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

                                   FORM 10-K

                 ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D)
                                       OF
                      THE SECURITIES EXCHANGE ACT OF 1934

                  For the fiscal year ended December 31, 1999
                       Commission File Number: 001-14145

                                   NEFF CORP.
             (Exact Name of registrant as specified in its charter)


               DELAWARE                                65-0626400
               --------                                ----------
      (State or other jurisdiction of       (I.R.S. Employer Identification No.)
       incorporation or organization)


             3750 N.W. 87th AVENUE, SUITE 400, MIAMI, FLORIDA 33178
             -----------------------------------------------------
               (Address of principal executive offices) (Zip Code)

                 Registrant's telephone number: (305) 513-3350

          Securities registered pursuant to Section 12(b) of the Act:

                                                          Name of each exchange
Title of each class                                        on which registered
-------------------                                     -----------------------
Class A Common Stock
Par Value $.01 per share                                New York Stock Exchange


          Securities registered pursuant to Section 12(g) of the Act:
                                (Title of class)
                                      None


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

     Indicate by check mark if disclosure of delinquent  filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to the
best of registrant's knowledge, in definitive proxy or information statements by
reference in Part III of this Form 10-K or any amendment to this Form 10-K [X].

     As of March 28, 2000,  the aggregate  market value of the voting stock held
by non-affiliates of the registrant was approximately $49.7 million. As of March
28, 2000, there were 16,065,350 shares of the registrant's  Class A Common Stock
outstanding.

                      Documents incorporated by reference:

     Portions of the Company's  Proxy  Statement in  connection  with its Annual
Meeting to be held on June 16, 2000 (the "2000 Proxy Statement").  Specifically,
the  sections  in the 1999  Proxy  Statement  entitled  "Ownership  of Shares of
Certain Beneficial  Owners," "Certain  Relationships and Related  Transactions,"
"Executive and Director  Compensation," and "Compensation  Committee  Interlocks
and Insider  Participation"  are incorporated by reference into Part III of this
Report.

<PAGE>

                                     Part I

     Safe Harbor Statement under the Private Securities Litigation Reform Act of
1995

     The matters  discussed herein may include  forward-looking  statements that
involve risks and uncertainties which could result in operating performance that
is materially  different  from that implied in the  forward-looking  statements.
Risks that could cause  actual  results to differ  materially  from those in the
forward-looking  statements  include,  but are not limited to, risks inherent in
the Company's growth strategy,  such as the uncertainty that the Company will be
able to identify,  acquire and integrate attractive acquisition candidates;  the
Company's dependence on additional capital for future growth and the high degree
to which the Company is leveraged.  Additional  information concerning these and
other risks and  uncertainties  is contained  from time to time in the Company's
filings with the Securities and Exchange Commission.

     The Company  cautions that the factors  described  above could cause actual
results  or  outcomes  to  differ   materially   from  those  expressed  in  any
forward-looking   statements   made  by  or  on  behalf  of  the  Company.   Any
forward-looking  statements speak only as of the date on which such statement is
made,  and the Company  undertakes no  obligation to update any  forward-looking
statement or statements  to reflect  events or  circumstances  after the date on
which such  statement  is made or to reflect  the  occurrence  of  unanticipated
events.  New  factors  emerge  from  time to time,  and it is not  possible  for
management to predict all of such factors. Further, management cannot assess the
impact of each such factor on the business or the extent to which any factor, or
combinations  of factors,  may cause actual  results to differ  materially  from
those contained in any forward-looking statements.

     ITEM 1. BUSINESS

     General

     Neff is one of the largest equipment rental companies in the United States,
with 84 rental  locations  in 18 states.  The  Company  rents a wide  variety of
equipment,  including backhoes,  air compressors,  loaders, lifts and compaction
equipment to construction  and industrial  customers.  In addition,  the Company
sells used equipment,  spare parts and  merchandise and provides  ongoing repair
and maintenance services.

     According to industry  sources,  the  equipment  rental  industry grew from
approximately $600 million in revenues in 1982 to over $20 billion in 1999. This
growth has been driven primarily by construction  and industrial  companies that
have  increasingly  outsourced  equipment needs to reduce investment in non-core
assets and convert costs from fixed to variable.  The equipment  rental industry
is highly fragmented, with an estimated 18,000 equipment rental companies in the
United  States.  As a result,  the Company  believes that there are  substantial
consolidation  opportunities for well-capitalized operators such as the Company.
Relative to smaller competitors,  the Company has several advantages,  including
increased  purchasing power,  larger  inventories to service larger accounts and
the ability to transfer equipment among rental locations in response to changing
patterns of customer demand.

                                     2
<PAGE>

Competitive Strengths

     The Company believes it has several competitive strengths, which provide it
with the opportunity for continued growth and increased profitability.

     Strong  Market  Position.  Neff  is  one of the  largest  construction  and
industrial  equipment  rental  companies in the United States,  and is a leading
competitor with a significant  presence in the Southeast and Gulf Coast regions.
We  operate  84 rental  locations  in 18  states,  including  Florida,  Georgia,
Alabama,  Mississippi,  South Carolina,  North Carolina,  Tennessee,  Louisiana,
Texas, Oklahoma, Arizona, Nevada, Utah, California, Oregon, Washington, Virginia
and  Colorado.  From  December 31, 1995 to December 31, 1999,  we increased  our
equipment  rental  locations from eight to 84 and expanded our rental fleet from
$62  million to $413  million  based on original  cost.  We believe our size and
geographic diversity help insulate us from regional economic downturns.

     High  Quality  Rental  Fleet.  We believe  our  rental  fleet is one of the
newest,  most comprehensive and  well-maintained  rental fleets in the equipment
rental  industry.  As of December 31, 1999,  the average age of our rental fleet
was  approximately  24  months.  We  make  ongoing  capital  investment  in  new
equipment,  engage in regular  sales of used  equipment  and conduct an advanced
preventative  maintenance program. We believe this maintenance program increases
fleet  utilization,  extends the useful life of equipment  and  produces  higher
resale values.

     Excellent Customer Service. We differentiate ourselves from our competitors
by  providing  high  quality,  responsive  service  to  our  customers.  Service
initiatives   include  (i)  reliable  on-time  equipment  delivery  directly  to
customers' job sites;  (ii) on-site repairs and maintenance of rental  equipment
by factory trained mechanics,  generally  available 24 hours a day, seven days a
week; and (iii) ongoing  training of an experienced  sales force to consult with
customers regarding their equipment needs.

     State-of-the-Art   Management  Information  System.  We  have  developed  a
customized, state-of-the-art management information system capable of monitoring
operations at up to 300 sites. We use this system to maximize fleet  utilization
and determine the optimal fleet  composition by market.  The system links all of
our  rental  locations  and  allows  management  to  track  customer  and  sales
information,  as well as the location,  rental status and maintenance history of
every piece of  equipment  in the rental  fleet.  Rental  location  managers can
search our entire  rental  fleet for needed  equipment,  quickly  determine  the
closest  location of such equipment,  and arrange for delivery to the customer's
work site, thus maximizing equipment utilization.

     Experienced  Management Team. Since 1995, we have  significantly  increased
the  quality  and  depth  of our  management  team to help  oversee  our  growth
strategy.  Our senior management team has extensive  experience in the equipment
rental  industry  and our  regional  management has,  on  average,  21  years of
experience  and  substantial  knowledge of the local markets served within their
regions.  We believe  that our  management  team has the ability to continue the
Company's strong growth as well as manage the Company on a much larger scale. We
are not dependent on recruiting  additional operating,  acquisition,  finance or
other personnel to implement our growth strategy.

                                       3
<PAGE>

     Business Strategy

     Our  objective  is to  increase  revenue,  cash flow and  profitability  by
building and  maintaining  a leading  market  position in the  equipment  rental
industry. Key elements of our business strategy include:

     Increase Profitability of Recently Opened Rental Locations.  Since March 1,
1995,  we have  opened 26  start-up  rental  equipment  locations  including  10
locations in 1997, 5 locations in 1998 and 1 location in 1999.  Because we incur
significant expenses in connection with the opening of new locations, management
believes that our financial  performance  does not yet fully reflect the benefit
of these rental locations.  Based on our historical experience,  a new equipment
rental location tends to realize  significant  increases in revenues,  cash flow
and profitability  during the first three years of operation as more prospective
customers  become aware of its  operation and as the rental  equipment  fleet is
customized  to  local  market  demand.   Because  there  is  relatively   little
incremental  operating  expense  associated  with such  revenues,  cash flow and
profitability increase significantly as a rental location matures.

     Increase Fleet at Existing  Locations.  We believe we can capitalize on the
demand for rental  equipment  in the markets we serve and  increase  revenues by
increasing the size of the rental fleet and adding new product lines at existing
locations.  We believe that this strategy allows us to attract new customers and
serve as a single  source  supplier  for our  customers.  Because  the  start-up
expenditures associated with increasing the fleet and expanding product lines at
existing locations are relatively modest,  these investments  typically generate
higher and faster returns than investments in new locations.

     Acquire   Equipment   Rental   Companies.   We  intend  to  expand  through
acquisitions of equipment  rental  companies and believe there are a significant
number of acquisition opportunities in North America, which would complement our
existing operations. After completing an acquisition, we generally integrate the
operations  of the acquired  company  into our  management  information  system,
consolidate  equipment  purchasing  and resale  functions and  centralize  fleet
management  as quickly  as  possible  while  assuring  consistent,  high-quality
service to the  acquired  company's  customers.  Since  July 1997,  we have made
several  strategic  acquisitions,  which  have more than  doubled  our number of
rental  locations,  significantly  enhanced our geographic  presence and further
diversified our customer base.

     We believe we can successfully  implement our acquisition  strategy because
of (i) our access to  financial  resources;  (ii) the  potential  for  increased
profitability  due to the  centralizing  of  certain  administrative  functions,
enhanced systems capabilities,  greater purchasing power and economies of scale;
and  (iii)  the  potential  for  owners  of the  businesses  being  acquired  to
participate in our planned growth while realizing liquidity. We have developed a
set  of  financial,  geographic  and  management  criteria  designed  to  assist
management in the evaluation of acquisition candidates.

     These  criteria are used to evaluate a variety of factors,  including,  but
not  limited  to, (i)  historical  and  projected  financial  performance;  (ii)
composition and size of the candidate's customer base; (iii) relationship of the
candidate's  geographic  location to the Company's market areas;  (iv) potential
synergies  gained through  acquisition of the  candidate;  and (v)  liabilities,
contingent or otherwise, of the candidate.

     Selective  Openings of Start-up  Equipment Rental  Locations.  We intend to
expand our operations by opening additional  start-up locations in markets where
we are not able to  identify  attractive  acquisition  candidates.  We have been
successful in opening  start-up  equipment  rental locations in existing markets
and new markets.

                                       4

<PAGE>

     We have opened 26 start-up equipment rental locations since March 1995. Our
decision to open a start-up  equipment rental location is based upon a review of
demographic  information,  business growth projections and the level of existing
competition.  Because  our  management  team has  extensive  experience  opening
start-up locations,  our growth strategy is not dependent on the availability of
acquisition candidates on satisfactory terms.

     In June 1998,  we expanded our  operations  into South America by acquiring
65% of the outstanding stock of S.A.  Argentina.  S.A. Argentina rents and sells
industrial  and  construction  equipment  throughout  South  America,  including
Argentina, Brazil, Uruguay, Paraguay, Chile and Bolivia.

     Sales of Subsidiaries. On November 18, 1999, the Company completed the sale
of Sullair  Argentina S.A. The Company  received  $42.5 million,  of which $12.5
million  was a  receivable  that was  received  in  February  2000.  The Company
recorded a loss on the sale of $4.2 million.

     On December 17, 1999,  the Company  completed  the sale of Neff  Machinery,
Inc., a wholly-owned subsidiary. The Company received $90.5 million and recorded
a gain on the sale of $3.8 million.

     Operations

     Our operations  primarily  consist of renting  equipment,  and, to a lesser
extent,  selling used equipment,  complementary  parts and merchandise to a wide
variety of construction and industrial  customers.  In addition,  to service our
customer base more fully,  we also act as a dealer of new equipment on behalf of
several nationally known equipment manufacturers and provide ongoing maintenance
and repair  services  for the  equipment  we sell and rent.  Our  locations  are
grouped together by geographic area and a regional  manager oversees  operations
within each region.

     Equipment Rentals.  We are one of the largest equipment rental companies in
the United States,  with 84 rental  locations in 18 states.  Our rental fleet is
comprised  of a complete  line of light and heavy  construction  and  industrial
equipment  from a wide variety of  manufacturers,  including  John Deere,  Case,
Bomag, Bosch, Sullivan Industries,  Ingersoll-Rand,  Gradall, Lull, JLG, Bobcat,
MultiQuip and Wacker.

                                       5
<PAGE>
<TABLE>
<CAPTION>

    Major categories of equipment  represented the following percentages (based
on original cost) of the Company's total rental fleet as of December 31, 1999:


                                           Percentage of Total Rental Fleet
     Major Equipment Category                  (based on original cost)
    <S>                                              <C>
     Earthmoving     ..........................        39.3 %
     Material Handling  .......................        16.6
     Aerial          ..........................        12.8
     Other           ..........................         6.4
     Compaction      ..........................         6.1
     Trucks          ..........................         5.9
     Compressors     ..........................         5.5
     Cranes          ..........................         2.3
     Generators      ..........................         1.6
     Welders         ..........................         1.3
     Pumps           ..........................         1.3
     Lighting        ..........................         0.9

</TABLE>

     We attempt to  differentiate  ourselves from our competitors by providing a
broad  selection  of new  and  well-maintained  rental  equipment,  and  through
high-quality,  responsive service to our customers. As of December 31, 1999, our
equipment rental fleet had an original cost of approximately $413 million and an
average age of 24 months,  which  management  believes  compares  favorably with
other leading equipment rental companies. We make ongoing capital investments in
new equipment, engage in regular sales of used equipment and conduct an advanced
preventative  maintenance  program.  This program  increases fleet  utilization,
extends the useful life of equipment and produces higher resale values.

     In  addition  to  providing  a new and  reliable  equipment  rental  fleet,
management  believes providing high quality customer service is essential to our
future success.  The equipment rental business is a service  industry  requiring
quick  response  times to satisfy  customers'  needs.  Though  some  activity is
arranged  with  lead-time,  much of the rental  initiation  process  takes place
within a 48-hour period. Consequently,  equipment availability,  branch location
and  transportation  capabilities  play a major role in earning repeat business.
Rental  customers  prefer a quick  selection  process  and seek  quick,  concise
communication  when ordering  equipment.  Punctuality  and  reliability  are key
components of the servicing process, as well as maintenance performance,  timely
equipment removal at the rental termination and simplified billing.  Our service
initiatives   include  (i)  reliable  on-time  equipment  delivery  directly  to
customers' job sites;  (ii) on-site repairs and maintenance of rental  equipment
by factory  trained  mechanics,  which are  generally  available 24 hours a day,
seven days a week; and (iii) ongoing  training of an experienced  sales force to
consult with customers regarding their equipment needs.

     New Equipment  Sales.  We are a  distributor  of new equipment on behalf of
several  nationally  known  equipment   manufacturers.   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 we may continue, amend
or terminate dealership agreements.

                                       6
<PAGE>

     Used  Equipment  Sales.  We  maintain a regular  program  of  selling  used
equipment  in order to adjust the size and  composition  of our rental  fleet to
changing  market  conditions  and to maintain the quality and low average age of
our rental  fleet.  Management  attempts to balance the  objective  of obtaining
acceptable prices from equipment sales against the revenues obtainable from used
equipment rentals.  We are generally able to achieve favorable resale prices for
our used equipment due to our strong  preventative  maintenance  program and our
practice of selling used equipment before it becomes obsolete or irreparable. We
believe the  proactive  management  of our rental  fleet allows us to adjust the
rates of new equipment  purchases and used equipment sales to maximize equipment
utilization  rates and respond to changing economic  conditions.  Such proactive
management,  together with our broad geographic diversity,  minimizes the impact
of regional economic downturns.

     Parts  and  Service.  We sell a full  complement  of  parts,  supplies  and
merchandise to our customers in conjunction  with our equipment rental and sales
business.  We also offer maintenance service to our customers that own equipment
and generate revenues from damage waiver charges,  delivery charges and warranty
income.  We believe  that these  revenues are more stable than  equipment  sales
revenues because of the recurring nature of the parts and service  business.  We
also believe that during economic downturns,  the parts and service business may
actually  increase as customers  postpone new  equipment  purchases  and instead
attempt to maintain their existing equipment.

     Management Information System

     We have developed a  state-of-the-art,  customized  management  information
system, capable of monitoring operations on a real-time basis at up to 300 sites
that can be upgraded to support additional locations or terminals.  We currently
employ eight management  information system employees who continually update and
refine  the  system.  We use this  system  to  maximize  fleet  utilization  and
determine the optimal fleet composition by market.  This system links all of our
rental locations and allows management to track customer and sales  information,
as well as the location, rental status and maintenance history of every piece of
equipment  in the rental  fleet.  Using this  system,  rental  equipment  branch
managers  can search  our entire  rental  fleet for  needed  equipment,  quickly
determine the closest location of such equipment and arrange for delivery to the
customer's  work site.  This practice  helps  diminish  "lost  rents,"  improves
utilization and makes equipment available in markets where it can earn increased
revenues. Our communications system can handle multiple protocols and allows the
integration of systems running on different platforms. This feature allows us to
include  systems used by  locations  acquired in an  acquisition  of an existing
equipment rental company in its central  databases while the acquired  locations
are integrated into our system.

     Customers

     Our  customers  include  commercial,   industrial  and  civil  construction
contractors,  manufacturers,  public  utilities,  municipalities,  golf courses,
shipyards,  commercial farmers,  military bases, offshore platform operators and
maintenance  contractors,  refineries and petrochemical facilities and a variety
of other industrial accounts.

     During  1999  we  served  over  27,000  customers.  Our  top  10  customers
represented 3.4% of our total revenues in 1999. Our rental  equipment  customers
vary in size from large Fortune 500 companies who have elected to outsource much
of their equipment needs to small construction contractors,  subcontractors, and
machine operators whose equipment needs are job-based and not easily measured in
advance.  Our new  and  used  equipment  sales  customers  are  generally  large
construction  contractors  who regularly  purchase  wholesale goods and annually
budget for fleet maintenance purchases.

                                       7
<PAGE>

     We do not currently  provide our own purchase  financing to  customers.  We
rent equipment,  sell parts, and provide repair services on account to customers
who are screened  through a credit  application  process.  Customers can finance
purchases  of  large   equipment   with  a  variety  of   creditors,   including
manufacturers, banks, finance companies and other financial institutions.

     Sales and Marketing

     We  maintain  a strong  sales  and  marketing  orientation  throughout  our
organization  in order to increase our customer base and better  understand  and
serve our  customers.  Managers  at each of our  branches  are  responsible  for
supervising  and training all sales employees at that location and directing the
salesforce by conducting  regular sales  meetings and  participating  in selling
activities.  Managers develop relationships with local customers and assist them
in planning their  equipment  requirements.  Managers are also  responsible  for
managing  the mix of  equipment  at their  locations,  keeping  abreast of local
construction activity and monitoring competitors in their respective markets.

     To stay informed about their local markets, salespeople track new equipment
sales and construction  projects in the area through Equipment Data Reports,  FW
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  local  area.  Our  salespeople  also  use  targeted  marketing
strategies to address the specific needs of local customers.

     Purchasing

     We purchase equipment from vendors with reputations for product quality and
reliability.  Our Vice  President of Asset  Management and  Procurement  directs
fleet purchasing,  asset utilization and fleet maintenance for our rental fleet.
We believe our size and the  quantity  of  equipment  we purchase  enables us to
purchase  equipment  directly  from  vendors  pursuant  to  national  purchasing
agreements  at lower  prices  and on more  favorable  terms  than  many  smaller
competitors.  We seek to maintain close relationships with our vendors to ensure
the  timely  delivery  of new  equipment.  We  believe  that we have  sufficient
alternative  sources  of supply for the  equipment  we  purchase  in each of our
principal product categories.

