,016
-----------
Net cash used in operating activities............. (78,042)
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of rental equipment............................. (2,208,233)
Purchases of property and equipment....................... (96,568)
Proceeds from sale of rental equipment.................... 307,793
-----------
Net cash used in investing activities............. (1,997,008)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from note payable................................ 1,523,139
Repayments of note payable................................ (935,609)
Capital contributions..................................... 1,566,097
-----------
Net cash provided by financing activities......... 2,153,627
-----------
NET INCREASE IN CASH AND CASH EQUIVALENTS................... 78,577
CASH AND CASH EQUIVALENTS, beginning of period.............. 115,137
-----------
CASH AND CASH EQUIVALENTS, end of period.................... $ 193,714
===========
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid for interest.................................... $ 79,579
===========
</TABLE>

The accompanying notes to financial statements are an integral part of this
statement.

F-33
<PAGE> 99

R. AND R. RENTAL, INC.

NOTES TO FINANCIAL STATEMENTS

DECEMBER 10, 1997

1. ORGANIZATION AND BASIS OF PRESENTATION

R. and R. Rentals, Inc. (the "Company") was incorporated in July 1988 in
the State of Ohio. The Company rents a broad array of equipment to a diverse
customer base that includes construction industry participants, industrial
companies, homeowners and others. The Company also engages in related activities
such as selling used equipment, acting as a distributor for certain new
equipment and selling related merchandise and parts. The nature of the Company's
business is such that short-term obligations are typically met by cash flow
generated from long-term assets. Consequently, consistent with industry
practice, the accompanying balance sheet is presented on an unclassified basis.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Cash equivalents

The Company considers all highly liquid instruments with a maturity of
three months or less when purchased to be cash equivalents. At December 10,
1997, the Company had no cash equivalents.

Inventories

Inventories consist of equipment, tools, parts, fuel and related equipment
supplies and accessories inventories are stated at the lower of weighted average
cost or market.

Rental equipment

Rental equipment is recorded at cost and depreciated over the estimated
useful lives of the equipment using the straight-line method. The useful life
estimated by management for rental equipment is seven years. Ordinary
maintenance and repair costs are charged to operations as incurred.

Revenue recognition

Revenue related to the sale of equipment is recognized at the point of
sale. Revenue related to equipment rental is recognized over the contract term.

Property and equipment

Property and equipment are recorded at cost and depreciated over their
estimated useful lives using the straight-line method. The range of useful lives
estimated by management for property and equipment is three to fifteen years.
Ordinary maintenance and repair costs are charged to operations as incurred.

Impairment of long-lived assets

Fair value of financial instruments

The carrying amounts reported in the balance sheet for cash and cash
equivalents, accounts receivable, accounts payable, accrued expenses and other
liabilities and note payable approximate fair value as of December 10, 1997.

F-34
<PAGE> 100
R. AND R. RENTAL, INC.

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

Income taxes

The Company is an S corporation for income tax purposes. Accordingly,
income, losses and related temporary differences which arise in the recording of
income and expense items for financial reporting and tax reporting purposes are
included in the individual tax return of the stockholder. Therefore, no
provision or liability for Federal and state income taxes has been included in
the accompanying financial statements.

On a pro forma basis, the Company would have had a tax benefit, however it
would have been fully offset by a valuation allowance as the benefit would not
have achieved the realization requirements of Statement of Financial Accounting
Standards ("SFAS") No. 109, "Accounting for Income Taxes."

Use of estimates

Concentrations of credit risk

3. RENTAL EQUIPMENT

Rental equipment and related accumulated depreciation as of December 10,
1997, consist of the following:

<TABLE>
<S> <C>
Rental equipment............................................ $ 5,349,321
Less -- accumulated depreciation............................ (1,346,496)
-----------
Rental equipment, net............................. $ 4,002,825
===========
</TABLE>

4. PROPERTY AND EQUIPMENT

A summary of property and equipment as of December 10, 1997, is as follows:

<TABLE>
<S> <C>
Trucks and autos............................................ $ 255,842
Furniture and fixtures...................................... 147,333
Computer equipment.......................................... 81,986
Leasehold improvements...................................... 38,466
---------
523,627
Less -- accumulated depreciation............................ (255,724)
---------
Property and equipment, net....................... $ 267,903
=========
</TABLE>

F-35
<PAGE> 101
R. AND R. RENTAL, INC.

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

5. ACCRUED EXPENSES AND OTHER LIABILITIES

Accrued expenses and other liabilities as of December 10, 1997, consists of
the following:

<TABLE>
<S> <C>
Accrued property taxes...................................... $100,000
Payroll-related............................................. 8,996
--------
Accrued expenses and other liabilities............ $108,996
========
</TABLE>

6. DEBT

The Company entered into a demand promissory note bearing interest at prime
(8.5% at December 10, 1997), with interest payable quarterly. This note is
secured by substantially all of the Company's rental equipment. The note had an
outstanding balance of $1,523,139 at December 10, 1997.

7. COMMITMENTS AND CONTINGENCIES

Operating Leases

The Company leases various automobiles under operating leases. Future
minimum lease payments, by year and in the aggregate, for noncancelable
operating leases with initial or remaining terms of one year or more are as
follows at December 10, 1997 for the following years ended December 10:

<TABLE>
<S> <C>
1998........................................................ $30,044
1999........................................................ 17,875
2000........................................................ 6,186
-------
Total............................................. $54,105
=======
</TABLE>

Expense under these operating leases for the period ended December 10, 1997
was $44,493 and is included under selling, general and administrative expenses
in the accompanying statement of operations.

Litigation, Claims and Assessments

8. RELATED PARTY TRANSACTIONS

The Company leases two buildings from the stockholder under monthly
operating leases. For the period ended December 10, 1997, rent expense totaled
approximately $56,500 and is included under selling, general and administrative
expenses in the accompanying statement of operations.

9. SUBSEQUENT EVENT

Effective December 11, 1997, substantially all of the Company's operating
assets and liabilities were purchased by NationsRent, Inc., an unrelated third
party, in exchange for cash and debt.

The demand promissory note of $1,523,139 at December 10, 1997 was paid off
by the stockholder of the Company with proceeds from the purchase of the
Company's assets and liabilities.

F-36
<PAGE> 102

REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS

To C & E Rental and Service, Inc.:

We have audited the accompanying balance sheets of C & E Rental and Service,
Inc. (an Indiana S corporation) as of December 31, 1996 and December 22, 1997,
and the related statements of income, stockholder's equity and cash flows for
the year ended December 31, 1996 and the period from January 1, 1997 through
December 22, 1997. These financial statements are the responsibility of the
Company's management. Our responsibility is to express an opinion on these
financial statements based on our audits.

In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of C & E Rental and Service, Inc.
as of December 31, 1996 and December 22, 1997, and the results of its operations
and its cash flows for the year ended December 31, 1996 and the period from
January 1, 1997 through December 22, 1997 in conformity with generally accepted
accounting principles.

ARTHUR ANDERSEN LLP

Fort Lauderdale, Florida,
May 8, 1998.

F-37
<PAGE> 103

C & E RENTAL AND SERVICE, INC.

BALANCE SHEETS

<TABLE>
<CAPTION>
DECEMBER 31, DECEMBER 22,
1996 1997
------------ ------------
<S> <C> <C>
ASSETS
Cash and cash equivalents................................... $ 43,390 $ 184,318
Accounts receivable, net of allowances for doubtful accounts
of $81,011 and $109,973 as of December 31, 1996, and
December 22, 1997, respectively........................... 705,695 701,156
Inventories................................................. 134,491 213,934
Due from affiliate.......................................... 372,115 --
Rental equipment, net....................................... 2,202,833 3,022,154
Property and equipment, net................................. 394,665 621,734
Other assets................................................ 30,357 32,543
---------- ----------
Total assets...................................... $3,883,546 $4,775,839
========== ==========

LIABILITIES AND STOCKHOLDER'S EQUITY
LIABILITIES:
Accounts payable.......................................... $ 194,278 $ 205,403
Accrued expenses and other liabilities.................... 198,443 185,087
Debt...................................................... 1,284,908 922,856
---------- ----------
Total liabilities................................. 1,677,629 1,313,346
---------- ----------

COMMITMENTS AND CONTINGENCIES (Notes 8 and 10)

STOCKHOLDER'S EQUITY:
Common stock -- no par value, 1,000 shares authorized,
issued and outstanding................................. 200,000 200,000
Retained earnings......................................... 2,588,781 3,845,357
Less: Treasury stock -- 500 shares at cost................ (582,864) (582,864)
---------- ----------
Total stockholder's equity........................ 2,205,917 3,462,493
---------- ----------
Total liabilities and stockholder's equity........ $3,883,546 $4,775,839
========== ==========
</TABLE>

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

F-38
<PAGE> 104

C & E RENTAL AND SERVICE, INC.

STATEMENTS OF INCOME

<TABLE>
<CAPTION>
FOR THE PERIOD
FOR THE YEAR FROM JANUARY 1,
ENDED 1997 TO
DECEMBER 31, DECEMBER 22,
1996 1997
------------ ---------------
<S> <C> <C>
REVENUE:
Equipment rentals......................................... $4,395,313 $4,506,274
Sales of equipment, parts and supplies.................... 1,961,510 2,638,935
Other..................................................... 115,115 128,586
---------- ----------
6,471,938 7,273,795
COST OF REVENUE:
Cost of equipment rentals, excluding depreciation......... 1,752,011 1,846,084
Rental equipment depreciation............................. 637,210 765,518
Cost of sales of equipment, parts and supplies............ 1,352,831 1,791,275
---------- ----------
3,742,052 4,402,877
---------- ----------
Gross profit...................................... 2,729,886 2,870,918
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES................ 1,760,595 1,417,097
NONRENTAL DEPRECIATION AND AMORTIZATION..................... 136,897 157,252
---------- ----------
Operating income.................................. 832,394 1,296,569
OTHER INCOME (EXPENSE):
Interest expense.......................................... (115,243) (101,218)
Other, net................................................ 51,580 61,225
---------- ----------
Total other income (expense), net................. (63,663) (39,993)
---------- ----------
Net income........................................ 768,731 1,256,576
PRO FORMA PROVISION FOR INCOME TAX.......................... 307,492 502,630
---------- ----------
PRO FORMA NET INCOME........................................ $ 461,239 $ 753,946
========== ==========
</TABLE>

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

F-39
<PAGE> 105

C & E RENTAL AND SERVICE, INC.

STATEMENTS OF STOCKHOLDER'S EQUITY

FOR THE YEAR ENDED DECEMBER 31, 1996 AND

THE PERIOD FROM JANUARY 1, 1997 TO DECEMBER 22, 1997

<TABLE>
<CAPTION>
COMMON STOCK
--------------------
NUMBER RETAINED TREASURY
OF SHARES AMOUNT EARNINGS STOCK TOTAL
--------- -------- ---------- --------- ----------
<S> <C> <C> <C> <C> <C>
BALANCE, January 1, 1996................. 1,000 $200,000 $1,820,050 $(582,864) $1,437,186
Net income............................. -- -- 768,731 -- 768,731
----- -------- ---------- --------- ----------
BALANCE, December 31, 1996............... 1,000 200,000 2,588,781 (582,864) 2,205,917
Net income............................. -- -- 1,256,576 -- 1,256,576
----- -------- ---------- --------- ----------
BALANCE, December 22, 1997............... 1,000 $200,000 $3,845,357 $(582,864) $3,462,493
===== ======== ========== ========= ==========
</TABLE>

The accompanying notes to financial statements are an integral part of this
statement.

F-40
<PAGE> 106

C & E RENTAL AND SERVICE, INC.

STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>
FOR THE
PERIOD FROM
FOR THE YEAR JANUARY 1, 1997
ENDED TO
DECEMBER 31, DECEMBER 22,
1996 1997
------------ ---------------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income................................................ $ 768,731 $ 1,256,576
Adjustments to reconcile net income to net cash provided
by operating activities:
Depreciation and amortization.......................... 774,107 922,770
Gain on sale of assets................................. (473,908) (705,063)
Changes in operating assets and liabilities:
Accounts receivable, net............................. (199,095) 4,539
Inventories.......................................... 15,644 (79,443)
Other assets......................................... 7,146 (2,186)
Accounts payable..................................... 65,384 11,125
Accrued expenses and other liabilities............... (21,052) (13,356)
----------- -----------
Net cash provided by operating activities......... 936,957 1,394,962
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of rental equipment............................. (1,609,651) (2,848,230)
Proceeds from sale of rental equipment.................... 1,271,362 1,968,454
Purchases of property and equipment....................... (102,209) (384,321)
----------- -----------
Net cash used in investing activities............. (440,498) (1,264,097)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from debt........................................ 612,000 1,488,000
Repayments of debt........................................ (734,711) (1,850,052)
Payments from (advances to) affiliate..................... (372,115) 372,115
----------- -----------
Net cash provided by (used in) financing
activities...................................... (494,826) 10,063
----------- -----------

NET INCREASE IN CASH AND CASH EQUIVALENTS................... 1,633 140,928
CASH AND CASH EQUIVALENTS, beginning of period.............. 41,757 43,390
----------- -----------
CASH AND CASH EQUIVALENTS, end of period.................... $ 43,390 $ 184,318
=========== ===========
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid for interest.................................... $ 115,243 $ 101,218
=========== ===========
</TABLE>

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

F-41
<PAGE> 107

C & E RENTAL AND SERVICE, INC.

NOTES TO FINANCIAL STATEMENTS

DECEMBER 31, 1996 AND DECEMBER 22, 1997

1. ORGANIZATION AND BASIS OF PRESENTATION

C & E Rental and Service, Inc. ("C & E Rental" or the "Company", formerly
Bob's Rental & Supply, Inc.), was incorporated in the State of Indiana in August
1959 and is engaged in the rental of a broad array of equipment to a diverse
customer base that includes construction industry participants, industrial
companies, homeowners and others. The Company also engages in related activities
such as selling new and used equipment, related merchandise and parts. The
nature of the Company's business is such that short-term obligations are
typically met by cash flow generated from long-term assets. Consequently,
consistent with industry practice, the accompanying balance sheets are presented
on an unclassified basis.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Cash equivalents

The Company considers all highly liquid instruments with a maturity of
three months or less when purchased to be cash equivalents. At December 31, 1996
and December 22, 1997, the Company had no cash equivalents.

Inventories

Inventories consist of equipment, tools, parts, fuel and related supply
items. Inventories are stated at the lower of cost (first-in, first-out) or
market.

Rental equipment

Rental equipment is recorded at cost and depreciated over the estimated
useful lives of the equipment using an accelerated method. The useful life
estimated by management for rental equipment is seven years. Ordinary
maintenance and repair costs are charged to operations as incurred.

Property and equipment

Property and equipment are recorded at cost and depreciated over their
estimated useful lives using straight-line and accelerated methods. Ordinary
maintenance and repair costs are charged to operations as incurred. The range of
useful lives estimated by management for property and equipment is as follows:

<TABLE>
<CAPTION>
YEARS
-------------
<S> <C>
Machinery and equipment..................................... 5
Furniture and fixtures...................................... 5
Autos and trucks............................................ 5
Buildings................................................... 20 - 30
Leasehold improvements...................................... Life of lease
</TABLE>

Impairment of long-lived assets

F-42
<PAGE> 108
C & E RENTAL AND SERVICE, INC.

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

Fair value of financial instruments

The carrying amounts reported in the accompanying balance sheets for cash
and cash equivalents, accounts receivable, accounts payable and accrued expenses
and other liabilities approximate fair value as of December 31, 1996 and
December 22, 1997 and approximates the carrying value of such debt.

Revenue recognition

Revenue related to the sale of equipment, parts and supplies is recognized
at the point of sale. Revenue related to rental equipment is recognized over the
contract term.

Income taxes

The pro forma adjustment to reflect income taxes in the accompanying
statements of income is for informational purposes only. The pro forma provision
for income tax has been provided at the estimated effective rate of 40%.

Use of estimates

Concentrations of credit risk

3. RENTAL EQUIPMENT

Rental equipment and related accumulated depreciation consist of the
following:

<TABLE>
<CAPTION>
DECEMBER 31, DECEMBER 22,
1996 1997
------------ ------------
<S> <C> <C>
Rental equipment............................................ $ 4,245,254 $ 5,275,468
Less -- accumulated depreciation............................ (2,042,421) (2,253,314)
----------- -----------
Rental equipment, net............................. $ 2,202,833 $ 3,022,154
=========== ===========
</TABLE>

F-43
<PAGE> 109
C & E RENTAL AND SERVICE, INC.

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

4. PROPERTY AND EQUIPMENT

A summary of property and equipment consists of the following:

<TABLE>
<CAPTION>
DECEMBER 31, DECEMBER 22,
1996 1997
------------ ------------
<S> <C> <C>
Machinery and equipment..................................... $ 26,190 $ 47,614
Furniture and fixtures...................................... 153,241 245,779
Autos and trucks............................................ 406,528 479,348
Buildings................................................... 349,743 349,743
Leasehold improvements...................................... -- 195,351
Land........................................................ 88,566 89,430
---------- ----------
1,024,268 1,407,265
Less -- accumulated depreciation............................ (629,603) (785,531)
---------- ----------
Property and equipment, net....................... $ 394,665 $ 621,734
========== ==========
</TABLE>

5. ACCRUED EXPENSES AND OTHER LIABILITIES

Accrued expenses and other liabilities consists of the following:

<TABLE>
<CAPTION>
DECEMBER 31, DECEMBER 22,
1996 1997
------------ ------------
<S> <C> <C>
Payroll-related............................................. $100,640 $ 70,069
Sales, property and other taxes............................. 97,803 115,018
-------- --------
Accrued expenses and other liabilities............ $198,443 $185,087
======== ========
</TABLE>

6. DEBT

Debt consists of the following:

<TABLE>
<CAPTION>
DECEMBER 31, DECEMBER 22,
1996 1997
------------ ------------
<S> <C> <C>
Line of credit, with borrowings up to $950,000, secured by
substantially all of the Company's business assets,
interest at 9.00% and 8.75%, as of 1996 and 1997,
respectively, payable in monthly installments through
November 1998............................................. $ 227,000 $150,000
Promissory note, secured by substantially all of the
Company's business assets, interest at 8.00%, payable in
monthly installments of $15,775 through July 2001......... 712,908 587,539
Note payable to officer, unsecured, interest at 9.50% and
9.00%, as of 1996 and 1997, respectively, payable in
December 1997............................................. 345,000 65,000
Note payable to bank, secured by certain real property,
interest at 8.75%, payable in monthly installments of
$1,583 through May 2000................................... -- 120,317
---------- --------
Total debt........................................ $1,284,908 $922,856
========== ========
</TABLE>

F-44
<PAGE> 110
C & E RENTAL AND SERVICE, INC.

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

Maturities of the Company's debt at December 22, 1997, for the years ended
December 22, are as follows:

<TABLE>
<S> <C>
1998........................................................ $371,459
1999........................................................ 169,516
2000........................................................ 275,014
2001........................................................ 106,867
--------
Total............................................. $922,856
========
</TABLE>

7. RELATED-PARTY TRANSACTIONS

In addition to the note payable to officer, described in Note 6, the
Company made a $372,115 advance to an affiliated company during 1996 which is
reflected as due from affiliate in the accompanying balance sheet as of December
31, 1996. The advance was repaid in 1997. During 1997, the Company entered into
a monthly operating lease with the same affiliated company for one of its
buildings. For the period ended December 22, 1997, such rental expense totaled
approximately $40,000.

8. COMMITMENTS AND CONTINGENCIES

Operating Leases

The Company leases real estate under operating leases. Certain leases
require the Company to pay maintenance, insurance, taxes and certain other
expenses in addition to the stated rentals. Future minimum lease payments, by
year and in the aggregate, for noncancelable operating leases with initial or
remaining terms of one year or more are as follows at December 22, 1997:

<TABLE>
<S> <C>
1998........................................................ $54,600
1999........................................................ 28,935
-------
Total............................................. $83,535
=======
</TABLE>

Rent expense under operating leases for the year ended December 31, 1996
and the period ended December 22, 1997 were approximately $46,800 and $94,600,
respectively.

Litigation, Claims and Assessments

9. EMPLOYEE BENEFIT PLAN

The Company has a contributory 401(k) profit-sharing plan under which
substantially all full-time employees are eligible to participate. Employer
contributions were approximately $51,000 and $61,000 for 1996 and 1997,
respectively.

10. SUBSEQUENT EVENT

Effective December 23, 1997, substantially all of the Company's operating
assets and liabilities were purchased by NationsRent, Inc., an unaffiliated
third party, in exchange for cash and debt.

F-45
<PAGE> 111

REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS

To Titan Rentals, Inc.:

We have audited the accompanying balance sheet of Titan Rentals, Inc. (a West
Virginia corporation) as of December 30, 1997, and the related statements of
income, stockholders' equity and cash flows for the period from January 1, 1997
through December 30, 1997. These financial statements are the responsibility of
the Company's management. Our responsibility is to express an opinion on these
financial statements based on our audit.

We conducted our audit in accordance with generally accepted auditing standards.
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audit provides a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Titan Rentals, Inc. as of
December 30, 1997, and the results of its operations and its cash flows for the
period from January 1, 1997 through December 30, 1997 in conformity with
generally accepted accounting principles.

ARTHUR ANDERSEN LLP

Fort Lauderdale, Florida,
May 6, 1998.

F-46
<PAGE> 112

TITAN RENTALS, INC.