     The following  table  summarizes our principal  categories of equipment and
specifies the Company's major suppliers of such equipment:

<TABLE>
<CAPTION>

Product Category                              Primary Vendors
<S>                                           <C>
Air Compressors and Equipment.................Ingersoll-Rand, Sullivan and Sullair
Earthmoving Equipment (such as Backhoes,
  Loaders, Dozers, Excavators and Material
  Handling Equipment).........................John Deere, Case, JCB, Kobelco, Volvo and Bobcat
Compaction Equipment, Rollers
  and Recyclers...............................Bomag, Wacker, MultiQuip and Rammax
Pumps.........................................MultiQuip, Wacker and Thompson
Generators....................................MultiQuip, Wacker and Yamaha
Welders.......................................Miller and Lincoln
Electric Tools................................Bosch, Dewalt and Milwaukee
Light Towers..................................Specialty Lighting, Coleman and Ingersoll - Rand
Forklifts.....................................Lull, Gradall, Toyota and Clark
Trucking......................................International, Ford and GMC
Aerial........................................JLG, Genie Industries, and Snorkel
Concrete......................................Partner, Edco, Whiteman, Miller, MultiQuip, Wacker and
                                              Stone
Hydraulic Hammers.............................Kent and Tramac

</TABLE>
                                       8
<PAGE>

        Locations

     Our locations  typically include (i) offices for sales,  administration and
management;  (ii) a customer showroom  displaying  equipment and parts; (iii) an
equipment  service  area;  and (iv) outdoor and indoor  storage  facilities  for
equipment.  Each location offers a full range of rental equipment,  with the mix
designed to meet the anticipated needs of the customers in each location.

     Each  stand-alone  rental  equipment  location  is staffed  by, on average,
approximately  15  full-time  employees,  including a branch  manager,  a rental
coordinator,  service manager, sales  representatives,  an office administrator,
mechanics and drivers.  Additionalpart-time employees are also used to staff the
rental equipment operations located at the same sites.

     Competition

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

     Environmental and Safety Regulation

     Our 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
treatment, storage and disposal of solid and hazardous wastes and materials, and
the  remediation  of  contamination  associated  with the  release of  hazardous
substances. We believe that we are in material compliance with such requirements
and  do  not  currently   anticipate  any  material  capital   expenditures  for
environmental  compliance or  remediation  for the current or succeeding  fiscal
years.  Certain of our present and former  facilities  have used  substances and
generated or disposed of wastes which are or may be considered hazardous, and we
may incur liability in connection therewith. Moreover, there can be no assurance
that 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 us, could result in additional  environmental compliance or
remediation  costs.  Such compliance and remediation  costs could be material to
our financial condition or results of operations.

     In  particular,  at our owned and leased  facilities  we store and dispense
petroleum  products from  aboveground  storage tanks and have in the past stored
and dispensed  petroleum  products from  underground  storage tanks. We also use
hazardous  materials,  including  solvents,  to clean and maintain equipment and
generate and dispose of solid and hazardous  wastes,  including  used motor oil,
radiator  fluid  and  solvents.  In  connection  with such  activities,  we have
incurred capital expenditures and other compliance costs which are expensed on a
current  basis and  which,  to date,  have not been  material  to our  financial
condition. Based on currently available information, we believe that we will not
be  required to incur  material  capital  expenditures  or other  compliance  or
remediation costs on environmental and safety matters in the foreseeable future.

                                       9
<PAGE>

     Employees

     As of February 25, 2000, we had approximately 1,260 employees.  None of our
employees  are  represented  by a union or  covered by a  collective  bargaining
agreement. We believe our relations with our employees are good.

     ITEM 2. PROPERTIES

     We lease approximately 18,000 square feet for our corporate headquarters in
an office building in Miami,  Florida. We own the buildings and/or the land at 3
of our locations.  All other sites are leased, generally for terms of five years
with renewal options.  Owned and leased sites range from approximately  7,000 to
25,000  square  feet on lots  ranging  up to 22 acres,  and  include  showrooms,
equipment service areas and storage facilities.  We do not consider any specific
leased  location to be  material  to our  operations.  We believe  that  equally
suitable alternative  locations are available in all areas where we currently do
business.

     ITEM 3. LEGAL PROCEEDINGS

     On December 17, 1999,  the Company  completed  the sale of Neff  Machinery,
Inc., a wholly-owned subsidiary. The Company received $90.5 million and recorded
a gain on the sale of $3.8 million. The terms of the purchase and sale agreement
(the "Agreement")  provided for an adjustment to the purchase price based on the
assets and  liabilities of Neff Machinery,  Inc. at the date of closing.  In the
opinion of the Company, it is due additional consideration of $8.8 million under
the terms of the Agreement. The purchaser believes it is due $20.3 million under
the terms of the Agreement.

     Because of the uncertainty of the outcome of this dispute,  the Company has
not recorded any additional  amounts that may be receivable or payable under the
terms of the Agreement.

     The Company and the members of its board of directors are  defendants in at
least six lawsuits  filed in the Delaware  Court of Chancery.  Five of the suits
were  filed on  February  29,  2000,  and one was  filed on March 1,  2000.  The
plaintiffs in the suits are Neff shareholders, and purport to bring the suits as
class  actions on behalf of all persons who own the common stock of the Company.
The complaints allege,  among other things,  that the Company and the individual
defendants  acted  improperly  in responding to a buyout bid made by a member of
management in February 2000. The plaintiffs seek, among other things, injunctive
relief and damages.  The Company has not yet  responded to the  complaints.  The
Board of Directors has  established  a Special  Committee to evaluate the buyout
offer and review the plaintiffs' claims in the lawsuits.

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

     ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

     During the fourth quarter of 1999, no matter was submitted to a vote of the
security holders of the Company.

                                       10
<PAGE>

                                        PART II

     ITEM 5. MARKET FOR THE  REGISTRANT'S  COMMON STOCK AND RELATED  STOCKHOLDER
             MATTERS

     Price Range of Common Stock

     On May 21,  1998,  our Class A Common  Stock  (the  "Common  Stock")  began
trading on the New York Stock  Exchange  under the symbol  "NFF".  The following
table  sets  forth the high and low  closing  sales  prices  of Common  Stock as
reported on the respective exchange for the periods indicated.

<TABLE>
<CAPTION>

                                                         High            Low
     Year ended December 31, 1999:
         <S>                                            <C>             <C>
          First Quarter...........................       8.00            5.56
          Second Quarter..........................       15.75           6.44
          Third Quarter...........................       18.44          10.25
          Fourth Quarter..........................       12.75           6.25
</TABLE>

<TABLE>
<CAPTION>

    Year ended December 31, 1998:
         <S>                                            <C>             <C>
          First Quarter...........................          NA            NA
          Second Quarter..........................       13.00           9.88
          Third Quarter...........................       14.19           7.75
          Fourth Quarter..........................        8.69           5.38
</TABLE>

     As of March 28,  2000,  the  Company  had 64  shareholders  of record.  The
Company believes the number of beneficial  owners is substantially  greater than
the number of record holders because a large portion of the Common Stock is held
of record in broker "street names" for the benefit of individual investors.

     Dividend Policy

     We have not paid any cash dividends on our Common Stock during the two-year
period ended  December 31, 1999. We presently  intend to retain all earnings for
the development of our business and do not anticipate  paying any cash dividends
on our Common Stock in the foreseeable future. In addition, our revolving credit
agreement precludes us from purchasing, redeeming or retiring any of our capital
stock or from paying  dividends.  The payment of  dividends  is also  limited by
provisions of the indentures  governing our senior  subordinated notes issued in
May and December 1998 and due 2008.  The  declaration  and payment of any future
cash dividends  will depend on a number of factors  including  future  earnings,
capital  requirements,  the financial condition and prospects of the Company and
any restrictions under credit agreements  existing from time to time, as well as
such other factors as the Board of Directors may deem relevant.  There can be no
assurances that we will pay any dividends in the future.

                                       11
<PAGE>

ITEM 6. SELECTED CONSOLIDATED FINANCIAL DATA

     The following table sets forth selected consolidated  financial data of the
Company for each of the five years ended  December 31, 1999.  The data set forth
below should be read in conjunction with  "Management's  Discussion and Analysis
of Financial Condition and Results of Operations" and the Company's Consolidated
Financial  Statements  and the Notes thereto  included  elsewhere in this Annual
Report.  Certain  amounts in the prior years have been  reclassified  to conform
with the current year presentation.
<TABLE>
<CAPTION>
                                                             Year Ended December 31,
                                                -----------------------------------------------------
                                                 1999      1998       1997      1996      1995
                                                ------    ------     ------    ------    ------
<S>                                             <C>       <C>        <C>       <C>        <C>
Statement of Operations                            (amounts in thousands, except per share data)

Revenues
  Rental revenue.............................  $ 222,862  $ 179,014  $ 69,512   $35,808   $ 20,019
  Equipment sales............................    121,865    108,352    50,578    44,160     33,943
  Parts and service..........................     47,284     36,724    22,132    15,045     13,292
                                                --------   --------  --------  --------    -------
     Total revenues..........................    392,011    324,090   142,222    95,013     67,254
                                                --------   --------  --------  --------    -------
Cost of revenues
  Cost of equipment sold.....................    100,871     83,783    40,766    33,605     26,562
  Depreciation of rental equipment (1).......     55,159     56,336    24,231    19,853     11,747
  Maintenance of rental equipment............     66,763     49,858    18,752     8,092      3,469
  Cost of parts and service..................     30,166     23,690    13,741     8,143      7,504
                                                --------   --------  --------  --------    -------
      Total cost of revenues.................    252,959    213,667    97,490    69,693     49,282
                                                --------   --------  --------  --------    -------

Gross profit.................................    139,052    110,423    44,732    25,320     17,972
                                                --------   --------  --------  --------    -------

Selling, general and administrative expenses.     74,893     60,347    31,329    18,478     10,956
Other depreciation and amortization..........     10,731      8,833     2,806     1,432        916
Write down of assets held for sale...........      1,444          -         -         -          -
Officer stock option compensation (2)........          -      3,198     4,400         -          -
                                                --------   --------  --------  --------    -------
Income from operations.......................     51,984     38,045     6,197     5,410      6,100
                                                --------   --------  --------  --------    -------
Other expenses...............................     41,520     35,855    14,338     6,337      3,090
                                                --------   --------  --------  --------    -------
Income (loss) before income taxes, minority
interest and extraordinary item..............     10,464      2,190    (8,141)     (927)     3,010
(Provision for) benefit from income taxes (3)     (3,877)       134     1,748      (461)    (1,176)
                                                --------   --------  --------  --------    -------
Income (loss) before minority interest and
  extraordinary item.........................      6,587      2,324    (6,393)   (1,388)     1,834
Minority interest............................     (1,733)    (1,111)        -         -          -
                                                --------   --------  --------  --------    -------
Income (loss) before extraordinary item......      4,854      1,213    (6,393)   (1,388)     1,834
Extraordinary loss,net.......................          -     (2,675)     (451)     (809)         -
                                                --------   --------  --------  --------    -------
Net income (loss)............................   $  4,854   $ (1,462) $ (6,844) $ (2,197)  $  1,834
                                                ========   ========  ========  ========   ========

Basic earnings (loss) per common share :
Income (loss) before extraordinary item.......  $   0.23   $  (0.23) $  (1.64) $  (0.56)  $   0.22
Extraordinary loss, net.......................         -      (0.15)    (0.05)    (0.10)         -
                                                --------   --------  --------  --------    -------
Net income (loss).............................  $   0.23   $  (0.38) $  (1.69) $  (0.66)  $   0.22
                                                ========   ========  ========  ========    =======
Diluted earnings (loss) per common share :
Income (loss) before extraordinary item.......  $   0.22   $  (0.23) $  (1.64) $  (0.56)  $   0.22
Extraordinary loss, net.......................         -      (0.15)    (0.05)    (0.10)         -
                                                --------   --------  --------  --------    -------
Net income (loss).............................  $   0.22   $  (0.38) $  (1.69) $  (0.66)  $   0.22
                                                ========   ========  ========  ========    =======
Weighted average common shares outstanding :
  Basic......................................     21,165     17,213     8,465     8,465      8,465
                                                ========   ========  ========  ========    =======
  Diluted....................................     21,887     17,213     8,465     8,465      8,465
                                                ========   ========  ========  ========    =======
</TABLE>
                                       12
<PAGE>


<TABLE>
<CAPTION>
     ITEM 6. SELECTED CONSOLIDATED FINANCIAL DATA - (continued)


                                                                      Year Ended December 31,
                                                                      -----------------------
                                                    1999        1998        1997         1996         1995
                                                   -----       -----       -----        -----        -----
<S>                                              <C>         <C>         <C>           <C>          <C>
Balance Sheet Data (end of period):                                  (amounts in thousands)

Net book value of rental equipment.............$ 285,863   $ 321,220   $ 179,547     $ 76,794     $ 45,596
Total assets...................................  471,706     572,369     279,654      109,118       68,816
Total debt.....................................  335,852     406,993     226,203       58,250       48,345
Redeemable preferred stock.....................        -           -      53,747       46,299       11,430
Total stockholders' equity (deficit)...........  104,208      99,360     (24,735)      (7,508)      (1,931)

Other Data:
EBITDA(4)......................................$ 117,874   $ 103,214   $ 33,234      $ 26,695     $ 18,763
EBITDA margin(5)...............................     30.1%       31.8%      23.4%         28.1%        27.9%
Rental equipment purchases.....................$ 221,671   $ 199,198   $ 143,515     $ 86,886     $ 52,795

</TABLE>

_____________________

     1)  Depreciation  of rental  equipment for 1996, 1997 and 1999 reflects the
Company's change in depreciation  policy to recognize extended estimated service
lives  and  increased   residual  values  of  its  rental  equipment.   See  the
Consolidated  Financial  Statements and the Notes thereto included  elsewhere in
this Annual Report.
     2) Officer stock option  compensation  expense  represents a noncash charge
with respect to the change in estimated  market value of the shares to be issued
to the Chief Executive Officer under an option agreement.
     3) Prior to December  26,  1995,  the Company  operated as a  Subchapter  S
corporation  under the  provisions of the Internal  Revenue Code.  Income (loss)
before  extraordinary  items for 1995 is restated to reflect what the data would
have been if the Company had Subchapter C status in this year.
     4)  EBITDA   represents   income  from  operations  plus  depreciation  and
amortization.  EBITDA is not intended to represent cash flow from operations and
should not be considered as an alternative  to operating or net income  computed
in accordance with GAAP, as an indicator of the Companys operating performance,
as an  alternative  to cash flows from  operating  activities  (as determined in
accordance  with GAAP) or as a measure of liquidity.  The Company  believes that
EBITDA is a standard measure  commonly  reported and widely used by analysts and
investors  as  a  measure  of  profitability   for  companies  with  significant
depreciation  and amortization  expense.  However,  not all companies  calculate
EBITDA using the same methods; therefore, the EBITDA figures set forth above may
not be comparable to EBITDA reported by other companies.
     5) EBITDA margin represents EBITDA as a percentage of total revenues.

                                       13
<PAGE>


    ITEM 7.  MANAGEMENT'S  DISCUSSION  AND ANALYSIS OF FINANCIAL  CONDITION AND
              RESULTS OF OPERATIONS

     The following  discussion and analysis compares the year ended December 31,
1999 to the year ended December 31, 1998 and the year ended December 31, 1998 to
the year ended December 31, 1997.  Consolidated  results of operations should be
read in conjunction with the Company's Consolidated Financial Statements and the
Notes thereto, appearing elsewhere in this Annual Report.

     Overview

     Since  1995,  the  Company  has  pursued  an  aggressive  growth  strategy,
increasing  its  number of  equipment  rental and sales  locations  to 84, as of
December 31, 1999.  The Company has achieved this growth through the addition of
53 equipment rental locations as a result of acquisitions, and the opening of 26
start-up  equipment  rental  locations  primarily  throughout  the southeast and
southwest  regions of the United  States.  The  Company  intends to  continue to
pursue its aggressive growth strategy by (i) making  additional  acquisitions of
equipment  rental  companies;  (ii) increasing  fleet at its existing  equipment
rental  locations in both existing and new product  lines;  (iii)  continuing to
open new equipment rental locations.

     Since March 1, 1995,  the Company has opened 26 start-up  rental  equipment
locations.  Management believes the Company's recent financial  performance does
not fully reflect the benefit of these rental locations.  Based on the Company's
historical  experience,  a new equipment  rental  location  tends to incur costs
during the early period of operations  without the benefit of the revenue stream
of a mature location.  New rental  locations  realize  significant  increases in
revenues and cash flow during the first three years of operation,  and generally
become  profitable in the third year of operation as more  equipment is added to
the rental fleet and as the location matures. Because there is relatively little
incremental operating expense associated with such revenues,  there is a greater
proportionate  increase  in cash  flow and  profitability  as a rental  location
matures.  The Company believes the revenues,  cash flow and profitability of the
26 start-up locations opened since March 1, 1995 will increase  significantly as
these locations mature.

     The Company  primarily  derives  revenue from (i) the rental of  equipment;
(ii) sales of new and used  equipment and (iii) sales of parts and service.  The
Company's  primary source of revenue is the rental of equipment to  construction
and  industrial  customers.  Growth in rental  revenue is dependent upon several
factors,  including  the demand for rental  equipment,  the amount of  equipment
available for rent, rental rates and the general economic environment. The level
of new and used equipment sales is primarily a function of the supply and demand
for such equipment,  price and general economic conditions. The age, quality and
mix of the  Company's  rental fleet also affect  revenues  from the sale of used
equipment.  Revenues  derived  from the sale of parts and  service is  generally
correlated with sales of new equipment.

     Costs  of  revenues  include  cost  of  equipment  sold,  depreciation  and
maintenance  costs of rental  equipment  and cost of parts and service.  Cost of
equipment sold consists of the net book value of rental equipment at the time of
sale  and  cost  for new  equipment  sales.  Depreciation  of  rental  equipment
represents the depreciation costs attributable to rental equipment.  Maintenance
of rental  equipment  represents the costs of servicing and  maintaining  rental
equipment  on an  ongoing  basis.  Cost of parts and  service  represents  costs
attributable to the sale of parts directly to customers and service provided for
the repair of customer owned equipment.

                                       14
<PAGE>

     Depreciation  of rental  equipment is calculated on a  straight-line  basis
over the estimated  service life of the asset (generally two to eight years with
a 20% residual  value).  Since  January 1, 1996,  the Company has,  from time to
time, made certain changes to its depreciation assumptions to recognize extended
estimated  service lives and increased  residual values of its rental equipment.
The Company  believes  that these changes in estimates  will more  appropriately
reflect  its  financial  results  by better  allocating  the cost of its  rental
equipment over the service lives of these assets. In addition, the new lives and
residual values more closely conform to those prevalent in the industry.

     Selling,  general and  administrative  expenses include sales and marketing
expenses, payroll and related costs, professional fees, property and other taxes
and  other   administrative   overhead.   Other  depreciation  and  amortization
represents the  depreciation  associated with property and equipment (other than
rental equipment) and the amortization of goodwill and intangible assets.

     Results of Operations

     In  view  of  the   Company's   growth,   management   believes   that  the
period-to-period  comparisons  of its  financial  results  are  not  necessarily
meaningful and should not be relied upon as an indication of future performance.
In addition,  the Company's  results of operations  may fluctuate from period to
period in the future as a result of the cyclical nature of the industry in which
the Company operates.

     The  following  table sets forth,  for the periods  indicated,  information
derived from the consolidated  statements of operations of the Company expressed
as a percentage of total revenues.  There can be no assurance that the trends in
the table below will continue in the future.

<TABLE>
<CAPTION>

                                                                    Year Ended December 31,
                                                                    -----------------------
    <S>                                               <C>                <C>               <C>
  Revenues :                                            1999               1998              1997
                                                      --------           --------          --------
    Rental revenue..................................      56.9 %             55.3 %            48.9 %
    Equipment sales.................................      31.1               33.4              35.6
    Parts and service...............................      12.0               11.3              15.5
                                                      --------           --------          --------
         Total revenues.............................       100 %              100 %             100 %
                                                      --------           --------          --------
  Cost of revenues:
    Cost of equipment sold..........................      25.7               25.8              28.6
    Depreciation of rental equipment................      14.1               17.4              17.0
    Maintenance of rental equipment.................      17.0               15.4              13.2
    Cost of parts and services......................       7.7                7.3               9.7
                                                      --------           --------          --------
         Total cost of revenues.....................      64.5               65.9              68.5
                                                      --------           --------          --------
  Gross profit......................................      35.5               34.1              31.5

    Selling, general and administrative expenses          19.1               18.6              22.0
    Other depreciation and amortization............        2.7                2.7               2.0
    Writedown of assets held for sale..............        0.4                  -                 -
    Officer stock option compensation..............          -                1.1               3.1
                                                      --------           --------          --------
  Income from operations...........................       13.3 %             11.7  %            4.4  %
                                                      ========           ========          ========
  EBITDA...........................................       30.1 %             31.8  %           23.4  %
                                                      ========           ========          ========
</TABLE>
                                       15
<PAGE>

    1999 Compared to 1998

     Revenues.  Total revenues for 1999  increased  21.0% to $392.0 million from
$324.1  million in 1998.  This growth in revenues is primarily  attributable  to
revenues  generated  by  acquisitions  of  approximately  $38.8  million  and an
increase in revenues from the maturation of the 26 new rental  locations  opened
since March 1995 of approximately $26.4 million.