BALANCE SHEET

AS OF DECEMBER 30, 1997

<TABLE>
<S> <C>
ASSETS
Cash and cash equivalents................................... $ 249,470
Accounts receivable, net of allowance for doubtful accounts
of $37,360................................................ 637,253
Inventories................................................. 93,120
Prepaid expenses and other assets........................... 117,205
Rental equipment, net....................................... 1,132,746
Property and equipment, net................................. 73,305
Income taxes receivable..................................... 70,352
----------
Total assets...................................... $2,373,451
==========
LIABILITIES AND STOCKHOLDERS' EQUITY
LIABILITIES:
Accounts payable.......................................... $ 105,384
Accrued expenses and other liabilities.................... 97,354
Debt...................................................... 501,612
Deferred income taxes..................................... 194,307
----------
Total liabilities................................. 898,657
----------
COMMITMENTS AND CONTINGENCIES (Notes 9 and 11)
STOCKHOLDERS' EQUITY:
Common stock -- $1,000 par value, 1,000 shares authorized,
155 shares issued and outstanding...................... 155,000
Retained earnings......................................... 1,319,794
----------
Total stockholders' equity........................ 1,474,794
----------
Total liabilities and stockholders' equity........ $2,373,451
==========
</TABLE>

The accompanying notes to financial statements are an integral part of this
balance sheet.

F-47
<PAGE> 113

TITAN RENTALS, INC.

STATEMENT OF INCOME

FOR THE PERIOD FROM JANUARY 1, 1997 THROUGH DECEMBER 30, 1997

<TABLE>
<S> <C>
REVENUE:
Equipment rentals......................................... $1,926,760
Sales of equipment, parts and supplies.................... 2,991,843
Other..................................................... 50,611
----------
4,969,214
COST OF REVENUE:
Cost of equipment rentals, excluding depreciation......... 1,302,454
Rental equipment depreciation............................. 302,271
Cost of sales of equipment, parts and supplies............ 2,043,201
----------
3,647,926
----------
Gross profit...................................... 1,321,288
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES................ 823,906
NONRENTAL DEPRECIATION AND AMORTIZATION..................... 16,048
----------
Operating income.................................. 481,334
OTHER INCOME (EXPENSE):
Interest expense.......................................... (33,579)
Other expense............................................. (7,438)
----------
Total other income (expense), net................. (41,017)
----------
Income before provision for income tax............ 440,317
PROVISION FOR INCOME TAX.................................... 168,085
----------
NET INCOME.................................................. $ 272,232
==========
</TABLE>

The accompanying notes to financial statements are an integral part of this
statement.

F-48
<PAGE> 114

TITAN RENTALS, INC.

STATEMENT OF STOCKHOLDERS' EQUITY

FOR THE PERIOD FROM JANUARY 1, 1997 THROUGH DECEMBER 30, 1997

<TABLE>
<CAPTION>
COMMON STOCK
--------------------
NUMBER RETAINED
OF SHARES AMOUNT EARNINGS TOTAL
--------- -------- ---------- ----------
<S> <C> <C> <C> <C>
BALANCE, January 1, 1997........................... 155 $155,000 $1,047,562 $1,202,562
Net income....................................... -- -- 272,232 272,232
--- -------- ---------- ----------
BALANCE, December 30, 1997......................... 155 $155,000 $1,319,794 $1,474,794
=== ======== ========== ==========
</TABLE>

The accompanying notes to financial statements are an integral part of this
statement.

F-49
<PAGE> 115

TITAN RENTALS, INC.

STATEMENT OF CASH FLOWS

FOR THE PERIOD FROM JANUARY 1, 1997 THROUGH DECEMBER 30, 1997

<TABLE>
<S> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income................................................ $ 272,232
Adjustments to reconcile net income to net cash provided
by operating activities:
Depreciation and amortization.......................... 318,319
Gain on sale of rental equipment....................... (666,617)
Deferred income taxes.................................. 56,199
Changes in operating assets and liabilities:
Accounts receivable.................................. (72,740)
Inventories.......................................... (5,430)
Prepaid expenses and other assets.................... 49,703
Income taxes receivable.............................. (41,127)
Accounts payable..................................... (184,448)
Accrued expenses and other liabilities............... 49,522
-----------
Net cash used in operating activities............. (224,387)
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of rental equipment............................. (1,063,670)
Purchases of property and equipment....................... (61,822)
Proceeds from sale of rental equipment.................... 1,510,660
-----------
Net cash provided by investing activities......... 385,168
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from debt........................................ 417,271
Repayments of debt........................................ (578,759)
-----------
Net cash used in financing activities............. (161,488)
-----------
NET DECREASE IN CASH AND CASH EQUIVALENTS................... (707)
CASH AND CASH EQUIVALENTS, beginning of period.............. 250,177
-----------
CASH AND CASH EQUIVALENTS, end of period.................... $ 249,470
===========
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid for interest.................................... $ 33,579
===========
Cash paid for income taxes................................ $ 154,467
===========
</TABLE>

The accompanying notes to financial statements are an integral part of this
statement.

F-50
<PAGE> 116

TITAN RENTALS, INC.

NOTES TO FINANCIAL STATEMENTS

DECEMBER 30, 1997

1. ORGANIZATION AND BASIS OF PRESENTATION

Titan Rentals, Inc. (the "Company") was incorporated in the state of West
Virginia in January 1990 for the purpose of creating an equipment rental
company. The Company rents a broad array of equipment to a diverse customer base
that includes construction industry participants, industrial companies,
homeowners and others. The Company also engages in related activities such as
selling used equipment, acting as a distributor for certain new equipment and
selling related merchandise and parts. The nature of the Company's business is
such that short-term obligations are typically met by cash flow generated from
long-term assets. Consequently, consistent with industry practice, the
accompanying balance sheet is presented on an unclassified basis.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Cash equivalents

The Company considers all highly liquid instruments with a maturity of
three months or less when purchased to be cash equivalents. At December 30,
1997, the Company had no cash equivalents.

Inventories

Inventories consist of equipment, tools, parts, fuel and related supply
items. Inventories are stated at the lower of average cost or market.

Rental equipment

Rental equipment is recorded at cost and depreciated over the estimated
useful lives of the equipment using accelerated and straight-line methods. The
range of useful lives estimated by management for rental equipment is three to
seven years. Rental equipment having a cost of $500 or less is expensed at the
time of purchase. Ordinary maintenance and repair costs are charged to
operations as incurred.

Revenue recognition

Revenue related to the sale of equipment, parts and supplies is recognized
at the point of sale. Revenue related to rental equipment is recognized over the
contract term.

Property and equipment

Property and equipment are recorded at cost and depreciated over their
estimated useful lives using accelerated and straight-line methods. The range of
useful lives estimated by management for property and equipment is five to seven
years. Ordinary maintenance and repair costs are charged to operations as
incurred.

Impairment of long-lived assets

F-51
<PAGE> 117
TITAN RENTALS, INC.

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

Fair value of financial instruments

The carrying amounts reported in the accompanying balance sheet for cash
and cash equivalents, accounts receivable, income taxes receivable, accounts
payable, accrued expenses and other liabilities and debt approximate fair value
as of December 30, 1997 and approximates the carrying value of such debt.

Income taxes

The Company follows Statement of Financial Accounting Standards ("SFAS")
No. 109, "Accounting for Income Taxes," which requires, among other things,
recognition of future tax effects measured at enacted rates attributable to
deductible temporary differences between financial statement and income tax
bases of assets and liabilities to the extent that realization of said effects
is more likely than not.

Use of estimates

Concentrations of credit risk

3. RENTAL EQUIPMENT

As of December 30, 1997, rental equipment and related accumulated
depreciation consist of the following:

<TABLE>
<S> <C>
Rental equipment............................................ $1,491,084
Less -- accumulated depreciation............................ (358,338)
----------
Rental equipment, net............................. $1,132,746
==========
</TABLE>

4. PROPERTY AND EQUIPMENT

A summary of property and equipment as of December 30, 1997, is as follows:

<TABLE>
<S> <C>
Furniture, fixtures and office equipment.................... $121,175
Less -- accumulated depreciation............................ (47,870)
--------
Property and equipment, net....................... $ 73,305
========
</TABLE>

F-52
<PAGE> 118
TITAN RENTALS, INC.

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

5. ACCRUED EXPENSES AND OTHER LIABILITIES

Accrued expenses and other liabilities as of December 30, 1997, consists of
the following:

<TABLE>
<S> <C>
Payroll-related............................................. $12,746
Property and sales tax...................................... 30,469
Other....................................................... 54,139
-------
Accrued expenses and other liabilities............ $97,354
=======
</TABLE>

6. DEBT

As of December 30, 1997, debt consists of the following:

<TABLE>
<S> <C>
Line of credit, secured by accounts receivable and
inventory, interest at prime plus .50% (9.5% at December
30, 1997), payable in monthly installments through
December 2002............................................. $ 33,303
Equipment notes, secured by equipment, interest from 7.90%
to 9.25%, payable in various monthly installments through
January 2000.............................................. 468,309
--------
Total debt........................................ $501,612
========
</TABLE>

Maturities of the Company's debt at December 30, 1997, for the years ended
December 30, are as follows:

<TABLE>
<S> <C>
1998........................................................ $247,731
1999........................................................ 158,804
2000........................................................ 95,077
--------
Total............................................. $501,612
========
</TABLE>

7. INCOME TAXES

The provision for Federal and state income taxes for the period from
January 1, 1997 through December 30, 1997, is as follows:

<TABLE>
<S> <C>
Current..................................................... $111,886
Deferred.................................................... 56,199
--------
$168,085
========
Federal..................................................... $112,552
State....................................................... 55,533
--------
$168,085
========
</TABLE>

A reconciliation of the difference between the expected provision for
income taxes for the period from January 1, 1997 through December 30, 1997,
using the statutory federal income tax rate of 34% and the Company's effective
tax rate is as follows:

<TABLE>
<S> <C>
Provision at statutory tax rate............................. $149,700
State income taxes, net of federal benefit.................. 36,652
Other....................................................... (18,267)
--------
$168,085
========
</TABLE>

F-53
<PAGE> 119
TITAN RENTALS, INC.

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

The components of deferred income tax assets and (liabilities) as of
December 30, 1997, are as follows:

<TABLE>
<S> <C>
Accrued liabilities......................................... $ 22,000
Accounts receivable......................................... (36,504)
Prepaid expenses............................................ (13,429)
Property and equipment...................................... (166,374)
---------
Deferred tax liability............................ $(194,307)
=========
</TABLE>

8. RELATED-PARTY TRANSACTIONS

Effective January 1, 1994, the Company entered into a lease with a related
party to lease its office and operating facilities. The minimum annual rental
payments amount to $84,000 per year and are paid on a month-to-month basis.

The accompanying financial statements include revenue of $173,499 for the
period from January 1, 1997 through December 30, 1997 and outstanding accounts
receivable as of December 30, 1997 of $24,117 related to sales to a related
party.

9. COMMITMENTS AND CONTINGENCIES

Operating Leases

The Company leases rental equipment under operating leases. Future minimum
lease payments, by year and in the aggregate, for noncancelable operating leases
with initial or remaining terms of one year or more are as follows at December
30, 1997:

Rental equipment expense under noncancelable operating leases was $74,292
for the period from January 1, 1997 through December 30, 1997.

Litigation, Claims and Assessments

10. EMPLOYEE BENEFIT PLAN

The Company has a defined contribution profit-sharing plan under which
employees having worked a minimum of twelve months are eligible to participate.
Employer contributions, which are discretionary and depend on the Company's
profitability, were approximately $49,000 for 1997.

11. SUBSEQUENT EVENT

Effective December 31, 1997, all of the outstanding stock of the Company
was purchased by NationsRent, Inc., an unrelated third party, in exchange for
cash and debt.

F-54
<PAGE> 120

REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS

To The Bode-Finn Company:

We have audited the accompanying balance sheets of The Bode-Finn Company (an
Ohio corporation) as of December 31, 1996 and 1997, and the related statements
of income, stockholders' equity and cash flows for each of the three years in
the period ended December 31, 1997. These financial statements are the
responsibility of the Company's management. Our responsibility is to express an
opinion on these financial statements based on our audits.

In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of The Bode-Finn Company as of
December 31, 1996 and 1997, and the results of its operations and cash flows for
each of the three years in the period ended December 31, 1997 in conformity with
generally accepted accounting principles.

ARTHUR ANDERSEN LLP

Fort Lauderdale, Florida,
May 12, 1998.

F-55
<PAGE> 121

THE BODE-FINN COMPANY

BALANCE SHEETS

<TABLE>
<CAPTION>
DECEMBER 31,
-------------------------- MARCH 31,
1996 1997 1998
----------- ----------- -----------
(UNAUDITED)
<S> <C> <C> <C>
ASSETS
Cash and cash equivalents........................... $ 244,625 $ 398,042 $ 887,170
Accounts receivable, net of allowance for doubtful
accounts of $770,000, $760,000 and $798,180
(unaudited) for 1996, 1997 and 1998,
respectively...................................... 8,013,745 7,840,930 7,250,208
Inventories, net.................................... 4,635,371 3,823,388 4,855,835
Rental equipment, net............................... 20,438,368 21,560,523 21,920,589
Property and equipment, net......................... 1,041,681 956,768 989,588
Other assets........................................ 879,378 886,487 849,219
----------- ----------- -----------
Total assets.............................. $35,253,168 $35,466,138 $36,752,609
=========== =========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
LIABILITIES:
Accounts payable.................................. $ 3,951,392 $ 2,350,332 $ 3,921,807
Accrued expenses and other liabilities............ 4,623,823 5,374,820 5,094,374
Debt.............................................. 16,407,989 16,086,500 15,839,363
----------- ----------- -----------
Total liabilities......................... 24,983,204 23,811,652 24,855,544
----------- ----------- -----------
COMMITMENTS AND CONTINGENCIES (Notes 9 and 12)
STOCKHOLDERS' EQUITY:
Common stock, no par value, 2,500 shares
authorized, 1,250 shares issued and
outstanding.................................... 125,000 125,000 125,000
Retained earnings................................. 10,144,964 11,529,486 11,772,065
----------- ----------- -----------
Total stockholders' equity................ 10,269,964 11,654,486 11,897,065
----------- ----------- -----------
Total liabilities and stockholders'
equity.................................. $35,253,168 $35,466,138 $36,752,609
=========== =========== ===========
</TABLE>

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

F-56
<PAGE> 122

THE BODE-FINN COMPANY

STATEMENTS OF INCOME

<TABLE>
<CAPTION>
FOR THE THREE MONTH
PERIOD ENDED
FOR THE YEAR ENDED DECEMBER 31, MARCH 31,
--------------------------------------- -------------------------
1995 1996 1997 1997 1998
----------- ----------- ----------- ----------- -----------
(UNAUDITED)
<S> <C> <C> <C> <C> <C>
REVENUE:
Equipment rentals.............. $18,231,447 $19,772,670 $20,211,679 $ 4,742,679 $ 4,687,176
Sales of equipment, parts and
supplies.................... 26,599,122 32,722,336 33,821,681 7,324,630 8,254,837
Service and other.............. 5,468,525 6,251,936 7,216,815 1,753,068 1,768,973
----------- ----------- ----------- ----------- -----------
50,299,094 58,746,942 61,250,175 13,820,377 14,710,986
COST OF REVENUE:
Cost of equipment rentals,
excluding depreciation...... 4,771,698 5,229,390 4,978,411 1,323,300 1,399,440
Rental equipment
depreciation................ 5,436,903 6,515,970 7,265,763 1,745,328 1,832,972
Cost of sales of equipment,
parts and supplies.......... 20,161,831 25,937,735 26,425,012 5,752,417 6,177,680
Other.......................... 2,052,764 1,895,993 2,159,402 589,033 576,602
----------- ----------- ----------- ----------- -----------
32,423,196 39,579,088 40,828,588 9,410,078 9,986,694
----------- ----------- ----------- ----------- -----------
Gross profit........... 17,875,898 19,167,854 20,421,587 4,410,299 4,724,292
SELLING, GENERAL AND
ADMINISTRATIVE EXPENSES........ 14,093,787 15,443,249 16,596,595 3,755,319 3,964,404
NONRENTAL DEPRECIATION AND
AMORTIZATION................... 205,564 260,652 256,808 72,853 61,814
----------- ----------- ----------- ----------- -----------
Operating income....... 3,576,547 3,463,953 3,568,184 582,127 698,074
OTHER INCOME (EXPENSE):
Interest expense............... (1,329,494) (1,494,310) (1,601,831) (349,526) (379,571)
Other income................... 227,106 212,218 347,947 39,326 85,795
----------- ----------- ----------- ----------- -----------
Other income (expense),
net.................. (1,102,388) (1,282,092) (1,253,884) (310,200) (293,776)
----------- ----------- ----------- ----------- -----------
Income before provision
for income taxes..... 2,474,159 2,181,861 2,314,300 271,927 404,298
PROVISION FOR INCOME TAXES....... 1,036,771 936,241 929,778 137,461 161,719
----------- ----------- ----------- ----------- -----------
NET INCOME....................... $ 1,437,388 $ 1,245,620 $ 1,384,522 $ 134,466 $ 242,579
=========== =========== =========== =========== ===========
</TABLE>

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

F-57
<PAGE> 123

THE BODE-FINN COMPANY

STATEMENTS OF STOCKHOLDERS' EQUITY

FOR EACH OF THE THREE YEARS ENDED DECEMBER 31, 1997

AND THE THREE MONTH PERIOD ENDED MARCH 31, 1998 (UNAUDITED)

<TABLE>
<CAPTION>
COMMON STOCK
---------------------
NUMBER TOTAL
OF RETAINED STOCKHOLDERS'
SHARES AMOUNT EARNINGS EQUITY
--------- -------- ----------- -------------
<S> <C> <C> <C> <C>
BALANCE, January 1, 1995.................... 1,250 $125,000 $ 7,461,956 $ 7,586,956
Net income................................ -- -- 1,437,388 1,437,388
----- -------- ----------- -----------
BALANCE, December 31, 1995.................. 1,250 125,000 8,899,344 9,024,344
Net income................................ -- -- 1,245,620 1,245,620
----- -------- ----------- -----------
BALANCE, December 31, 1996.................. 1,250 125,000 10,144,964 10,269,964
Net income................................ -- -- 1,384,522 1,384,522
----- -------- ----------- -----------
BALANCE, December 31, 1997.................. 1,250 125,000 11,529,486 11,654,486
Net income (unaudited).................... -- -- 242,579 242,579
----- -------- ----------- -----------
BALANCE, March 31, 1998 (unaudited)......... 1,250 $125,000 $11,772,065 $11,897,065
===== ======== =========== ===========
</TABLE>

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

F-58
<PAGE> 124

THE BODE-FINN COMPANY

STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>
FOR THE THREE MONTH
FOR THE YEAR ENDED DECEMBER 31, PERIOD ENDED MARCH 31,
------------------------------------------ --------------------------
1995 1996 1997 1997 1998
------------ ------------ ------------ ------------ -----------
(UNAUDITED)
<S> <C> <C> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income.......................... $ 1,437,388 $ 1,245,620 $ 1,384,522 $ 134,466 $ 242,579
Adjustments to reconcile net income
to net cash provided by operating
activities:
Depreciation and amortization..... 5,642,467 6,776,622 7,522,571 1,818,181 1,899,786
Provision for bad debts........... 291,256 413,151 244,184 54,550 57,169
Provision for inventory
obsolescence.................... -- -- 50,000 -- --
Gain on sale of rental
equipment....................... (618,322) (712,961) (800,940) (121,132) (131,185)
(Gain) loss on sale of property
and equipment................... 740 (22,522) (230,537) 1,231 (29,649)
Changes in operating assets and
liabilities:
Accounts receivable............. (220,880) (810,847) (71,369) 390,384 533,553
Inventories..................... (1,359,110) 1,198,655 1,614,587 553,534 (795,309)
Other assets.................... 275,012 140,938 (7,109) (16,922) 37,268
Accounts payable................ 604,748 1,179,194 (1,601,060) (1,008,860) 1,571,475
Accrued expenses and other
liabilities.................. 383,309 (274,895) 750,997 141,046 (280,446)
------------ ------------ ------------ ------------ -----------
Total adjustments............ 4,999,220 7,887,335 7,471,324 1,812,012 2,862,662
------------ ------------ ------------ ------------ -----------
Net cash provided by
operating activities....... 6,436,608 9,132,955 8,855,846 1,946,478 3,105,241
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of rental equipment... (10,733,785) (10,254,290) (10,364,431) (2,720,488) (2,588,134)
Purchases of property and
equipment.................... (419,435) (702,564) (211,398) (43,803) (101,984)
Proceeds from sale of rental
equipment.................... 1,690,437 1,850,831 1,736,844 283,554 289,142
Proceeds from sale of property
and equipment................ 16,422 42,378 458,045 1,200 32,000
------------ ------------ ------------ ------------ -----------
Net cash used in investing
activities................. (9,446,361) (9,063,645) (8,380,940) (2,479,537) (2,368,976)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from debt................ 8,236,990 10,797,136 17,437,380 18,054,160 758,150
Repayments of debt................ (5,331,819) (10,831,673) (17,758,869) (17,066,355) (1,005,287)
------------ ------------ ------------ ------------ -----------
Net cash provided by (used in)
financing activities............ 2,905,171 (34,537) (321,489) 987,805 (247,137)
------------ ------------ ------------ ------------ -----------
NET INCREASE (DECREASE) IN CASH AND
CASH EQUIVALENTS.................... (104,582) 34,773 153,417 454,746 489,128
CASH AND CASH EQUIVALENTS, beginning
of period........................... 314,434 209,852 244,625 244,625 398,042
------------ ------------ ------------ ------------ -----------
CASH AND CASH EQUIVALENTS, end of
period.............................. $ 209,852 $ 244,625 $ 398,042 $ 699,371 $ 887,170
============ ============ ============ ============ ===========

SUPPLEMENTAL DISCLOSURE OF CASH FLOW
INFORMATION:
Cash paid for interest.............. $ 1,441,462 $ $1,476,730 $ 1,582,877 $ 349,380 $ 373,420
============ ============ ============ ============ ===========
Cash paid for income taxes.......... $ 832,954 $ 915,026 $ 812,481 $ 98,200 $ 88,000
============ ============ ============ ============ ===========
</TABLE>

The accompanying notes to financial statements are an integral part of these
statements.
F-59
<PAGE> 125

THE BODE-FINN COMPANY

NOTES TO FINANCIAL STATEMENTS

DECEMBER 31, 1996 AND 1997

1. ORGANIZATION AND BASIS OF PRESENTATION:

The Bode-Finn Company (the "Company") was incorporated in Ohio in January
1938. The Company rents a broad array of equipment to a diverse customer base
that includes construction industry participants, industrial companies and
others in the states of Ohio, Kentucky, West Virginia and Indiana. The Company
also engages in related activities such as selling used equipment, acting as a
distributor for certain new equipment and selling related merchandise and parts.
The nature of the Company's business is such that short-term obligations are
typically met by cash flow generated from long-term assets. Consequently,
consistent with industry practice, the accompanying audited and unaudited
balance sheets are presented on an unclassified basis.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:

Cash equivalents

The Company considers all highly liquid instruments with a maturity of
three months or less when purchased to be cash equivalents.

Inventories

Inventories consist of equipment, parts and related supply items. New and
used equipment inventories are stated at the lower of cost (determined using a
first-in, first-out "FIFO" basis) or market. Parts inventories are determined
using a combination of the last-in, first-out "LIFO" and FIFO methods and are
stated at replacement cost which approximates market.

Rental equipment

Rental equipment is recorded at cost and depreciated over the estimated
useful lives of the equipment using an accelerated method. The range of useful
lives estimated by management for rental equipment is five to seven years.
Rental equipment is depreciated to a salvage value of ten to twenty percent of
cost. Rental equipment having a cost of $2,000 or less is expensed at the time
of purchase. Ordinary maintenance and repair costs are charged to operations as
incurred.

Revenue recognition

Revenue related to the sale of equipment, parts and supplies is recognized
at the point of sale. Revenue related to rental equipment is recognized over the
contract term.

Property and equipment

Property and equipment are recorded at cost and depreciated over their
estimated useful lives using an accelerated method. The range of useful lives
estimated by management for property and equipment is two to thirty-nine years.
Property and equipment is depreciated to a salvage value of zero to twenty
percent of cost. Ordinary maintenance and repair costs are charged to operations
as incurred.

Impairment of long-lived assets

F-60
<PAGE> 126
THE BODE-FINN COMPANY

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

Fair value of financial instruments

The carrying amounts for accounts receivable, accounts payable and accrued
expenses and other liabilities approximate fair value due to the short-term
nature of these accounts. The fair value of debt is determined using current
interest rates for similar instruments as of December 31, 1996 and 1997 and
approximates the carrying value of these notes due to the fact that the
underlying instruments include provisions to adjust note balances and interest
rates to approximate fair market value.

Income taxes

The Company follows Statement of Financial Accounting Standards ("SFAS")
No. 109, "Accounting for Income Taxes," which requires, among other things,
recognition of future tax benefits measured at enacted rates attributable to
deductible temporary differences between financial statement and income tax
bases of assets and liabilities and to tax net operating loss carryforwards to
the extent that realization of said benefits is more likely than not.

Concentrations of credit risk

Financial instruments that potentially subject the Company to significant
concentrations of credit risk consist principally of cash investments and
accounts receivable. The Company maintains cash and cash equivalents with high
quality financial institutions. Concentrations of credit risk with respect to
accounts receivable are limited because a large number of geographically diverse
customers make up the Company's customer base. No single customer represents
greater than 10% of total accounts receivable. The Company controls credit risk
through credit approvals, credit limits, and monitoring procedures.

Use of estimates

Interim financial information

In the opinion of management, the unaudited interim financial information
as of March 31, 1998 and for the three month periods ended March 31, 1997 and
1998 furnished herein reflects all adjustments consisting of normal recurring
accruals that, in the opinion of management, are necessary for a fair
presentation of the results for the interim period. The results of operations
for the three months ended March 31, 1998 are not necessarily indicative of the
results to be expected for the entire year.

3. INVENTORIES:

Inventories are comprised of the following:

<TABLE>
<CAPTION>
DECEMBER 31,
---------------------------- MARCH 31,
1996 1997 1998
------------ ------------ ------------
(UNAUDITED)
<S> <C> <C> <C>
New and used equipment, FIFO............. $ 2,581,561 $ 1,590,860 $ 2,319,053
Parts, LIFO.............................. 645,076 801,055 747,327
Parts, FIFO.............................. 900,780 901,854 921,799
Work in progress, at cost................ 682,954 754,619 1,092,656
Allowance for obsolete inventory......... (175,000) (225,000) (225,000)
------------ ------------ ------------
Total inventories, net......... $ 4,635,371 $ 3,823,388 $ 4,855,835
============ ============ ============
</TABLE>

F-61
<PAGE> 127
THE BODE-FINN COMPANY

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

The current costs, determined by using the FIFO basis, of LIFO inventories
was $1,122,383, $1,301,380 and $1,247,652 (unaudited) at December 31, 1996 and
1997 and March 31, 1998.

4. RENTAL EQUIPMENT:

Rental equipment and related accumulated depreciation consist of the
following:

<TABLE>
<CAPTION>
DECEMBER 31,
---------------------------- MARCH 31,
1996 1997 1998
------------ ------------ ------------
(UNAUDITED)
<S> <C> <C> <C>
Rental equipment......................... $ 46,719,676 $ 50,299,100 $ 51,198,041
Less -- accumulated depreciation......... (26,281,308) (28,738,577) (29,277,452)
------------ ------------ ------------
Rental equipment, net.......... $ 20,438,368 $ 21,560,523 $ 21,920,589
============ ============ ============
</TABLE>

5. PROPERTY AND EQUIPMENT:

Property and equipment consists of the following:

<TABLE>
<CAPTION>
DECEMBER 31,
---------------------------- MARCH 31,
1996 1997 1998
------------ ------------ ------------
(UNAUDITED)
<S> <C> <C> <C>
Furniture, fixtures and office
equipment.............................. $ 3,728,682 $ 3,588,314 $ 3,621,218
Less -- accumulated depreciation......... (2,687,001) (2,631,546) (2,631,630)
------------ ------------ ------------
Property and equipment, net.... $ 1,041,681 $ 956,768 $ 989,588
============ ============ ============
</TABLE>

6. ACCRUED EXPENSES AND OTHER LIABILITIES:

Accrued expenses and other liabilities consists of the following:

<TABLE>
<CAPTION>
DECEMBER 31,
------------------------ MARCH 31,
1996 1997 1998
---------- ---------- -----------
(UNAUDITED)
<S> <C> <C> <C>
Compensation and payroll-related............... $2,083,332 $2,422,240 $1,723,623
Deferred income-rental and maintenance......... 777,237 955,808 999,391
Taxes.......................................... 532,373 698,314 737,698
Medical insurance reserve...................... 232,256 302,381 302,381
Other.......................................... 998,625 996,077 1,331,281
---------- ---------- ----------
Accrued expenses and other liabilities......... $4,623,823 $5,374,820 $5,094,374
========== ========== ==========
</TABLE>

F-62
<PAGE> 128
THE BODE-FINN COMPANY

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

7. DEBT:

Debt consists of the following:

<TABLE>
<CAPTION>
DECEMBER 31,
-------------------------- MARCH 31,
1996 1997 1998
----------- ----------- -----------
(UNAUDITED)
<S> <C> <C> <C>
Notes payable, unsecured, interest at 6%,
payable on demand......................... $ 28,095 $ 35,525 $ 43,675
Revolving $7,000,000 credit agreement,
secured by rental equipment and inventory,
interest at prime, 8.5% at December 31,
1997 and March 31, 1998 (unaudited), due
1999...................................... -- 2,950,000 3,350,000
Revolving $15,000,000 credit agreement,
secured by rental equipment and inventory,
interest at 9.25%, payable in monthly
installments through February 2003........ -- 12,916,670 12,291,674
Revolving $8,000,000 credit agreement,
secured by rental equipment and inventory,
interest at prime 8.5% at December 31,
1997 and March 31, 1998 (unaudited),
repaid during 1997........................ 6,650,000 -- --
Notes payable, secured by rental equipment
and inventory, interest at prime plus
1/2% (9.0% at December 31, 1997 and March
31, 1998 (unaudited)), payable in monthly
installments, repaid during 1997.......... 9,123,939 -- --
Note payable, secured by property and
equipment, interest at 9.1%, payable in
monthly installments, repaid during
1997...................................... 317,337 -- --
Rental equipment notes, secured by rental
equipment and inventory, interest from
8.5% to 10.5%, payable in various monthly
installments through 2001................. 288,618 184,305 154,014
----------- ----------- -----------
Total debt........................ $16,407,989 $16,086,500 $15,839,363
=========== =========== ===========
</TABLE>

Maturities of the Company's debt at December 31, 1997 for the years ended
December 31, are as follows:

<TABLE>
<S> <C>
1998........................................................ $ 2,610,563
1999........................................................ 5,497,943
2000........................................................ 2,536,997
2001........................................................ 2,524,034
2002........................................................ 2,500,297
2003 and thereafter......................................... 416,666
-----------
$16,086,500
===========
</TABLE>

F-63
<PAGE> 129
THE BODE-FINN COMPANY

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

8. INCOME TAXES:

The provision (benefit) for Federal and state income taxes is as follows:

<TABLE>
<CAPTION>
FOR THE THREE MONTH
PERIOD ENDED
FOR THE YEAR ENDED DECEMBER 31, MARCH 31,
---------------------------------- -------------------
1995 1996 1997 1997 1998
---------- ---------- -------- -------- --------
(UNAUDITED)
<S> <C> <C> <C> <C> <C>
Current................................... $ 800,518 $1,157,016 $828,793 $128,263 $150,404
Deferred.................................. 236,253 (220,775) 100,985 9,198 11,315
---------- ---------- -------- -------- --------
$1,036,771 $ 936,241 $929,778 $137,461 $161,719
========== ========== ======== ======== ========
Federal................................... $ 888,321 $ 805,329 $789,496 $116,774 $137,462
State and local........................... 148,450 130,912 140,282 20,687 24,257
---------- ---------- -------- -------- --------
$1,036,771 $ 936,241 $929,778 $137,461 $161,719
========== ========== ======== ======== ========
</TABLE>

The deferred income tax results from temporary differences in the
recognition of certain items for tax and financial statement purposes,
principally from differences in depreciation methods, allowance for doubtful
accounts and other expenses not currently deductible for tax purposes. For
financial statement purposes, the credit has been recognized in 1997 as a
deferred tax asset.

A reconciliation of the difference between the expected provision for
income taxes using the statutory federal income tax rate of 34% and the
Company's actual provision is as follows:

<TABLE>
<CAPTION>
FOR THE THREE MONTH
PERIOD ENDED
FOR THE YEAR ENDED DECEMBER 31, MARCH 31,
-------------------------------- -------------------
1995 1996 1997 1997 1998
---------- -------- -------- -------- --------
(UNAUDITED)
<S> <C> <C> <C> <C> <C>
Provision at statutory tax rate............. $ 841,214 $741,832 $786,862 $117,225 $137,462
State and local income taxes, net of federal
benefit................................... 97,977 86,402 92,586 13,653 16,010
Other....................................... 97,580 108,007 50,330 6,583 8,247
---------- -------- -------- -------- --------
$1,036,771 $936,241 $929,778 $137,461 $161,719
========== ======== ======== ======== ========
</TABLE>

The components of deferred income tax assets (liabilities) are as follows:

<TABLE>
<CAPTION>
DECEMBER 31,
-------------------------- MARCH 31,
1996 1997 1998
----------- ----------- -----------
(UNAUDITED)
<S> <C> <C> <C>
Reserves and accruals not deductible until paid..... $ 945,915 $ 1,103,736 $ 1,116,255
Depreciation........................................ (1,274,973) (1,394,170) (1,320,000)
Alternative minimum tax credit carryforward......... 392,356 252,747 252,747
----------- ----------- -----------
Net deferred tax asset (liability)........ $ 63,298 $ (37,687) $ 49,002
=========== =========== ===========
</TABLE>

Net deferred tax assets and net deferred tax liability are reported in the
accompanying balance sheets as components of other assets and accrued expenses
and other liabilities, respectively.

F-64
<PAGE> 130
THE BODE-FINN COMPANY

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

9. COMMITMENTS AND CONTINGENCIES:

Operating Leases

The Company leases rental equipment, real estate and certain office
equipment under noncancelable operating leases. These leases expire at various
dates through September 30, 2010. Certain real estate leases require the Company
to pay maintenance, insurance, taxes and certain other expenses in addition to
the stated rentals. Future minimum lease payments for noncancelable operating
leases with initial or remaining terms of one year or more are as follows at
December 31, 1997:

<TABLE>
<S> <C>
1998..................................................... $1,644,419
1999..................................................... 1,055,192
2000..................................................... 568,309
2001..................................................... 356,649
2002..................................................... 166,289
Thereafter............................................... 1,196,538
----------
$4,987,396
==========
</TABLE>

Rent expense under noncancelable operating leases for the years ended
December 31, 1995, 1996 and 1997 were $1,537,082, $1,598,979 and $1,824,938,
respectively.

Litigation

10. RELATED PARTY TRANSACTIONS:

The Company leases land and buildings used in its operations from its
stockholders and officers. The leases cover several operating locations and
expire at various dates through September 30, 2010. The leases require minimum
monthly payments plus override amounts when certain conditions are met or
exceeded. The total rent expense related to these leases for the years ended
December 31, 1995, 1996 and 1997 was $661,481, $739,781 and $768,716,
respectively.

11. EMPLOYEE BENEFIT PLANS:

401(k) Plan

The Company participates in a 401(k) plan (the "Plan") which covers certain
full-time employees over 21 years old who have worked a minimum of one year for
the Company. The Plan is funded by employee deferrals of income and
discretionary contributions by the Company. The Company's matching contributions
totaled $207,982, $262,267 and $302,769 for the years ended December 31, 1995,
1996 and 1997. No amount was due to the Plan as of December 31, 1997.

Profit Sharing Plan

All full-time employees over 21 years old who have worked a minimum of one
year for the Company may participate in the Company's Profit Sharing Retirement
Plan (the "Profit Sharing Plan"). The Profit Sharing Plan is funded by
contributions made by the Company. The Company's Board of Directors determines
the annual amount of contributions. The Company's Profit Sharing retirement
contributions totaled $550,000, $400,000 and $508,000 for the years ended
December 31, 1995, 1996 and 1997, respectively.

F-65
<PAGE> 131
THE BODE-FINN COMPANY

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

Deferred Compensation Plan

The Company has deferred compensation agreements with various employees.
Under the terms of the agreements, the Company will pay these employees a
defined amount for ten years subsequent to their retirement from the Company, if
retirement from the Company is after the agreed retirement date. A deferred
compensation accrual of approximately $534,226, $539,585 and $539,585
(unaudited) is included in the accompanying balance sheets in accrued expenses
and other liabilities at December 31, 1996 and 1997 and March 31, 1998.

12. SUBSEQUENT EVENT:

Effective May 5, 1998, substantially all of the outstanding stock of the
Company was purchased by NationsRent, Inc., an unrelated third party, in
exchange for cash and stock.

F-66
<PAGE> 132

REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS

To RFL Enterprises, Inc.:

We have audited the accompanying balance sheet of RFL Enterprises, Inc. (an
Indiana S corporation) as of December 31, 1997, and the related statements of
income, stockholder's equity and cash flows for the year then ended. These
financial statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audit.

We conducted our audit in accordance with generally accepted auditing standards.
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material
misstatement. An audit includes examining on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audit provides a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of RFL Enterprises, Inc. as of
December 31, 1997, and the results of its operations and cash flows for the year
then ended in conformity with generally accepted accounting principles.

ARTHUR ANDERSEN LLP

Fort Lauderdale, Florida,
May 8, 1998.

F-67
<PAGE> 133

RFL ENTERPRISES, INC.

BALANCE SHEETS

<TABLE>
<CAPTION>
DECEMBER 31, MARCH 31,
1997 1998
------------ -----------
(UNAUDITED)
<S> <C> <C>
ASSETS
Cash and cash equivalents................................... $ 50,158 $ 390,055
Accounts receivable, net of allowances for doubtful accounts
of $10,000 and $10,000 (unaudited) as of December 31, 1997
and March 31, 1998, respectively.......................... 215,240 170,300
Inventories................................................. 185,366 180,962
Rental equipment, net....................................... 1,622,404 1,333,136
Property, plant and equipment, net.......................... 199,192 197,592
---------- ----------
Total assets...................................... $2,272,360 $2,272,045
========== ==========

LIABILITIES AND STOCKHOLDER'S EQUITY
LIABILITIES:
Accounts payable.......................................... $ 1,791 $ 1,362
Accrued expenses and other liabilities.................... 58,041 54,940
Debt...................................................... 844,871 742,877
---------- ----------
Total liabilities................................. 904,703 799,179
---------- ----------
COMMITMENTS AND CONTINGENCIES (Notes 7 and 8)
STOCKHOLDER'S EQUITY:
Common stock -- no par value, 1,000 shares authorized, 100
issued and outstanding................................. 10,000 10,000
Retained earnings......................................... 1,357,657 1,462,866
---------- ----------
Total stockholder's equity........................ 1,367,657 1,472,866
---------- ----------
Total liabilities and stockholder's equity........ $2,272,360 $2,272,045
========== ==========
</TABLE>

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

F-68
<PAGE> 134

RFL ENTERPRISES, INC.

STATEMENTS OF INCOME

<TABLE>
<CAPTION>
FOR THE FOR THE THREE MONTH
YEAR ENDED PERIOD ENDED MARCH 31,
DECEMBER 31, -------------------------
1997 1997 1998
------------ ----------- -----------
(UNAUDITED)
<S> <C> <C> <C>
REVENUE:
Equipment rentals........................................ $ 966,277 $241,591 $201,806
Sales of equipment, parts and supplies................... 1,950,382 522,518 473,635
Other.................................................... 126,511 27,454 33,913
---------- -------- --------
3,043,170 791,563 709,354
COST OF REVENUE:
Cost of equipment rentals................................ 463,165 105,353 102,899
Rental equipment depreciation............................ 261,405 58,259 77,144
Cost of sales of equipment, parts and supplies........... 1,471,807 334,783 326,984
---------- -------- --------
2,196,377 498,395 507,027
---------- -------- --------
Gross profit..................................... 846,793 293,168 202,327
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES............... 208,694 47,470 46,365
NONRENTAL DEPRECIATION..................................... 23,307 1,600 1,600
---------- -------- --------
Operating income................................. 614,792 244,098 154,362
OTHER INCOME (EXPENSE):
Interest expense......................................... (92,293) (20,654) (16,891)
Interest income.......................................... 14,925 2,356 348
---------- -------- --------
Total other income (expense), net................ (77,368) (18,298) (16,543)
---------- -------- --------
Net income....................................... 537,424 225,800 137,819
PRO FORMA PROVISION FOR INCOME TAXES....................... 214,970 90,320 55,128
---------- -------- --------
PRO FORMA NET INCOME....................................... $ 322,454 $135,480 $ 82,691
========== ======== ========
</TABLE>

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

F-69
<PAGE> 135

RFL ENTERPRISES, INC.

STATEMENTS OF STOCKHOLDER'S EQUITY

FOR THE YEAR ENDED DECEMBER 31, 1997 AND THE
THREE MONTH PERIOD ENDED MARCH 31, 1998

<TABLE>
<CAPTION>
COMMON STOCK
NO PAR VALUE
-------------------
NUMBER RETAINED
OF SHARES AMOUNT EARNINGS TOTAL
--------- ------- ---------- ----------
<S> <C> <C> <C> <C>
BALANCE, January 1, 1997............................ 100 $10,000 $ 940,484 $ 950,484
Distribution...................................... -- -- (120,251) (120,251)
Net income........................................ -- -- 537,424 537,424
--- ------- ---------- ----------
BALANCE, December 31, 1997.......................... 100 10,000 1,357,657 1,367,657
Distribution (unaudited).......................... -- -- (32,610) (32,610)
Net income (unaudited)............................ -- -- 137,819 137,819
--- ------- ---------- ----------
BALANCE, March 31, 1998 (unaudited)................. 100 $10,000 $1,462,866 $1,472,866
=== ======= ========== ==========
</TABLE>

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

F-70
<PAGE> 136

RFL ENTERPRISES, INC.

STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>
FOR THE FOR THE THREE MONTH
YEAR ENDED PERIOD ENDED MARCH 31,
DECEMBER 31, -------------------------
1997 1997 1998
------------ ----------- -----------
(UNAUDITED)
<S> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income.............................................. $ 537,424 $ 225,800 $ 137,819
Adjustments to reconcile net income to net cash provided
by operating activities:
Depreciation......................................... 284,712 59,859 78,744
Gain on sale of rental equipment..................... (471,986) (177,803) (150,519)
Changes in operating assets and liabilities:
Accounts receivable, net........................... 56,067 97,997 44,940
Inventories........................................ (29,941) (3,529) 4,404
Accounts payable................................... 968 174,349 (429)
Accrued expenses and other liabilities............. 31,674 (11,446) (3,101)
----------- --------- ---------
Net cash provided by operating activities....... 408,918 365,227 111,858
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of rental equipment........................... (2,077,859) (616,880) (110,992)
Proceeds from sale of rental equipment.................. 1,914,038 522,518 473,635
----------- --------- ---------
Net cash provided by (used in) investing
activities.................................... (163,821) (94,362) 362,643
CASH FLOWS FROM FINANCING ACTIVITIES:
Payment of distributions................................ (120,251) (120,000) (32,610)
Repayments of debt...................................... (133,202) (101,752) (101,994)
----------- --------- ---------
Net cash used in financing activities........... (253,453) (221,752) (134,604)
----------- --------- ---------
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS...... (8,356) 49,113 339,897
CASH AND CASH EQUIVALENTS, beginning of period............ 58,514 58,514 50,158
----------- --------- ---------
CASH AND CASH EQUIVALENTS, end of period.................. $ 50,158 $ 107,627 $ 390,055
=========== ========= =========
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid for interest.................................. $ 87,293 $ 20,654 $ 16,891
=========== ========= =========
</TABLE>

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

F-71
<PAGE> 137

RFL ENTERPRISES, INC.