     Gross Profit.  Gross profit for 1999  increased  26.0% to $139.1 million or
35.5% of total  revenues from $110.4 million or 34.1% of total revenues in 1998.
This  increase is  primarily  attributable  to an  increase  in gross  profit of
approximately  $13.1 million associated with the growth in revenues arising from
acquisitions and approximately  $12.9 million  associated with the maturation of
the 26 new rental  locations  opened  since  March 1995.  The  increase in gross
profit as a percentage of revenue is primarily  attributable  to improved rental
revenue margins.

     Selling,  General  and  Administrative   Expenses.   Selling,  general  and
administrative  expenses  increased  24.2%  to $74.9  million  or 19.1% of total
revenues from $60.3 million or 18.6% of total  revenues in 1998. The increase in
selling,  general and  administrative  expenses  is  primarily  attributable  to
increased  regional and  corporate  personnel to support the  continued  revenue
growth of the  Company.  The Company had 84  locations  at  December  31,  1999,
compared to 86 at December 31, 1998.

     Other  Depreciation and Amortization.  Other  depreciation and amortization
expense for 1999 increased 21.6% to $10.7 million or 2.7% of total revenues from
$8.8  million or 2.7% of total  revenues in 1998.  This  increase  is  primarily
attributable  to  amortization of goodwill  resulting from  acquisitions  and to
increased expenditures on computer equipment, management information systems and
property and equipment needed to support the Company's expansion.

     Officer  Stock Option  Compensation.  Officer  stock option  expense was $0
million  for 1999 and $3.2  million for 1998.  The  expense in 1998  represented
changes in  estimated  market value of the shares to be issued to a key employee
under an option agreement.

     Interest  Expense.  Interest  expense  for  1999  increased  22.0% to $39.9
million from $32.7 million in 1998.  This increase is primarily  attributable to
the Company's  borrowings  related to acquisitions and to additional  borrowings
related to the Company's continued investment in rental equipment.

     Extraordinary  Loss.  During  1998,  as a result  of  modifications  to the
Company's Credit Facility,  the Company recorded  extraordinary  losses from the
write-off of debt issue costs associated with the early  extinguishment  of debt
of $2.7 million, net of related income taxes.

     Earnings Before Interest, Taxes,  Depreciation and Amortization.  EBITDA is
not  presented  as an  alternative  to  operating  results  or  cash  flow  from
operations as determined by Generally Accepted Accounting  Principles  ("GAAP"),
but  rather to provide  additional  information  related  to the  ability of the
Company to meet its  capital  requirements  and pursue  its  business  strategy.
EBITDA  should not be  considered  in  isolation  from,  or  construed as having
greater  importance than, GAAP operating income or cash flows from operations as
a measure of an entity's performance.

     EBITDA  for  1999  increased  14.2%  to  $117.9  million  or 30.1% of total
revenues from $103.2 million or 31.8% of total revenues in 1998. The increase in
EBITDA is primarily  attributable to the maturation of new rental  locations and
acquisitions as discussed  above. In 1998,  EBITDA included  charges for officer
stock option compensation of $3.2 million.

                                       16
<PAGE>

     1998 Compared to 1997

     Revenues.  Total revenues for 1998 increased  127.9% to $324.1 million from
$142.2 million in 1997.  This growth in revenues was primarily  attributable  to
revenues  generated  by  acquisitions  of  approximately  $114.9  million and an
increase in revenues from the maturation of the 26 new rental  locations  opened
since March 1995 of approximately $47.4 million.

     Gross Profit.  Gross profit for 1998 increased  146.9% to $110.4 million or
34.1% of total  revenues from $44.7 million or 31.5% of total  revenues in 1997.
This  increase  was  primarily  attributable  to an increase in gross  profit of
approximately  $44.1 million associated with the growth in revenues arising from
acquisitions and approximately  $17.4 million  associated with the maturation of
the 26 new rental  locations  opened  since  March 1995.  The  increase in gross
profit as a percentage of revenue was primarily  attributable to improved rental
revenue margins.

     Selling,  General  and  Administrative   Expenses.   Selling,  general  and
administrative  expenses  increased  92.6%  to $60.3  million  or 18.6% of total
revenues from $31.3 million or 22.0% of total  revenues in 1997. The increase in
selling,  general and administrative  expenses was primarily attributable to the
increase  in the number of  locations  operated  by the  Company  and  increased
regional and corporate personnel to support the continued growth of the Company.
The Company had 86 locations  at December  31, 1998,  compared to 53 at December
31, 1997.

     Other  Depreciation and Amortization.  Other  depreciation and amortization
expense for 1998 increased 214.8% to $8.8 million or 2.7% of total revenues from
$2.8 million or 2.0% of total  revenues in 1997.  This  increase  was  primarily
attributable  to  amortization of goodwill  resulting from  acquisitions  and to
increased expenditures on computer equipment, management information systems and
property and equipment needed to support the Company's expansion.

     Officer Stock Option  Compensation.  Officer stock option  expense was $3.2
million for 1998 and $4.4 million for 1997. The expense  represented  changes in
estimated  market  value of the shares to be issued to a key  employee  under an
option agreement.

     Interest  Expense.  Interest  expense  for 1998  increased  172.9% to $32.7
million from $12.0 million in 1997. This increase was primarily  attributable to
the Company's  borrowings  related to acquisitions and to additional  borrowings
related to the Company's continued investment in rental equipment.

     Extraordinary  Loss.  During  1998,  as a result  of  modifications  to the
Company's Credit Facility,  the Company recorded  extraordinary  losses from the
write-off of debt issue costs associated with the early  extinguishment  of debt
of $2.7 million, net of related income taxes.

     Earnings Before Interest, Taxes,  Depreciation and Amortization.  EBITDA is
not  presented  as an  alternative  to  operating  results  or  cash  flow  from
operations as determined by Generally Accepted Accounting  Principles  ("GAAP"),
but  rather to provide  additional  information  related  to the  ability of the
Company to meet its capital requirements and pursue its business strategy.

    EBITDA should not be  considered in isolation  from, or construed as having
greater  importance than, GAAP operating income or cash flows from operations as
a measure of an entity's performance.

     EBITDA  for 1998  increased  210.6%  to  $103.2  million  or 31.8% of total
revenues from $33.2 million or 23.4% of total  revenues in 1997. The increase in
EBITDA was primarily  attributable to the maturation of new rental locations and
acquisitions as discussed  above. In 1998 and 1997,  EBITDA included charges for
officer   stock  option   compensation   of  $3.2  million  and  $4.4   million,
respectively.

                                     17
<PAGE>

     Liquidity and Capital Resources

     During 1998, the Company  completed an initial public offering of its Class
A  Common  Stock  (the  "Offering")  and  the  sale of $200  million  of  Senior
Subordinated  Notes due 2008  (the  "Senior  Notes")  to  reduce  the  Company's
indebtedness,  extend its debt maturities to reflect the long-term nature of its
assets and provide increased  operational and financial flexibility to allow the
Company to pursue its growth strategy.

     Proceeds  from the  Offering  and Senior  Notes were used to repay a $100.0
million term loan,  redeem the Company's  Series A Cumulative  Preferred  Stock,
repay a mortgage  related to properties the Company owns and reduce  outstanding
borrowings under the Company's revolving credit facility.

     During 1999, the Company's  operating  activities provided net cash flow of
$43.5 million as compared to $42.7 million for 1998.  This increase is primarily
attributable  to the  growth  in the  Company's  operations  resulting  from  an
increase in the number of rental locations operated by the Company.

     Net cash  provided by (used in) investing  activities  was $1.6 million for
1999 as compared to $(266.5)  million in the same period for the prior year. The
change in cash from investing  activities was due to sales of  subsidiaries  and
decreased acquisitions in 1999.

     Net cash provided by (used in) financing activities was $(46.0) million for
1999 as compared  to $225.3  million  for 1998.  The net cash used in  financing
activities was primarily attributable to net borrowings made under the Company's
revolving credit facility.

     As of  December  31,  1999,  the Company had  approximately  $82.3  million
available under its revolving credit facility.  Based upon current expectations,
the Company  believes  that cash flow from  operations,  together  with amounts,
which may be borrowed under the revolving credit facility,  will be adequate for
it to meet its capital  requirements  and pursue its  business  strategy for the
next 12 months.

     Inflation and General Economic Conditions

     Although the Company cannot  accurately  anticipate the effect of inflation
on its  operations,  it does not believe that inflation has had, or is likely in
the foreseeable  future to have, a material impact on its results of operations.
The  Company's  operating  results  may  be  adversely  affected  by  events  or
conditions in a particular region, such as regional economic,  weather and other
factors.

     In addition,  the Company's  operating results may be adversely affected by
increases  in interest  rates that may lead to a decline in  economic  activity,
while simultaneously  resulting in higher interest payments by the Company under
its variable rate credit facilities.

     Although  much of the  Company's  business is with  customers in industries
that are cyclical in nature, management believes that certain characteristics of
the equipment rental industry and the Company's operating strategies should help
to mitigate the effects of an economic downturn.  These characteristics  include
(i) the flexibility and low cost offered to customers by renting, which may be a
more attractive alternative to capital purchases;  (ii) the Company's ability to
redeploy  equipment during regional  recessions;  and (iii) the diversity of the
Company's industry and customer base.

     Market Risk

     The Company's financial  instruments consist of cash, accounts  receivable,
and debt.  Cash and accounts  receivable  are short term,  non-interest  bearing
instruments and not subject to market risk.

     For fixed rate debt  instruments,  interest rate changes  affect their fair
market value but do not impact  earnings or cash flows.  Conversely for variable
rate debt  instruments,  interest rate changes  generally do not affect the fair
market value but do impact future earnings and cash flows.

     At December 31, 1999, the Company had fixed rate debt of $198.7 million and
variable  rate debt of $137.2  million.  Holding  debt  levels  constant,  a one
percentage point increase in interest rates would decrease the fair market value
of the fixed rate debt by approximately $10.7 million and decrease earnings  and
cash flows for variable rate debt by approximately $0.8 million.

                                       18
<PAGE>

<TABLE>
<CAPTION>


ITEM 8.   FINANCIAL STATEMENTS AND SUPPLEMENTAL DATA

                   Index to Financial Statements and Schedules

                                                                    Page Numbers
<S>                                                                          <C>
Reports of Independent Certified Public Accountants ................          20

Consolidated Balance Sheets as of December 31, 1999 and 1998 .......          22

Consolidated Statements of Operations for the years ended
 December 31, 1999, 1998 and 1997 .................................           23

Consolidated Statements of Stockholder's Equity (Deficit) for
 the years ended December 31, 1999, 1998 and 1997 .................           24

Consolidated Statements of Cash Flows for the years ended
 December 31, 1999, 1998 and 1997 .................................           25

Notes to Consolidated Financial Statements ........................           26

SCHEDULES:

Report of Independent Certified Public Accountants ................           42

II-Valuation and Qualifying Accounts and Reserves .................           43


     All other  schedules  are omitted  because they are not  applicable  or the
required information is shown in the financial statements or notes thereto.

</TABLE>
                                       19
<PAGE>

REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS



To the Board of Directors and Stockholders of
Neff Corp.


     We have audited the accompanying  consolidated balance sheets of Neff Corp.
and  subsidiaries  (the  "Company"),  as of December 31, 1999 and 1998,  and the
related  consolidated  statements of operations,  stockholders' equity (defecit)
and cash flows for each of the three  years in the  period  ended  December  31,
1999.  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 did not audit the 1998 financial  statements
of  Sullair  Argentina  Sociedad  Anonima  (a  consolidated  subsidiary),  which
statements  reflect total assets of  $71,960,577 at December 31, 1998, and total
revenues and net income of $27,138,214  and  $3,175,507,  respectively,  for the
period from July 1, 1998  through  December  31,  1998.  Those  statements  were
audited  by other  auditors  whose  report  has been  furnished  to us,  and our
opinion,  insofar as it relates to the  amounts  included  by Sullair  Argentina
Sociedad Anonima, is based solely on the report of such other auditors.

     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  and the  report of the other  auditors  provide a
reasonable basis for our opinion.

     In our opinion,  based on our audits and, for 1998, the report of the other
auditors, such consolidated financial statements present fairly, in all material
respects,  the financial position of Neff Corp. and subsidiaries at December 31,
1999 and 1998 and the results of their  operations and their cash flows for each
of the three years in the period  ended  December  31, 1999 in  conformity  with
generally accepted accounting principles.



/s/ Deloitte & Touche

Miami, Florida
March 23, 2000

                                       20
<PAGE>


REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS



To the Board of Directors of
Sullair Argentina Sociedad Anonima

     1. We have  audited the  consolidated  balance  sheet of Sullair  Argentina
Sociedad  Anonima and its  subsidiary  Sullair San Luis  Sociedad  Anonmia as of
December  31, 1998,  and the related  consolidated  statements  of income and of
changes in shareholders'  equity and in financial  position (cash flows) for the
six  month  period  ended  December  31,  1998.  These  consolidated   financial
statements   are  the   responsibility   of  the   Company's   management.   Our
responsibility  is  to  express  an  opinion  of  these  consolidated  financial
statements based on our audits.

     2. We conducted our audit in accordance with auditing  standards  generally
accepted in the United States of America.  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.  An audit does not provide assurance that the
Company's computerized systems or any other system, such as those from customers
and suppliers,  are or would be year 2000 compliant.  We believe that our audits
provide a reasonable basis for our opinion.

     3. Accounting  principles generally accepted in Argentina require companies
with  controlling  financial  interest in the other  companies  to present  both
parent  company,  where  investments  in  subsidiaries  are accounted for by the
equity  method,   and  consolidated   financial   statements,   as  primary  and
supplementary information,  respectively.  Because of the special purpose of the
financial statements, parent company financial statements are not included. This
procedure  has been adopted for the  convenience  of the reader of the financial
statements.

     4. In our opinion,  the  consolidated  financial  statements  audited by us
present  fairly,  in all material  respects,  the financial  position of Sullair
Argentina  Sociedad Anonima and its subsidiary Sullair San Luis Sociedad Anonima
at December 31, 1998, and the results of their operations,  the changes in their
shareholders'  equity and the changes in their  financial  position (cash flows)
for the six-month  period ended December 31, 1998, in conformity with accounting
principles generally accepted in Argentina.

     5. Accounting  principles  generally  accepted in Argentina vary in certain
important respects from accounting  principles  generally accepted in the United
States of  America.  The  application  of the  latter  would have  affected  the
determination  of  consolidated  net income for the mentioned  periods,  and the
determination  of consolidated  shareholders'  equity and financial  position at
December  31,  1998,  to  the  extent  summarized  in  Notes  10  and  11 to the
consolidated financial statements of Sullair Argentina Sociedad Anonima.




/s/Price Waterhouse & Co.


Buenos Aires, Argentina
February 16, 1999

                                       21
<PAGE>


<TABLE>
<CAPTION>


                           NEFF CORP. AND SUBSIDIARIES
                          CONSOLIDATED BALANCE SHEETS
                      (in thousands, except per share data)

                                                                         December 31,
                                                                    1999             1998
                                                                --------          --------
<S>                                                             <C>               <C>
     ASSETS
Cash and cash equivalents..................................... $   3,374           $ 4,340
Accounts receivable, net of allowance for doubtful accounts of
     $2,904 in 1999 and $3,229 in 1998........................    53,740            59,022
Inventories...................................................     3,860            29,164
Rental equipment, net.........................................   285,863           321,220
Property and equipment, net...................................    25,638            45,114
Goodwill, net.................................................    88,008            96,722
Net deferred tax asset........................................         -             2,780
Intangible assets, net........................................     1,003             1,459
Prepaid expenses and other assets.............................    10,220            12,548
                                                                --------          --------
           Total assets....................................... $ 471,706         $ 572,369
                                                                ========          ========
    LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities
      Accounts payable........................................ $   7,527          $ 24,405
      Accrued expenses........................................    22,734            27,090
      Credit facility.........................................   137,182           191,189
      Senior subordinated notes...............................   198,670           198,522
      Notes payable...........................................         -            17,282
      Capitalized lease obligations...........................       742             1,487
      Net deferred tax liability..............................       643                 -
                                                                --------          --------
           Total liabilities..................................   367,498           459,975
                                                                --------          --------
Commitments and Contingencies (Note 12).......................

Minority interest.............................................         -            13,034
                                                                --------          --------
Stockholders' equity
      Class A Common Stock; $.01 par value; 100,000 shares
        authorized; 16,065 shares issued and outstanding in
        1999 and 1998.........................................       161               161
      Class B special Common Stock; $.01 par value, liquidation
        preference $11.67; 20,000 shares authorized; 5,100
        shares issued and outstanding in 1999 and 1998........        51                51
      Additional paid-in capital..............................   127,759           127,765
      Accumulated deficit.....................................   (23,763)          (28,617)
                                                                --------          --------
           Total stockholders' equity.........................   104,208            99,360
                                                                --------          --------
           Total liabilities and stockholders' equity......... $ 471,706         $ 572,369
                                                                ========          ========

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

</TABLE>
                                       22
<PAGE>
<TABLE>
<CAPTION>
                                                   NEFF CORP. AND SUBSIDIARIES
                                              CONSOLIDATED STATEMENTS OF OPERATIONS
                                              (in thousands, except per share data)

                                                                                For the Years Ended December 31,
                                                                              1999           1998           1997
                                                                              ----           ----           ----
<S>                                                                           <C>          <C>             <C>
Revenues
       Rental revenue..................................................... $  222,862    $ 179,014      $  69,512
       Equipment sales....................................................    121,865      108,352         50,578
       Parts and service..................................................     47,284       36,724         22,132
                                                                              -------      -------        -------
            Total revenues................................................    392,011      324,090        142,222
                                                                              -------      -------        -------
Cost of revenues
       Cost of equipment sold.............................................    100,871       83,783         40,766
       Depreciation of rental equipment...................................     55,159       56,336         24,231
       Maintenance of rental equipment....................................     66,763       49,858         18,752
       Cost of parts and service..........................................     30,166       23,690         13,741
                                                                              -------      -------         ------
            Total cost of revenues........................................    252,959      213,667         97,490
                                                                              -------      -------         ------
Gross profit..............................................................    139,052      110,423         44,732
                                                                              -------      -------         ------
Other operating expenses
       Selling, general and administrative expenses.......................     74,893       60,347         31,329
       Other depreciation and amortization................................     10,731        8,833          2,806
       Writedown of assets held for sale..................................      1,444            -              -
       Officer stock option compensation..................................          -        3,198          4,400
                                                                               ------       ------         ------
            Total other operating expenses................................     87,068       72,378         38,535
                                                                               ------       ------         ------
Income from operations....................................................     51,984       38,045          6,197
                                                                               ------       ------         ------
Other expense
       Interest expense...................................................     39,901       32,677         11,976
       Loss on sale of subsidiaries.......................................        422            -              -
       Amortization of debt issue costs...................................      1,197        3,178          2,362
                                                                                -----       ------         ------
            Total other expense...........................................     41,520       35,855         14,338
                                                                               ------       ------         ------
Income (loss) before income taxes, minority interest and
   extraordinary item.....................................................     10,464        2,190         (8,141)
(Provision for) benefit from income taxes.................................     (3,877)         134          1,748
                                                                               ------          ---          -----
Income (loss) before minority interest and extraordinary item.............      6,587        2,324         (6,393)
Minority interest.........................................................     (1,733)      (1,111)             -
                                                                               ------       ------         ------
Income (loss) before extraordinary item...................................      4,854        1,213         (6,393)

Extraordinary loss, net of income taxes...................................          -       (2,675)          (451)
                                                                                -----       ------         ------
Net income (loss)........................................................  $    4,854   $   (1,462)     $  (6,844)
                                                                                =====       ======         ======
Basic income (loss) per common share :
Income (loss) before extraordinary item................................... $     0.23   $    (0.23)     $   (1.64)
Extraordinary loss, net...................................................          -        (0.15)         (0.05)
                                                                                -----         -----         -----
Net income (loss)......................................................... $     0.23   $    (0.38)     $   (1.69)
                                                                                =====        =====          =====

Basic weighted average common shares outstanding..........................     21,165       17,213          8,465
                                                                               ======       ======          =====

Diluted income (loss) per common share :
Income (loss) before extraordinary item................................... $     0.22   $    (0.23)     $   (1.64)
Extraordinary loss, net...................................................          -        (0.15)         (0.05)
                                                                               ------       ------          -----
Net income (loss)......................................................... $     0.22   $    (0.38)     $   (1.69)
                                                                               ======       ======          =====
Diluted weighted average common shares outstanding........................     21,887       17,213          8,465
                                                                               ======       ======          =====
The accompanying notes are an integral part of these consolidated financial statements.