NOTES TO FINANCIAL STATEMENTS

DECEMBER 31, 1997

1. ORGANIZATION AND BASIS OF PRESENTATION

RFL Enterprises, Inc. (the "Company") was incorporated in 1983 as an
Indiana S corporation. The Company rents a broad array of equipment to a
customer base that includes principally construction industry participants and
industrial companies. The Company also engages in related activities such as
selling used equipment, acting as a distributor for certain new equipment and
selling related merchandise and parts. The nature of the Company's business is
such that short-term obligations are typically met by cash flow generated from
long-term assets. Consequently, consistent with industry practice, the
accompanying audited and unaudited balance sheets are presented on an
unclassified basis.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Cash equivalents

Inventories

Inventories consist of equipment, tools, parts, fuel and related supply
items and are stated at the lower of average weighted cost or market.

Rental equipment

Revenue recognition

Revenue related to the sale of equipment, parts and supplies is recognized
at the point of sale. Revenue related to rental equipment is recognized over the
contract term.

Property, plant and equipment

Property, plant and equipment are recorded at cost and depreciated over
their estimated useful lives using the straight-line method. The range of useful
lives estimated by management for property and equipment is five to thirty-nine
years. Ordinary maintenance and repair costs are charged to operations as
incurred.

Impairment of long-lived assets

Fair value of financial instruments

F-72
<PAGE> 138
RFL ENTERPRISES, INC.

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

Income taxes

The Company is an S corporation for income tax purposes. Accordingly,
income, losses and related temporary differences which arise in the recording of
income and expense items for financial reporting and tax reporting purposes are
included in the individual tax return of the shareholder. Therefore, no
provision or liability for Federal and state income taxes has been included in
the accompanying financial statements.

The pro forma adjustment to reflect income taxes in the accompanying
statements of income is for information purposes only. The pro forma provision
for income tax has been provided at the estimated rate of 40%.

Use of estimates

Concentrations of credit risk

Financial instruments that potentially subject the Company to significant
concentrations of credit risk consist principally of cash investments and
accounts receivable. The Company maintains cash and cash equivalents with high
quality financial institutions. Three customers each represent greater than 10%
of total accounts receivable. As of December 31, 1997, these accounts
represented 40% of total accounts receivable. The Company controls credit risk
through credit approvals, credit limits, and monitoring procedures.

Interim financial information

3. RENTAL EQUIPMENT

Rental equipment and related accumulated depreciation consist of the
following:

<TABLE>
<CAPTION>
DECEMBER 31, MARCH 31,
1997 1998
------------ -----------
(UNAUDITED)
<S> <C> <C>
Rental equipment............................................ $2,161,788 $1,880,998
Less -- accumulated depreciation............................ (539,384) (547,862)
---------- ----------
Rental equipment, net............................. $1,622,404 $1,333,136
========== ==========
</TABLE>

F-73
<PAGE> 139
RFL ENTERPRISES, INC.

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

4. PROPERTY, PLANT AND EQUIPMENT

A summary of property, plant and equipment is as follows:

<TABLE>
<CAPTION>
DECEMBER 31, MARCH 31,
1997 1998
------------ -----------
(UNAUDITED)
<S> <C> <C>
Furniture, fixtures and office equipment.................... $ 20,603 $ 20,603
Building.................................................... 140,820 140,820
Land........................................................ 80,000 80,000
-------- --------
241,423 241,423
Less -- accumulated depreciation............................ (42,231) (43,831)
-------- --------
Property and equipment, net....................... $199,192 $197,592
======== ========
</TABLE>

5. ACCRUED EXPENSES AND OTHER LIABILITIES

Accrued expenses and other liabilities consists of the following:

<TABLE>
<CAPTION>
DECEMBER 31, MARCH 31,
1997 1998
------------ -----------
(UNAUDITED)
<S> <C> <C>
Deferred revenues........................................... $36,000 $36,000
Sales and property tax...................................... 12,197 13,183
Other....................................................... 9,844 5,757
------- -------
Accrued expenses and other liabilities............ $58,041 $54,940
======= =======
</TABLE>

6. DEBT

Debt consists of the following:

<TABLE>
<CAPTION>
DECEMBER 31, MARCH 31,
1997 1998
------------ -----------
(UNAUDITED)
<S> <C> <C>
Line of credit, interest at 8.75%, payable on demand........ $550,000 $ 64,000
Term loan, secured by accounts receivable, inventories and
equipment, interest at 9.9%, payable in semi annual
installments through December 1999........................ 114,000 500,000
Mortgage, secured by building and land, interest at 9.18%,
payable in monthly installments through June 2009......... 157,871 155,877
Unsecured note payable to stockholder, interest at 10%,
payable on demand......................................... 23,000 23,000
-------- --------
Total debt........................................ $844,871 $742,877
======== ========
</TABLE>

F-74
<PAGE> 140
RFL ENTERPRISES, INC.

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

Subsequent to December 31, 1997, the Company retired the line of credit,
term loan and note payable to stockholder in connection with its purchase by
NationsRent, Inc., an unrelated third party. Maturities of the mortgage at
December 31, 1997, for the years ended December 31, are as follows:

<TABLE>
<S> <C>
1998........................................................ $ 12,000
1999........................................................ 12,000
2000........................................................ 12,000
2001........................................................ 12,000
2002........................................................ 12,000
Thereafter.................................................. 97,871
--------
Total............................................. $157,871
========
</TABLE>

7. COMMITMENTS AND CONTINGENCIES

8. SUBSEQUENT EVENT

Effective April 15, 1998, substantially all of the Company's operating
assets and liabilities were purchased by NationsRent, Inc. in exchange for cash
and debt.

F-75
<PAGE> 141

REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS

To Naples Rent-All & Sales Company, Inc.:

We have audited the accompanying balance sheet of Naples Rent-All & Sales
Company, Inc. (a Florida S corporation) as of December 31, 1997, and the related
statements of income, stockholder's equity and cash flows for the year then
ended. These financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these financial
statements based on our audit.

We conducted our audit in accordance with generally accepted auditing standards.
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audit provides a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Naples Rent-All & Sales
Company, Inc. as of December 31, 1997, and the results of its operations and its
cash flows for the year then ended in conformity with generally accepted
accounting principles.

ARTHUR ANDERSEN LLP

Fort Lauderdale, Florida,
May 1, 1998.

F-76
<PAGE> 142

NAPLES RENT-ALL & SALES COMPANY, INC.

BALANCE SHEETS

<TABLE>
<CAPTION>
DECEMBER 31, MARCH 31,
1997 1998
------------ -----------
(UNAUDITED)
<S> <C> <C>
ASSETS
Cash and cash equivalents................................... $ 98,660 $ 87,208
Accounts receivable, net of allowances for doubtful accounts
of $34,035 and $24,072 (unaudited) as of December 31, 1997
and March 31, 1998, respectively.......................... 408,579 447,831
Inventories................................................. 816,397 957,373
Rental equipment, net....................................... 913,137 866,056
Property and equipment, net................................. 119,647 144,475
Other assets................................................ 27,259 55,240
---------- ----------
Total assets...................................... $2,383,679 $2,558,183
========== ==========

LIABILITIES AND STOCKHOLDER'S EQUITY
LIABILITIES:
Accounts payable.......................................... $ 428,714 $ 564,619
Accrued expenses and other liabilities.................... 148,452 172,948
Debt...................................................... 176,128 171,420
---------- ----------
Total liabilities................................. 753,294 908,987
---------- ----------
COMMITMENTS AND CONTINGENCIES (Notes 7 and 9)
STOCKHOLDER'S EQUITY:
Common stock -- $10 par value, 5,500 shares authorized,
5,129 shares issued.................................... 51,290 51,290
Additional paid-in capital................................ 6,826 6,826
Retained earnings......................................... 1,901,639 1,920,450
Treasury stock -- 1,709 shares at cost.................... (329,370) (329,370)
---------- ----------
Total stockholder's equity........................ 1,630,385 1,649,196
---------- ----------
Total liabilities and stockholder's equity........ $2,383,679 $2,558,183
========== ==========
</TABLE>

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

F-77
<PAGE> 143

NAPLES RENT-ALL & SALES COMPANY, INC.

STATEMENTS OF INCOME

<TABLE>
<CAPTION>
FOR THE FOR THE THREE MONTH
YEAR ENDED PERIOD ENDED MARCH 31,
DECEMBER 31, -------------------------
1997 1997 1998
------------ ----------- -----------
(UNAUDITED)
<S> <C> <C> <C>
REVENUE:
Equipment rentals....................................... $2,262,014 $ 509,684 $ 512,784
Sales of equipment, parts and supplies.................. 3,747,704 807,151 867,976
Other................................................... 57,121 19,900 24,782
---------- ---------- ----------
6,066,839 1,336,735 1,405,542
COST OF REVENUE:
Cost of equipment rentals, excluding depreciation....... 1,706,311 360,942 394,948
Rental equipment depreciation........................... 440,152 93,437 94,377
Cost of sales of equipment, parts and supplies.......... 2,967,261 627,675 686,811
---------- ---------- ----------
5,113,724 1,082,054 1,176,136
---------- ---------- ----------
Gross profit.................................... 953,115 254,681 229,406
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES.............. 517,662 109,503 119,820
NONRENTAL DEPRECIATION AND AMORTIZATION................... 44,970 6,981 9,333
---------- ---------- ----------
Operating income................................ 390,483 138,197 100,253
OTHER INCOME (EXPENSE):
Interest expense........................................ (23,535) (4,976) (3,976)
Other income, net....................................... 52,433 14,907 13,054
---------- ---------- ----------
Total other income (expense), net............... 28,898 9,931 9,078
---------- ---------- ----------
Net income...................................... 419,381 148,128 109,331
PRO FORMA PROVISION FOR INCOME TAX........................ 167,752 59,251 43,732
---------- ---------- ----------
PRO FORMA NET INCOME...................................... $ 251,629 $ 88,877 $ 65,599
========== ========== ==========
</TABLE>

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

F-78
<PAGE> 144

NAPLES RENT-ALL & SALES COMPANY, INC.

STATEMENTS OF STOCKHOLDER'S EQUITY

<TABLE>
<CAPTION>
COMMON STOCK
------------------- ADDITIONAL
NUMBER PAID-IN RETAINED TREASURY
OF SHARES AMOUNT CAPITAL EARNINGS STOCK TOTAL
--------- ------- ---------- ---------- --------- ----------
<S> <C> <C> <C> <C> <C> <C>
BALANCE, January 1, 1997......... 5,129 $51,290 $6,826 $1,810,258 $(329,370) $1,539,004
Stockholder distributions...... -- -- -- (328,000) -- (328,000)
Net income..................... -- -- -- 419,381 -- 419,381
----- ------- ------ ---------- --------- ----------
BALANCE, December 31, 1997....... 5,129 51,290 6,826 1,901,639 (329,370) 1,630,385
Stockholder distributions
(unaudited)................. -- -- -- (90,520) -- (90,520)
Net income (unaudited)......... -- -- -- 109,331 -- 109,331
----- ------- ------ ---------- --------- ----------
BALANCE, March 31, 1998
(unaudited).................... 5,129 $51,290 $6,826 $1,920,450 $(329,370) $1,649,196
===== ======= ====== ========== ========= ==========
</TABLE>

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

F-79
<PAGE> 145

NAPLES RENT-ALL & SALES COMPANY, INC.

STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>
FOR THE FOR THE THREE MONTH
YEAR ENDED PERIOD ENDED MARCH 31,
DECEMBER 31, -------------------------
1997 1997 1998
------------ ----------- -----------
(UNAUDITED)
<S> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income............................................... $ 419,381 $148,128 $109,331
Adjustments to reconcile net income to net cash provided
by operating activities:
Depreciation and amortization......................... 485,122 100,418 103,710
Gain on sale of rental equipment...................... (212,328) (35,288) (69,563)
Gain on sale of property and equipment................ (4,637) -- --
Changes in operating assets and liabilities:
Accounts receivable, net............................ (64,496) (13,733) (39,252)
Inventories......................................... 64,926 (17,837) (140,976)
Other assets........................................ 1,533 (53,435) (27,981)
Accounts payable.................................... (18,273) 29,397 135,905
Accrued expenses and other liabilities.............. 31,964 (12,133) 24,496
--------- -------- --------
Net cash provided by operating activities........ 703,192 145,517 95,670
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of rental equipment............................ (560,004) (112,088) (85,472)
Purchases of property and equipment...................... (71,997) (2,869) (34,161)
Proceeds from sale of rental equipment................... 393,040 65,646 107,739
Proceeds from sale of property and equipment............. 16,320 -- --
--------- -------- --------
Net cash used in investing activities............ (222,641) (49,311) (11,894)
CASH FLOWS FROM FINANCING ACTIVITIES:
Stockholder distributions................................ (328,000) (72,132) (90,520)
Proceeds from debt....................................... 65,000 10,632 --
Repayments of debt....................................... (188,261) (35,000) (4,708)
--------- -------- --------
Net cash used in financing activities............ (451,261) (96,500) (95,228)
--------- -------- --------
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS....... 29,290 (294) (11,452)
CASH AND CASH EQUIVALENTS, beginning of period............. 69,370 69,370 98,660
--------- -------- --------
CASH AND CASH EQUIVALENTS, end of period................... $ 98,660 $ 69,076 $ 87,208
========= ======== ========
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid for interest................................... $ 23,535 $ 4,976 $ 3,976
========= ======== ========
</TABLE>

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

F-80
<PAGE> 146

NAPLES RENT-ALL & SALES COMPANY, INC.

NOTES TO FINANCIAL STATEMENTS

DECEMBER 31, 1997

1. ORGANIZATION AND BASIS OF PRESENTATION

Naples Rent-All & Sales Company, Inc. (the "Company") was incorporated in
January 1968 to serve as a rental center for homeowners and contractors
equipment, lawn and garden equipment, and golf course and turf maintenance
equipment. The Company also engages in related activities such as selling used
equipment, acting as a distributor for certain new equipment and selling related
merchandise and parts. The nature of the Company's business is such that
short-term obligations are typically met by cash flow generated from long-term
assets. Consequently, consistent with industry practice, the accompanying
audited and unaudited balance sheets are presented on an unclassified basis.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Cash equivalents

The Company considers all highly liquid instruments with a maturity of
three months or less when purchased to be cash equivalents. As of December 31,
1997 and March 31, 1998 (unaudited), the Company had no cash equivalents.

Inventories

Inventories consist of equipment, tools, parts, fuel and related supply
items. Inventories are stated at the lower of weighted average cost or market.

Rental equipment

Rental equipment is recorded at cost and depreciated over a five-year life
using accelerated methods. Rental equipment is depreciated to a salvage value of
five percent of cost. Rental equipment having a cost of $500 or less is expensed
at the time of purchase. Ordinary maintenance and repair costs are charged to
operations as incurred.

Property and equipment

Property and equipment are recorded at cost and depreciated over an
estimated useful life of five years using the straight-line method. Ordinary
maintenance and repair costs are charged to operations as incurred. The range of
useful lives estimated by management for property and equipment is as follows:

<TABLE>
<CAPTION>
YEARS
-------------
<S> <C>
Furniture and fixtures...................................... 5
Equipment................................................... 5
Leasehold improvements...................................... Life of lease
</TABLE>

Impairment of long-lived assets

F-81
<PAGE> 147
NAPLES RENT-ALL & SALES COMPANY, INC.

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

Fair value of financial instruments

The carrying amounts reported in the accompanying balance sheets for cash
and cash equivalents, accounts receivable, accounts payable, accrued expenses
and other liabilities and debt approximate fair value as of December 31, 1997
and March 31, 1998 (unaudited).

Revenue recognition

Revenue related to the sale of equipment, parts and supplies is recognized
at the point of sale. Revenue related to rental equipment is recognized over the
contract term.

Income taxes

The Company is an S corporation for tax purposes. Accordingly, income,
losses and related temporary differences which arise in the recording of income
and expense items for financial reporting and tax reporting purposes are
included in the individual tax return of the stockholder. Therefore, no
provision or liability for Federal and state income taxes has been included in
the accompanying financial statements.

Use of estimates

Concentrations of credit risk

Financial instruments that potentially subject the Company to significant
concentrations of credit risk consist principally of cash investments and
accounts receivable. The Company maintains cash and cash equivalents with high
quality financial institutions. Concentrations of credit risk with respect to
accounts receivable are limited because a large number of customers make up the
Company's customer base. No single customer represents greater than 10% of total
accounts receivable. The Company controls credit risk through credit approvals,
credit limits, and monitoring procedures.

Interim financial information

F-82
<PAGE> 148
NAPLES RENT-ALL & SALES COMPANY, INC.

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

3. RENTAL EQUIPMENT

Rental equipment and related accumulated depreciation consist of the
following:

<TABLE>
<CAPTION>
DECEMBER 31, MARCH 31,
1997 1998
------------ -----------
(UNAUDITED)
<S> <C> <C>
Rental equipment............................................ $ 2,033,651 $ 2,051,524
Less -- accumulated depreciation............................ (1,120,514) (1,185,468)
----------- -----------
Rental equipment, net............................. $ 913,137 $ 866,056
=========== ===========
</TABLE>

4. PROPERTY AND EQUIPMENT

A summary of property and equipment is as follows:

<TABLE>
<CAPTION>
DECEMBER 31, MARCH 31,
1997 1998
------------ -----------
(UNAUDITED)
<S> <C> <C>
Furniture and fixtures...................................... $ 32,697 $ 32,032
Equipment................................................... 278,072 291,313
Leasehold improvements...................................... 36,847 38,362
--------- ---------
347,616 361,707
Less -- accumulated depreciation............................ (227,969) (217,232)
--------- ---------
Property and equipment, net....................... $ 119,647 $ 144,475
========= =========
</TABLE>

5. ACCRUED EXPENSES AND OTHER LIABILITIES

Accrued expenses and other liabilities consists of the following:

<TABLE>
<CAPTION>
DECEMBER 31, MARCH 31,
1997 1998
------------ -----------
(UNAUDITED)
<S> <C> <C>
Payroll-related............................................. $ 55,247 $ 56,988
Accrued dividends payable................................... 45,000 50,429
Accrued property taxes...................................... 15,187 4,978
Other....................................................... 33,018 60,553
-------- --------
Accrued expenses and other liabilities............ $148,452 $172,948
======== ========
</TABLE>

F-83
<PAGE> 149
NAPLES RENT-ALL & SALES COMPANY, INC.

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

6. DEBT

Debt consists of the following:

<TABLE>
<CAPTION>
DECEMBER 31, MARCH 31,
1997 1998
------------ -----------
(UNAUDITED)
<S> <C> <C>
Revolving line of credit, with borrowings up to $350,000,
secured by substantially all of the Company's receivables,
interest at prime plus .25% (8.75% at December 31, 1997
and March 31, 1998), payable in monthly installments
through November 1998..................................... $ 50,000 $ 50,000
Equipment notes, secured by equipment, interest at rates
averaging approximately 7%, payable in monthly
installments through December 2000........................ 126,128 121,420
-------- --------
Total debt........................................ $176,128 $171,420
======== ========
</TABLE>

Maturities of the Company's debt at December 31, 1997 for the years ended
December 31, are as follows:

<TABLE>
<S> <C>
1998........................................................ $122,090
1999........................................................ 36,168
2000........................................................ 17,870
--------
Total............................................. $176,128
========
</TABLE>

7. COMMITMENTS AND CONTINGENCIES

Operating Leases

The Company leases real estate under operating leases. Certain real estate
leases require the Company to pay maintenance, insurance, taxes and certain
other expenses in addition to the stated rentals. Future minimum lease payments,
by year and in the aggregate, for noncancelable operating leases with initial or
remaining terms of one year or more are as follows at December 31, 1997:

<TABLE>
<S> <C>
1998........................................................ $221,710
1999........................................................ 203,234
--------
Total............................................. $424,944
========
</TABLE>

Rent expense under operating leases for the year ended December 31, 1997
and three month periods ended March 31, 1997 and 1998 was approximately
$222,000, $58,000 (unaudited) and $55,000 (unaudited), respectively.

Consulting Agreement

The Company has a consulting agreement with a former stockholder in which
the Company is required to pay the former stockholder $30,000 per year through
November 1, 1999. Consulting fees for the year ended December 31, 1997 under the
terms of this agreement were $30,000. Subsequent to year-end, all future amounts
owed under this agreement were settled in exchange for approximately $40,000.

Litigation, Claims and Assessments

F-84
<PAGE> 150
NAPLES RENT-ALL & SALES COMPANY, INC.

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

8. EMPLOYEE BENEFIT PLAN

The Company has a contributory 401(k) profit-sharing plan under which
substantially all full-time employees are eligible to participate. The plan
allows for discretionary employer contributions as determined by the Company.
Employees vest in contributions made by the employer over a seven-year period.
Employer contributions for the year ended December 31, 1997 and three month
periods ended March 31, 1997 and 1998 were approximately $17,000, $0 (unaudited)
and $3,000 (unaudited), respectively.

9. SUBSEQUENT EVENT

Effective April 30, 1998, substantially all of the Company's operating
assets and liabilities were purchased by NationsRent, Inc., an unrelated third
party, in exchange for cash and debt.

F-85
<PAGE> 151

REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS

To Raymond Equipment Company, Inc.:

We have audited the accompanying balance sheets of Raymond Equipment Company,
Inc. (a Kentucky S corporation) as of June 30, 1996 and 1997, and the related
statements of income, stockholders' equity and cash flows for the years then
ended. These financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these financial
statements based on our audits.