</TABLE>
                                       23
<PAGE>

<TABLE>
<CAPTION>


                                                       NEFF CORP. AND SUBSIDIARIES
                                                        CONSOLIDATED STATEMENTS OF
                                             STOCKHOLDERS' EQUITY (DEFICIT) FOR EACH OF THE
                                            THREE YEARS IN THE PERIOD ENDED DECEMBER 31, 1999
                                                                 (in thousands)

                                                                                             Additional
                                                       Common Stock A     Common Stock B      Paid-in    Accumulated
                                                       --------------     --------------
                                                       Shares    Amount   Shares  Amount      Capital      Deficit        Total
                                                       ------    ------   ------  ------      -------      -------       ------
<S>                                                    <C>       <C>      <C>     <C>         <C>          <C>           <C>
Balance, December 31, 1996 ........................     8,465   $    85        -      -           -      $  (7,593)  $   (7,508)
Net loss ..........................................         -         -        -      -           -         (6,844)      (6,844)
Adjustment for acquired property
   and equipment (Note 13), net of taxes ..........         -         -        -      -           -         (2,936)      (2,936)
Dividends in kind - Series A Preferred Stock ......         -         -        -      -           -           (657)        (657)
Preferred stock dividends accrued -
   Series B and C .................................         -         -        -      -           -         (3,200)      (3,200)
Accretion of Series A, B and C Preferred Stock ....         -         -        -      -           -         (3,590)      (3,590)
                                                       ------    ------          ------      ------        -------       ------
Balance, December 31, 1997 ........................     8,465        85        -      -           -        (24,820)     (24,735)
Net loss ..........................................         -         -        -      -           -         (1,462)      (1,462)
Preferred stock dividends accrued -
   Series A, B and C ..............................          -        -        -      -           -         (1,010)      (1,010)
Accretion of Series A, B and C Preferred Stock ....          -        -        -      -           -         (1,325)      (1,325)
Exchange of Preferred Stock Series B and C for Class
    B Common Stock ................................          -        -    6,000 $   60    $ 44,876              -       44,936
Conversion of Class B Common Stock
   to Class A Common Stock ........................        900        9     (900)    (9)          -              -            -
Net proceeds from Common Stock Offering ...........      6,700       67        -      -      85,663              -       85,730
Redemption of Series A Preferred Stock ............          -        -        -      -      (2,768)             -       (2,768)
Other .............................................          -        -        -      -          (6)             -           (6)
                                                        ------   ------   ------ ------       ------        ------       ------
Balance, December 31, 1998 ........................     16,065      161    5,100     51      127,765       (28,617)      99,360
Net income ........................................          -        -        -      -            -         4,854        4,854
Other .............................................          -        -        -      -           (6)            -           (6)
                                                        ------   ------   ------ ------       ------        ------       ------
Balance, December 31, 1999 ........................     16,065   $  161    5,100 $   51    $ 127,759     $ (23,763)   $ 104,208
                                                        ======   ======    ===== ======    =========     =========    =========

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

</TABLE>
                                       24
<PAGE>

<TABLE>
<CAPTION>

                                                            NEFF CORP. AND SUBSIDIARIES
                                                       CONSOLIDATED STATEMENTS OF CASH FLOWS
                                                                      (in thousands)


                                                                                For the Years Ended December 31,
                                                                                1999        1998         1997
                                                                                ----        ----         ----
<S>                                                                             <C>         <C>           <C>
Cash Flows from Operating Activities
Net income (loss)..........................................................  $  4,854     $ (1,462)    $ (6,844)
Adjustments to reconcile net income (loss) to net cash provided by
  operating activities net of acquisitions.................................
       Depreciation and amortization.......................................    67,087      68,347       29,399
       Officer stock option compensation...................................         -       3,198        4,400
       Gain on sale of equipment...........................................   (20,994)    (24,569)      (9,812)
       Minority interest...................................................     1,733       1,111            -
       Loss on sale of subsidiaries........................................       422           -            -
       Extraordinary loss on debt extinguishment...........................         -       4,280          722
       Deferred income taxes...............................................     3,423        (510)      (1,748)
       Writedown of assets held for sale...................................     1,444           -            -
       Change in operating assets and liabilities (net of acquisitions
          and sales)
            Accounts receivable............................................   (18,739)    (14,488)      (8,341)
            Other assets...................................................    (5,288)       (403)      (2,957)
            Accounts payable and accrued expenses..........................     9,513       7,192        4,104
                                                                              -------     -------      -------
                 Net cash provided by operating activities.................    43,455      42,696        8,923
                                                                              -------     -------      -------

Cash Flows from Investing Activities
Purchases of equipment.....................................................  (221,671)   (199,198)    (143,515)
Proceeds from sale of equipment............................................   121,865     108,352       50,578
Proceeds from sale of subsidiaries.........................................   120,500           -            -
Purchases of property and equipment........................................    (2,803)    (15,015)     (16,747)
S.A. Argentina Earn-out payment............................................    (5,518)          -            -
Cash paid for acquisitions.................................................   (10,750)   (160,646)     (63,605)
                                                                              -------     -------      -------
                 Net cash provided by (used in) investing activities.......     1,623    (266,507)    (173,289)
                                                                              -------     -------      -------

Cash Flows from Financing Activities
Debt issue costs...........................................................      (128)    (12,277)      (2,425)
Net borrowings (repayments) under Senior Credit Facility...................   (54,007)     29,364      103,576
Proceeds from issuance of senior subordinated notes........................         -     198,516            -
Proceeds from common stock offering........................................         -      85,730            -
Borrowings (repayments) under mortgage note................................         -     (13,400)      13,400
Borrowings (repayments) under capitalized lease obligations................      (745)       (833)         866
Borrowings (repayments) under term loan....................................         -     (49,916)      49,916
Net borrowings (repayments) under notes payable............................     8,836       1,997         (135)
Redemption of Series A preferred stock.....................................         -     (13,915)           -
Distribution to stockholders...............................................         -           -       (2,936)
                                                                              -------     -------      -------
                 Net cash provided by (used in) financing activities.......   (46,044)    225,266      162,262
                                                                              -------     -------      -------
Net increase (decrease) in cash and cash equivalents.......................      (966)      1,455       (2,104)
Cash and cash equivalents, beginning of year...............................     4,340       2,885        4,989
                                                                              -------     -------      -------
Cash and cash equivalents, end of year.....................................   $ 3,374     $ 4,340      $ 2,885
                                                                              =======     =======      =======


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

</TABLE>
                                       25
<PAGE>


                          NEFF CORP. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

     NOTE 1-GENERAL

     Description of Business

     Neff Corp. and its subsidiaries  (the "Company") own and operate  equipment
rental  locations  throughout  the  southern  and western  regions of the United
States.  The  Company  also  sells used  equipment,  parts and  merchandise  and
provides ongoing repair and maintenance services.

     Principles of Consolidation

     The accompanying  consolidated financial statements include the accounts of
Neff Corp. and its wholly-owned and majority-owned  subsidiaries.  The financial
statements of Sullair Argentina Sociedad Anonima ("S.A.  Argentina") included in
the  consolidated  financial  statements  of the Company  have been  adjusted to
reflect U.S. Generally Accepted Accounting Principles.  Significant intercompany
transactions and balances have been eliminated in consolidation.

     Stock Split

     In May 1998,  the  Company  effected  an 84.65 for 1.00  stock  split.  The
accompanying  consolidated  financial  statements  reflect  the stock split on a
retroactive basis from the beginning of the periods presented.

     Acquisitions

     In August  1997,  the  Company  purchased  the common  stock of  Industrial
Equipment Rentals,  Inc. ("IER") for approximately $63.6 million.  This purchase
was funded by a $50 million term loan and borrowings  under the Company's credit
facility  (see Note 5).  IER had  rental  equipment  operations  similar  to the
Company's in Alabama,  Louisiana,  Mississippi  and Texas.  The  transaction was
accounted  for under the purchase  method.  In  connection  with this  purchase,
goodwill of approximately $29.2 million was recorded.

     In January 1998, the Company  acquired  substantially  all of the assets of
Richbourg's  Sales  and  Rentals,  Inc.  ("Richbourg")  for  approximately  $100
million. Richbourg has rental equipment operations similar to the Company's with
15 locations in three  states.  This  transaction  was  accounted  for under the
purchase  method.  In connection with this purchase,  goodwill of  approximately
$40.8 million was recorded.

     Also  during  1998,  the  Company  acquired  the net assets or  outstanding
securities of seven equipment  rental companies  (collectively,  "the Other 1998
Acquisitions") in separate transactions for an aggregate purchase price of $25.4
million.  The acquisition of these  businesses  added 4 locations in Texas, 4 in
Florida and 3 locations in California. These transactions were all accounted for
under the purchase  method of accounting.  In connection  with these  purchases,
goodwill of approximately  $14.6 million was recorded.  Revenues on an unaudited
pro forma basis would have increased by $48.2 million and $132.3 million, during
1998 and 1997,  respectively,  had the  acquisitions  of IER,  Richbourg and the
Other 1998 Acquisitions occurred on January 1, 1997.

                                       26
<PAGE>

     The net loss and the net loss per share (diluted) would have been decreased
by $1.8 million and by $0.10 during 1998, respectively. The net loss and the net
loss per share  (diluted) would have been increased by $1.4 million and by $0.16
during 1997,  respectively,  had the acquisition of IER, Richbourg and the Other
1998 Acquisitions occurred on January 1, 1997.

     On June 30, 1998, the Company acquired 65% of the outstanding stock of S.A.
Argentina,  for approximately $36.1 million and earn-out payments equal to 82.8%
of S.A.  Argentina's net income for 1998 and 1999,  with such earn-out  payments
not to exceed $12.6 million in the aggregate.  The Company also had an option to
purchase  the  remaining  35% of  outstanding  stock  of  S.A.  Argentina.  S.A.
Argentina rents and sells industrial and construction equipment throughout South
America.  In  connection  with the  purchase,  goodwill of  approximately  $14.0
million was  recorded.  Earn-out  payments of $5.5 million were made in 1999 and
recorded to goodwill.  The Company's  investment  in S.A.  Argentina was sold in
November 1999.

     In 1999,  the Company  acquired  the net assets of three  equipment  rental
companies for an aggregate purchase price of $10.8 million.  The acquisitions of
these  businesses  added 5 locations in Virginia,  2 in Colorado,  1 location in
Oregon and 1 location in Washington. These transactions were accounted for under
the purchase method of accounting and goodwill of approximately $8.0 million was
recorded.  The pro  forma  effect of the 1999  acquisitions  on the  results  of
operations are not presented as they are not considered material.

Sales of Subsidiaries

     On November 18, 1999, the Company  completed the sale of Sullair  Argentina
S.A. The Company received $42.5 million, of which $12.5 million was a receivable
that was received in February 2000.  The Company  recorded a loss on the sale of
$4.2 million.

<TABLE>
<CAPTION>

     The following amounts are included in the consolidated financial statements
of the Company for Sullair Argentina S.A. (in thousands):


                                   1999          1998          1997
                                   ----          ----          ----
<S>                                <C>           <C>           <C>
Assets                           $       -     $  71,961     $       -
                                ===========   ===========   ===========
Liabilities                      $       -     $  35,125     $       -
                                ===========   ===========   ===========
Revenues                         $  47,604     $  27,138     $       -
                                ===========   ===========   ===========
Net Income                       $   3,218     $   3,176     $       -
                                ===========   ===========   ===========
</TABLE>

     On December 17, 1999,  the Company  completed  the sale of Neff  Machinery,
Inc., a wholly-owned subsidiary. The Company received $90.5 million and recorded
a gain on the sale of $3.8 million. The terms of the purchase and sale agreement
(the "Agreement")  provided for an adjustment to the purchase price based on the
assets and  liabilities of Neff  Machinery  Inc. at the date of closing.  In the
opinion of the Company, it is due additional consideration of $8.8 million under
the terms of the Agreement. The purchaser believes it is due an additional $20.3
million  under the terms of the  Agreement.  Because of the  uncertainty  of the
outcome of this  dispute,  the Company has not recorded any  additional  amounts
that may be receivable or payable under the terms of the Agreement.

                                       27
<PAGE>
<TABLE>
<CAPTION>

    The following amounts are included in the consolidated financial statements
of the Company for Neff Machinery, Inc. (in thousands):


                                    1999          1998          1997
                                -----------   -----------   -----------
<S>                             <C>          <C>            <C>
Assets.......................    $       -     $  56,654     $  78,141
                                ===========   ===========   ===========
Liabilities..................    $       -     $  28,090     $  54,410
                                ===========   ===========   ===========
Revenues.....................    $  95,996     $  93,328     $  82,131
                                ===========   ===========   ===========
Net Income...................    $   5,100     $   3,020     $   1,647
                                ===========   ===========   ===========

</TABLE>

     The  Company's  earnings and cash flows  reflect the  operations of Sullair
Argentina S.A. and Neff Machinery,  Inc.  through November 18, 1999 and December
17, 1999, respectively.


     NOTE 2-SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

     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 of assets and  liabilities at the
date of the  financial  statements  and the  reported  amounts of  revenues  and
expenses  during the reporting  period.  Actual  results could differ from those
estimates.

     Recognition of Revenue

     Rental  agreements  are  structured  as  operating  leases and the  related
revenues are recognized over the rental period. Sales of equipment and parts are
recognized  at the time of  shipment  or, if out on  lease,  at the time a sales
contract is  finalized.  Equipment  may at times be delivered to customers for a
trial period.  Revenue on such sales is recognized at the time a sales  contract
is  finalized.  Service  revenues  are  recognized  at the time the services are
rendered.

     Cash Equivalents

     The Company  considers  all highly  liquid  investments  purchased  with an
original maturity of three months or less to be cash equivalents.

                                       28
<PAGE>


     Inventories

     Inventories,  which consist principally of parts and new equipment held for
sale,  are stated at the lower of cost or market,  with cost  determined  on the
first-in,  first-out  basis  for  parts and  specific  identification  basis for
equipment. Substantially all inventory represents finished goods held for sale.

     Rental Equipment

     Rental  equipment  is  stated  at  cost  less   accumulated   depreciation.
Depreciation  is recorded  using the  straight-line  method  over the  estimated
useful  life of the  related  equipment  (generally  two to eight  years with an
estimated 20% residual value).  For certain  equipment,  depreciation is matched
against the related rental income earned by computing depreciation on individual
equipment at the rate of 50%, 80% and 80% for 1999, 1998 and 1997, respectively,
of the rental income earned.  Routine  repairs and  maintenance  are expensed as
incurred; improvements are capitalized at cost.

     The  Company  routinely  reviews  the  assumptions  utilized  in  computing
depreciation  of its  rental  equipment.  Changes  to the  assumptions  (such as
service  lives  and/or  residual  values)  are  made  when,  in the  opinion  of
management,  such changes more appropriately  allocate asset costs to operations
over the service life of the assets.  Management utilizes,  among other factors,
historical  experience and industry  comparison in determining  the propriety of
any such changes.

     During 1999 and 1997, the Company made certain changes to its  depreciation
assumptions to recognize extended estimated service lives and increased residual
values of its rental  equipment.  The  Company  believes  that these  changes in
estimates  will more  appropriately  reflect  its  financial  results  by better
allocating  the cost of its  rental  equipment  over the  service  life of these
assets.

     These changes in accounting  estimates  increased  income or reduced (loss)
before  extraordinary  item and  increased  net  income  or  reduced  (loss)  by
approximately  $10.0 million,  and $3.3 million or $0.46,  and $0.39 per diluted
common share for the years ended December 31, 1999 and 1997, respectively.

     Rental  fleet  accumulated  depreciation  at December 31, 1999 and 1998 was
approximately $74.1 million and $63.4 million, respectively.

     Property and Equipment

     Property  and  equipment is stated at cost less  accumulated  depreciation.
Depreciation is recorded using  accelerated and  straight-line  methods over the
estimated  useful  lives of the related  assets.  Significant  improvements  are
capitalized at cost. Repairs and maintenance are expensed as incurred.

     The  capitalized  cost of equipment and vehicles  under  capital  leases is
amortized  over the lesser of the lease  term or the  asset's  estimated  useful
life,  and  is  included  in  depreciation  and  amortization   expense  in  the
consolidated statements of operations.

                                       29
<PAGE>

     Intangible Assets

     Intangible  assets primarily result from business  combinations and include
agreements not to compete and other identifiable intangible assets. These assets
are amortized on a straight-line basis over their estimated useful life (five to
15  years).   Accumulated  amortization  at  December  31,  1999  and  1998  was
approximately $0.3 million and $2.9 million, respectively.

     Goodwill  arising from  acquisitions is being amortized over 40 years using
the straight-line method. Accumulated amortization at December 31, 1999 and 1998
was approximately $3.7 million and $2.6 million, respectively.

     Prepaid Expenses and Other Assets

     Prepaid  expenses  and other  assets  primarily  include  debt issue costs,
prepaid  expenses and deposits.  Debt issue costs are amortized over the term of
the debt on a straight-line basis, which approximates the interest method.

     Stock Options

     In October 1995, the FASB issued Statement No. 123 ("SFAS 123"), Accounting
for  Stock-Based  Compensation,  which  requires  companies to either  recognize
expense for stock-based awards based on their fair value on the date of grant or
provide footnote  disclosures  regarding the impact of such changes. The Company
adopted  the  disclosure  provisions  of SFAS 123 on January  1, 1996,  but will
continue to account for  options  issued to  employees  or  directors  under the
Company's  stock option plans in accordance  with  Accounting  Principles  Board
Opinion No. 25 ("APB 25"), Accounting for Stock Issued to Employees.

     Reclassifications

     Certain amounts for the prior years have been  reclassified to conform with
the current year presentation.

     NOTE 3-ACCOUNTS RECEIVABLE

     The majority of the Company's customers are engaged in the construction and
industrial  business  throughout the southern and western  regions of the United
States.

     The Company extends credit to its customers based upon an evaluation of the
customer's  financial  condition  and  credit  history.  For  sales  of  certain
construction  equipment,   the  Company's  policy  is  to  secure  its  accounts
receivable by obtaining  liens on the  customer's  projects and issuing  notices
thereof to the projects' owners and general  contractors.  All other receivables
are generally unsecured.

                                       30
<PAGE>

     NOTE 4-PROPERTY AND EQUIPMENT


     Property and equipment consists of the following (dollars in thousands):

<TABLE>
<CAPTION>



                                                                      December 31,            Estimated
                                                                     --------------         Useful Lives
                                                                   1999          1998        (in Years)
                                                                   ----          ----         ---------
<S>                                                                <C>           <C>          <C>
Land.....................................................      $      -        $  8,343          -
Buildings and improvements...............................        16,567          15,874       2-30
Office equipment.........................................         7,344           7,083        2-7
Service equipment and vehicles...........................         9,841          20,364        2-5
Shop equipment...........................................         4,370           4,227         7
Capitalized lease equipment..............................           860           1,401        3-5
                                                               --------        --------   --------

                                                                 38,982          57,292

Less accumulated depreciation                                   (13,344)        (12,178)
                                                               --------        --------

                                                               $ 25,638        $ 45,114
                                                               ========        ========
</TABLE>



     The Company has entered into lease  arrangements  for certain  property and
equipment,  which are  classified  as capital  leases.  As of December 31, 1999,
future minimum lease payments under capitalized lease obligations are as follows
(in thousands):

<TABLE>
<CAPTION>

     <S>                                                   <C>
     2000...............................................   $ 495
     2001...............................................     271
     2002...............................................      32
     Thereafter.........................................       -
                                                           -----
     Total future minimum lease payments................     798

     Less amounts representing interest (6.00% to 13.5%)     (56)
                                                           -----
     Present value of net future minimum lease payments    $ 742
                                                           =====
</TABLE>
                                       31
<PAGE>

    NOTE 5-NOTES PAYABLE AND DEBT


     Notes payable and debt consist of the following (in thousands):

<TABLE>
<CAPTION>
                                                                                             December 31

                                                                                          1999         1998
                                                                                          ----         ----



     <S>                                                                                 <C>          <C>
     $219.5 million revolving line of credit with interest ranging from the
     Lender's Prime Rate plus 1.25% to LIBOR plus up to 2.25%. At December
     31, 1999, the Lender's Prime Rate was 8.5% and LIBOR Rate was 5.81%.             $  137,182    $  191,189

     10.25%  Senior  Subordinated  Notes  issued  May 1998  due June  2008.              100,000       100,000


     10.25% Senior  Subordinated  Notes issued December 1998 due June 2008,
     with an effective interest rate of 10.5%, net of unamortized discount
     of $1,330 and $1,478, respectively.                                                  98,670        98,522

     S.A. Argentina  unsecured loans from various banks with interest rates
     of LIBOR plus 1.5% to 3.5%.                                                               -        16,541

     Various  notes  payable  assumed  through  acquisitions  of  IER  with
     interest rates ranging from 7% to 12%.                                                    -           741
                                                                                       ---------     ---------
                                                                                       $ 335,852     $ 406,993
                                                                                       =========     =========
</TABLE>

     In May 1998,  the Company  amended and restated its $250 million  revolving
credit  facility  (as  amended and  restated,  the "New  Credit  Facility").  In
September  1998,  the  New  Credit  Facility  was  increased  to  $310  million.
Subsequent to the sale of Sullair Argentina S.A. and Neff Machinery, Inc. during
the fourth  quarter of 1999 (see Note 1), the New Credit  facility was decreased
to $219.5  million.  Borrowings  under the New  Credit  Facility  are based upon
eligible accounts  receivable,  rental fleet and inventory amounts. The interest
rates on balances  outstanding under the New Credit Facility vary based upon the
leverage ratio  maintained by the Company.  The New Credit  Facility  expires in
April 2003 and the Company is charged a commitment fee on the  aggregated  daily
unused  balance of the New Credit  Facility  which varies  between 0.2% and 0.5%
based on the leverage ratio  maintained by the Company.  The New Credit Facility
is secured by  substantially  all of the Company's  assets and contains  certain
restrictive covenants which, among other things, require the Company to maintain
certain financial coverage ratios and places certain restrictions on the payment
of dividends.

     In  connection  with the  Richbourg  acquisition  (see Note 1), the Company
executed a $100 million term loan (the "Richbourg Term Loan").  In May 1998, the
Company completed the sale of $100 million of Senior Subordinated Notes due 2008
(the "May Notes") as well as the initial  public  offering (see Note 6). The net
proceeds of approximately  $182.7 million from the sale of the May Notes and the
initial public  offering were used to repay the Richbourg Term Loan,  redeem the
Company's Series A Cumulative  Redeemable  Preferred  Stock,  repay the mortgage
notes payable and reduce the amount outstanding under the New Credit Facility.

                                       32
<PAGE>

     In December  1998,  the Company  completed the sale of $100 million  Senior
Subordinated  Notes  due  2008  (the  "December  Notes").  The net  proceeds  of
approximately  $95.2 million from the December Notes were used to reduce amounts
outstanding  under the New Credit Facility.  The terms of the December Notes are
substantially the same as the May Notes.

     The May and December Notes are senior unsecured  obligations of the Company
and are  redeemable  at the option of the  Company,  in whole or in part,  on or
after June 1, 2003, at  pre-established  redemption prices together with accrued
and unpaid interest to the redemption date.

     During  1998  and  1997  the  Company  recorded   extraordinary  losses  of
approximately $2.7 million and $0.5 million,  respectively net of related income
taxes,  from the  write-off  of debt  issue  costs  associated  with  the  early
extinguishment of debt.

     NOTE 6-REDEEMABLE PREFERRED STOCK AND STOCKHOLDERS' EQUITY

     During  December  1995,  the  Company  issued  300,000  shares  of Series A
Cumulative  Redeemable  Preferred  Stock  ("Series  A"), and a detachable  stock
purchase warrant (the "Redeemable Warrant") for $12.0 million ($11.4 million net
of certain  related  costs).  Series A provided  for the  semiannual  payment of
preferential dividends at an annual rate of 8% (5% beginning January 1, 1997) of
the  liquidation  value.  The  dividends  were payable in cash or in  additional
shares.

     The   Redeemable   Warrant   granted   the  holder  the  right  to  acquire
approximately 20% of the common stock of the Company at a purchase price of $.01
per share.

     The Series A and the  Redeemable  Warrant  were  recorded at their pro rata
estimated  fair  value  in  relation  to the  proceeds  received  on the date of
issuance  ($8.0  million for the Series A and $3.4  million  for the  Redeemable
Warrant, net of issue costs). Series A was accreted using the effective interest
method  based  on its  liquidation  value at  maturity  of  $12.0  million.  The
Redeemable  Warrant was being accreted to its fair value on a prospective  basis
until the mandatory redemption date in December 2000. Through December 31, 1996,
accretion to the Series A and the Redeemable  Warrant  amounted to approximately
$0.5 million and $1.9 million, respectively.

     During  December  1996, in  connection  with the execution of the Company's
$250 million revolving credit facility,  the Company and GE Capital entered into
certain  agreements,  including an agreement to exercise the Redeemable  Warrant
for  approximately 20% of the Company's common stock.  Simultaneously  with this
exercise,  the  Company and GE Capital  agreed to exchange  the shares of common
stock for 800,000 shares of Series B Cumulative Convertible Redeemable Preferred
Stock ("Series B").

     The accreted balance of the Redeemable Warrant on the date these agreements
were entered into was approximately $5.3 million, which represented the carrying
value of Series B as of December 31, 1996.

                                       33
<PAGE>

     In a  separate  transaction  related to the credit  facility,  the  Company
issued 800,000 shares of Series C Cumulative  Convertible  Redeemable  Preferred
Stock  ("Series C") to GE Capital in exchange for $32.0 million  ($31.5  million
net of certain related costs).  For the year ended December 31, 1997,  accretion
of Series C amounted  to  approximately  $0.1  million.  Similarly  to Series A,
Series B and Series C were  accreted  toward their  ultimate  total  liquidation
value of $64 million.

     In March 1998, the holders of Series B and Series C exchanged  their shares
for Class B Common  Stock,  which has a  liquidation  preference  of $11.67  per
share.

     In May  1998,  the  Company  completed  an  initial  public  offering  (the
"Offering")  of 6.7 million shares of Class A Common Stock at a price of $14 per
share. The Company received net proceeds of approximately $85.7 million from the
Offering.

     NOTE 7-STOCK OPTION PLANS

     In December 1995, the Company granted its chief  executive  officer options
to purchase  shares of Class A Common Stock  representing 3% (on a fully diluted
basis)  of the  issued  and  outstanding  Common  Stock  of the  Company  for an
aggregate  purchase  price of $1.6 million.  Upon  completion of the Offering in
1998 (see Note 6) the number of shares  granted under this  agreement were fixed
at 657,220 shares.  No further options can be granted under this agreement.  The
Company  estimated  compensation  expense at each  reporting date based upon the
estimated  market  value of shares to be issued  until the  number of shares was
fixed.  Compensation expense of $3.2 and $4.4 million was recognized in 1998 and
1997,  respectively.  These options have been fully vested since  December 1996.
One-third  of the  options  expire on  December  1,  2005,  one-third  expire on
December 31, 2005 and the remaining one-third expire on December 31, 2006.

     In May 1996,  the Company also granted to another key employee an option to
purchase  84,650  shares of the  Company's  Class A Common  Stock at an exercise
price of  approximately  $0.5 million,  determined  based upon a multiple of the
Company's adjusted earnings.

     No  compensation  expense  was  recognized  at the date of grant  since the
exercise price of these options  approximated  the estimated market value of the
shares to be issued at the date of grant.

     In 1998,  the Company  adopted an  Incentive  Stock  Option plan ("1998 ISO
Plan"). Under this plan, designated officers,  employees, and consultants of the
Company  are  eligible  to  receive  awards  in  the  form  of  options,   stock
appreciation rights,  restricted stock grants,  performance awards, and dividend
equivalent  rights.  An aggregate of 1.0 million  shares of Class A Common Stock
are reserved for issuance under the 1998 ISO Plan.

     In 1999,  the Company  adopted an  Incentive  Stock  Option plan ("1999 ISO
Plan"). Under this plan, designated officers,  employees, and consultants of the
Company  are  eligible  to  receive  awards  in  the  form  of  options,   stock
appreciation rights,  restricted stock grants,  performance awards, and dividend
equivalent  rights.  An aggregate of 1.0 million  shares of Class A Common Stock
are reserved for issuance under the 1999 ISO Plan.

                                       34
<PAGE>

    The exercise price of options granted under the 1998 and 1999 ISO Plans may
not be less than 100% of the fair market value of the  Company's  Class A Common
Stock on the date of grant. Generally, options vest over a period of three years
and are not exercisable  beyond 10 years from date of grant.  There have been no
stock  appreciation  rights,  restricted  stock  grants,  performance  awards or
dividend equivalent rights awarded under the 1998 and 1999 ISO Plans. No options
were granted under the 1998 and 1999 ISO Plans during 1999.

     The following  table  summarizes  stock option activity under the ISO Plan,
for the year ended December 31, 1998 (in thousands, except per share data):

<TABLE>
<CAPTION>

                                                         ISO Plan Options
                                                         ----------------
                                       Shares Available  Number of   Weighted Average
                                         For Options      Shares    Exercise Price/Share
                                         -----------      ------    --------------------
<S>                                      <C>              <C>       <C>
Balance at December 31, 1997.........              -           -
Authorized...........................          1,000           -
Granted..............................           (945)        945                  $9.39
Forfeited............................              6          (6)                $14.00
Expired..............................              -           -
                                             -------     -------
Balance at December 31, 1998 and 1999             61         939                  $9.39
                                             =======     =======

</TABLE>


<TABLE>
<CAPTION>
                                                                                Exercisable Options
                                                                                -------------------
                             Number of    Weighted Average    Weighted Average               Weighted Average
                              Options    Exercise Price Per    Remaining Life   Number of     Exercise Price
                            Outstanding       Share              (Years)         Options         Per Share
                            -----------       -----               -----          -------         ---------
<S>                         <C>               <C>                 <C>            <C>             <C>
Range of Exercise Prices:

 $6.00-7.88                        553       $  6.18                10.0                -               N/A

 $9.75-14.00                       386       $ 13.97                 9.4              200          $  14.00
                                 -----

                                   939       $  9.39                 9.7
                                 =====
</TABLE>

     The Company  accounts for  stock-based  compensation in accordance with APB
25. Under APB 25, compensation expense is measured as the excess of market value
of the  underlying  stock on the date of grant  over the  exercise  price of the
options on the date of grant.

                                       35
<PAGE>


     The following  table sets forth pro forma  information  as if stock options
had been  accounted  for under the fair value method (in  thousands,  except per
share data):

<TABLE>
<CAPTION>

                                                For the Year Ended
                                                    December 31,

                                                 1998         1997
                                                 ----         ----
<S>                                              <C>          <C>
Pro forma net income (loss) (in thousands)       $(1,397)     $(4,094)
                                                 =======      =======

Pro forma loss per share
      Basic                                      $(0.38)      $(1.36)
                                                =======      =======

      Diluted                                    $(0.38)      $(1.36)
                                                =======      =======

</TABLE>

     The weighted average fair value of options granted during 1998 as estimated
on the date of grant using the Black-Scholes option pricing model was $5.47.

     The following weighted average assumptions were used in applying this model
for 1998: a risk free rate of 5.05%;  dividend yield of 0%; volatility factor of
 .636;  and an  expected  life of the  options  of 5 years.  There  were no stock
options granted in 1999 or 1997.

     Effective  January 1, 1997,  the Company  adopted a phantom stock plan (the
"Phantom Plan").  The Phantom Plan is designed to reward employees for increases
in the  Company's  performance.  The Phantom  Plan  enables the Company to award
employees  individual units  representing a hypothetical  share of the Company's
stock (the "Phantom Share"). Each Phantom Share is assigned a share value on the
date granted as determined by the administrator of the Phantom Plan.

     The cash award the employee is entitled to receive on the  redemption  date
is the  difference  between  the  value  assigned  on the date of grant  and the
greater of the fair market  value of the  Company's  Class A Common Stock or the
calculated  Phantom Plan share value.  As of December 31, 1999,  the Company had
granted 0.2 million  Phantom  Shares with assigned per share values ranging from
of $9 to $11.25,  vesting over three to five years.  Approximately $0.3 and $0.1
million of  compensation  expense was recorded for the years ended  December 31,
1999 and 1998,  respectively.  No compensation expense was recorded for the year
ended December 31, 1997.

     NOTE 8-RETIREMENT PLAN

     In February  1996,  the Company  adopted a qualified  401(k) profit sharing
plan (the "401(k) Plan"). The 401(k) Plan covers  substantially all employees of
the Company.  Participating  employees may contribute to the 401(k) Plan through
salary  deductions.  The Company may  contribute,  at its  discretion,  matching
contributions  equal to 50% of the employee's  contribution  not to exceed 3% of
the  employee's  annual  salary.  The  Company  contributed  approximately  $0.8
million,  $0.6  million and $0.3  million to the 401(k) Plan for the years ended
December 31, 1999, 1998 and 1997, respectively.

                                       36
<PAGE>

    NOTE 9-INCOME TAXES

     The  components  of the  (provision  for)  benefit  from income taxes is as
follows (in thousands):

<TABLE>
<CAPTION>

                                        For the Years Ended
                                             December 31,

                                     1999     1998       1997
                                     ----      ----      ----
<S>                                  <C>       <C>       <C>
Current......................... $   (454)  $ (376)   $     -
Deferred........................   (3,423)     510      1,748
                                 --------   ------    -------
Total........................... $ (3,877)  $  134    $ 1,748
                                 ========   ======    =======

</TABLE>


     The following table summarizes the tax effects comprising the Company's net
deferred tax assets and liabilities (in thousands):

<TABLE>
<CAPTION>
                                                                      December 31,
                                                                  1999           1998
                                                                  ----           ----
<S>
Deferred Tax Assets                                               <C>            <C>
      Net operating loss carryforwards....................... $ 10,564       $  4,582
      Alternative minimum tax credits........................    1,039            874
      Deferred stock option compensation.....................    2,849          2,849
      Intangible assets, allowance for bad debts and other...    2,507          2,548
                                                                ------         -----
          Total deferred tax assets..........................   16,959         10,853
      Valuation allowance....................................        -           (900)
Deferred Tax Liabilities
      Depreciation...........................................  (17,602)        (7,173)
                                                                ------         ------
Net Deferred Tax Asset  (Liability).......................... $   (643)      $  2,780
                                                                ======         ======
</TABLE>

     As of December  31,  1999 and 1998,  the  Company  had net  operating  loss
carryforwards  for federal and state income tax purposes of approximately  $29.5
million and $15.0  million,  respectively,  expiring  through 2019 (includes net
operating  loss  carryforwards  for  federal  and state  income tax  purposes of
approximately  $4.8  million  and  $4.4  million,   respectively,   acquired  in
connection with the acquisition of IER described in Note 1). IER's net operating
loss  carryforwards  may  only be  utilized  by  Neff  Rental,  Inc.  one of the
Company's subsidiaries.

     Current accounting standards require that deferred income taxes reflect the
tax consequences on future years of differences  between the tax bases of assets
and liabilities and their bases for financial reporting  purposes.  In addition,
future tax  benefits,  such as net  operating  loss ("NOL")  carryforwards,  are
required to be  recognized  to the extent that  realization  of such benefits is
more likely than not. A valuation  allowance is  established  for those benefits
that do not meet the more likely than not criteria.  Even though the Company has
incurred tax losses for the past three  years,  management  believes  that it is
more likely than not that the Company will generate taxable income sufficient to
realize  the  majority of the tax  benefits  associated  with future  deductible
temporary differences and NOL carryforwards prior to their expiration.

                                       37
<PAGE>

     This belief is based upon,  among other  factors,  the fact that all of the
Company's taxable temporary  differences will reverse within the period that the
deductible  temporary  differences  will be realized,  the  availability  of tax
planning strategies, and projection of future taxable income.

     The  following  table  summarizes  the  differences  between the  statutory
federal income tax rate and the Company's  effective income tax rate (dollars in
thousands):

<TABLE>
<CAPTION>

                                                                      For the Years Ended December 31,
                                                                  1999            1998           1997
                                                                  ----            ----           ----

                                                                 Amount   %      Amount   %     Amount    %
                                                                 ------   -      ------   -     ------    -
<S>                                                              <C>             <C>     <C>    <C>      <C>
(Provision) benefit at statutory federal income tax rate....  $(3,558)   34.0    (745)   34.0   $2,768  (34.0)
State income tax, net of federal income tax benefit.........     (410)    3.9       -       -      171   (2.1)
Change in valuation allowance...............................      900    (8.6)    468   (21.4)    (559)   6.9
Non-deductible expenses.....................................     (650)    6.2    (467)   21.3     (716)   8.8
Foreign subsidiary..........................................      888    (8.5)    831   (37.9)       -      -
Other.......................................................   (1,047)   10.0      47    (2.1)      84   (1.1)
                                                               ------    ----      --    ----       --   ----

                                                              $(3,877)   37.0    $134    (6.1)  $1,748  (21.5)
                                                              =======    ====    ====    ====   ======  =====
</TABLE>


     NOTE 10-EARNINGS PER SHARE

     For the years ended  December 31, 1999,  1998 and 1997,  the treasury stock
method was used to  determine  the  dilutive  effect of options and  warrants on
earnings per share data.

     Net loss and  weighted  average  number of shares  outstanding  used in the
computations are summarized as follows (in thousands, except per share data):

<TABLE>
<CAPTION>


                                                          For the years ended December 31,
                                                          1999        1998          1997
                                                          ----        ----          ----
<S>                                                      <C>        <C>           <C>
Net income (loss).....................................   $4,854     $(1,462)      $(6,844)
Deduct:
    Preferred stock dividend..........................        -      (1,010)       (3,857)
    Accretion of preferred stock......................        -      (4,093)       (3,590)
                                                       --------    --------      --------
Net income (loss) basic and diluted...................   $4,854     $(6,565)     $(14,291)
                                                       ========    ========      ========
Number of shares:
    Weighted average common shares outstanding-basic..   21,165      17,213         8,465
    Employee stock options (1)........................      722           -             -
                                                       --------    --------      --------
Weighted average common shares outstanding - diluted..   21,887      17,213         8,465
                                                       ========    ========      ========
Net income (loss) per common share-basic..............    $0.23       $0.38         $1.69
                                                       ========    ========      ========
Net income (loss) per common share-diluted............    $0.22       $0.38         $1.69
                                                       ========    ========      ========
</TABLE>


     (1) The incremental  shares  resulting from the assumed exercise of options
for the year  ended  1998 and 1997  would  be  antidilutive  and are  therefore,
excluded from the computation of diluted earnings (loss) per share.

                                       38
<PAGE>

    NOTE 11-FAIR VALUE OF FINANCIAL INSTRUMENTS

     The fair  market  value of  financial  instruments  held by the  Company at
December 31, 1999 are based on a variety of factors and  assumptions and may not
necessarily  be  representative  of the  actual  gains or  losses  that  will be
realized in the future and do not include  expenses that could be incurred in an
actual sale or settlement.

     The fair value of the Company's  credit  facility is assumed to be equal to
its carrying value, as the rates approximate  market rates. At December 31, 1999
and 1998  approximately  $137.2 million and $191.2 million was outstanding under
the credit facility, respectively.

     The fair value of the Company's Senior  Subordinated Notes was estimated by
obtaining the quoted market price.  The carrying amount of the Company's  Senior
Subordinated  Notes was $198.7 million and $198.5 million,  at December 31, 1999
and 1998,  respectively.  The fair value of the  Company's  Senior  Subordinated
Notes as of the same  dates  was  estimated  to be  $188.7  million  and  $195.0
million, respectively.

     NOTE 12-COMMITMENTS AND CONTINGENCIES

     On December 17, 1999,  the Company  completed  the sale of Neff  Machinery,
Inc., a wholly-owned subsidiary. The Company received $90.5 million and recorded
a gain on the sale of $3.8 million.  The terms of the Agreement  provided for an
adjustment  to the purchase  price based on the assets and  liabilities  of Neff
Machinery, Inc. at the date of closing. In the opinion of the Company, it is due
additional  consideration of $8.8 million under the terms of the Agreement.  The
purchaser  believes it is due $20.3  million  under the terms of the  Agreement.
Because of the  uncertainty of the outcome of this dispute,  the Company has not
recorded any  additional  amounts that may be  receivable  or payable  under the
terms of the Agreement.

     The Company and the members of its board of directors are  defendants in at
least six lawsuits  filed in the Delaware  Court of Chancery.  Five of the suits
were  filed on  February  29,  2000,  and one was  filed on March 1,  2000.  The
plaintiffs in the suits are  shareholders  of the Company,  and purport to bring
the suits as class  actions on behalf of all persons who own the common stock of
the Company. The complaints allege, among other things, that the Company and the
individual  defendants  acted improperly in responding to a buyout bid made by a
member of management in February 2000. The plaintiffs  seek, among other things,
injunctive  relief  and  damages.  The  Company  has  not yet  responded  to the
complaints.  The Board of  Directors  has  established  a Special  Committee  to
evaluate the buyout offer and review the plaintiffs' claims in the lawsuits.

     The Company is also a party to certain legal actions  arising in the normal
course of business.  In the opinion of management,  the ultimate outcome of such
litigation is not expected to have a material effect on the financial  position,
results of operations or cash flows of the Company.

     NOTE 13-RELATED PARTY TRANSACTIONS AND OTHER COMMITMENTS

     In May 1997,  the Company  acquired  certain land and buildings used in its
Florida  operations  for  approximately  $13.9 million from Atlantic Real Estate
Holdings  Corp.  ("Atlantic"),  an  affiliate  of  the  Company  through  common
ownership.

                                       39
<PAGE>

     Prior  to the  acquisition  of  these  assets,  the  Company  leased  these
properties from Atlantic.  The Company financed  approximately  $13.4 million of
the purchase price with a mortgage note payable.