In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Raymond Equipment Company, Inc.
as of June 30, 1996 and 1997, and the results of its operations and its cash
flows for the years then ended in conformity with generally accepted accounting
principles.

ARTHUR ANDERSEN LLP

Fort Lauderdale, Florida,
May 13, 1998.

F-86
<PAGE> 152

RAYMOND EQUIPMENT COMPANY, INC.

BALANCE SHEETS

<TABLE>
<CAPTION>
JUNE 30,
------------------------- MARCH 31,
1996 1997 1998
----------- ----------- -----------
(UNAUDITED)
<S> <C> <C> <C>
ASSETS
Cash and cash equivalents............................... $ 749,276 $ 224,684 $ 427,366
Marketable securities at market value................... 1,227,355 777,860 914,335
Accounts receivable..................................... 3,390,079 3,608,443 2,198,061
Inventories............................................. 644,061 586,321 752,124
Rental equipment, net................................... 28,865,568 32,685,787 33,704,468
Property and equipment, net............................. 2,709,715 2,719,656 2,868,278
Other assets............................................ 195,664 399,687 397,243
----------- ----------- -----------
Total assets.................................. $37,781,718 $41,002,438 $41,261,875
=========== =========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
LIABILITIES:
Accounts payable...................................... $ 974,322 $ 793,087 $ 883,350
Accrued expenses and other liabilities................ 1,059,130 539,020 328,848
Debt.................................................. 24,498,329 25,883,180 23,468,571
----------- ----------- -----------
Total liabilities............................. 26,531,781 27,215,287 24,680,769
----------- ----------- -----------
COMMITMENTS AND CONTINGENCIES (Notes 9 and 10)
STOCKHOLDERS' EQUITY:
Common stock, no par value, 500,000 shares authorized,
207,650, 209,651 and 210,975 (unaudited) shares
issued and outstanding at June 30, 1996, 1997 and
March 31, 1998, respectively....................... 439,116 544,168 629,513
Retained earnings..................................... 10,461,809 12,969,978 15,442,113
Net unrealized gain on marketable
securities.................................. 349,012 273,005 509,480
----------- ----------- -----------
Total stockholders' equity.................... 11,249,937 13,787,151 16,581,106
----------- ----------- -----------
Total liabilities and stockholders' equity.... $37,781,718 $41,002,438 $41,261,875
=========== =========== ===========
</TABLE>

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

F-87
<PAGE> 153

RAYMOND EQUIPMENT COMPANY, INC.

STATEMENTS OF INCOME

<TABLE>
<CAPTION>
FOR THE NINE MONTH PERIOD
FOR THE YEAR ENDED JUNE 30, ENDED MARCH 31,
--------------------------- -------------------------
1996 1997 1997 1998
------------ ------------ ----------- -----------
(UNAUDITED)
<S> <C> <C> <C> <C>
REVENUE:
Equipment rentals......................... $10,427,708 $11,997,902 $ 8,082,542 $ 9,113,745
Sales of equipment, parts and supplies.... 8,700,165 9,323,810 7,318,745 6,923,388
----------- ----------- ----------- -----------
19,127,873 21,321,712 15,401,287 16,037,133
COST OF REVENUE:
Cost of equipment rentals, excluding
depreciation........................... 3,172,008 3,329,502 2,506,446 2,291,828
Rental equipment depreciation............. 3,652,589 4,198,076 3,049,772 3,565,429
Cost of sales of equipment, parts and
supplies............................... 5,287,538 5,991,061 4,178,088 4,123,883
----------- ----------- ----------- -----------
12,112,135 13,518,639 9,734,306 9,981,140
----------- ----------- ----------- -----------
Gross profit...................... 7,015,738 7,803,073 5,666,981 6,055,993
SELLING, GENERAL AND ADMINISTRATIVE
EXPENSES.................................. 2,361,132 2,837,207 1,865,711 1,952,962
NONRENTAL DEPRECIATION AND AMORTIZATION..... 147,637 182,783 150,571 167,226
----------- ----------- ----------- -----------
Operating income.................. 4,506,969 4,783,083 3,650,699 3,935,805
OTHER INCOME (EXPENSE):
Interest expense.......................... (1,670,707) (1,801,706) (1,303,290) (1,429,917)
Interest income........................... 28,544 23,812 11,619 20,190
Other, net................................ 93,829 121,010 112,418 258,086
----------- ----------- ----------- -----------
Total other expense, net.......... (1,548,334) (1,656,884) (1,179,253) (1,151,641)
----------- ----------- ----------- -----------
Net income........................ 2,958,635 3,126,199 2,471,446 2,784,164
PRO FORMA PROVISION FOR INCOME TAXES........ 1,239,454 1,306,480 1,044,578 1,169,665
----------- ----------- ----------- -----------
PRO FORMA NET INCOME........................ $ 1,719,181 $ 1,819,719 $ 1,426,868 $ 1,614,499
=========== =========== =========== ===========
</TABLE>

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

F-88
<PAGE> 154

RAYMOND EQUIPMENT COMPANY, INC.

STATEMENTS OF STOCKHOLDERS' EQUITY

<TABLE>
<CAPTION>
NET
COMMON STOCK UNREALIZED
-------------------- GAIN ON TOTAL
NUMBER OF RETAINED MARKETABLE STOCKHOLDERS'
SHARES AMOUNT EARNINGS SECURITIES EQUITY
--------- -------- ----------- ---------- -------------
<S> <C> <C> <C> <C> <C>
BALANCE, July 1, 1995................. 202,880 $256,651 $ 8,595,607 $174,455 $ 9,026,713
Issuance of common stock............ 4,770 182,465 -- -- 182,465
Distributions to stockholders....... -- -- (1,092,433) -- (1,092,433)
Net income.......................... -- -- 2,958,635 -- 2,958,635
Net increase in unrealized gain on
marketable securities............ -- -- -- 174,557 174,557
------- -------- ----------- -------- -----------
BALANCE, June 30, 1996................ 207,650 439,116 10,461,809 349,012 11,249,937
Issuance of common stock............ 2,001 105,052 -- -- 105,052
Distributions to stockholders....... -- -- (618,030) -- (618,030)
Net income.......................... -- -- 3,126,199 -- 3,126,199
Net decrease in unrealized gain on
marketable securities............ -- -- -- (76,007) (76,007)
------- -------- ----------- -------- -----------
BALANCE, June 30, 1997................ 209,651 544,168 12,969,978 273,005 13,787,151
Issuance of common stock
(unaudited)...................... 1,324 85,345 -- -- 85,345
Distributions to stockholders
(unaudited)...................... -- -- (312,029) -- (312,029)
Net income (unaudited).............. -- -- 2,784,164 -- 2,784,164
Net increase in unrealized gain on
marketable securities
(unaudited)...................... -- -- -- 236,475 236,475
------- -------- ----------- -------- -----------
BALANCE, March 31, 1998 (unaudited)... 210,975 $629,513 $15,442,113 $509,480 $16,581,106
======= ======== =========== ======== ===========
</TABLE>

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

F-89
<PAGE> 155

RAYMOND EQUIPMENT COMPANY, INC.

STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>
FOR THE NINE MONTH PERIOD
FOR THE YEAR ENDED JUNE 30, ENDED MARCH 31,
--------------------------- --------------------------
1996 1997 1997 1998
------------ ------------ ----------- ------------
(UNAUDITED)
<S> <C> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income....................................... $ 2,958,635 $ 3,126,199 $ 2,471,446 $ 2,784,164
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization.................. 3,800,226 4,380,859 3,200,343 3,732,655
Gain on sale of rental equipment............... (1,540,076) (1,385,381) (1,195,800) (867,733)
Realized gain on sale of marketable
securities................................... (27,458) (73,615) (73,615) (50,000)
Charitable contribution marketable
securities................................... -- 297,103 -- --
Changes in operating assets and liabilities:
Accounts receivable.......................... (83,880) (218,364) 1,900,804 1,410,382
Inventories.................................. (239,521) 57,740 103,038 (165,803)
Other assets................................. (3,724) (204,023) 29,620 2,444
Accounts payable............................. 497,168 (181,235) 1,210,542 90,263
Accrued expenses and other liabilities....... 48,138 (520,110) (784,978) (210,172)
------------ ------------ ----------- ------------
Net cash provided by operating
activities.............................. 5,409,508 5,279,173 6,861,400 6,726,200

CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of marketable securities............... (490,000) -- -- --
Proceeds from the sale of marketable
securities..................................... 99,997 150,000 150,000 150,000
Purchases of rental equipment.................... (10,790,192) (11,300,675) (7,291,951) (7,650,313)
Purchases of property and equipment.............. (1,223,457) (217,559) (138,068) (363,494)
Proceeds from sale of rental equipment........... 4,258,338 4,678,959 4,295,084 3,947,732
Proceeds from sale of property and equipment..... 173,075 13,637 13,637 33,850
------------ ------------ ----------- ------------
Net cash used in investing activities..... (7,972,239) (6,675,638) (2,971,298) (3,882,225)

CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from issuance of common stock, net of
issuance costs................................. 182,465 105,052 105,052 85,345
Proceeds from debt............................... 15,404,343 15,329,825 4,907,186 9,839,377
Principal payments on debt....................... (11,416,600) (13,944,974) (9,183,049) (12,253,986)
Distributions to stockholders.................... (1,092,433) (618,030) (246,761) (312,029)
------------ ------------ ----------- ------------
Net cash provided by (used in) financing
activities.............................. 3,077,775 871,873 (4,417,572) (2,641,293)
NET INCREASE (DECREASE) IN CASH AND CASH
EQUIVALENTS...................................... 515,044 (524,592) (527,470) 202,682
CASH AND CASH EQUIVALENTS, beginning of period..... 234,232 749,276 749,276 224,684
------------ ------------ ----------- ------------
CASH AND CASH EQUIVALENTS, end of period........... $ 749,276 $ 224,684 $ 221,806 $ 427,366
============ ============ =========== ============
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid for interest........................... $ 1,653,083 $ 1,832,804 $ 1,364,318 $ 1,407,413
============ ============ =========== ============
</TABLE>

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

F-90
<PAGE> 156

RAYMOND EQUIPMENT COMPANY, INC.

NOTES TO FINANCIAL STATEMENTS

JUNE 30, 1996 AND JUNE 30, 1997

1. ORGANIZATION AND BASIS OF PRESENTATION

Raymond Equipment Company, Inc. (the "Company") was incorporated in the
state of Kentucky in 1955. The Company rents a broad array of equipment to a
diverse customer base that includes construction industry participants,
industrial companies, homeowners and others. The Company also engages in related
activities such as selling used equipment, acting as a distributor for certain
new equipment and selling related merchandise parts and supplies. The nature of
the Company's business is such that short-term obligations are typically met by
cash flow generated from long-term assets. Consequently, consistent with
industry practice, the accompanying audited and unaudited balance sheets are
presented on an unclassified basis.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Cash equivalents

The Company considers all highly liquid instruments with a maturity of
three months or less when purchased to be cash equivalents. At June 30, 1996 and
1997 and March 31, 1998 (unaudited), the Company had no cash equivalents.

Marketable securities

In accordance with the provisions of Statement of Financial Accounting
Standards No. 115, unrealized gains and losses on investments available-for-sale
(which are stated at quoted fair value) are included as a separate component of
stockholders' equity. All of the Company's marketable securities are held as
available-for-sale.

Inventories

Inventories consist of equipment, tools, parts, fuel and related supply
items. Inventories are stated at the lower of weighted average cost or market.

Rental equipment

Rental equipment is recorded at cost and depreciated over the estimated
useful lives of the equipment using the straight-line method. The range of
useful lives estimated by management for rental equipment is two to ten years.
Rental equipment is depreciated to a salvage value of zero to ten percent of
cost. All rental equipment is capitalized at the time of purchase. Ordinary
maintenance and repair costs are charged to operations as incurred.

Property and equipment

Property and equipment are recorded at cost and depreciated over their
estimated useful lives using the straight-line method. The range of useful lives
estimated by management are as follows:

<TABLE>
<CAPTION>
YEARS
-------
<S> <C>
Buildings and improvements.................................. 20 - 25
Automobiles and trucks...................................... 3 - 7
Office furniture and fixtures............................... 5 - 10
</TABLE>

Ordinary maintenance and repair costs are charged to operations as
incurred.

F-91
<PAGE> 157
RAYMOND EQUIPMENT COMPANY, INC.

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

Impairment of long-lived assets

Fair value of financial instruments

The carrying amount reported in the accompanying balance sheets for cash
and cash equivalents, accounts receivable, accounts payable, accrued expenses
and other liabilities and debt approximates fair value as of June 30, 1996 and
1997 and March 31, 1998 (unaudited).

Revenue recognition

Revenue related to the sale of equipment, parts and supplies is recognized
at the point of sale. Revenue related to rental equipment is recognized over the
contract term.

Income taxes

The Company is an S corporation for income tax purposes. Accordingly,
income, losses and related temporary differences which arise in the recording of
income and expense items for financial reporting and tax reporting purposes are
proportionally included in the individual tax returns of the stockholders.
Therefore, no provision or liability for Federal and state income taxes has been
included in the accompanying financial statements.

Use of estimates

Concentrations of credit risk

Financial instruments that potentially subject the Company to significant
concentrations of credit risk consist principally of cash investments,
marketable securities and accounts receivable. The Company maintains cash and
cash equivalents with high quality financial institutions. Concentrations of
credit risk with respect to accounts receivable are limited because a large
number of diverse customers make up the Company's customer base. No single
customer represents greater than 10% of total accounts receivable. The Company
controls credit risk through credit approvals, credit limits and monitoring
procedures.

Interim financial information

In the opinion of management, the unaudited financial information as of
March 31, 1998 and for the nine month periods ended March 31, 1997 and 1998
furnished herein reflects all adjustments consisting of normal recurring
accruals that are necessary for a fair presentation of the results for the
interim periods. The results of operations for the nine months ended March 31,
1998 are not necessarily indicative of the results to be expected for the entire
year.

F-92
<PAGE> 158
RAYMOND EQUIPMENT COMPANY, INC.

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

3. MARKETABLE SECURITIES

The cost and estimated market value of marketable securities are as
follows:

<TABLE>
<CAPTION>
JUNE 30,
--------------------- MARCH 31,
1996 1997 1998
---------- -------- -----------
(UNAUDITED)
<S> <C> <C> <C>
Cost................................................ $ 878,343 $504,855 $404,855
Unrealized gains.................................... 349,012 273,005 509,480
---------- -------- --------
Estimated market value.............................. $1,227,355 $777,860 $914,335
========== ======== ========
</TABLE>

4. RENTAL EQUIPMENT

Rental equipment and related accumulated depreciation consist of the
following:

<TABLE>
<CAPTION>
JUNE 30,
------------------------- MARCH 31,
1996 1997 1998
----------- ----------- ------------
(UNAUDITED)
<S> <C> <C> <C>
Rental equipment............................... $35,794,948 $41,753,287 $ 44,188,277
Less -- accumulated depreciation............... (6,929,380) (9,067,500) (10,483,809)
----------- ----------- ------------
Rental equipment, net................ $28,865,568 $32,685,787 $ 33,704,468
=========== =========== ============
</TABLE>

5. PROPERTY AND EQUIPMENT

Property and equipment and related accumulated depreciation consist of the
following:

<TABLE>
<CAPTION>
JUNE 30,
------------------------ MARCH 31,
1996 1997 1998
---------- ----------- -----------
(UNAUDITED)
<S> <C> <C> <C>
Furniture, fixtures and office equipment......... $3,615,247 $ 3,740,810 $ 3,994,517
Less -- accumulated depreciation................. (905,532) (1,021,154) (1,126,239)
---------- ----------- -----------
Property and equipment, net............ $2,709,715 $ 2,719,656 $ 2,868,278
========== =========== ===========
</TABLE>

6. ACCRUED EXPENSES AND OTHER LIABILITIES

Accrued expenses and other liabilities consists of the following:

<TABLE>
<CAPTION>
JUNE 30,
--------------------- MARCH 31,
1996 1997 1998
---------- -------- -----------
(UNAUDITED)
<S> <C> <C> <C>
Payroll-related..................................... $ 769,254 $279,162 $ 39,308
Accrued interest.................................... 129,231 64,308 86,812
Accrued property taxes.............................. 123,830 161,723 200,066
Other............................................... 36,815 33,827 2,662
---------- -------- --------
Accrued expenses and other liabilities.............. $1,059,130 $539,020 $328,848
========== ======== ========
</TABLE>

F-93
<PAGE> 159
RAYMOND EQUIPMENT COMPANY, INC.

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

7. DEBT

Debt consists of the following:

<TABLE>
<CAPTION>
JUNE 30,
------------------------- MARCH 31,
1996 1997 1998
----------- ----------- -----------
(UNAUDITED)
<S> <C> <C> <C>
Equipment notes, secured by equipment, interest
at an average of approximately 8.00% payable
in various monthly installments through March
2002.......................................... $18,977,807 $21,303,549 $19,614,353
Two installment notes with a local bank, secured
by property, interest at 8.00% and 9.00%,
payable in various monthly installments
through December 1998 and June 2006,
respectively.................................. 5,520,522 4,579,631 3,854,218
----------- ----------- -----------
$24,498,329 $25,883,180 $23,468,571
=========== =========== ===========
</TABLE>

Maturities of the Company's debt at June 30, 1997 for the year ended June
30, are as follows:

<TABLE>
<S> <C>
1998........................................................ $10,670,581
1999........................................................ 6,404,076
2000........................................................ 6,489,429
2001........................................................ 1,743,065
2002........................................................ 95,915
Thereafter.................................................. 480,114
-----------
Total............................................. $25,883,180
===========
</TABLE>

8. PROFIT SHARING PLAN

The Company has a profit sharing plan the ("Plan") that covers
substantially all employees. The Plan allows for discretionary employer
contributions as determined by the Company's Board of Directors. Employer
contributions for the years ended June 30, 1996 and 1997 and the nine months
ended March 31, 1997 and 1998 were $150,000, $150,000, $150,000 (unaudited) and
$112,000 (unaudited), respectively.

9. COMMITMENTS AND CONTINGENCIES

10. SUBSEQUENT EVENT

Effective May 7, 1998, the Company entered into a definitive agreement for
the sale of all of the outstanding stock of the Company to NationsRent, Inc., an
unrelated third party, in exchange for cash and debt.

F-94
<PAGE> 160

When the transaction referred to in Note 11 to the division financial statements
is completed, we expect to be in a position to issue the following auditors'
report.

ARTHUR ANDERSEN LLP

Fort Lauderdale, Florida,
May 29, 1998.

REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS

To General Rental, Inc.:

We have audited the accompanying division balance sheet for the Florida
Panhandle and Southeast Texas Divisions of General Rental, Inc. (a Delaware
corporation) as of December 31, 1997, and the related statements of division
operations, division equity and division cash flows for the year then ended.
These division financial statements are the responsibility of the Divisions'
management. Our responsibility is to express an opinion on these division
financial statements based on our audit.

We conducted our audit in accordance with generally accepted auditing standards.
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the division financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the division financial statements. An audit also
includes assessing the accounting principles used and significant estimates made
by management, as well as evaluating the overall division financial statement
presentation. We believe that our audit provides a reasonable basis for our
opinion.

In our opinion, the division financial statements referred to above present
fairly, in all material respects, the financial position of the Florida
Panhandle and Southeast Texas Divisions of General Rental, Inc. as of December
31, 1997, and the results of their operations and their cash flows for the year
then ended in conformity with generally accepted accounting principles.

Fort Lauderdale, Florida,
May 29, 1998 (except with respect
to the matter referred to in Note 11 as
to which the date is June __, 1998).

F-95
<PAGE> 161

THE FLORIDA PANHANDLE AND SOUTHEAST TEXAS DIVISIONS

OF GENERAL RENTAL, INC.

DIVISION BALANCE SHEETS

<TABLE>
<CAPTION>
DECEMBER 31, MARCH 31,
1997 1998
------------ -----------
(UNAUDITED)
<S> <C> <C>
ASSETS
Cash........................................................ $ 7,550 $ 6,244
Accounts receivable, net of allowance for doubtful accounts
of $214,626 and $185,355 (unaudited) for December 31, 1997
and March 31, 1998, respectively.......................... 1,912,175 1,655,344
Inventories................................................. 381,576 246,871
Rental equipment, net....................................... 11,970,725 11,610,015
Property and equipment, net................................. 392,292 373,888
Goodwill, net............................................... 2,067,955 2,050,136
Non-compete agreements, net................................. 1,390,000 1,311,000
Prepaid expenses and other assets........................... 19,402 18,744
----------- -----------
Total assets...................................... $18,141,675 $17,272,242
=========== ===========

LIABILITIES AND DIVISION EQUITY
LIABILITIES:
Accounts payable.......................................... $ 1,462,325 $ 1,315,244
Accrued expenses and other liabilities.................... 1,837,982 1,893,161
Revolver debt............................................. 4,125,533 4,125,533
Notes payable............................................. 8,648,739 8,212,220
----------- -----------
Total liabilities................................. 16,074,579 15,546,158
----------- -----------
COMMITMENTS AND CONTINGENCIES (Notes 8, 9 and 11)
DIVISION EQUITY............................................. 2,067,096 1,726,084
----------- -----------
Total liabilities and division equity............. $18,141,675 $17,272,242
=========== ===========
</TABLE>

The accompanying notes to division financial statements are an integral part of
these division balance sheets.

F-96
<PAGE> 162

THE FLORIDA PANHANDLE AND SOUTHEAST TEXAS DIVISIONS

OF GENERAL RENTAL, INC.