     The remaining  purchase price consisted of the forgiveness of approximately
$0.5 million in notes  receivable  from  Atlantic.  The assets were  recorded at
Atlantic's  historical  carrying value and  approximately  $2.9 million,  net of
income  tax  benefit of  approximately  $1.8  million,  has been  recorded  as a
distribution  to  stockholders in the  accompanying  statement of  stockholders'
equity (deficit).

     During 1999, 1998 and 1997 revenues from affiliated  companies  amounted to
approximately $4.6 million, $2.2 million, and $0.7 million, respectively.

     Operating Leases

     During  1999,   1998  and  1997  rental  expense  under   operating   lease
arrangements  amounted to  approximately  $7.3 million,  $4.5 million,  and $3.4
million, respectively.

     The Company leases real estate,  rental equipment and other 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 rental amounts.  As of December 31, 1999,  future minimum rental payments
under operating lease  arrangements are as follows for the years ending December
31 (in thousands):

<TABLE>
<CAPTION>
               <S>                         <C>
               2000........................$  9,708
               2001........................   9,205
               2002........................   9,019
               2003........................   7,008
               2004........................   4,242
               Thereafter..................   3,075
                                            -------
                                           $ 42,257
                                            =======
</TABLE>

     NOTE 14-SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION

<TABLE>
<CAPTION>

                                                                   For the Years Ended
                                                                         December 31,

                                                            1999          1998          1997
                                                            ----          ----          ----
                                                                       (in thousands)
<S>
Supplemental Disclosure of Cash Flow Information          <C>           <C>          <C>

      Cash paid for interest............................  $ 41,353      $ 30,696     $ 10,367
                                                          ========      ========     ========
      Cash paid for taxes...............................  $  1,584      $    786     $    711
                                                          ========      ========     ========


      Cash paid for Acquisitions (Note 1) :
      Net assets acquired, net of cash................... $   2,787      $  91,546    $  34,405
      Goodwill..........................................      7,963         69,100       29,200
                                                          ---------      ---------    ---------
      Cash paid for acquisitions........................  $  10,750      $ 160,646    $  63,605
                                                          =========      =========    =========


</TABLE>
                                       40
<PAGE>

     NOTE 15 - SUMMARY OF QUARTERLY FINANCIAL INFORMATION (UNAUDITED)

     A summary of the  quarterly  operating  results  during 1999 and 1998 is as
follows (in thousands except per share data):

<TABLE>
<CAPTION>

                                                                   1999
                                              -------------------------------------------------
                                               1st           2nd           3rd            4th
                                             -------      --------       --------       -------
<S>                                          <C>          <C>            <C>            <C>
Revenues.................................   $ 91,652     $ 103,101      $ 103,780      $ 93,478
Gross Profit.............................     30,562        38,291         36,823        33,376
Net income (loss)........................   $    707     $   4,219      $     336      $   (408)

Earnings per share data - Basic:
Net income (loss)........................   $   0.03     $    0.20      $    0.02      $  (0.02)
                                            ========      ========       ========      ========

Earnings per share data - Diluted:
Net income (loss)........................   $   0.03     $    0.19      $    0.02      $  (0.02)
                                            ========      ========       ========      ========
</TABLE>
<TABLE>
<CAPTION>
                                                                   1998
                                            ---------------------------------------------------
                                                1st           2nd           3rd            4th
                                              ------        ------         ------        ------
<S>                                           <C>           <C>            <C>           <C>
Revenues................................    $ 61,846      $ 73,800       $ 89,905      $ 98,539
Gross Profit............................      19,970        25,082         31,309        34,062
Income (loss) before extraordinary item       (1,946)       (1,189)         1,671         2,677
Extraordinary item......................           -        (2,675)             -             -
Net income (loss).......................    $ (1,946)     $ (3,864)       $ 1,671      $  2,677

Earnings per share data - Basic:
Income (loss) before extraordinary item     $  (0.46)     $  (0.24)       $  0.08      $   0.13
Extraordinary item.....................            -         (0.15)             -             -
                                             -------       -------         ------       -------
Net income (loss)......................     $  (0.46)     $  (0.39)       $  0.08      $   0.13
                                             =======       =======         ======       =======
Earnings per share data - Diluted:
Income (loss) before extraordinary item     $  (0.46)     $  (0.24)       $  0.08      $   0.12
Extraordinary item.....................            -         (0.15)             -             -
                                            --------      --------        -------      --------
Net income (loss)......................     $  (0.46)     $  (0.39)       $  0.08      $   0.12
                                            ========      ========        =======      ========
</TABLE>

     Certain amounts have been reclassified for comparative purposes.


NOTE 16-SEGMENT INFORMATION

     The Company has  historically  operated three segments:  Neff Rental,  Inc.
("Rental"), Neff Machinery, Inc.("Machinery") and S.A. Argentina. These segments
were a result of the historical  organization  of the Company and the management
of its  subsidiaries.  All of  these  segments  rent  and  sell  industrial  and
construction equipment,  sell parts,  merchandise and provide ongoing repair and
maintenance service and have therefore been aggregated for disclosure  purposes.
Rental and  Machinery's  operations  are conducted in the United States and S.A.
Argentina's  operations  are  conducted  in South  America.  Machinery  and S.A.
Argentina were sold during the fourth quarter of 1999, (see Note 1).

                                       41
<PAGE>


REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS


To the Board of Directors and Stockholders of Neff Corp.

     We have audited the  consolidated  financial  statements of Neff Corp.  and
Subsidiaries  (the  "Company")  as of December 31, 1999 and 1998 and for each of
the three  years in the period  ended  December  31,  1999,  and have issued our
report thereon dated March 23, 2000;  such  financial  statements and report are
included  elsewhere in your 1999 Annual Report to Stockholders on Form 10-K. Our
audits also included the financial  statement  schedule of Neff Corp.  listed in
Item 14(a)2.  The  financial  statement  schedule is the  responsibility  of the
Company's  management.  Our responsibility is to express an opinion based on our
audits.  In our opinion such financial  statement  schedule,  when considered in
relation to the basic financial statements taken as a whole,  presents fairly in
all material respects the information set forth therein.



/s/ DELOITTE & TOUCHE LLP


Miami, Florida
March 23, 2000

                                       42
<PAGE>


                                                                    SCHEDULE II

                                   NEFF CORP.
                        VALUATION AND QUALIFYING ACCOUNTS
                                 (in thousands)
<TABLE>
<CAPTION>


                                              Balance     Charged to                                  Balance
                                         at Beginning      Costs and                                   at End
                                            of Period       Expenses      Other     Deductions (1)   of Period
<S>                                          <C>         <C>          <C>          <C>             <C>
Classification
Year ended December 31, 1999:
Allowance for doubtful accounts.............  $ 3,229     $ 2,317       $    -       $   (2,642)     $ 2,904
                                              =======     =======       ======        ==========      ======
Deferred tax valuation allowance............  $   900     $     -       $    -       $     (900)         $ -
                                              =======     =======       ======        ==========      ======
Year ended December 31, 1998:
Allowance for doubtful accounts.............  $ 1,092     $ 3,487       $    -       $   (1,350)     $ 3,229
                                              =======     =======       ======        ==========      ======
Deferred tax valuation allowance............  $ 1,368     $     -       $    -       $     (468)       $ 900
                                              =======     =======       ======        ==========      ======
Year ended December 31, 1997:
Allowance for doubtful account..............  $   375     $   957       $    -       $     (240)     $ 1,092
                                              =======     =======       ======        ==========      ======
Deferred tax valuation allowance............  $   809     $   559       $    -       $         -     $ 1,368
                                              =======     =======       ======        ==========      ======

</TABLE>


     1) Deductions  represent bad debt  write-offs  and  adjustments  to reflect
future tax benefits based on their  realization  being more likely than not, and
sales of subsidiaries.

                                       43
<PAGE>

                                    PART III

ITEM 9.  CHANGES IN AND  DISAGREEMENTS  WITH  ACCOUNTANTS  ON ACCOUNTING AND
         FINANCIAL DISCLOSURE

          None.

ITEM 10.  DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

          The  information  required  by this Item 10 will be  contained  in the
          Company's  definitive  proxy materials to be filed with the Securities
          and Exchange  Commission and is  incorporated in this Annual Report on
          Form 10-K by this reference.

ITEM 11.  EXECUTIVE COMPENSATION

          The  information  required  by this Item 11 will be  contained  in the
          Company's  definitive  proxy materials to be filed with the Securities
          and Exchange  Commission and is  incorporated in this Annual Report on
          Form 10-K by this reference.

ITEM 12.  SECURITY OWNERSHIP OF CERTAIN BENEFICAL OWNERS AND MANAGEMENT

          The  information  required  by this Item 12 will be  contained  in the
          Company's  definitive  proxy materials to be filed with the Securities
          and Exchange  Commission and is  incorporated in this Annual Report on
          Form 10-K by this reference.

ITEM 13.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

          The  information  required  by this Item 13 will be  contained  in the
          Company's  definitive  proxy materials to be filed with the Securities
          and Exchange  Commission and is  incorporated in this Annual Report on
          Form 10-K by this reference.

                                       44
<PAGE>

                                    PART IV

ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES

     (a) The  following  documents  are filed with,  and as part of, this Annual
          Report on Form 10-K.

     1. Financial  Statements.  For a complete list of the Financial  Statements
        filed  with  this  Annual  Report  on Form  10-K,  see the  Index  to
        Financial Statements and Schedules in Item 8 on Page 19.

     2. Financial Statements Schedules.
        The following Supplementary Schedules are filed with this Annual Report
        on Form 10-K:

        See Index to Financial Statements and Schedules on Page 19.

     3. Exhibits

         Information with respect to this item is contained in Item 14(c) hereof
         and is incorporated herein by reference.


     (b)  Reports on Form 8-K

          During the last quarter of the period  covered by this Annual  Report,
          the following reports on Form 8-K were filed:

          From 8-K  Report  filed on  December  2, 1999,  reporting  the sale of
          Sullair Argetina, S.A. under Item 5.

          Form 8-K Report filed on December 29, 1999 and amended on December 30,
          1999 and March 2, 2000,  reporting  the sale of Neff  Machinery,  Inc.
          under  item 5 and filing pro forma  unaudited  consolidated  financial
          statements for Neff Corp. for the period ended September 30, 1999

     (c) Exhibits

          4.1 First  Amendment to Amended and Restated  Stockholder's  Agreement
          between Jorge Mas, Juan Carlos Mas, Jose Ramon Mas,  General  Electric
          Capital Corporation,  GECFS, Inc., Santos Fund I.L.P.,  Santos Capital
          Advisors, Inc., Kevin Fitzgerald and Neff Corporation.

          10.1 Agreement by and between Neff Corp.  and Mark Irion,  Chief
          Financial Officer, Neff Corp.

          10.2  Waiver to Credit  Agreement  dated March 22, 2000 among Neff
          Corp and Neff Rental, Inc. and Bankers Trust Company.

          27.1  Consolidated Financial Data Schedule

                                       45
<PAGE>


                                   SIGNATURES

     Pursuant  to the  requirements  of  Section  13 or 15(d) of the  Securities
Exchange Act of 1934, the Registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.


                                   NEFF CORP.



Date: March  29, 2000                                /s/ Mark H. Irion
                                                     -----------------------
                                                     Mark H. Irion
                                                     Chief Financial Officer

     Pursuant to the  requirements  of the  Securities and Exchange Act of 1934,
this  report has been  signed  below by the  following  persons on behalf of the
Registrant and in the capacities and on the dates indicated.

Signatures                    Title                               Date


/s/ Kevin P. Fitzgerald
-----------------------       President,
Kevin P. Fitzgerald           Chief Executive Officer, Director  March  29, 2000

/s/ Mark H. Irion             Chief Financial Officer            March  29, 2000
-----------------------
Mark H. Irion

/s/ Jorge Mas                 Director                           March  29, 2000
-----------------------
Jorge Mas

/s/ Arthur B. Laffer          Director                           March  29, 2000
-----------------------
Arthur B. Laffer

/s/ Joel-Tomas Citron         Director                           March  29, 2000
-----------------------
Joel-Tomas Citron

/s/ Juan Carlos Mas           Director                           March  29, 2000
-----------------------
Juan Carlos Mas

/s/ Jose Ramon Mas            Director                           March  29, 2000
-----------------------
Jose Ramon Mas

/s/ Michael Markbreiter       Director                           March  29, 2000
-----------------------
Michael Markbreiter

                                       46
<PAGE>


                                    EXHIBITS



     EXHIBIT 4.1


                                 FIRST AMENDMENT
                                       TO
                              AMENDED AND RESTATED
                             STOCKHOLDERS' AGREEMENT


     FIRST  AMENDMENT  dated as of March  13,  2000  (this  "Amendment")  to the
AMENDED AND RESTATED  STOCKHOLDERS'  AGREEMENT (the "Agreement") dated MARCH 25,
1998 by and among JORGE MAS, JUAN CARLOS MAS, JOSE RAMON MAS, each of whom is an
individual residing in Florida, GENERAL ELECTRIC CAPITAL CORPORATION, a New York
corporation,  GECFS,  Inc., a Nevada  corporation,  SANTOS FUND I, L.P., a Texas
limited partnership, SANTOS CAPITAL ADVISORS, INC., a Florida corporation, KEVIN
P. FITZGERALD and NEFF CORP., a Delaware corporation.

     All capitalized terms not defined herein but defined in the Agreement shall
have the meanings given to such terms in the Agreement.

                                   WITNESSETH:

     WHEREAS, the parties hereto desire that certain provisions of the Agreement
be amended as herein set forth.

     NOW,  THEREFORE,  in  consideration  of the premises and for other good and
valuable consideration, the receipt of which is hereby acknowledged, the parties
hereto hereby agree as follows:

     1. Section  2(b)(i).  Section 2(b)(i) of the Agreement is hereby amended by
adding at the end thereof the following sentence:

     Notwithstanding  anything to the contrary  contained in the Agreement,  the
Board may be expanded to seven  directors to add Mr.  Michael  Markbreiter  as a
member of the Board,  in the director class whose term will expire in 2002. Upon
Mr.  Markbreiter's  resignation or removal, the size of the Board will revert to
six directors.

     2. No Other Amendments.  Except as expressly amended hereby, the provisions
of the Agreement are and shall remain in full force and effect.

     3.  Counterparts.  This  Amendment may be executed by the parties hereto in
any  number of  separate  counterparts,  each of which  shall be deemed to be an
original and all of which taken  together  shall be deemed to constitute one and
the same instrument.

     4.  Headings.  The headings of this  Amendment are for  reference  only and
shall not limit or otherwise affect the meaning hereof.

                                       1
<PAGE>

    IN WITNESS  WHEREOF,  the parties  hereto have caused this  Amendment to be
duly executed and delivered as of the date first above written.

                                            ________________________________
                                            JORGE MAS

                                            ________________________________
                                            JUAN CARLOS MAS

                                            ________________________________
                                            JOSE RAMON MAS


                                            GENERAL ELECTRIC CAPITAL CORPORATION

                                            By:   __________________________
                                            Name: __________________________
                                            Title:__________________________

                                            GECFS, INC.

                                            By:   __________________________
                                            Name: __________________________
                                            Title:__________________________

                                            ________________________________
                                            KEVIN P. FITZGERALD

                                            SANTOS FUND I, L.P.
                                            By: Santos Fund, Inc., its
                                            general partner

                                            By:   __________________________
                                            Name: __________________________
                                            Title:__________________________

                                            SANTOS CAPITAL ADVISORS, INC.

                                            By:   __________________________
                                            Name: __________________________
                                            Title:__________________________

                                            NEFF CORP.

                                            By:   __________________________
                                            Name: __________________________
                                            Title:__________________________

                                       2
<PAGE>



     EXHIBIT 10.1

                              EMPLOYMENT AGREEMENT


     THIS EMPLOYMENT AGREEMENT  ("Agreement") is made and entered into as of the
1st day of March,  2000,  by and between  Neff Corp.,  a Delaware  Company  (the
"Company"),  and  Mark  Irion,  an  individual  (the  "Executive")  (hereinafter
collectively referred to as the "Parties").

     WHEREAS,  the  Executive  and the  Company  have  entered  into a Severance
Agreement, dated as of May 14, 1999 (the "Severance Agreement");

     WHEREAS,  the Company  continues to desire to employ the Executive as Chief
Financial Officer of the Company and the Executive  continues to desire to serve
the Company as its Chief Financial Officer;

     WHEREAS,  the Company and the  Executive  desire to terminate the Severance
Agreement and set forth the terms of the Executive's  continued  employment with
the Company herein:

     NOW,  THEREFORE,  in  consideration  of the foregoing,  the mutual promises
contained  herein and other good and  valuable  consideration,  the  receipt and
sufficiency  of which is  hereby  acknowledged,  the  Parties,  intending  to be
legally bound, agree as follows:

     1. Term.  Subject to the provisions for termination set forth in Section 8,
the initial term of  employment  under this  Agreement  shall be for a period of
three  (3)  years  commencing  on the date  hereof  and  shall be  automatically
extended for  additional  one (1) year periods,  unless one of the Parties shall
give  written  notice to the other on or before the date which is six (6) months
prior to the  expiration  of the current  term of the  Agreement of such Party's
election not to so extend this Agreement.

     2. Employment.  The Executive shall be employed as Chief Financial  Officer
of the  Company or in such other  senior  executive  capacity as may be mutually
agreed to in writing by the Parties.  The  Executive  shall  perform the duties,
undertake the responsibilities and exercise the authority customarily performed,
undertaken and exercised by persons  situated in a similar  executive  capacity.
The Executive shall report to the Chief Executive Officer of the Company.

     3. Base Salary and Bonus.  The Company agrees to pay or cause to be paid to
the  Executive  during the term of this  Agreement  a base salary at the rate of
$160,000 per annum,  which rate shall be reviewed at least annually by the Board
of  Directors  of the Company  (the  "Board")  and may be changed in the Board's
discretion  (hereinafter  referred  to as the "Base  Salary").  Such Base Salary
shall be payable in accordance with the Company's customary practices applicable
to its senior  executives.  In addition to the Base Salary,  Executive  shall be
eligible annually for the term of his employment under this Agreement to receive
a cash bonus in the discretion of the Board.

                                       1
<PAGE>

     4. Employee Benefits. The Executive shall be entitled to participate in all
employee  benefit  plans,  practices and programs  maintained by the Company and
made available to employees generally including, without limitation all pension,
retirement,  profit  sharing,  savings,  medical,  hospitalization,  disability,
dental,  life or  travel  accident  insurance  benefit  plans.  The  Executive's
participation  in such plans,  practices and programs shall be on the same basis
and  terms as are  applicable  to other  similarly  situated  executives  of the
Company generally.

     5. Executive  Benefits.  The Executive  shall be entitled to participate in
all  executive  benefit  or  incentive  compensation  plans  now  maintained  or
hereafter  established by the Company for the purpose of providing  compensation
and/or benefits to executives of the Company including,  but not limited to, the
Company's  401(k) Plan, the Company's 1998 Stock  Incentive  Plan, the Company's
1999 Stock Incentive Plan and any supplemental retirement,  salary continuation,
stock option,  deferred compensation,  supplemental medical or life insurance or
other bonus or incentive  compensation  plans. Unless otherwise provided herein,
or in the terms of such executive benefit or incentive  compensation  plans, the
Executive's  participation in such plans shall be on the same basis and terms as
other similarly situated  executives of the Company,  but in no event on a basis
less favorable in terms of benefit levels or reward opportunities  applicable to
the  Executive  as in  effect on the date  hereof.  No  additional  compensation
provided  under any of such plans shall be deemed to modify or otherwise  affect
the terms of this Agreement or any of the Executive's entitlements hereunder.

     6. Other Benefits.

     (a) Fringe  Benefits and  Perquisites.  The Executive  shall be entitled to
receive all fringe  benefits and  perquisites  generally  made  available by the
Company to similarly situated executives.

     (b)  Expenses.   The  Executive   shall  be  entitled  to  receive   prompt
reimbursement of all expenses  reasonably incurred by him in connection with the
performance of his duties hereunder.

     7. Vacation and Sick Leave. At such reasonable  times as the Board shall in
its discretion permit, the Executive shall be entitled,  without loss of pay, to
absent himself  voluntarily  from the  performance of his employment  under this
Agreement, in accordance with the following:

     (a) The Executive  shall be entitled to annual  vacation in accordance with
the policies as  periodically  established  by the Board for similarly  situated
executives of the Company.

                                       2
<PAGE>

     (b) In addition to the aforesaid  paid  vacations,  the Executive  shall be
entitled,   without  loss  of  pay,  to  absent  himself  voluntarily  from  the
performance of his employment for such  additional  periods of time and for such
valid and  legitimate  reasons  as the Board in its  discretion  may  determine.
Further, the Board shall be entitled to grant to the Executive a leave or leaves
of  absence  with or  without  pay at such time or times and upon such terms and
conditions as the Board in its discretion may determine.

     (c) The Executive  shall be entitled to sick leave (without loss of pay) in
accordance with the Company's policies as in effect from time to time.

     8.  Termination.  The  Executive's  employment  hereunder may be terminated
under the following circumstances:

     (a) Disability.  The Company may terminate the Executive's employment after
having established the Executive's  Disability.  For purposes of this Agreement,
"Disability"  means a physical or mental infirmity which impairs the Executive's
ability to perform  substantially  his or her duties for a period of one hundred
eighty (180)  consecutive days. A determination of Disability shall be made by a
physician  satisfactory to both the Executive and the Company, which physician's
determination  as to  Disability  shall be made  within  10 days of the  request
therefor and shall be binding on all  parties;  provided,  however,  that if the
Executive  and the Company do not agree on a physician,  the  Executive  and the
Company  shall each select a physician  and these two  together  shall  select a
third physician, which third physician's determination as to Disability shall be
binding on all parties.  The Executive shall be entitled to the compensation and
benefits  provided for under this  Agreement  for any period  during the term of
this  Agreement and prior to the  establishment  of the  Executive's  Disability
during  which  the  Executive  is  unable  to work due to a  physical  or mental
infirmity. Notwithstanding anything contained in this Agreement to the contrary,
until the Termination Date specified in a Notice of Termination (as each term is
hereinafter defined) relating to the Executive's Disability, the Executive shall
be  entitled  to return to his  position  with the  Company as set forth in this
Agreement in which event no Disability  of the Executive  will be deemed to have
occurred.

     (b) Cause.  The  Company  may  terminate  the  Executive's  employment  for
"Cause."  The  Company  shall  be  deemed  to have  terminated  the  Executive's
employment  for  "Cause"  in  the  event  that  the  Executive's  employment  is
terminated  for any of the following  reasons:  (i) the  commission of an act of
fraud   or   intentional   misrepresentation   or  an   act   of   embezzlement,
misappropriation  or conversion of assets or opportunities of the Company;  (ii)
dishonesty or willful  misconduct in the performance of duties; or (iii) willful
violation of any law, rule or regulation in connection  with the  performance of
duties (other than traffic  violations or similar offenses);  provided,  that no
act or failure to act shall be considered  willful  unless done or omitted to be
done in bad faith and without  reasonable belief that the action or omission was
in the best interests of the Company. Notwithstanding anything contained in this
Agreement to the contrary,  no failure to perform by the Executive  after Notice
of  Termination is given by the Company shall  constitute  Cause for purposes of
this Agreement.

                                       3
<PAGE>

     (c) (i) Good Reason.  The Executive may terminate his  employment for "Good
Reason." For purposes of this  Agreement,  Good Reason shall mean the occurrence
of any of the events or conditions described in this Section (c)(i):

     (A)  during  the two (2) year  period  following  a Change in  Control  (as
defined):

     (1) a change in the Executive's status, title, position or responsibilities
(including  reporting  responsibilities)  which, in the  Executive's  reasonable
judgment,  does not represent a promotion  from his status,  title,  position or
responsibilities  as in effect immediately prior thereto;  the assignment to the
Executive of any duties or responsibilities which, in the Executive's reasonable
judgment,    are   inconsistent   with   such   status,   title,   position   or
responsibilities;  or any removal of the Executive  from or failure to reappoint
or  reelect  him to  any of  such  positions,  except  in  connection  with  the
termination of his employment for Disability, Cause, as a result of his death or
by the Executive other than for Good Reason;

     (2) a reduction  in the  Executive's  Base Salary or any failure to pay the
Executive any  compensation  or benefits to which he is entitled within five (5)
days of the date due;

     (3) a failure by the Company to  increase  the  Executive's  Base Salary at
least  annually  at a  percentage  of Base  Salary  no  less  than  the  average
percentage  increases granted to the Executive during the three most recent full
years ended prior to a Change in Control;

     (4) the failure by the Company to (i) continue in effect (without reduction
in benefit  level and/or  reward  opportunities)  any material  compensation  or
benefit plan in which the Executive was  participating at the time of the Change
in Control,  including,  but not  limited to, the  Company's  401(k)  Plan,  the
Company's 1998 Stock  Incentive Plan, the Company's 1999 Stock Incentive Plan or
(ii) provide the  Executive  with  compensation  and benefits at least equal (in
terms of benefit levels and/or reward opportunities) to those provided for under
each employee benefit plan,  program and practice as in effect immediately prior
to the Change in Control (or as in effect  following  the Change in Control,  if
greater).

                                       4
<PAGE>

     (5) the insolvency or the filing (by any party, including the Company) of a
petition for bankruptcy, of the Company;

     (6) any material breach by the Company of any provision of this Agreement;

     (7) any purported  termination of the  Executive's  employment for Cause by
the Company which does not comply with the terms of Section 8 of this Agreement;

                                       or

     (8) the failure of the Company to obtain an agreement,  satisfactory to the
Executive,  from any  successor  or assign of the Company to assume and agree to
perform this Agreement, as contemplated in Section 13 hereof;

     (9) the Company  requires the  Executive to be based at any office  located
more than fifty (50) miles from the  office  where the  Executive  is  currently
based without the Executive's consent;

     (B)  the  nature  of  Executive's   duties  or  the  scope  of  Executive's
responsibilities  (including reporting  responsibilities) is materially modified
by  the  Company  without   Executive's  written  consent  where  such  material
modification  constitutes a demotion of Executive or a substantial  reduction in
Executive's responsibilities;

     (C) a reduction in the Executive's Base Salary;

     (D) any material  breach by the Company of any provision of this  Agreement
that has not been cured within thirty (30) days following receipt by the Company
of written  notice  thereof from the  Executive  specifically  identifying  such
material breach;

                                       or

     (E) this Agreement is not assumed by any successor to the Company  pursuant
to Section 13 hereof in a situation other than a Change in Control.

     (ii) The  Executive's  right to terminate his  employment  pursuant to this
Section 8(c) shall not be affected by his  incapacity  due to physical or mental
illness if such  incapacity  occurs after the event or condition  giving rise to
Executive's right to terminate his employment pursuant to this Section 8(c).

     (d) Voluntary  Termination.  The Executive  may  voluntarily  terminate his
employment hereunder at any time.

                                      5
<PAGE>

     (e) For purposes of this Agreement, a "Change in Control" shall mean any of
the following events:

     (i) An acquisition (other than directly from Neff Corp. (the (Company)) of
any voting  securities of the Company (the "Voting  Securities") by any "Person"
(as the  term  person  is used for  purposes  of  Section  13(d) or 14(d) of the
Securities  Exchange Act of 1934, as amended (the "Exchange Act")),  immediately
after which such Person has "Beneficial  Ownership"  (within the meaning of Rule
13d-3 promulgated under the Exchange Act) of thirty percent (30%) or more of the
then  outstanding  Shares or the  combined  voting power of the  Company's  then
outstanding Voting Securities;  provided,  however, that Beneficial Ownership by
any of Jorge Mas,  Juan Carlos  Mas,  Jose Ramon Mas,  or  aggregate  Beneficial
Ownership by General Electric Capital Corporation and any of its 100% Affiliates
(as defined),  of thirty percent (30%) or more of the then outstanding Shares or
the combined voting power of the Company's then  outstanding  Voting  Securities
shall  not  constitute  a Change  in  Control;  provided  further,  however,  in
determining  whether  a  Change  in  Control  has  occurred,  Shares  or  Voting
Securities  which are acquired in a "Non-Control  Acquisition"  (as  hereinafter
defined)  shall not  constitute  an  acquisition  which  would cause a Change in
Control.  A  "Non-Control  Acquisition"  shall  mean  an  acquisition  by (A) an
employee benefit plan (or a trust forming a part thereof)  maintained by (1) the
Company or (2) any corporation or other Person of which a majority of its voting
power or its voting equity  securities or equity interest is owned,  directly or
indirectly,  by the Company (for purposes of this  definition,  a "Subsidiary"),
(B) the  Company or its  Subsidiaries,  or (C) any Person in  connection  with a
"Non-Control Transaction" (as hereinafter defined);

     (ii) The  individuals  who, as of the date of this Agreement are members of
the Board (the "Incumbent  Board"),  cease for any reason to constitute at least
two-thirds  of the members of the Board of Directors  of the Company;  provided,
however,  that if the  election,  or  nomination  for election by the  Company's
common  stockholders,  of any new  director  was  approved by a vote of at least
two-thirds of the Incumbent Board, such new director shall, for purposes of this
Agreement,  be considered as a member of the Incumbent Board;  provided further,
however,  that no individual shall be considered a member of the Incumbent Board
if such individual  initially  assumed office as a result of either an actual or
threatened "Election Contest" (as described in Rule 14a-11 promulgated under the
Exchange Act) or other actual or threatened  solicitation of proxies or consents
by or on behalf of a Person other than the Board (a "Proxy  Contest")  including
by reason of any agreement  intended to avoid or settle any Election  Contest or
Proxy Contest;

                                       or

     (iii) The consummation of:


     (A) A merger, consolidation or reorganization involving the Company, unless
such merger,  consolidation or reorganization is a "Non-Control  Transaction." A
"Non-Control  Transaction" shall mean a merger,  consolidation or reorganization
of the Company where:

                                       6
<PAGE>

     (1) the  stockholders  of the  Company,  immediately  before  such  merger,
consolidation  or  reorganization,   own  directly  or  indirectly   immediately
following such merger,  consolidation or reorganization,  at least fifty percent
(50%) of the combined voting power of the outstanding  voting  securities of the
corporation  resulting from such merger or consolidation or reorganization  (the
"Surviving Corporation") in substantially the same proportion as their ownership
of the Voting  Securities  immediately  before  such  merger,  consolidation  or
reorganization,

     (2) the  individuals  who were members of the Incumbent  Board  immediately
prior to the execution of the agreement providing for such merger, consolidation
or reorganization  constitute at least two-thirds of the members of the board of
directors of the Surviving Corporation,  or a corporation  beneficially directly
or  indirectly  owning a majority  of the  Voting  Securities  of the  Surviving
Corporation, and

     (3) no Person other than (i) the Company,  (ii) any  Subsidiary,  (iii) any
employee  benefit plan (or any trust forming a part thereof)  that,  immediately
prior to such merger,  consolidation  or  reorganization,  was maintained by the
Company,  or any Subsidiary,  or (iv) any Person who,  immediately prior to such
merger,  consolidation  or  reorganization  had  Beneficial  Ownership  of fifty
percent (50%) or more of the then outstanding  Voting Securities or Shares,  has
Beneficial Ownership of fifty percent (50%) or more of the combined voting power
of the Surviving  Corporation's then outstanding voting securities or its common
stock.

     (B) A complete liquidation or dissolution of the Company;

                                       or

     (C) The sale or other disposition of all or substantially all of the assets
of the Company to any Person (other than a transfer to a Subsidiary).

                                       7
<PAGE>

     Notwithstanding  the foregoing,  a Change in Control shall not be deemed to
occur  solely  because any Person (the  "Subject  Person")  acquired  Beneficial
Ownership of more than the permitted  amount of the then  outstanding  Shares or
Voting  Securities as a result of the acquisition of Shares or Voting Securities
by the Company which, by reducing the number of Shares or Voting Securities then
outstanding,  increases the proportional  number of shares Beneficially Owned by
the Subject  Persons,  provided that if a Change in Control would occur (but for
the  operation  of this  sentence) as a result of the  acquisition  of Shares or
Voting  Securities  by the  Company,  and after  such share  acquisition  by the
Company,  the Subject  Person  becomes the  Beneficial  Owner of any  additional
Shares  or  Voting  Securities  which  increases  the  percentage  of  the  then
outstanding  Shares  or  Voting  Securities  Beneficially  Owned by the  Subject
Person, then a Change in Control shall occur.

     If the  Executive's  employment is terminated by the Company  without Cause
prior  to  the  date  of a  Change  in  Control  but  the  Executive  reasonably
demonstrates  that the  termination  (i) was at the request of a third party who
has  indicated  an intention or taken steps  reasonably  calculated  to effect a
change in control or (ii) otherwise arose in connection with, or in anticipation
of, a Change in Control which has been threatened or proposed,  such termination
shall be deemed to have occurred  after a Change in Control for purposes of this
Plan provided a Change in Control shall actually have occurred.

     For the purposes of this Agreement,  "100% Affiliate" means with respect to
any Person, (i) each other Person that, directly or indirectly, owns or controls
one hundred  percent  (100%) of the stock  having  ordinary  voting power in the
election of directors of such Person,  (ii) each other Person of which the stock
having  ordinary  voting  power in the  election  of its  directors  is owned or
controlled one hundred percent (100%) by such Person, or (iii) each other Person
of which the stock having ordinary voting power in the election of its directors
is owned or  controlled  one  hundred  percent  (100%) by any Person  defined in
clause (i) above or any of its 100% Affiliates.

     (f) Notice of Termination.  Any purported  termination by the Company or by
the Executive  shall be  communicated  by written  Notice of  Termination to the
other.  For purposes of this Agreement,  a "Notice of Termination"  shall mean a
notice which  indicates  the specific  termination  provision in this  Agreement
relied upon and shall set forth in reasonable detail the facts and circumstances
claimed to provide a basis for termination of the Executive's  employment  under
the provision so indicated.  For purposes of this  Agreement,  no such purported
termination of employment shall be effective without such Notice of Termination.

     (g) Termination Date, Etc. "Termination Date" shall mean in the case of the
Executive's  death, his date of death, or in all other cases, the date specified
in the Notice of Termination subject to the following:

                                       8
<PAGE>

     (i) If the Executive's employment is terminated by the Company for Cause or
due to Disability,  the date specified in the Notice of Termination  shall be at
least thirty (30) days from the date the Notice of  Termination  is given to the
Executive,  provided that in the case of Disability the Executive shall not have
returned to the  full-time  performance  of his duties  during such period of at
least thirty (30) days; and

     (ii) If the Executive's  employment is terminated for Good Reason, the date
specified  in the Notice of  Termination  shall not be more than sixty (60) days
from the date the Notice of Termination is given to the Company.

     9.  Compensation  Upon  Termination.  Upon  termination of the  Executive's
employment during the term of this Agreement (including any extensions thereof),
the Executive shall be entitled to the following benefits:

     (a) If the Executive's employment is terminated by the Company for Cause or
Disability or by the Executive (other than for Good Reason), or by reason of the
Executive's  death,  the Company shall pay the  Executive all amounts  earned or
accrued  hereunder  through  the  Termination  Date  but  not  paid  as  of  the
Termination Date,  including (i) Base Salary, (ii) reimbursement for any and all
monies  advanced  or  expenses  incurred  in  connection  with  the  Executive's
employment for reasonable  and necessary  expenses  incurred by the Executive on
behalf of the  Company  for the period  ending on the  Termination  Date,  (iii)
vacation  pay, (iv) any bonuses or incentive  compensation  and (v) any previous
compensation which the Executive has previously deferred (including any interest
earned or credited thereon) (collectively,  "Accrued Compensation"). In addition
to the foregoing, if the Executive's employment is terminated by the Company for
Disability or by reason of the Executive's  death,  the Company shall pay to the
Executive or his beneficiaries as severance pay each month for the eighteen (18)
months immediately  following the date of termination an amount in cash equal to
the  difference,  if any,  between  (i) the sum of (y) the  amount  of  payments
Executive  receives or will receive during that month pursuant to the disability
insurance policies maintained by the Company for Executive's benefit and (z) the
adjustment  described  in the next  sentence and (ii)  Executive's  base monthly
salary on the date of termination due to Disability.  The adjustment referred to
in clause (z) of the  preceding  sentence is the amount by which any  tax-exempt
payments  referred to in clause (y) would need to be increased if such  payments
were  subject to tax in order to make the  after-tax  proceeds of such  payments
equal  to the  actual  amount  of  such  tax-exempt  payments.  The  Executive's
entitlement  to any  other  compensation  or  benefits  shall be  determined  in
accordance  with the  Company's  employee  benefit  plans and  other  applicable
programs and practices then in effect.

     (b) If the Executive's employment by the Company shall be terminated (1) by
the Company  other than for Cause,  death or  Disability or (2) by the Executive
for Good Reason,  then the Executive shall be entitled to the benefits  provided
below:

                                       9
<PAGE>

     (i) the Company shall pay the Executive all Accrued Compensation;

     (ii) the Company  shall pay the  Executive as severance  pay and in lieu of
any further salary for periods  subsequent to the Termination  Date, in a single
payment an amount in cash equal to one and  one-half  (1.5) times the sum of (A)
the Executive's Base Salary at the highest rate in effect at any time within the
ninety (90) day period ending on the date the Notice of Termination is given (or
if the  Executive's  employment  is  terminated  after a Change in Control,  the
Executive's Base Salary immediately prior to the Change in Control,  if greater)
and (B) the "Bonus  Amount."  The term "Bonus  Amount"  shall mean the  greatest
amount of the cash  awards  received  by the  Executive  during any of the three
fiscal years immediately preceding the Termination Date;

     (iii) for a period of eighteen (18) months following such termination,  the
Company  shall at its  expense  continue  on  behalf  of the  Executive  and his
dependents and beneficiaries the life insurance, disability, medical, dental and
hospitalization  benefits which were being provided to the Executive at the time
Notice of Termination  is given (or, if the Executive is terminated  following a
Change in Control,  the  benefits  provided to the  Executive at the time of the
Change in Control,  if  greater).  The  benefits  provided in this Section 9 (b)
(iii)  shall be no less  favorable  to the  Executive,  in terms of amounts  and
deductibles and costs to him, than the coverage provided the Executive under the
plans providing such benefits at the time Notice of Termination is given (or, if
the  Executive is terminated  following a Change in Control,  at the time of the
Change in Control if more favorable to the Executive).  The Company's obligation
hereunder with respect to the foregoing  benefits shall be limited to the extent
that the Executive obtains any such benefits pursuant to a subsequent employer's
benefit plans, in which case the Company may reduce the coverage of any benefits
it is required  to provide  the  Executive  hereunder  as long as the  aggregate
coverage of the combined benefit plans is no less favorable to the Executive, in
terms of amounts and deductibles and costs to him, than the coverage required to
be provided  hereunder.  This Subsection (iii) shall not be interpreted so as to
limit any  benefits to which the  Executive  or his  dependents  may be entitled
under  any of the  Company's  employee  benefit  plans,  programs  or  practices
following  the  Executive's  termination  of  employment,   including,   without
limitation, retiree medical and life insurance benefits; and

                                       10
<PAGE>

     (iv) for a period of eighteen (18) months following such  termination,  the
Company  shall at its  expense  continue  on  behalf  of the  Executive  the car
allowance  which was  being  provided  to the  Executive  at the time  Notice of
Termination  is given (or, if the Executive is terminated  following a Change in
Control,  the car allowance  provided to the Executive at the time of the Change
of Control, if greater).  The Company's obligation hereunder with respect to the
car allowance shall terminate if the Executive receives a car allowance pursuant
to a subsequent employer's benefit plans or practices.

     (v) all restrictions on any outstanding  award (including  restricted stock
and  performance  stock awards)  granted to the  Executive  shall lapse and such
awards shall become fully (100%) vested  immediately,  assuming all  performance
targets and goals (if  applicable)  had been fully met by the Company and by the
Executive,  as  applicable,  for such  year,  and all  stock  options  and stock
appreciation  rights  granted to the Executive  shall become fully (100%) vested
and shall become immediately exercisable.

     (c) The amounts  provided for in Sections  9(a) and 9(b)(i),  (ii) and (iv)
shall be paid within ten (10) days after the Executive's Termination Date.

     (d) The  Executive  shall not be  required  to  mitigate  the amount of any
payment,  benefit or other Company obligation  provided for in this Agreement by
seeking other  employment  or otherwise  and no such  payment,  benefit or other
Company  obligation shall be offset or reduced by the amount of any compensation
or benefits provided to the Executive in any subsequent employment.

     10.  Termination of Severance  Agreement.  Effective as of the date hereof,
the Severance  Agreement shall be terminated and shall be of no further force or
effect.

     11. Unauthorized Disclosure.  The Executive shall not make any Unauthorized
Disclosure. For purposes of this Agreement, "Unauthorized Disclosure" shall mean
disclosure  by the  Executive  without  the  consent of the Board to any person,
other  than an  employee  of the  Company  or a  person  to whom  disclosure  is
reasonably  necessary or appropriate in connection  with the  performance by the
Executive  of his  duties as an  executive  of the  Company or as may be legally
required, of any confidential information obtained by the Executive while in the
employ  of  the  Company  (including,  but  not  limited  to,  any  confidential
information  with  respect  to any of the  Company's  customers  or  methods  of
distribution)  the disclosure of which he knows or has reason to believe will be
materially injurious to the Company; provided, however, that such term shall not
include  the  use  or  disclosure  by the  Executive,  without  consent,  of any
information  known generally to the public (other than as a result of disclosure
by him in  violation  of  this  Section  11) or any  information  not  otherwise
considered  confidential by a reasonable  person engaged in the same business as
that conducted by the Company.