STATEMENTS OF DIVISION OPERATIONS

<TABLE>
<CAPTION>
FOR THE THREE MONTH
FOR THE YEAR PERIOD ENDED MARCH 31,
ENDED -------------------------
DECEMBER 31, 1997 1997 1998
----------------- ----------- -----------
(UNAUDITED)
<S> <C> <C> <C>
REVENUE:
Equipment rentals.................................... $7,238,033 $646,230 $2,209,487
Sales of equipment, parts and supplies............... 1,875,624 234,000 311,184
---------- -------- ----------
Total revenue................................ 9,113,657 880,230 2,520,671
COST OF REVENUE:
Cost of equipment rentals, excluding depreciation.... 4,017,826 386,493 1,377,633
Rental equipment depreciation........................ 941,665 117,406 291,246
Cost of sales of equipment, parts and supplies....... 1,203,840 156,721 204,305
---------- -------- ----------
Total cost of revenue........................ 6,163,331 660,620 1,873,184
---------- -------- ----------
Gross profit................................. 2,950,326 219,610 647,487
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES........... 1,494,933 119,442 298,139
NONRENTAL DEPRECIATION AND AMORTIZATION................ 407,605 27,279 115,420
---------- -------- ----------
Operating income............................. 1,047,788 72,889 233,928
INTEREST EXPENSE....................................... 703,775 41,660 294,860
---------- -------- ----------
Income (loss) before provision for income
taxes...................................... 344,013 31,229 (60,932)
PROVISION FOR INCOME TAXES............................. 137,605 12,492 --
---------- -------- ----------
NET INCOME (LOSS)...................................... $ 206,408 $ 18,737 $ (60,932)
========== ======== ==========
</TABLE>

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

F-97
<PAGE> 163

THE FLORIDA PANHANDLE AND SOUTHEAST TEXAS DIVISIONS

OF GENERAL RENTAL, INC.

STATEMENTS OF DIVISION EQUITY

FOR THE YEAR ENDED DECEMBER 31, 1997 AND THE

THREE MONTH PERIOD ENDED MARCH 31, 1998 (UNAUDITED)

<TABLE>
<S> <C>
BALANCE, December 31, 1996.................................. $1,326,099
Net income................................................ 206,408
Net transfers from corporate.............................. 534,589
----------
BALANCE, December 31, 1997.................................. 2,067,096
Net loss (unaudited)...................................... (60,932)
Net distributions to corporate (unaudited)................ (280,080)
----------
BALANCE, March 31, 1998 (unaudited)......................... $1,726,084
==========
</TABLE>

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

F-98
<PAGE> 164

THE FLORIDA PANHANDLE AND SOUTHEAST TEXAS DIVISIONS

OF GENERAL RENTAL, INC.

STATEMENTS OF DIVISION CASH FLOWS

<TABLE>
<CAPTION>
FOR THE THREE MONTH
FOR THE YEAR PERIOD ENDED MARCH 31,
ENDED --------------------------
DECEMBER 31, 1997 1997 1998
----------------- ----------- -----------
(UNAUDITED)
<S> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss)................................ $ 206,408 $ 18,737 $ (60,932)
Adjustments to reconcile net income to net cash
provided by operating activities --
Depreciation and amortization................. 1,349,270 144,685 406,666
(Gain) loss on sale of rental equipment....... (221,170) 17,050 (8,868)
Changes in operating assets and liabilities:
Accounts receivable......................... (705,914) (183,219) 256,831
Inventories................................. (91,421) 43,516 134,705
Prepaid expenses and other assets........... (19,402) (27,761) 658
Accounts payable............................ 368,097 91,252 (147,081)
Accrued expenses and other liabilities...... 243,240 43,465 55,179
----------- --------- ---------
Total adjustments........................ 922,700 128,988 698,090
----------- --------- ---------
Net cash provided by operating
activities............................. 1,129,108 147,725 637,158
CASH FLOWS FROM INVESTING ACTIVITIES:
Cash used in acquisitions........................ (4,125,533) -- --
Purchases of rental equipment.................... (4,191,992) (855,787) (2,141)
Purchases of property and equipment.............. (167,407) (19,577) (3,357)
Proceeds from sale of rental equipment........... 695,353 35,473 83,633
----------- --------- ---------
Net cash provided by (used in) investing
activities.................................. (7,789,579) (839,891) 78,135
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from revolver debt...................... 4,125,533 -- --
Proceeds from notes payable...................... 3,735,697 519,938 --
Repayments of notes payable...................... (1,729,748) (109,249) (436,519)
Net transfers from (distributions to)
corporate..................................... 534,589 281,477 (280,080)
----------- --------- ---------
Net cash provided by (used in) financing
activities............................. 6,666,071 692,166 (716,599)
NET INCREASE (DECREASE) IN CASH.................... 5,600 -- (1,306)
CASH, beginning of period.......................... 1,950 1,950 7,550
CASH, end of period................................ $ 7,550 $ 1,950 $ 6,244
=========== ========= =========
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid for interest........................ $ 703,775 $ 41,660 $ 294,860
=========== ========= =========
</TABLE>

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

F-99
<PAGE> 165

THE FLORIDA PANHANDLE AND SOUTHEAST TEXAS DIVISIONS

OF GENERAL RENTAL, INC.

NOTES TO DIVISION FINANCIAL STATEMENTS

DECEMBER 31, 1997

1. ORGANIZATION

General Rental, Inc. ("General"), a Delaware corporation, was incorporated
in 1996. General operates through various geographical divisions including the
Florida Panhandle and Southeast Texas Divisions (the "Divisions"). The Divisions
consist of six stores in the Florida Panhandle and seven stores in Texas. The
principal business of the Divisions is rental of a broad array of equipment to a
diverse customer base that includes construction industry participants,
industrial companies and others in Florida and Texas. The Divisions also engage
in related activities such as selling used equipment, acting as a distributor
for certain new equipment and selling related merchandise and parts. The nature
of the Divisions' business is such that short-term obligations are typically met
by cash flow generated from long-term assets. Consequently, consistent with
industry practice, the accompanying audited and unaudited division balance
sheets are presented on an unclassified basis.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The accompanying division financial statements include only the Florida
Panhandle and Southeast Texas Divisions of General. These division financial
statements were carved out of the financial statements of General on a specific
identification basis or by using the following allocations, as required.

Allocations

The accompanying division balance sheets and statements of division
operations include allocations of certain liabilities and expenses where
specific identification is not practicable. Management of the Divisions believes
that the following allocation methods used are reasonable:

<TABLE>
<CAPTION>
FINANCIAL STATEMENT CAPTION ALLOCATION METHOD
- --------------------------- -----------------
<S> <C>
- - Accounts payable - Portion based on the percentage of revenues related to
the Divisions
- - Accrued expenses and - Portion based on the percentage of revenues or debt
other liabilities related to the Divisions
- - Revolver debt - Based on the cash required for acquisitions (see Note 3)
- - Notes payable - Based on the percentage of rental equipment financed
related to the Divisions
- - Selling, general and - Portion based on the percentage of revenues related to
administrative expenses the Divisions
- - Interest expense - Based on the average debt balance allocated to the
Divisions using an average interest rate of 9.5%
- - Provision for income - Provided at an assumed income tax rate of 40%, no
taxes benefit is recorded for losses
</TABLE>

Inventories

Inventories consist of equipment and parts. New equipment and parts
inventories are stated at the lower of average cost or market.

F-100
<PAGE> 166
THE FLORIDA PANHANDLE AND SOUTHEAST TEXAS DIVISIONS

OF GENERAL RENTAL, INC.

NOTES TO DIVISION FINANCIAL STATEMENTS -- (CONTINUED)

Rental equipment

Rental equipment is recorded at cost and depreciated over the estimated
useful lives of the equipment on a straight-line basis. The range of useful
lives estimated by management for rental equipment is three to ten years. Rental
equipment is depreciated to a salvage value of 20% of cost. Ordinary maintenance
and repair costs are charged to operations as incurred.

Revenue recognition

Revenue related to the sale of equipment, parts and supplies is recognized
at the point of sale. Revenue related to rental equipment is recognized over the
contract term. Earned but not billed revenue included in accounts receivable was
$221,206 at December 31, 1997 and $229,420 (unaudited) at March 31, 1998,
respectively.

Property and equipment

Property and equipment are recorded at cost and depreciated over their
estimated useful lives using a straight-line basis. The range of useful lives
estimated by management for property and equipment is three to ten years.
Ordinary maintenance and repair costs are charged to operations as incurred.

Long-lived assets

Statement of Financial Accounting Standards No. 121, "Accounting for the
Impairment of Long-Lived Assets and for Long-Lived Assets to be Disposed of "
requires that long-lived assets, including certain identifiable intangibles and
the goodwill related to those assets, be reviewed for impairment whenever events
or changes in circumstances indicate that the carrying amount of the asset in
question may not be recoverable. Management has reviewed the long-lived assets
of the Divisions and has determined that there are no events requiring
impairment loss recognition.

Fair value of financial instruments

The carrying amounts for accounts receivable, accounts payable and accrued
expenses and other liabilities as of December 31, 1997 is not significantly
different than fair value due to the short-term nature of these accounts. The
fair value of revolver debt and notes payable is determined using current
applicable interest rates for similar instruments as of December 31, 1997 and is
not significantly different than the carrying value of such debt.

Division equity

Division equity represents the difference between division assets and
division liabilities. Changes in division equity result from operating results
of the Divisions and any net transfers from or net distributions to corporate.
These transfers and distributions to and from corporate consist mainly of
funding for operating losses, funding of purchases of rental equipment and fixed
assets, funding of debt service costs and distributions of excess cash.

Concentrations of credit risk

Financial instruments that potentially subject the Divisions to significant
concentrations of credit risk consist principally of accounts receivable.
Concentrations of credit risk with respect to accounts receivable are limited
because a large number of geographically diverse customers make up the
Divisions' customer base. No

F-101
<PAGE> 167
THE FLORIDA PANHANDLE AND SOUTHEAST TEXAS DIVISIONS

OF GENERAL RENTAL, INC.

NOTES TO DIVISION FINANCIAL STATEMENTS -- (CONTINUED)

single customer represents greater than 10% of total accounts receivable. The
Divisions control credit risk through credit approvals, credit limits, and
monitoring, generally without requiring collateral.

Use of estimates

The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts in the division financial
statements and accompanying notes. Actual results could differ from those
estimates.

Interim financial information

3. ACQUISITIONS

During 1997, General purchased the assets and assumed certain liabilities
of stores (the "Acquired Stores") which are included in the division financial
statements beginning on their dates of acquisition. The acquisitions of the
Acquired Stores were accounted for under the purchase method. As a result, the
Divisions recorded approximately $1.0 million of goodwill and $1.4 million of
non-compete agreement costs. The assets and liabilities of the Acquired Stores
at their dates of acquisition are as follows:

<TABLE>
<S> <C>
Accounts receivable, net of allowance for doubtful accounts
of $27,361................................................ $ 932,877
Inventories................................................. 45,000
Prepaid expenses and other assets........................... 100,000
Rental equipment............................................ 6,780,603
Property and equipment...................................... 51,760
Goodwill.................................................... 977,833
Non-compete agreements...................................... 1,430,000
Accounts payable............................................ (348,726)
Accrued expenses and other liabilities...................... (1,386,018)
Notes payable............................................... (4,457,796)
-----------
Cash paid for acquisitions........................ $ 4,125,533
===========
</TABLE>

4. RENTAL EQUIPMENT

Rental equipment and related accumulated depreciation consist of the
following:

<TABLE>
<CAPTION>
DECEMBER 31, MARCH 31,
1997 1998
------------ -----------
(UNAUDITED)
<S> <C> <C>
Rental equipment.......................................... $12,959,442 $12,862,897
Less -- accumulated depreciation.......................... (988,717) (1,252,882)
----------- -----------
Rental equipment, net........................... $11,970,725 $11,610,015
=========== ===========
</TABLE>

F-102
<PAGE> 168
THE FLORIDA PANHANDLE AND SOUTHEAST TEXAS DIVISIONS

OF GENERAL RENTAL, INC.

NOTES TO DIVISION FINANCIAL STATEMENTS -- (CONTINUED)

5. PROPERTY AND EQUIPMENT

Property and equipment and related accumulated depreciation consist of the
following:

<TABLE>
<CAPTION>
DECEMBER 31, MARCH 31,
1997 1998
------------ -----------
(UNAUDITED)
<S> <C> <C>
Property and equipment...................................... $ 507,909 $ 511,266
Less -- accumulated depreciation............................ (115,617) (137,378)
--------- ---------
Property and equipment, net....................... $ 392,292 $ 373,888
========= =========
</TABLE>

6. INTANGIBLE ASSETS

Goodwill and related accumulated amortization consist of the following:

<TABLE>
<CAPTION>
DECEMBER 31, MARCH 31,
1997 1998
------------ -----------
(UNAUDITED)
<S> <C> <C>
Goodwill................................................... $2,138,270 $2,138,270
Less -- accumulated amortization........................... (70,315) (88,134)
---------- ----------
Goodwill, net.................................... $2,067,955 $2,050,136
========== ==========
</TABLE>

Goodwill amortization expense was $47,930 for the year ended December 31,
1997 and $9,693 (unaudited) and $17,819 (unaudited) for the three months ended
March 31, 1997 and 1998, respectively.

Non-compete agreements and related accumulated amortization consist of the
following:

<TABLE>
<CAPTION>
DECEMBER 31, MARCH 31,
1997 1998
------------ -----------
(UNAUDITED)
<S> <C> <C>
Non-compete agreements..................................... $1,580,000 $1,580,000
Less -- accumulated amortization........................... (190,000) (269,000)
---------- ----------
Non-compete agreements, net...................... $1,390,000 $1,311,000
========== ==========
</TABLE>

Non-compete agreements amortization expense was $187,500 for the year ended
December 31, 1997 and $7,500 (unaudited) and $79,000 (unaudited) for the three
months ended March 31, 1997 and 1998, respectively.

Goodwill and non-compete agreements are amortized over their estimated
useful lives of 30 years and 5 years, respectively.

F-103
<PAGE> 169
THE FLORIDA PANHANDLE AND SOUTHEAST TEXAS DIVISIONS

OF GENERAL RENTAL, INC.

NOTES TO DIVISION FINANCIAL STATEMENTS -- (CONTINUED)

7. ACCRUED EXPENSES AND OTHER LIABILITIES

Accrued expenses and other liabilities consist of the following:

<TABLE>
<CAPTION>
DECEMBER 31, MARCH 31,
1997 1998
------------ -----------
(UNAUDITED)
<S> <C> <C>
Payroll-related accrued expenses........................... $ 181,893 $ 187,354
Non-payroll tax-related accrued expenses................... 144,484 148,822
Non-compete agreement liabilities.......................... 1,353,412 1,394,043
Other...................................................... 158,193 162,942
---------- ----------
Accrued expenses and other liabilities........... $1,837,982 $1,893,161
========== ==========
</TABLE>

8. REVOLVER DEBT AND NOTES PAYABLE

The revolver debt and notes payable have been allocated from General as
discussed in Note 2. All assets of the Divisions are pledged as collateral for
General's debt. As a result of cash flow difficulties at General, all such debt
is currently in default and is due on demand. The interest rate on such debt was
at a variable rate for the revolver debt and a fixed rate for the notes payable,
and approximated 9.5% for all periods presented in the accompanying division
financial statements.

9. COMMITMENTS AND CONTINGENCIES

Operating Leases

The Divisions lease rental equipment, real estate, vehicles and certain
office equipment under noncancelable operating leases. These leases expire at
various dates through January 31, 2011. Certain real estate leases require the
Divisions to pay maintenance, insurance, taxes and certain other expenses in
addition to the stated rentals. Future minimum lease payments, by year and in
the aggregate, for noncancelable operating leases with initial or remaining
terms of one year or more are as follows at December 31, 1997:

<TABLE>
<S> <C>
1998........................................................ $ 764,393
1999........................................................ 732,495
2000........................................................ 782,424
2001........................................................ 449,930
2002........................................................ 157,550
Thereafter.................................................. 339,099
----------
$3,225,891
==========
</TABLE>

Rent expense under noncancelable operating leases was $567,163 for the year
ended December 31, 1997 and $74,020 (unaudited) and $141,791 (unaudited) for the
three months ended March 31, 1997 and 1998.

10. EMPLOYEE BENEFIT PLAN

The Divisions participate in a 401(k) plan (the "Plan") which covers
certain full-time employees over 21 years old who have worked a minimum of one
year for the Divisions. The Plan is funded by employee deferrals of income and
matching contributions by the Divisions of $.50 per $1.00 up to a matching
contribution of 3% of a participant's compensation. The Divisions' matching
contributions totaled $8,000 for the year ended December 31, 1997, and $1,000
(unaudited) and $2,000 (unaudited) for the three months ended March 31, 1997 and
1998, respectively.

F-104
<PAGE> 170
THE FLORIDA PANHANDLE AND SOUTHEAST TEXAS DIVISIONS

OF GENERAL RENTAL, INC.

NOTES TO DIVISION FINANCIAL STATEMENTS -- (CONTINUED)

11. SUBSEQUENT EVENT

In May 1998, General entered into a definitive agreement to sell the assets
of the Divisions to NationsRent, Inc., an unrelated third party, in exchange for
cash and the assumption of certain accrued liabilities. General's management
intends to utilize the proceeds of the sale to reduce its debt obligations.
Management expects this transaction to be completed in June 1998.

F-105
<PAGE> 171

REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS

To Associated Rental Equipment Management Company, Inc.:

We have audited the accompanying balance sheets of Associated Rental
Equipment Management Company, Inc. (a Texas Corporation) as of December 31, 1996
and 1997, and the related statements of income, stockholder's equity and cash
flows for each of the three years in the period ended December 31, 1997. These
financial statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audits.

In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of Associated Rental Equipment
Management Company, Inc. as of December 31, 1996 and 1997, and the results of
its operations and its cash flows for each of the three years in the period
ended December 31, 1997 in conformity with generally accepted accounting
principles.

ARTHUR ANDERSEN LLP

Fort Lauderdale, Florida,
June 11, 1998.

F-106
<PAGE> 172

ASSOCIATED RENTAL EQUIPMENT MANAGEMENT COMPANY, INC.

BALANCE SHEETS

<TABLE>
<CAPTION>
DECEMBER 31,
------------------------- MARCH 31,
1996 1997 1998
----------- ----------- -----------
(UNAUDITED)
<S> <C> <C> <C>
ASSETS
Cash and cash equivalents.............................. $ 337,694 $ 828,345 $ 1,050,550
Accounts receivable, net of allowances for doubtful
accounts of $553,000, $461,000 and $400,000
(unaudited) for 1996, 1997 and 1998, respectively.... 2,904,093 4,436,887 4,813,464
Due from stockholder................................... 315,000 75,000 75,000
Marketable securities.................................. 2,235,030 2,612,642 2,861,312
Inventories............................................ 1,111,530 1,914,717 749,384
Prepaid expenses and other assets...................... 251,809 573,934 462,032
Rental equipment, net.................................. 35,287,240 59,982,594 66,134,633
Property and equipment, net............................ 2,561,625 4,975,581 5,391,791
----------- ----------- -----------
Total assets................................. $45,004,021 $75,399,700 $81,538,166
=========== =========== ===========
LIABILITIES AND STOCKHOLDER'S EQUITY
LIABILITIES:
Accounts payable..................................... $ 1,156,178 $ 2,027,383 $ 1,273,626
Accrued expenses and other liabilities............... 2,362,396 2,915,667 2,275,330
Debt................................................. 36,017,937 61,598,630 67,781,414
----------- ----------- -----------
Total liabilities................................. 39,536,511 66,541,680 71,330,370
----------- ----------- -----------
COMMITMENTS AND CONTINGENCIES
(Notes 7, 8 and 11)
STOCKHOLDER'S EQUITY:
Common stock -- no par value; 1,000 shares
authorized, issued and outstanding................ 1,000 1,000 1,000
Paid-in capital...................................... 25,134 25,134 25,134
Unrealized gains on marketable securities............ 27,934 96,677 320,748
Retained earnings.................................... 5,413,442 8,735,209 9,860,914
----------- ----------- -----------
Total stockholder's equity................... 5,467,510 8,858,020 10,207,796
----------- ----------- -----------
Total liabilities and stockholder's equity... $45,004,021 $75,399,700 $81,538,166
=========== =========== ===========
</TABLE>

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

F-107
<PAGE> 173

ASSOCIATED RENTAL EQUIPMENT MANAGEMENT COMPANY, INC.

STATEMENTS OF INCOME

<TABLE>
<CAPTION>
FOR THE THREE-MONTH PERIOD
FOR THE YEAR ENDED DECEMBER 31, ENDED MARCH 31,
--------------------------------------- ---------------------------
1995 1996 1997 1997 1998
----------- ----------- ----------- ------------ ------------
(UNAUDITED) (UNAUDITED)
<S> <C> <C> <C> <C> <C>
REVENUE:
Equipment rentals........... $20,726,189 $18,930,099 $24,261,338 $ 4,288,418 $ 7,153,512
Sales of equipment.......... 4,167,919 4,827,389 16,527,647 5,904,630 4,290,175
----------- ----------- ----------- ----------- -----------
24,894,108 23,757,488 40,788,985 10,193,048 11,443,687
----------- ----------- ----------- ----------- -----------
COST OF REVENUE:
Cost of equipment rentals,
excluding depreciation... 2,390,006 2,341,976 4,972,991 592,083 1,281,994
Rental equipment
depreciation............. 5,867,435 6,369,939 8,625,665 1,626,480 2,643,037
Cost of sales of
equipment................ 3,041,939 4,233,657 13,463,673 4,754,430 3,665,302
----------- ----------- ----------- ----------- -----------
11,299,380 12,945,572 27,062,329 6,972,993 7,590,333
----------- ----------- ----------- ----------- -----------
Gross profit........ 13,594,728 10,811,916 13,726,656 3,220,055 3,853,354
SELLING, GENERAL AND
ADMINISTRATIVE EXPENSES..... 8,114,872 6,751,686 6,144,202 951,277 1,473,824
NON-RENTAL DEPRECIATION AND
AMORTIZATION................ 300,697 385,806 466,240 96,942 123,302
----------- ----------- ----------- ----------- -----------
Operating income.... 5,179,159 3,674,424 7,116,214 2,171,836 2,256,228
----------- ----------- ----------- ----------- -----------
OTHER (EXPENSE) INCOME:
Investment earnings......... 62,767 227,717 344,301 5,131 36,566
Interest expense............ (2,290,370) (2,803,824) (3,748,335) (734,705) (1,225,593)
Other, net.................. (66,316) (14,093) 13,358 7,310 58,504
----------- ----------- ----------- ----------- -----------
Other (expense)
income, net....... (2,293,919) (2,590,200) (3,390,676) (722,264) (1,130,523)
----------- ----------- ----------- ----------- -----------
Income before
benefit for income
taxes............. 2,885,240 1,084,224 3,725,538 1,449,572 1,125,705
BENEFIT FOR INCOME TAXES...... (836,000) -- -- -- --
----------- ----------- ----------- ----------- -----------
NET INCOME.................... 3,721,240 1,084,224 3,725,538 1,449,572 1,125,705
PRO FORMA PROVISION FOR INCOME
TAXES....................... 1,990,096 433,690 1,490,215 579,829 450,282
----------- ----------- ----------- ----------- -----------
PRO FORMA NET INCOME.......... $ 1,731,144 $ 650,534 $ 2,235,323 $ 869,743 $ 675,423
=========== =========== =========== =========== ===========
</TABLE>

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

F-108
<PAGE> 174

ASSOCIATED RENTAL EQUIPMENT MANAGEMENT COMPANY, INC.

STATEMENTS OF STOCKHOLDER'S EQUITY

<TABLE>
<CAPTION>
COMMON STOCK
NO PAR VALUE
------------------ UNREALIZED
NUMBER PAID-IN GAINS ON RETAINED
OF SHARES AMOUNT CAPITAL SECURITIES EARNINGS TOTAL
--------- ------ ------- ---------- ---------- -----------
<S> <C> <C> <C> <C> <C> <C>
BALANCE, January 1, 1995............................. 1,000 $1,000 $25,134 $ -- $1,144,683 $ 1,170,817
Net income......................................... -- -- -- -- 3,721,240 3,721,240
----- ------ ------- -------- ---------- -----------
BALANCE, December 31, 1995........................... 1,000 1,000 25,134 -- 4,865,923 4,892,057
Unrealized gains on marketable securities.......... -- -- -- 27,934 -- 27,934
Dividends to stockholder........................... -- -- -- -- (536,705) (536,705)
Net income......................................... -- -- -- -- 1,084,224 1,084,224
----- ------ ------- -------- ---------- -----------
BALANCE, December 31, 1996........................... 1,000 1,000 25,134 27,934 5,413,442 5,467,510
Unrealized gains on marketable securities.......... -- -- -- 68,743 -- 68,743
Dividends to stockholder........................... -- -- -- -- (403,771) (403,771)
Net income......................................... -- -- -- -- 3,725,538 3,725,538
----- ------ ------- -------- ---------- -----------
BALANCE, December 31, 1997........................... 1,000 1,000 25,134 96,677 8,735,209 8,858,020
Unrealized gains on marketable securities
(unaudited)...................................... -- -- -- 224,071 -- 224,071
Net income (unaudited)............................. -- -- -- -- 1,125,705 1,125,705
----- ------ ------- -------- ---------- -----------
BALANCE, March 31, 1998 (unaudited).................. 1,000 $1,000 $25,134 $320,748 $9,860,914 $10,207,796
===== ====== ======= ======== ========== ===========
</TABLE>

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

F-109
<PAGE> 175

ASSOCIATED RENTAL EQUIPMENT MANAGEMENT COMPANY, INC.

STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>
FOR THE THREE-MONTH
PERIOD
FOR THE YEAR ENDED DECEMBER 31, ENDED MARCH 31,
------------------------------------------ ---------------------------
1995 1996 1997 1997 1998
------------ ------------ ------------ ------------ ------------
(UNAUDITED) (UNAUDITED)
<S> <C> <C> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income..................................... $ 3,721,240 $ 1,084,224 $ 3,725,538 $ 1,449,572 $ 1,125,705
Adjustments to reconcile net income to net cash
provided by operating activities --
Depreciation and amortization................ 6,168,132 6,755,745 9,091,905 1,723,422 2,766,339
Gain on sale of rental equipment............. (1,125,980) (593,732) (3,063,974) (1,150,020) (624,873)
Changes in operating assets and liabilities:
Accounts receivable........................ (259,253) 182,134 (1,532,794) (947,876) (376,577)
Prepaid expenses and other assets.......... (117,912) (45,002) (322,125) (707,848) 111,902
Accounts payable........................... (679,218) 351,343 871,205 327,808 241,441
Accrued expenses and other liabilities..... 199,573 (73,953) 553,271 (454,545) (1,635,535)
------------ ------------ ------------ ------------ ------------
Net cash provided by operating
activities............................. 7,906,582 7,660,759 9,323,026 240,513 1,608,402
------------ ------------ ------------ ------------ ------------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property and equipment............ (641,045) (1,548,066) (2,880,196) (786,076) (539,512)
Proceeds from sale of rental equipment......... 4,167,919 4,827,389 16,527,647 5,904,630 4,290,175
Marketable securities.......................... 16,954 (2,207,096) (308,869) 90,687 (24,599)
------------ ------------ ------------ ------------ ------------
Net cash provided by investing activities.... 3,543,828 1,072,227 13,338,582 5,209,241 3,726,064
------------ ------------ ------------ ------------ ------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from debt............................. 469,999 1,718,414 12,326,137 -- 2,344,168
Repayments of debt............................. (10,671,000) (11,758,122) (34,333,323) (5,616,132) (7,456,429)
Dividends to stockholder....................... -- (536,705) (403,771) -- --
Due from stockholder........................... (191,450) 18,133 240,000 315,000 --
------------ ------------ ------------ ------------ ------------
Net cash used in financing activities.... (10,392,451) (10,558,280) (22,170,957) (5,301,132) (5,112,261)
------------ ------------ ------------ ------------ ------------
NET INCREASE (DECREASE) IN CASH AND CASH
EQUIVALENTS.................................... 1,057,959 (1,825,294) 490,651 148,622 222,205
CASH AND CASH EQUIVALENTS, beginning of period... 1,105,029 2,162,988 337,694 337,694 828,345
------------ ------------ ------------ ------------ ------------
CASH AND CASH EQUIVALENTS, end of period......... $ 2,162,988 $ 337,694 $ 828,345 $ 486,316 $ 1,050,550
============ ============ ============ ============ ============
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid for interest, net of capitalization
of $150,000 in 1997........................ $ 2,290,405 $ 2,798,349 $ 3,419,630 $ 751,847 $ 1,332,907
============ ============ ============ ============ ============
SUPPLEMENTAL SCHEDULE OF NONCASH INVESTING AND
FINANCING ACTIVITIES:
Rental equipment financing with debt......... $ 7,846,334 $ 17,830,405 $ 47,587,879 $ 8,815,983 $ 11,295,045
============ ============ ============ ============ ============
Transfers of rental equipment to inventory,
net........................................ $ -- $ 1,111,530 $ 803,187 $ -- $ --
============ ============ ============ ============ ============
</TABLE>

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

F-110
<PAGE> 176

ASSOCIATED RENTAL EQUIPMENT MANAGEMENT COMPANY, INC.

NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1995, 1996 AND 1997

1. ORGANIZATION AND BASIS OF PRESENTATION

Associated Rental Equipment Management Company, Inc. (the "Company") was
incorporated on July 28, 1989 in the state of Texas. The Company rents a broad
array of equipment to a diverse customer base that includes construction
industry participants, industrial companies and others in the states of Texas
and Louisiana. The Company also engages in related activities such as selling
used rental equipment. The nature of the Company's business is such that
short-term obligations are typically met by cash flows generated from long-term
assets. Consequently, consistent with industry practice, the accompanying
balance sheets are presented on an unclassified basis.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Cash Equivalents

The Company considers all highly liquid instruments with a maturity of
three months or less when purchased to be cash equivalents. At December 31, 1996
and 1997 and March 31, 1998 (unaudited), the Company had no cash equivalents.

Marketable Securities

In accordance with the provisions of Statement of Financial Accounting
Standards No. 115, unrealized gains and losses on investments available-for-sale
(which are stated at quoted fair value) are included as a separate component of
stockholder's equity. All of the Company's marketable securities are held as
available-for-sale.

Inventories

Inventories consist of used rental equipment held for resale and are stated
at the lower of cost or market.

Rental Equipment

Rental equipment is recorded at cost and depreciated to zero salvage value
over the estimated useful lives of the equipment on a straight-line basis. The
average useful life estimated by management for rental equipment is seven years.
Ordinary maintenance and repair costs are charged to operations as incurred.
Significant improvements that extend the useful life of rental equipment are
capitalized.

Revenue Recognition

Revenue related to the sale of rental equipment is recognized at the point
of sale. Revenue related to rental equipment is recognized over the contract
term.

Property and Equipment

Property and equipment are recorded at cost and depreciated over their
estimated useful lives using accelerated methods. The range of useful lives
estimated by management for property and equipment is five to forty years.
Property and equipment is depreciated to a salvage value of zero to twenty
percent. Ordinary maintenance and repair costs are charged to operations as
incurred. Interest costs incurred during the construction period are capitalized
in accordance with generally accepted accounting principles.

Impairment of Long-Lived Assets

F-111
<PAGE> 177
ASSOCIATED RENTAL EQUIPMENT MANAGEMENT COMPANY, INC.

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

Fair Value of Financial Instruments

The carrying amounts reported in the accompanying balance sheets for
accounts receivable, due from stockholder, accounts payable, accrued expenses
and other liabilities approximate fair value due to the short-term nature of
these accounts. The fair value of debt is determined using current interest
rates for similar instruments as of December 31, 1996 and 1997 and March 31,
1998 (unaudited) and approximates the carrying value of these obligations due to
the fact that the underlying instruments bear interest at market rates or
include provisions to adjust note balances and interest rates to approximate
fair market value.

Income Taxes

The Company has been an S corporation for income tax purposes since January
1, 1995. Accordingly, income, losses and related temporary differences which
arise in the recording of income and expense items for financial reporting and
tax reporting purposes are included in the individual tax return of the
stockholder. Therefore, no historical provision or liability for Federal and
state income taxes has been included in the accompanying financial statements
for the years ended December 31, 1996 and 1997.

Included in the accompanying statement of income for the year ended
December 31, 1995 is a benefit for income taxes of $836,000, which represents
the reversal of the deferred income tax liability balance as of December 31,
1994 due to the change in the Company's tax status to an S corporation. The
deferred income tax liability as of December 31, 1994 arose due to the use of
accelerated depreciation methods for income tax reporting purposes.

An enterprise that changes from taxable C corporation status to nontaxable
S corporation status should continue to recognize a deferred tax liability to
the extent that the enterprise would be subject to a corporate-level tax on net
unrecognized built-in gains, as defined by Federal tax rules. At the time of the
change in tax status, the Company determined that it had no net unrecognized
built-in gains.

The pro forma adjustment to reflect income taxes in the accompanying
statements of income is for informational purposes only. The pro forma provision
for income taxes has been provided so that the estimated effective Federal and
state income rate will be 40% for all periods presented.

Use of Estimates

Concentrations of Credit Risk

Financial instruments that potentially subject the Company to significant
concentrations of credit risk consist principally of cash investments and
accounts receivable. The Company maintains cash and cash equivalents with high
quality financial institutions. Concentrations of credit risk with respect to
accounts receivable are limited because a large number of geographically diverse
customers make up the Company's customer base. No single customer represents
greater than 10% of total accounts receivable. The Company controls credit risk
through credit approvals, credit limits, and monitoring procedures.

Interim Financial Information

In the opinion of management, the unaudited financial information as of
March 31, 1998 and for the three-month periods ended March 31, 1997 and 1998
furnished herein reflects all adjustments, consisting of normal recurring
accruals that are necessary for a fair presentation of the results for the
interim periods. The

F-112
<PAGE> 178
ASSOCIATED RENTAL EQUIPMENT MANAGEMENT COMPANY, INC.

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

results of operations for the three months ended March 31, 1998 are not
necessarily indicative of the results to be expected for the entire year.

Comprehensive Income

In June 1997, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards No. 130, "Reporting Comprehensive Income" ("SFAS
No. 130"). This statement establishes standards for reporting and display of
comprehensive income. Comprehensive income is defined as the change in equity
during the financial reporting period of a business enterprise resulting from
non-owner sources. Comprehensive income was $3,721,240, $1,112,158, $3,794,281,
$1,449,572 (unaudited) and $1,349,776 (unaudited) for the years ended December
31, 1995, 1996 and 1997 and the three months ended March 31, 1997 and 1998,
respectively.

3. MARKETABLE SECURITIES

The cost and estimated fair market value of marketable securities are as
follows:

<TABLE>
<CAPTION>
DECEMBER 31,
----------------------- MARCH 31,
1996 1997 1998
---------- ---------- -----------
(UNAUDITED)
<S> <C> <C> <C>
Cost............................................. $2,207,096 $2,515,965 $2,540,564
Unrealized gains................................. 27,934 96,677 320,748
---------- ---------- ----------
Estimated market value........................... $2,235,030 $2,612,642 $2,861,312
========== ========== ==========
</TABLE>

The Company uses the specific identification method to determine cost of
securities upon sale. The net change in unrealized appreciation on the
securities available for sale of $27,934, $68,743 and $224,071 (unaudited) for
the years ended December 31, 1996 and 1997 and the three-month period ended
March 31, 1998, respectively, has been reflected in the accompanying statements
of stockholder's equity.

4. RENTAL EQUIPMENT

Rental equipment and related accumulated depreciation consists of the
following:

<TABLE>
<CAPTION>
DECEMBER 31,
--------------------------- MARCH 31,
1996 1997 1998
------------ ------------ ------------
(UNAUDITED)
<S> <C> <C> <C>
Rental equipment............................. $ 46,551,847 $ 69,017,032 $ 76,969,007
Less -- accumulated depreciation............. (11,264,607) (9,034,438) (10,834,374)
------------ ------------ ------------
Rental equipment, net.............. $ 35,287,240 $ 59,982,594 $ 66,134,633
============ ============ ============
</TABLE>

Net rental equipment under rental equipment financing obligations was
$27,801,496, $43,501,198 and $50,486,876 (unaudited) as of December 31, 1996 and
1997 and March 31, 1998, respectively.

F-113
<PAGE> 179
ASSOCIATED RENTAL EQUIPMENT MANAGEMENT COMPANY, INC.

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

5. PROPERTY AND EQUIPMENT

A summary of property and equipment is as follows:

<TABLE>
<CAPTION>
DECEMBER 31,
----------------------- MARCH 31,
1996 1997 1998
---------- ---------- -----------
(UNAUDITED)
<S> <C> <C> <C>
Land..................................................... $ -- $ 144,013 $ 144,013
Buildings................................................ 39,244 2,703,212 2,696,472
Leaseholds............................................... 553,616 980,102 963,847
Furniture and fixtures................................... 206,051 383,720 383,720
Machinery and equipment.................................. 120,912 171,876 194,876
Vehicles................................................. 1,915,599 2,175,748 2,184,471
Construction in process.................................. 849,507 -- 495,587
---------- ---------- ----------
3,684,929 6,558,671 7,062,986
Less -- accumulated depreciation and amortization........ (1,123,304) (1,583,090) (1,671,195)
---------- ---------- ----------
Property and equipment, net............................ $2,561,625 $4,975,581 $5,391,791
========== ========== ==========
</TABLE>

Buildings include structures and improvements constructed on land that is
leased from the stockholder (see note 9). Interest costs of $150,000 were
capitalized in 1997.

6. ACCRUED EXPENSES AND OTHER LIABILITIES

Accrued expenses and other liabilities are as follows:

<TABLE>
<CAPTION>
DECEMBER 31,
----------------------- MARCH 31,
1996 1997 1998
---------- ---------- -----------
(UNAUDITED)
<S> <C> <C> <C>
Accrued payroll and related expenses..................... $ 125,334 $ 161,089 $ 120,555
Interest accrual......................................... 25,440 354,145 333,970
Accrued taxes............................................ 1,621,679 1,293,892 793,288
Bank overdrafts.......................................... 584,740 1,096,046 995,198
Other.................................................... 5,203 10,495 32,319
---------- ---------- ----------
Total accrued expenses and other liabilities... $2,362,396 $2,915,667 $2,275,330
========== ========== ==========
</TABLE>

F-114
<PAGE> 180
ASSOCIATED RENTAL EQUIPMENT MANAGEMENT COMPANY, INC.

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

7. DEBT

Debt consists of the following:

<TABLE>
<CAPTION>
DECEMBER 31,
------------------------- MARCH 31,
1996 1997 1998
----------- ----------- -----------
(UNAUDITED)
<S> <C> <C> <C>
LINES OF CREDIT:
Rental equipment financing line of credit from a
financing company with borrowings up to $4,000,000
(increased to $5,484,000 on March 26, 1998); interest
at 1.25% over the greater of prime or commercial
paper rates (changed to 3.25% over the commercial
paper rate effective March 26, 1998) and payable
monthly; collateralized by equipment held for sale
and personally guaranteed by the stockholder; repaid
in the first quarter of 1998......................... $ -- $ 2,258,900 $ --
Working capital line of credit from a bank with
borrowings up to $2,000,000; interest at prime plus
1/2% with interest payable monthly; collateralized by
accounts receivable, inventory and property and
equipment and personally guaranteed by the
stockholder; the underlying credit agreement expires
September 1, 1998.................................... 768,207 1,231,407 1,571,407
Working capital line of credit from a financial
services institution with borrowings up to
$2,000,000; interest at 2.40% over the 30-day
commercial paper rate; collateralized by marketable
securities; the underlying credit agreement expires
October 31, 1999..................................... -- -- 730,435
----------- ----------- -----------
Subtotal..................................... 768,207 3,490,307 2,301,842
NOTES PAYABLE:
Various notes payable, secured by equipment, payable in
monthly principal and interest installments; interest
ranging from 3.99% to 7.9%; due between April 1997
and January 2002..................................... 8,055,522 15,364,724 15,750,295
</TABLE>

(CONTINUED)

F-115
<PAGE> 181
ASSOCIATED RENTAL EQUIPMENT MANAGEMENT COMPANY, INC.

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

(CONTINUED)

<TABLE>
<CAPTION>
DECEMBER 31,
------------------------- MARCH 31,
1996 1997 1998
----------- ----------- -----------
(UNAUDITED)
<S> <C> <C> <C>
RENTAL EQUIPMENT FINANCING OBLIGATIONS:
Rental equipment financing obligations, secured by
equipment, payable in monthly installments,
capitalized at the Company's incremental borrowing
rate of approximately 8%, due between January 1998
and October 2002..................................... 27,194,208 42,743,599 49,729,277
----------- ----------- -----------
Total debt................................... $36,017,937 $61,598,630 $67,781,414
=========== =========== ===========
</TABLE>

Maturities of the Company's debt at December 31, 1997 for the years ended
December 31, are as follows:

<TABLE>
<CAPTION>
RENTAL EQUIPMENT
FINANCING
LINES OF CREDIT NOTES PAYABLE OBLIGATIONS TOTAL
--------------- ------------- ---------------- -----------
<S> <C> <C> <C> <C>
1998.................... $ 3,490,307 $ 4,069,770 $30,934,508 $38,494,585
1999.................... -- 5,271,727 6,446,122 11,717,849
2000.................... -- 4,058,990 5,393,486 9,452,476
2001.................... -- 1,951,908 4,114,374 6,066,282
2002.................... -- 12,329 1,863,571 1,875,900
----------- ----------- ----------- -----------
$ 3,490,307 $15,364,724 48,752,061 67,607,092
=========== ===========
Less amount representing interest (6,008,462) (6,008,462)
----------- -----------
$42,743,599 $61,598,630
=========== ===========
</TABLE>

Each of the above lines of credit agreements subject the Company to certain
restrictive covenants including financial ratios, minimum net worth requirements
and payment of dividend restrictions. As of December 31, 1997, the Company was
not in compliance with certain of these restrictive covenants. The existence of
these events of default permits the lenders to take certain actions, including
increasing interest rates and accelerating repayment of the debt obligations.
Although the lenders have not exercised any of these rights, there is no
assurance that they will not do so in the future.

Rental equipment financing obligations include leases and rental purchase
option agreements, both of which meet the criteria for treatment as capital
leases under generally accepted accounting principles. The rental purchase
option agreements are noncancellable and have terms up to one year.
Substantially all rental equipment is purchased during or at the conclusion of
the option period and subsequently refinanced through third party leasing
arrangements with terms up to 60 months.

Interest expense related to rental equipment under rental equipment
financing leases for the years ended December 31, 1995, 1996 and 1997 and for
the three month period ended March 31, 1998 was $1,884,180, $2,142,810,
$2,746,663 and $923,110 (unaudited), respectively.

8. COMMITMENTS AND CONTINGENCIES

Operating Leases

The Company leases real estate, certain office equipment and vehicles under
noncancelable operating leases. These leases expire at various dates through
September 30, 2002. Certain real estate leases require the Company to pay
maintenance, insurance, taxes and certain other expenses in addition to the
stated rentals.

F-116
<PAGE> 182
ASSOCIATED RENTAL EQUIPMENT MANAGEMENT COMPANY, INC.

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

Future minimum lease payments, by year and in the aggregate, for noncancelable
operating leases with initial or remaining terms of one year or more are as
follows at December 31, 1997:

<TABLE>
<S> <C>
1998............................................. $ 396,813
1999............................................. 414,886
2000............................................. 329,701
2001............................................. 378,199
2002............................................. 295,796
2003 and thereafter.............................. 94,046
----------
$1,909,441
==========
</TABLE>

Rent expense under noncancelable operating leases for the years ended
December 31, 1995, 1996 and 1997 was $312,083, $329,776 and $403,226,
respectively.

Sales and Use Tax Audit

During the three years ended December 31, 1997, various taxing authorities
conducted and completed audits of sales and use tax with respect to the
Company's equipment rental activities. The additional sales and use tax payable
by the Company resulting from the ultimate audit settlements was less than the
amounts accrued during the periods covered by the audits. The Company recorded
these differences in the period in which the settlements were reached. Included
in selling, general and administrative expenses for the year ended December 31,
1997 is a $655,000 credit that arose from the reversal of sales and use tax
provided for in 1995. The Company believes that its remaining sales and use tax
accruals are adequate.

Litigation, Claims and Disputes

The Company is involved in routine litigation, claims and disputes arising
in the normal course of business. Management has reviewed these matters with
legal counsel and believes that the ultimate liability, if any, resulting from
these matters will not have a material adverse effect on the Company's financial
position, results of operations or cash flows.

9. RELATED PARTY TRANSACTIONS

The Company leases land and buildings used in its operations from its
stockholder. The leases cover several operating locations and expire annually on
December 31. The total rent paid related to these leases for the years ended
December 31, 1995, 1996 and 1997 was $252,000, $262,500 and $240,000,
respectively.

The Company leases rental equipment from an affiliated company. The total
rent paid for the years ended December 31, 1995, 1996 and 1997 was $322,648,
$361,742 and $288,687, respectively. The Company also guarantees certain debt of
the affiliate. Such debt had a balance of $226,295 at December 31, 1997.

The Company had the following balances due from/payable to affiliated
companies at December 31, 1996 and 1997:

<TABLE>
<CAPTION>
DECEMBER 31,
-------------------
1996 1997
-------- -------
<S> <C> <C>
Due from........................................ $108,861 $62,028
======== =======
Payable to...................................... $ 58,624 $61,684
======== =======
</TABLE>

F-117
<PAGE> 183
ASSOCIATED RENTAL EQUIPMENT MANAGEMENT COMPANY, INC.

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

10. EMPLOYEE BENEFIT PLAN

The Company sponsors a 401(k) plan (the "Plan") which covers full-time
employees over 21 years old who have worked a minimum of one year for the
Company. The Plan is funded by employee deferrals of income and discretionary
contributions by the Company. The Company's matching contributions totaled
$20,998, $25,741 and $27,675 for the years ended December 31, 1995, 1996 and
1997, respectively. Amounts due to the Plan at December 31, 1996 and 1997 were
$25,127 and $29,020, respectively.

11. SUBSEQUENT EVENT

In June 1998, the stockholder entered into an asset purchase agreement
whereby substantially all of the Company's operating assets and liabilities,
except for real property and certain equipment, will be purchased by
NationsRent, Inc., an unrelated third party, in exchange for cash and a
convertible promissory note. Completion of this transaction is subject to
customary closing conditions.

F-118
<PAGE> 184

- ------------------------------------------------------
- ------------------------------------------------------

NO DEALER, SALESMAN OR ANY OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS
PROSPECTUS, AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATIONS MUST NOT
BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE COMPANY OR THE UNDERWRITERS.
THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF AN
OFFER TO BUY ANY OF THE SHARES BY ANYONE IN ANY JURISDICTION IN WHICH SUCH OFFER
OR SOLICITATION IS NOT AUTHORIZED, OR IN WHICH THE PERSON MAKING THE OFFER OR
SOLICITATION IS NOT QUALIFIED TO DO SO, OR TO ANY PERSON TO WHOM IT IS UNLAWFUL
TO MAKE SUCH OFFER OR SOLICITATION. UNDER NO CIRCUMSTANCES SHALL THE DELIVERY OF
THIS PROSPECTUS OR ANY SALE MADE PURSUANT TO THIS PROSPECTUS CREATE ANY
IMPLICATION THAT INFORMATION CONTAINED IN THIS PROSPECTUS IS CORRECT AS OF ANY
TIME SUBSEQUENT TO THE DATE OF THIS PROSPECTUS.

------------------------

TABLE OF CONTENTS

<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Prospectus Summary................... 3
Risk Factors......................... 9
Use of Proceeds...................... 14
Dividend Policy...................... 14
Capitalization....................... 15
Dilution............................. 16
Selected Consolidated Historical and
Pro Forma Financial Information and
Operating Data..................... 17
Management's Discussion and Analysis
of Financial Condition and Results
of Operations...................... 19
Business............................. 26
Management........................... 37
Principal Stockholders............... 43
Certain Relationships and
Transactions....................... 44
Description of Certain
Indebtedness....................... 45
Description of Capital Stock......... 46
Shares Eligible for Future Sale...... 49
Underwriting......................... 51
Legal Matters........................ 52
Experts.............................. 52
Additional Information............... 53
Index to Pro Forma Consolidated
Financial Statements............... PF-1
Index to Financial Statements........ F-1
</TABLE>

- ------------------------------------------------------
- ------------------------------------------------------

11,000,000 SHARES

NATIONSRENT, INC.

[LOGO]

COMMON STOCK

----------------------------
PROSPECTUS
----------------------------

BEAR, STEARNS & CO. INC.

BT ALEX. BROWN

DONALDSON, LUFKIN & JENRETTE
SECURITIES CORPORATION

NATIONSBANC MONTGOMERY
SECURITIES LLC
, 1998
- ------------------------------------------------------
- ------------------------------------------------------
<PAGE> 185

PART II

INFORMATION NOT REQUIRED IN PROSPECTUS

ITEM 13. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.

The following table sets forth expenses and costs payable by the Company
(other than underwriting discounts and commissions) expected to be incurred in
connection with the issuance and distribution of the securities described in
this Registration Statement. All amounts are estimated except for the SEC
registration fee, the National Association of Securities Dealers, Inc. ("NASD")
filing fee and the New York Stock Exchange listing fee.

<TABLE>
<CAPTION>
AMOUNT
-------
<S> <C>
Registration fee under Securities Act....................... $44,781
NASD filing fee.............................................
New York Stock Exchange original listing fees...............
Legal fees and expenses.....................................
Accounting fees and expenses................................
Blue Sky fees and expenses..................................
Printing and engraving expenses.............................
Registrar and transfer agent fees...........................
Miscellaneous expenses......................................
-------
Total.............................................
=======
</TABLE>

ITEM 14. INDEMNIFICATION OF DIRECTORS AND OFFICERS.

The Certificate provides that the Company shall indemnify to the fullest
extent permitted by Section 145 of the DGCL, each person who is involved in any
litigation or other proceeding because such person is or was a director or
officer of the Company, against all expense, loss or liability reasonably
incurred or suffered in connection therewith. The Bylaws provides that a
director or officer may be paid expenses incurred in defending any proceeding in
advance of its final disposition upon receipt by the Company of an undertaking,
by or on behalf of the director or officer, to repay all amounts so advanced if
it is ultimately determined that such director or officer is not entitled to
indemnification.

Section 145 of the DGCL permits a corporation to indemnify any director or
officer of the corporation against expenses (including attorneys' fees),
judgments, fines and amounts paid in settlement actually and reasonably incurred
in connection with any action, suit or proceeding brought by reason of the fact
that such person is or was a director or officer of the corporation, if such
person acted in good faith and in a manner that he reasonably believed to be in
or not opposed to the best interests of the corporation, and, with respect to
any criminal action or proceeding, if he had no reason to believe his conduct
was unlawful. In a derivative action, (i.e., one brought by or on behalf of the
corporation), indemnification may be made only for expenses, actually and
reasonably incurred by any director or officer in connection with the defense or
settlement of such an action or suit, if such person acted in good faith and in
a manner that he reasonably believed to be in or not opposed to the best
interests of the corporation, except that no indemnification shall be made if
such person shall have been adjudged to be liable to the corporation, unless and
only to the extent that the court in which the action or suit was brought shall
determine that the defendant is fairly and reasonably entitled to indemnity for
such expenses despite such adjudication of liability.

Pursuant to Section 102(b)(7) of the DGCL, the Certificate eliminates the
liability of a director to the corporation or its stockholders for monetary
damages for such breach of fiduciary duty as a director, except for liabilities
arising (i) from any breach of the director's duty of loyalty to the corporation
or its stockholders, (ii) from acts or omissions not in good faith or which
involve intentional misconduct or a knowing violation of

II-1
<PAGE> 186

law, (iii) under Section 174 of the DGCL, or (iv) from any transaction from
which the director derived an improper personal benefit.

The Company intends to obtain primary and excess insurance policies
insuring the directors and officers of the Company and its subsidiaries against
certain liabilities they may incur in their capacity as directors and officers.
Under such policies, the insurer, on behalf of the Company, may also pay amounts
for which the Company has granted indemnification to the directors or officers.

Additionally, reference is made to the Underwriting Agreement filed as
Exhibit 1.1 hereto, which provides for indemnification by the Underwriters of
the Company, its directors and officers who sign the Registration Statement and
persons who control the Company, under certain circumstances.

ITEM 15. RECENT SALES OF UNREGISTERED SECURITIES.

Since its formation in August 1997, the Company has issued securities in
the following transactions. Each of these transactions was intended to be exempt
from the registration requirements of the Securities Act by virtue of either
Section 4(2) thereunder based on being issued in a transaction not involving a
public offering to a limited number of accredited investors or Section 3(b)
thereunder based on being issued to a limited number of non-executive employees
pursuant to written contracts relating to compensation of such persons.

In September 1997, the Company issued 12,500,000 shares of Common Stock to
H. Family Investments, Inc. and 12,500,000 shares to James L. Kirk in exchange
for an aggregate of approximately $47.1 million of equity capital which was
funded at various times from September 1997 through June 2, 1998 as required to
complete acquisitions.

In September 1997, in connection with the acquisition of Sam's, the Company
issued promissory notes in an aggregate principal amount of $7,690,000, which
are convertible into shares of Common Stock at the option of the holder at the
initial public offering price.

From November 1997 to April 1998, the Company granted options to certain of
its employees to purchase an aggregate of 1,087,571 shares of Common Stock at
exercise prices ranging from $2.96 to $6.69 per share and a weighted average
exercise price of $5.33 per share. These options vest over a four year period at
the rate of 25% per year beginning on the first anniversary of the date of
grant.

In December 1997, in connection with the acquisition of certain assets of
C&E, the Company issued a promissory note in the principal amount of $2,000,000,
which is convertible into shares of Common Stock at the option of the holder at
the initial public offering price.

In December 1997, in connection with the acquisition of certain assets of
Titan, the Company issued promissory notes in an aggregate principal amount of
$1,399,998, which are convertible into shares of Common Stock at the option of
the holders at the initial public offering price.

In April 1998, in connection with the acquisition of certain assets of
Florida Equipment, the Company issued a promissory note in the principal amount
of $900,000, which is convertible into shares of Common Stock at the option of
the holder at the initial public offering price.

In April 1998, in connection with the acquisition of certain assets of
Naples, the Company issued a promissory note in the principal amount of
$1,000,000, which is convertible into shares of Common Stock at the option of
the holder at the initial public offering price.

In May 1998, in connection with the acquisition of Bode-Finn, the Company
issued promissory notes in an aggregate principal amount of $10,000,000, which
are convertible into shares of Common Stock at the option of the holder at the
initial public offering price. The Company also issued warrants to purchase a
number of shares of Common Stock equal to $800,000 divided by the initial public
offering price at an exercise price equal to the initial public offering price
and with a term of five years commencing 18 months following the consummation of
the Offering.

II-2
<PAGE> 187

In May 1998, in connection with the acquisition of certain assets of
U-Rent-It, the Company issued a promissory note in the principal amount of
$500,000, which is convertible into shares of Common Stock at the option of the
holder at the initial public offering price.

In June 1998, the Company issued an aggregate of 5,118,694 shares of Common
Stock to accredited investors in a private placement transaction for aggregate
proceeds of $27.6 million.

ITEM 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.

(a) The following documents are filed as exhibits to this registration
statement:

<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
- ------- -----------
<C> <S>
1.1* Form of Underwriting Agreement.
3.1* Certificate of Incorporation of the Company, as amended.
3.2* By-Laws of the Company, as amended.
4.1* Form of Certificate of Common Stock.
4.2* Revolving Credit Agreement, dated as of March 18, 1998, by
and among the Company, BankBoston, N.A., LaSalle National
Bank, BancBoston Securities, Inc. and other lending
institutions named therein.
4.3* Amendment No. 1 to Revolving Credit Agreement dated as of
May 13, 1998
5.1* Opinion of Akerman, Senterfitt & Eidson, P.A.
10.1* Stock Purchase Agreement dated August 15, 1997, among the
Company, Sam's and the shareholders of Sam's, together with
Amendment No.'s 1 - 5 dated August 15, 1997.
10.2* Form of Unsecured Subordinated Promissory Notes -- Sam's
10.3* Form of Unsecured Convertible Subordinated Promissory
Note -- Sam's
10.4* Form of Unsecured Contingent Convertible Subordinated
Promissory Notes -- Sam's
10.5* Agreement, dated September 22, 1997, between the Company and
Gary L. Gabriel
10.6* Asset Purchase Agreement dated December 8, 1997 among
NationsRent of Ohio, Inc., R&R and the shareholder of R&R,
together with an Amendment dated December 10, 1997.
10.7* Form of Unsecured Subordinated Promissory Note -- R&R
10.8* Asset Purchase Agreement dated December 8, 1997, as amended,
among NationsRent of Indiana, Inc. and C&E, together with an
Amendment dated December 23, 1997.
10.9* Form of Unsecured Convertible Subordinated Promissory
Note -- C&E
10.10* Stock Purchase Agreement dated December 20, 1997, as
amended, among NationsRent of West Virginia, Inc., Titan and
the shareholders of Titan, together with an Amendment dated
December 31, 1997.
10.11* Form of Unsecured Convertible Subordinated Promissory
Notes -- Titan
10.12* Stock Purchase Agreement dated March 24, 1998 among the
Company, Bode-Finn and the shareholders of Bode-Finn,
together with Amendment No. 1 dated April 6, 1998 and
Amendment No. 2 dated April 17, 1998.
10.13* Form of Unsecured Convertible Subordinated Promissory
Notes -- Bode-Finn
10.14* Form of Warrant -- Bode-Finn
10.15* Registration Rights Agreement dated May 5, 1998 among the
Company, Bode-Finn, L.P. and Raymond E. Mason Foundation
10.16* Asset Purchase Agreement dated March 25, 1998 among
NationsRent of Indiana, Inc., RFL and the shareholder of RFL
10.17* Asset Purchase Agreement dated April 21, 1998 among
NationsRent of Florida, Inc. and Naples
10.18* Form of Unsecured Convertible Subordinated Promissory
Note -- Naples
10.19* Stock Purchase Agreement dated May 7, 1998 among the
Company, Jobs and the shareholders of Jobs
10.20* Form of Unsecured Subordinated Promissory Notes -- Jobs
10.21* Form of Unsecured Convertible Subordinated Promissory
Note -- Jobs
10.22* Asset Purchase Agreement dated May 14, 1998 among the
Company and General Rental
</TABLE>

II-3
<PAGE> 188

<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
- ------- -----------
<C> <S>
10.23* Stock Purchase Agreement dated May 30, 1998 among the
Company, J. Kelly and the shareholders of J. Kelly
10.24* Form of Unsecured Convertible Subordinated Promissory
Note -- J. Kelly
10.25* Form of Registration Rights Agreement among the Company and
the shareholders of J. Kelly
10.26* Asset Purchase Agreement dated June 7, 1998 among the
Company, Associated and the sole shareholder of Associated
10.27* Form of Unsecured Convertible Subordinated Promissory
Note -- Associated
10.28* Form of Registration Rights Agreement -- Associated
10.29* Form of Subscription Agreement, dated May 1998, between the
Company and certain subscribers
10.30* NationsRent 1998 Stock Option Plan
21.1* Subsidiaries of the Company
23.1 Consent of Arthur Andersen LLP
23.3* Consent of Akerman, Senterfitt & Eidson, P.A. (included in
Exhibit 5.1 above)
24.1 Power of Attorney (previously filed)
27.1 Financial data schedule (previously filed)
</TABLE>

- ---------------
* To be filed by amendment.

(b) Financial Statement Schedule. The following financial statement
schedule together with report of independent certified public accountants is
filed on pages S-1 and S-2 herewith:

Financial Statement Schedule II, Valuation and Qualifying Accounts and
Reserves, for the Period Ended December 31, 1997.

Schedules not listed above have been omitted because the information
required to be set forth therein is not applicable or is shown in the financial
statements or notes thereto.

ITEM 17. UNDERTAKINGS.

Insofar as indemnification for liabilities arising under the Securities Act
may be permitted to directors, officers and controlling persons of the
registrant pursuant to the foregoing provisions, or otherwise, the registrant
has been advised that in the opinion of the SEC such indemnification is against
public policy as expressed in the Act and is, therefore, unenforceable. In the
event that a claim for indemnification against such liabilities (other than the
payment by the registrant of expenses incurred or paid by a director, officer or
controlling person of the registrant in the successful defense of any action,
suit or proceeding) is asserted by such director, officer or controlling person
in connection with the securities being registered, the registrant will, unless
in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the Act and
will be governed by the final adjudication of such issue.

The undersigned registrant hereby undertakes that:

(1) To provide to the Underwriters at the closing specified in the
underwriting agreements certificates in such denominations and registered
in such names as required by the Underwriters to permit prompt delivery to
each purchaser.

(2) For purposes of determining any liability under the Securities
Act, each filing of the registrant's annual reports pursuant to section
13(a) or section 15(d) of the Securities Exchange Act of 1934 (and, where
applicable, each filing of an employee benefit plan's annual report
pursuant to section 15(d) of the Securities Exchange Act of 1934) that is
incorporated by reference in the registration statement shall be deemed to
be a new registration statement relating to the securities offered therein,
and the offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof.

II-4
<PAGE> 189

(3) For purposes of determining any liability under the Securities
Act, the information omitted from the form of prospectus filed as part of
this registration statement in reliance upon Rule 430A and contained in a
form of prospectus filed by the registrant pursuant to Rule 424(b)(1) or
(4) or 497(h) under the Securities Act shall be deemed to be part of this
registration statement as of the time it was declared effective.

(4) For the purpose of determining any liability under the Securities
Act, each post-effective amendment that contains a form of prospectus shall
be deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof.

II-5
<PAGE> 190

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Amendment No. 2 to Registration Statement to be signed on
its behalf by the undersigned, thereunto duly authorized, in the City of Fort
Lauderdale, State of Florida, on July 9, 1998.

NATIONSRENT, INC.

By: /s/ JAMES L. KIRK
------------------------------------
James L. Kirk
President and Chief Executive
Officer

Pursuant to the requirements of the Securities Act of 1933, this Amendment
No. 2 to Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.

<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<S> <C> <C>

/s/ JAMES L. KIRK Chairman of the Board, President July 9, 1998
- --------------------------------------------------- and Chief Executive Officer
James L. Kirk (principal executive officer)

/s/ GENE J. OSTROW Executive Vice President and Chief July 9, 1998
- --------------------------------------------------- Financial Officer (principal
Gene J. Ostrow financial officer)

* Vice President and Controller July 9, 1998
- --------------------------------------------------- (principal accounting officer)
Kris E. Hansel

* Director July 9, 1998
- ---------------------------------------------------
Thomas H. Bruinooge

* Director July 9, 1998
- ---------------------------------------------------
Gary L. Gabriel

* Director July 9, 1998
- ---------------------------------------------------
H. Wayne Huizenga

* Director July 9, 1998
- ---------------------------------------------------
Harris W. Hudson

*By: /s/ GENE J. OSTROW
---------------------------------------------
Gene J. Ostrow, as
attorney-in-fact
</TABLE>

II-6
<PAGE> 191

REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS ON SCHEDULE

To the Stockholders of NationsRent, Inc.:

We have audited in accordance with generally accepted auditing standards, the
consolidated financial statements of NationsRent, Inc., and subsidiaries
included in this registration statement and have issued our report thereon dated
June 3, 1998. Our audit was made for the purpose of forming an opinion on the
basic financial statements taken as a whole. The schedule included under Item
16(b) is the responsibility of the Company's management and is presented for
purposes of complying with the Securities and Exchange Commission's rules and is
not part of the basic financial statements. This schedule has been subjected to
the auditing procedures applied in the audit of the basic financial statements
and, in our opinion, fairly states in all material respects the financial data
required to be set forth therein in relation to the basic financial statements
taken as a whole.

ARTHUR ANDERSEN LLP

Fort Lauderdale, Florida,
June 3, 1998.

S-1
<PAGE> 192

NATIONSRENT, INC.

VALUATION AND QUALIFYING ACCOUNTS AND RESERVES
SCHEDULE II
(IN THOUSANDS)

<TABLE>
<CAPTION>
BALANCE AT CHARGED TO ACCOUNTS BALANCE AT
BEGINNING COSTS AND WRITTEN END
DESCRIPTIONS OF PERIOD(1) EXPENSES OFF OTHER(2) OF YEAR
------------ ------------ ---------- -------- -------- ----------
<S> <C> <C> <C> <C> <C>
Period ended December 31, 1997
Allowance for Doubtful Accounts....... $ -- -- (40) 627 $587
</TABLE>

- ---------------

(1) August 14, 1997 (inception).
(2) Represents the historical allowances of the acquired companies.

S-2
<PAGE> 193

INDEX TO EXHIBITS

<TABLE>
<S> <C>
23.1 Consent of Arthur Andersen LLP
24.1 Power of Attorney (previously filed)
27.1 Financial Data Schedule (previously filed)
</TABLE>

<PAGE> 1
Exhibit 23.1

CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS

As independent certified public accountants, we hereby consent to the use of
our reports (and to all references to our Firm) included in or made part of
this registration statement.

ARTHUR ANDERSEN LLP

Fort Lauderdale, Florida,
July 8, 1998.