                                       11
<PAGE>

     12. Indemnification.

     (a) General.  The Company  agrees that if the  Executive is made a party or
threatened to be made a party to any action, suit or proceeding,  whether civil,
criminal,  administrative  or investigative (a  "Proceeding"),  by reason of the
fact that the  Executive  is or was a director  or officer of the Company or any
subsidiary  thereof or is or was  serving at the  request of the  Company or any
subsidiary thereof as a director,  officer, member, employee or agent of another
corporation  or  a  partnership,  joint  venture,  trust  or  other  enterprise,
including,  without limitation,  service with respect to employee benefit plans,
whether or not the basis of such  Proceeding  is alleged  action in an  official
capacity as a director,  officer,  member,  employee or agent while serving as a
director, officer, member, employee or agent, the Executive shall be indemnified
and held  harmless by the Company to the fullest  extent  authorized  by Florida
law, as the same exists or may  hereafter  be amended,  against all Expenses (as
hereinafter  defined)  incurred  or  suffered  by the  Executive  in  connection
therewith,  and such indemnification  shall continue as to the Executive even if
the Executive has ceased to be an officer,  director,  or agent, or is no longer
employed by the  Company and shall inure to the benefit of his heirs,  executors
and  administrators;  provided,  however,  that the  Executive  shall  not be so
indemnified for any Proceeding  which shall have been adjudicated to have arisen
out of or been based upon his willful misconduct, bad faith, gross negligence or
reckless disregard of duty or his failure to act in good faith in the reasonable
belief that his action was in the best interests of the Company.

     (b) Expenses. As used in this Agreement, the term "Expenses" shall include,
without limitation,  damages, losses, judgments,  liabilities, fines, penalties,
excise   taxes,   settlements,   and  costs,   attorneys'   fees,   accountants'
investigations,  and any  expenses of  establishing  a right to  indemnification
under this Agreement.

     (c)  Enforcement.  If a claim or  request  for  indemnification  under this
Section 12 is not paid by the Company or on its behalf,  within thirty (30) days
after a written claim or request has been received by the Company, the Executive
may at any time thereafter  bring suit against the Company to recover the unpaid
amount  of the  claim or  request  and if  successful  in whole or in part,  the
Executive  shall be entitled to be paid also the  expenses of  prosecuting  such
suit. All  obligations  for  indemnification  hereunder shall be subject to, and
paid in accordance with, applicable Florida law.

     (d)  Partial  Indemnification.  If the  Executive  is  entitled  under  any
provision  of this  Agreement  to  indemnification  by the Company for some or a
portion of any Expenses,  but not,  however,  for the total amount thereof,  the
Company  shall  nevertheless  indemnify  the  Executive  for the portion of such
Expenses to which Executive is entitled.

                                       12
<PAGE>

     (e) Advances of Expenses.  Expenses incurred by the Executive in connection
with any Proceeding  shall be paid by the Company in advance upon request of the
Executive that the Company pay such Expenses and upon the  Executive's  delivery
of an  undertaking  to reimburse  the Company for Expenses with respect to which
the Executive is not entitled to indemnification.

     (f) Notice of Claim.  The Executive shall give to the Company notice of any
claim made against him for which  indemnification  will or could be sought under
this  Agreement,  but the failure of the Executive to give such notice shall not
relieve the  Company of any  liability  the  Company  may have to the  Executive
except to the extent that the Company is prejudiced  thereby.  In addition,  the
Executive  shall give the Company such  information  and  cooperation  as it may
reasonably require and as shall be within the Executive's power and at such time
and places as are convenient for the Executive.

     (g)  Defense  of Claim.  With  respect  to any  Proceeding  as to which the
Executive notifies the Company of the commencement thereof;

     (i) The Company will be entitled to participate therein at its own expense;
and

     (ii) Except as otherwise  provided  below,  to the extent that it may wish,
the  Company  will be  entitled  to assume the  defense  thereof,  with  counsel
reasonably  satisfactory  to the  Executive.  The Executive  also shall have the
right to  employ  his own  counsel  in such  action,  suit or  proceeding  if he
reasonably  concludes that failure to do so would involve a conflict of interest
between the Company and the Executive, and under such circumstances the fees and
expenses of such counsel shall be at the expense of the Company.

     (iii) The Company shall not be liable to indemnify the Executive under this
Agreement  for any amounts paid in  settlement  of any action or claim  effected
without its written consent. The Company shall not settle any action or claim in
any  manner  which  would not  include a full and  unconditional  release of the
Executive without the Executive's prior written consent. Neither the Company nor
the Executive will unreasonably  withhold or delay their consent to any proposed
settlement.

     (h)  Non-exclusivity.  The  right to  indemnification  and the  payment  of
Expenses  incurred in defending a Proceeding in advance of its final disposition
conferred in this Agreement  shall not be exclusive of any other right which the
Executive may have or hereafter may acquire under any statute,  provision of the
declaration of trust or certificate of  incorporation  or by-laws of the Company
or any subsidiary, agreement, vote of shareholders or disinterested directors or
otherwise.

                                       13
<PAGE>

     13. Successors and Assigns.

     (a) This Agreement  shall be binding upon and shall inure to the benefit of
the  Company,  its  successors  and assigns and the  Company  shall  require any
successor or assign to expressly  assume and agree to perform this  Agreement in
the same manner and to the same  extent  that the  Company  would be required to
perform it if no such  succession or assignment  had taken place.  The term "the
Company" as used herein shall  include  such  successors  and assigns.  The term
"successors and assigns" as used herein shall mean a corporation or other entity
acquiring  all or  substantially  all the assets  and  business  of the  Company
(including this Agreement) whether by operation of law or otherwise.

     (b) Neither this  Agreement  nor any right or interest  hereunder  shall be
assignable  or  transferable  by  the  Executive,  his  beneficiaries  or  legal
representatives, except by will or by the laws of descent and distribution. This
Agreement  shall inure to the benefit of and be enforceable  by the  Executive's
legal personal representative.

     14. Covenant Not to Compete

     (a) The Executive agrees that during the term of this Agreement and for one
(1) year  subsequent to termination of Executive's  employment  with the Company
for any reason (the "Non-Compete Term") the Executive shall not:

     (i)  Either  directly  or  indirectly,  for  himself  or on behalf of or in
conjunction  with  any  other  person,  persons,   company,  firm,  partnership,
corporation,  business, group or other entity (each, a "Person"),  engage in any
business or activity, whether as an employee,  consultant,  partner,  principal,
agent,   representative,   stockholder  or  other  individual,   corporate,   or
representative  capacity,  or render  any  services  or  provide  any  advice or
substantial  assistance to any  business,  person or entity,  if such  business,
person or  entity,  directly  or  indirectly  will in any way  compete  with the
Company  (a  "Competing  Business").  Without  limiting  the  generality  of the
foregoing,  for purposes of this  Section 14, it is  understood  that  Competing
Businesses  shall  include any  business  which rents or sells  construction  or
industrial equipment or engages in the sale of maintenance,  repair or operating
supplies;  provided,  however, that notwithstanding the foregoing, the Executive
may make passive  investments  in up to 2% of the  outstanding  publicly  traded
common stock of an entity which operates a Competing Business.

     (ii)  Either  directly  or  indirectly,  for  himself or on behalf of or in
conjunction with any other Person, solicit, hire or divert any Person who is, or
who is, at the time of termination of the  Executive's  employment,  or has been
within  six  (6)  months  prior  to  the  time  of  termination  of  Executive's
employment,  an  employee  of the  Company  or any of its  subsidiaries  for the
purpose or with the intent of enticing such employee away from the employ of the
Company or any of its subsidiaries.

                                       14
<PAGE>

     (iii)  Either  directly  or  indirectly,  for himself or on behalf of or in
conjunction with any other Person, solicit, hire or divert any Person who is, or
who is, at the time of termination of the  Executive's  employment,  or has been
within  six  (6)  months  prior  to  the  time  of  termination  of  Executive's
employment, a customer or supplier of the Company or any of its subsidiaries for
the  purpose or with the intent of (A)  inducing  or  attempting  to induce such
Person to cease doing  business  with the Company or (B) in any way  interfering
with the relationship between such Person and the Company.

     (b) Because of the difficulty of measuring  economic  losses to the Company
as a result of a breach of the foregoing covenants, and because of the immediate
and  irreparable  damage  that could be caused to the Company for which it would
have no other  adequate  remedy,  the  Executive  agrees (i) that the  foregoing
covenants, in addition to and not in limitation of any other rights, remedies or
damages available to the Company at law, in equity or under this Agreement,  may
be enforced by the  Company in the event of the breach or  threatened  breach by
the Executive,  by injunctions and/or restraining orders and (ii) to pay the sum
of one thousand dollars ($1,000) per day for each day during which the Executive
is in breach of such covenants as liquidated damages or, if greater,  the amount
of damages  the Company can  reasonably  demonstrate  it incurred as a result of
such breach.  The Company and  Executive  agree that the dollar amount in clause
(ii) of the  preceding  sentence  represents  the  product  of their  good faith
negotiations.  If the Company is involved in court or other legal proceedings to
enforce  the  covenants  contained  in this  Section  14,  then in the event the
Company  prevails in such  proceedings,  the  Executive  shall be liable for the
payment of reasonable  attorneys' fees, costs and ancillary expenses incurred by
the Company in enforcing its rights hereunder.

     (c) The covenants in this Section 14 are  severable  and separate,  and the
unenforceability of any specific covenant shall not affect the provisions of any
other covenant. Moreover, in the event any court of competent jurisdiction shall
determine that the scope, time or territorial  restrictions set forth herein are
unreasonable,  then it is the intention of the parties that such restrictions be
enforced  to the  fullest  extent  that such  court  deems  reasonable,  and the
Agreement shall thereby be reformed to reflect the same.

     (d) All of the  covenants  in this  Section  14  shall be  construed  as an
agreement  independent  of any  other  provision  in  this  Agreement,  and  the
existence of any claim or cause of action of the  Executive  against the Company
whether predicated on this Agreement or otherwise shall not constitute a defense
to the enforcement by the Company of such covenants.  It is specifically  agreed
that the period following the termination of the Executive's employment with the
Company  during which the agreements and covenants of the Executive made in this
Section  14 shall be  effective,  shall  be  computed  by  excluding  from  such
computation any time during which the Executive is in violation of any provision
of this Section 14.

                                       15
<PAGE>

     (e) Notwithstanding  any of the foregoing,  if any applicable law, judicial
ruling or order shall reduce the time period during which the Executive shall be
prohibited  from engaging in any  competitive  activity  described in Section 14
hereof, the period of time for which the Executive shall be prohibited  pursuant
to Section 14 hereof shall be the maximum time permitted by law.

     15.  Notice.  For the  purposes  of this  Agreement,  notices and all other
communications   provided  for  in  the  Agreement   (including  the  Notice  of
Termination)  shall be in  writing  and shall be deemed to have been duly  given
when personally  delivered or sent by certified mail, return receipt  requested,
postage prepaid,  addressed to the respective addresses last given by each party
to the other,  provided that all notices to the Company shall be directed to the
attention of the President.  All notices and  communications  shall be deemed to
have been received on the date of delivery  thereof or on the third business day
after the mailing  thereof,  except  that  notice of change of address  shall be
effective only upon receipt.

     16.  Non-exclusivity of Rights.  Nothing in this Agreement shall prevent or
limit the Executive's continuing or future participation in any benefit,  bonus,
incentive  or  other  plan or  program  provided  by the  Company  or any of its
subsidiaries and for which the Executive may qualify,  nor shall anything herein
limit or reduce such rights as the Executive may have under any other agreements
with the Company or any of its  subsidiaries.  Amounts which are vested benefits
or which the  Executive  is  otherwise  entitled  to  receive  under any plan or
program of the Company or any of its subsidiaries shall be payable in accordance
with such plan or program, except as explicitly modified by this Agreement.

     17.  Settlement of Claims.  The  Company's  obligation to make the payments
provided  for in  this  Agreement  and  otherwise  to  perform  its  obligations
hereunder  shall  not be  affected  by  any  circumstances,  including,  without
limitation, any set-off, counterclaim,  recoupment, defense or other right which
the Company may have against the Executive or others.

     18.  Survival.  The  agreements  and  obligations  of the  Company  and the
Executive made in Sections 9, 11, 12, 14, 15, 18 and 19 of this Agreement  shall
survive the expiration or termination of this Agreement.

                                       16
<PAGE>

     19.  Federal  Income Tax  Withholding.  The Company may  withhold  from any
benefits payable under this Agreement all federal, state, city or other taxes as
shall be required pursuant to any law or governmental regulation or ruling.

     20. Pooling Transactions.  Notwithstanding anything to the contrary, in the
event of a Change in Control  which is also  intended  to  constitute  a pooling
transaction,  the  Company  shall take such  actions,  if any,  as  specifically
recommended  by an  independent  accounting  firm retained by the Company to the
extent reasonably necessary in order to assure that the pooling transaction will
qualify as such,  including,  without  limitation,  (i)  deferring  the vesting,
exercise,  payment,  settlement  or  lapsing  restrictions  with  respect to any
payments  of base  salary,  other  payments  or  benefits,  allowances,  awards,
reimbursements  or perquisites  that are provided for hereunder,  (ii) providing
that the payment or settlement be made in the form of cash, Voting Securities or
securities of a successor or acquirer of the Company,  or a  combination  of the
foregoing,  and (iii)  providing  for the extension of the term of any option to
the extent  necessary to accommodate  the foregoing,  but not beyond the maximum
term of such option.

     21. Miscellaneous.  No provision of this Agreement may be modified,  waived
or  discharged  unless such  waiver,  modification  or discharge is agreed to in
writing and signed by the Executive  and the Company.  No waiver by either party
hereto at any time of any breach by the other  party  hereto  of, or  compliance
with, any condition or provision of this Agreement to be performed by such other
party shall be deemed a waiver of similar or dissimilar provisions or conditions
at the same or at any prior or subsequent time. No agreement or representations,
oral or otherwise, express or implied, with respect to the subject matter hereof
have  been  made by  either  party  which  are not  expressly  set forth in this
Agreement.

     22.  Governing Law. This  Agreement  shall be governed by and construed and
enforced in  accordance  with the laws of the State of Florida,  without  giving
effect to the conflict of law principles thereof.

     23.  Jurisdiction  and Venue.  Each of the parties to this Agreement hereby
(a) consents to personal  jurisdiction in any suit, claim,  action or proceeding
relating  to or arising  under this  Agreement  which is brought in any local or
federal  court in the State of Florida,  (b) consents to service of process upon
such party in the  manner  set forth in  Section  15 hereof,  and (c) waives any
objection such party may have to venue in any such Florida court or to any claim
that any such Florida court is an inconvenient forum.

     24.  Severability.  The  provisions  of  this  Agreement  shall  be  deemed
severable and the  invalidity  or  unenforceability  of any provision  shall not
affect the validity or enforceability of the other provisions hereof.

     25. Entire  Agreement.  This  Agreement  constitutes  the entire  agreement
between  the  parties  hereto  and  supersedes  all  prior  agreements,  if any,
understandings  and  arrangements,  oral or written,  between the parties hereto
with respect to the subject matter hereof.

                                       17
<PAGE>

     IN WITNESS WHEREOF, the Company has caused this Agreement to be executed by
its duly authorized  officer and the Executive has executed this Agreement as of
the day and year first above written.


                                                     NEFF CORP.



                                                     By:
                                                          Name:
                                                         Title:

                                       18
<PAGE>




    EXHIBIT 10.2


                                     WAIVER


     WAIVER TO CREDIT  AGREEMENT (this  "Waiver"),  dated as of  March 22, 2000,
among NEFF CORP. (the "Company"), NEFF RENTAL, INC. ("Neff Rental", and together
with the Company, the "Borrowers",  and each a "Borrower"), the lenders party to
the Credit  Agreement  referred  to below (the  "Lenders"),  and  Bankers  Trust
Company,  as Agent (the  "Agent").  All  capitalized  terms used  herein and not
otherwise defined herein shall have the respective  meanings provided such terms
in the Credit Agreement.

                              W I T N E S S E T H :

     WHEREAS,  the  Borrowers,  the  Lenders and the Agent are party to a Credit
Agreement, dated as of May 1, 1998 (as amended, modified or supplemented to, but
not including, the date hereof, the "Credit Agreement"); and

     WHEREAS,  subject to the terms and  conditions of this Waiver,  the parties
hereto agree as follows;

     NOW, THEREFORE, it is agreed:

     1. The Lenders  hereby waive any Default or Event of Default which may have
arisen under the Credit  Agreement  solely as a result of the Company failing to
comply with  Section 9.08 of the Credit  Agreement  for the Test Period ended on
December 31, 1999, so long as the Consolidated  Interest Coverage Ratio for such
Test Period was at least 2.95:1.00.

     2. In order to induce the Lenders to enter into this Waiver,  each Borrower
hereby represents and warrants that (i) no Default or Event of Default exists as
of the Waiver  Effective Date (as defined below) and after giving effect to this
Waiver,  and (ii) on the Waiver  Effective  Date and after giving effect to this
Waiver, all representations and warranties contained in the Credit Agreement and
in the other Credit Documents are true and correct in all material respects.

     3. This Waiver  shall become  effective on the date (the "Waiver  Effective
Date")  when (i) each  Borrower  and the  Required  Lenders  shall have signed a
counterpart  hereof (whether the same or different  counterparts) and shall have
delivered (including by way of facsimile  transmission) the same to the Agent at
the  Notice  Office  and (ii) the  Company  shall have paid to the Agent for the
account of each Lender who has executed a counterpart  hereof and delivered same
to the Agent at the  Notice  Office on or prior to 12:00 Noon (New York time) on
Wednesday,  March  22,  2000,  a waiver  fee  equal  to  0.10% of such  Lender's
Revolving Loan Commitment at such time.

                                       1
<PAGE>

     4.  This  Waiver is  limited  as  specified  and  shall  not  constitute  a
modification,  acceptance  or  waiver  of any  other  provision  of  the  Credit
Agreement or any other Credit Document.

     5. This  Waiver may be executed  in any number of  counterparts  and by the
different parties hereto on separate  counterparts,  each of which  counterparts
when  executed  and  delivered  shall be an  original,  but all of  which  shall
together constitute one and the same instrument.  A complete set of counterparts
shall be lodged with each Borrower and the Agent.

     6. THIS  WAIVER AND THE RIGHTS AND  OBLIGATIONS  OF THE  PARTIES  HEREUNDER
SHALL BE GOVERNED BY AND  CONSTRUED IN  ACCORDANCE  WITH THE LAW OF THE STATE OF
NEW YORK.
                                      * * *
                                       2
<PAGE>



     IN WITNESS WHEREOF,  each of the parties hereto has caused a counterpart of
this Waiver to be duly executed and delivered as of the date hereof.

                                             NEFF CORP.


                                             By
                                             Title:


                                             NEFF RENTAL, INC.


                                             By
                                             Title:


                                             BANKERS TRUST COMPANY, Individually
                                             and as Agent



                                             By
                                             Title:


                                             DEUTSCHE FINANCIAL SERVICES



                                             By
                                             Title:


                                             TRANSAMERICA BUSINESS CREDIT
                                             CORPORATION

                                             By
                                             Title:


                                       3
<PAGE>



                                             LASALLE BUSINESS CREDIT, INC.



                                             By
                                             Title:


                                             CIT GROUP/BUSINESS CREDIT, INC.



                                             By
                                             Title:


                                             IBJ SCHRODER BUSINESS CREDIT
                                             CORPORATION



                                             By
                                             Title:


                                             NATIONAL BANK OF CANADA


                                             By
                                             Title:


                                             SUMMIT BANK


                                             By
                                             Title:

                                       4
<PAGE>


                                            FIRST UNION NATIONAL BANK


                                             By
                                             Title:


                                             UNION BANK OF CALIFORNIA N.A.



                                             By
                                             Title:



                                             BANK ATLANTIC



                                             By
                                             Title:



                                             BNY FINANCIAL CORPORATION



                                             By
                                             Title:



                                             BNY FINANCIAL CORPORATION



                                             By
                                             Title:



                                             FLEET NATIONAL BANK



                                             By
                                             Title:

                                       5
<PAGE>


                                             BANK OF BOSTON, N.A.



                                             By
                                             Title:




                                             GMAC COMMERCIAL CREDIT LLC



                                             By
                                             Title:



                                            CREDIT LYONNAIS, NEW YORK BRANCH



                                             By
                                             Title:



                                            FLEET CAPITAL CORPORATION



                                             By
                                             Title: