EXHIBIT 10.4


 


EXECUTION COPY


 


SECURITY
AGREEMENT


 


SECURITY AGREEMENT dated as of July 8, 2005 (together with all
amendments, if any, from time to time hereto, this “Agreement”), by and
among NEFF RENTAL LLC, a Delaware limited liability company (“Neff LLC”),
NEFF FINANCE CORP., a Delaware corporation (“Neff Finance” and, together
with Neff LLC, the “Borrowers” and each, a “Borrower”), NEFF
RENTAL, INC., a Florida corporation (“NEFF”) and each other Person which
becomes party hereto as Grantor pursuant to Section 19 of this Agreement
(such Persons, together with the Borrowers and NEFF, collectively, the “Grantors”
and each, a “Grantor”) and WELLS FARGO BANK, NATIONAL ASSOCIATION, as
collateral agent (in such capacity, the “Agent”) for the benefit of the
Secured Parties (as defined below).


 


W I T N E S S E T H:


 


WHEREAS, pursuant to the Indenture dated as of the date hereof (as from
time to time amended, restated, supplemented or otherwise modified, the “Indenture”),
among the Borrowers, NEFF, each of the other Persons named therein as a
Guarantor (as defined in the Indenture) and Wells Fargo Bank, National
Association, as Trustee, the Borrowers are co-issuing $245,000,000 aggregate
principal amount of their 111⁄4% Second Priority Senior Secured Notes Due 2012
and may issue, from time to time, additional notes in accordance with the
provisions of the Indenture (collectively, the “Notes”);


 


WHEREAS, each Grantor will derive direct and indirect economic benefits
from the issuance of the Notes and other financial accommodations provided to
the Borrowers and the other Grantors pursuant to the Indenture;


 


WHEREAS, in order to induce the Agent to enter into the Indenture and the
other Note Documents, each Grantor has agreed to grant a continuing Lien on the
Collateral (as hereinafter defined) to secure the Note Obligations;


 


NOW, THEREFORE, in consideration of the premises and mutual covenants
herein contained and to induce the Trustee to enter into the Indenture and the
other Note Documents, it is agreed as follows:


 


1.                                       Defined
Terms.


 


(a)                                  All
capitalized terms used but not otherwise defined herein have the meanings given
to them in the Indenture.  All other
terms contained in this Agreement, unless the context indicates otherwise, have
the meanings provided for by the Code to the extent the same are used or
defined therein.


 


(b)                                 The following terms
shall have the meanings assigned thereto in the Code:  as-extracted collateral, chattel paper,
commodities intermediary, commercial tort claim, deposit account, electronic
chattel paper, financial asset, letter-of-credit right, payment intangibles,


 





















 


proceeds, securities intermediary, software, timber to
be cut, supporting obligation and uncertificated securities.


 


(c)                                  As
used herein, the following terms shall have the meaning set forth below:


 


“Account Debtor” means any Person who may become obligated to
any Credit Party under, with respect to, or on account of, an Account, Chattel
Paper or General Intangibles (including a payment intangible).


 


“Accounts” means all “accounts,” as such term is defined in the
Code, now owned or hereafter acquired by any Credit Party, including (a) all
accounts receivable, other receivables, book debts, Rental Payments and other
forms of obligations (other than, except in the case of Rental Payments, forms
of obligations evidenced by Chattel Paper or Instruments), (including any such
obligations that may be characterized as an account or contract right under the
Code), (b) all of each Credit Party’s rights in, to and under all purchase
orders or receipts for goods or services, (c) all of each Credit Party’s
rights to any goods represented by any of the foregoing (including unpaid
sellers’ rights of rescission, replevin, reclamation and stoppage in
transit and rights to returned, reclaimed or repossessed goods), (d) all
rights to payment due to any Credit Party for property sold, leased, licensed,
assigned or otherwise disposed of, for a policy of insurance issued or to be
issued, for a secondary obligation incurred or to be incurred, for energy
provided or to be provided, for the use or hire of a vessel under a charter or
other contract, arising out of the use of a credit card or charge card, or for
services rendered or to be rendered by such Credit Party or in connection with
any other transaction (whether or not yet earned by performance on the part of
such Credit Party), (e) all healthcare insurance receivables, and (f) all
collateral security of any kind, now or hereafter in existence, given by any
Account Debtor or other Person with respect to any of the foregoing.


 


“Blocked Account” means each Deposit Account that is subject to a
Control Agreement.


 


“Blocked Account Bank” means each depositary bank that is party to
a Control Agreement.


 


“Capital Lease” means, with respect to any Person, any lease of
any property (whether real, personal or mixed) by such Person as lessee that,
in accordance with GAAP, would be required to be classified and accounted for
as a capital lease on a balance sheet of such Person.


 


“Cash Equivalents” means:


 


(a) marketable securities (i) issued or directly and
unconditionally guaranteed as to interest and principal by the United States
government or (ii) issued by any agency of the United States government
the obligations of which are backed by the full faith and credit of the United
States, in each case maturing within one (1) year after acquisition
thereof;


 





















 


(b) marketable direct obligations issued by any state of the
United States of America or any political subdivision of any such state or any
public instrumentality thereof, in each case maturing within one year after
acquisition thereof and having, at the time of acquisition, a rating of at
least A-1 from S&P or at least P-1 from Moody’s;


 


(c) commercial paper maturing no more than one year from the date
of acquisition and, at the time of acquisition, having a rating of at least A-1
from S&P or at least P-1 from Moody’s;


 


(d) certificates of deposit or bankers’ acceptances issued or
accepted by any commercial bank organized under the laws of the United States
of America or any state thereof or the District of Columbia that is at least (i) ”adequately
capitalized” (as defined in the regulations of its primary Federal banking
regulator) and (ii) has Tier 1 capital (as defined in such regulations) of
not less than $250,000,000, in each case maturing within one year after
issuance or acceptance thereof; and


 


(e) shares of any money market mutual or similar funds that (i) has
substantially all of its assets invested continuously in the types of
investments referred to in clauses (a) through (d) above, (ii) has
net assets of not less than $500,000,000 and (iii) has the highest rating
obtainable from either S&P or Moody’s.


 


“Chattel Paper” means any “chattel paper,” as such term is
defined in the Code, including electronic chattel paper, now owned or hereafter
acquired by any Credit Party, wherever located.


 


“Code” means the Uniform Commercial Code as the same may, from
time to time, be enacted and in effect in the State of New York; provided,
that to the extent that the Code is used to define any term herein or in any
Note Document and such term is defined differently in different Articles of the
Code, the definition of such term contained in Article 9 shall govern;
provided further, that in the event that, by reason of mandatory provisions of
law, any or all of the attachment, perfection or priority of, or remedies with
respect to, the Agent’s or any Secured Party’s Lien on any Collateral is
governed by the Uniform Commercial Code as enacted and in effect in a
jurisdiction other than the State of New York, the term “Code” shall mean the
Uniform Commercial Code as enacted and in effect in such other jurisdiction
solely for purposes of the provisions thereof relating to such attachment,
perfection, priority or remedies and for purposes of definitions related to
such provisions.


 


“Collateral” has the meaning specified in Section 2(a).


 


“Concentration Account” means any cash collateral account (which
may be a deposit account or a securities account) that is (a) established
by the Designated Agent from time to time in its sole discretion to receive
cash and Cash Equivalents (or purchase cash or Cash Equivalents with funds
received) from the Credit Parties or Persons acting on their behalf pursuant to
the Note Documents, (b) with such depositaries and securities
intermediaries as the


 





















 


Designated
Agent may determine in its sole discretion, (c) in the name of the
Designated Agent (although such account may also have words referring to the
Borrowers and the account’s purpose), (d) under the control of the
Designated Agent and (e) in the case of a securities account, with respect
to which the Designated Agent shall be the Entitlement Holder (as defined in
the Code) and the only Person authorized to give Entitlement Orders (as defined
in the Code).


 


“Contractual Obligations” means, as applied to any Person, any
indenture, mortgage, deed of trust, contract, undertaking, agreement or other
instrument to which that Person is a party or by which it or any of its
properties is bound or to which it or any of its properties is subject.


 


“Control Agreements” means:


 


(a)                                  in
the case of any bank account, a tri-party deposit account control agreement by
and among the applicable Credit Party, the Designated Agent and the depository,
in form customarily signed by the Designated Agent and otherwise in form and
substance satisfactory in all respects to the Designated Agent (it being
understood a form customarily signed by the Designated Agent is satisfactory)
pursuant to which such depository acknowledges the security interest of the
Agent in the deposit account, agrees to comply with instructions originated by
the Designated Agent directing disposition of the funds in the bank account
without further consent from such Credit Party or Subsidiary, and agrees to subordinate
and limit any security interest the bank may have in such bank account on terms
satisfactory to the Designated Agent;


 


(b)                                 in
the case of any securities account, a tri-party securities account control
agreement by and among the applicable Credit Party, the Designated Agent and
the securities intermediary, in form customarily signed by the Designated Agent
and otherwise in form and substance satisfactory in all respects to the
Designated Agent (it being understood a form customarily signed by the Designated
Agent is satisfactory) pursuant to which such securities intermediary
acknowledges the security interest of the Agent in the securities account,
agrees to comply with instructions originated by the Designated Agent directing
disposition of the funds in the securities account without further consent from
such Credit Party or Subsidiary, and agrees to subordinate and limit any
security interest the securities intermediary may have in such securities
account on terms satisfactory to the Designated Agent; and


 


(c)                                  in
the case of any commodities account, a tri-party commodities account control
agreement by and among the applicable Credit Party, the Designated Agent and
the commodities intermediary, in form customarily signed by the Designated
Agent and otherwise in form and substance satisfactory in all respects to the
Designated Agent (it being understood a form customarily signed by the
Designated Agent is satisfactory) pursuant to which such commodities
intermediary acknowledges the security interest of the Agent in the commodities
account, agrees to comply with instructions originated by the Designated Agent
directing disposition of the funds in the commodities account


 





















 


without further consent from such Credit Party or Subsidiary, and
agrees to subordinate and limit any security interest the commodities
intermediary may have in such commodities account on terms satisfactory to the
Designated Agent.


 


“Copyright License” means any and all rights nor owned or
hereafter acquired by any Credit Party under any written agreement granting any
right to use any Copyright or Copyright registration.


 


“Copyright Security Agreements” means the Copyright Security
Agreements made in favor of the Agent, on behalf of itself and the Secured
Parties, by each applicable Credit Party.


 


“Copyrights” means all of the following now owned or hereafter
adopted or acquired by any Credit Party: (a) all copyrights and General
Intangibles of like nature (whether registered or unregistered), all
registrations and recordings thereof, and all applications in connection
therewith, including all registrations, recordings and applications in the
United States Copyright Office or in any similar office or agency of the United
States, any state or territory thereof, or any other country or any political
subdivision thereof; and (b) all reissues, extensions or renewals thereof.


 


“Credit Parties” means each of the Borrowers, NEFF, each of
their respective Subsidiaries and each other Person, in each case, who executes
or becomes party to this Agreement as a “Grantor” or who executes a guarantee
of any Note Obligations or who grants a Lien on all or part of its assets or
properties to secure all or part of the Note Obligations.


 


“Designated Agent” means (a) prior to the discharge of all
Priority Lien Obligations, the ABL Facility Agent, and (b) at any time
after the discharge of all Priority Lien Obligations, the Agent.


 


“Documents” means any “document,” as such term is defined in the
Code, including electronic documents, now owned or hereafter acquired by any
Credit Party, wherever located.


 


“Domestic Person” means any “United States person” under and as
defined in Section 7701(a)(30) of the IRC.


 


“Domestic Subsidiary” with respect to any Person, means each
Subsidiary of such Person that is organized under the laws of a State of the
United States of America or under the laws of the United States of America.


 


“Eligible Credit Party” means each Domestic Subsidiary of either
of the Borrowers.


 


“Equipment” means all “equipment,” as such term is defined in
the Code, now owned or hereafter acquired by any Credit Party, wherever located
and, in any event, including


 





















 


all such
Credit Party’s machinery and equipment, including processing equipment,
conveyors, machine tools, data processing and computer equipment, including
embedded software and peripheral equipment and all engineering, processing and
manufacturing equipment, office machinery, furniture, materials handling
equipment, tools, attachments, accessories, automotive equipment, trailers,
trucks, forklifts, molds, dies, stamps, motor vehicles, rolling stock and other
equipment of every kind and nature, trade fixtures and fixtures not forming a
part of real property, together with all additions and accessions thereto,
replacements therefor, all parts therefor, all substitutes for any of the
foregoing, fuel therefor, and all manuals, drawings, instructions, warranties
and rights with respect thereto, and all products and proceeds thereof and
condemnation awards and insurance proceeds with respect thereto.


 


“Excluded Equity” means any Voting Stock in excess of 65% of the
total outstanding Voting Stock of any direct Subsidiary of any Grantor that is
a Non-U.S. Person.  For the purposes of
this definition, “Voting Stock” means, as to any issuer, the issued and
outstanding shares of each class of Stock of such issuer entitled to vote
(within the meaning of Treasury Regulations § 1.956-2(c)(2)).


 


“Excluded Property” means, collectively, (i) Excluded
Equity, (ii) any permit, lease, license, contract, Instrument or other
agreement held by any Grantor that prohibits or requires the consent of any
Person other than either of the Borrowers, NEFF or their respective Affiliates
as a condition to the creation by such Grantor of a Lien thereon, or any
permit, lease, license, contract or other agreement held by any Grantor to the
extent that any laws applicable thereto prohibits the creation of a Lien
thereon, but only, in each case, to the extent, and for so long as, such
prohibition is not terminated or rendered unenforceable or otherwise deemed
ineffective by the Code (including, without limitation, pursuant to Sections 9-406,
9-407, 9-408 and 9-409 of the Code) or any other laws (including, without limitation,
the Bankruptcy Code) and (iii) Equipment owned by any Grantor that is
subject to a purchase money Lien or a Capital Lease if the contract or other
agreement in which such Lien is granted (or in the documentation providing for
such Capital Lease) prohibits or requires the consent of any Person other than either
of the Borrowers, NEFF or their respective Affiliates as a condition to the
creation of any other Lien on such Equipment; provided, however, “Excluded
Property” shall not include any Proceeds, substitutions or replacements of
Excluded Property (unless such Proceeds, substitutions or replacements would
constitute Excluded Property).


 


“Fixtures” means all “fixtures” as such term is defined in the
Code, now owned or hereafter acquired by any Credit Party.


 


“General Intangibles” means “general intangibles,” as such term
is defined in the Code, now owned or hereafter acquired by any Credit Party,
including all right, title and interest that such Credit Party may now or
hereafter have in or under any Contractual Obligation, all payment intangibles,
customer lists, Licenses, Copyrights, Trademarks, Patents, and all applications
therefor and reissues, extensions or renewals thereof, rights in Intellectual
Property, interests in partnerships, joint ventures and other business
associations, licenses, permits, copyrights, trade secrets, proprietary or
confidential information, inventions (whether or not 


 





















 


patented or
patentable), technical information, procedures, designs, knowledge, know-how,
software, data bases, data, skill, expertise, experience, processes, models, drawings,
materials and records, goodwill (including the goodwill associated with any
Trademark or Trademark License), all rights and claims in or under insurance
policies (including insurance for fire, damage, loss and casualty, whether
covering personal property, real property, tangible rights or intangible
rights, all liability, life, key man and business interruption insurance, and
all unearned premiums), uncertificated securities, chooses in action, deposit,
checking and other bank accounts, rights to receive tax refunds and other
payments, rights to receive dividends, distributions, cash, Instruments and
other property in respect of or in exchange for pledged Stock and Investment
Property, rights of indemnification, all books and records, correspondence,
credit files, invoices and other papers, including all tapes, cards, computer
runs and other papers and documents in the possession or under the control of
such Credit Party or any computer bureau or service company from time to time
acting for such Credit Party.


 


“Goods” means any “goods,” as such term is defined in the Code,
now owned or hereafter acquired by any Credit Party, wherever located,
including embedded software to the extent included in “goods” as defined in the
Code, manufactured homes, standing timber that is cut and removed for sale and
unborn young of animals.


 


“Governmental Authority” means any nation or government, any
state or other political subdivision thereof, and any agency, department or
other entity exercising executive, legislative, judicial, regulatory or
administrative functions of or pertaining to government.


 


“Instruments” means all “instruments,” as such term is defined
in the Code, now owned or hereafter acquired by any Credit Party, wherever
located, and, in any event, including all certificated securities, all
certificates of deposit, and all promissory notes and other evidences of
indebtedness, other than instruments that constitute, or are a part of a group
of writings that constitute, Chattel Paper.


 


“Intellectual Property” means any and all Licenses, Patents,
Copyrights, Trademarks, and the goodwill associated with such Trademarks.


 


“Inventory” means any “inventory,” as such term is defined in
the Code, including Parts Inventory and Rental Fleet and Equipment, now owned or
hereafter acquired by any Credit Party, wherever located, including inventory,
merchandise, goods and other personal property that are held by or on behalf of
any Credit Party for sale or lease or are furnished or are to be furnished
under a contract of service, or that constitute raw materials, work in process,
finished goods, returned goods, supplies or materials of any kind, nature or
description used or consumed or to be used or consumed in such Credit Party’s
business or in the processing, production, packaging, promotion, delivery or
shipping of the same, including all supplies and embedded software.


 


“Investment Property” means all “investment property,” as such
term is defined in the Code, now owned or hereafter acquired by any Credit
Party, wherever located, including:


 





















 


(a) all
securities, whether certificated or uncertificated, including stocks, bonds,
interests in limited liability companies, partnership interests, treasuries,
certificates of deposit, and mutual fund shares; (b) all securities
entitlements of any Credit Party, 
including the rights of such Credit Party to any securities account and
the financial assets held by a securities intermediary in such securities
account and any free credit balance or other money owing by any securities
intermediary with respect to that account; (c) all securities accounts of
any Credit Party; (d) all commodity contracts of any Credit Party; and (e) all
commodity accounts held by any Credit Party.


 


“Joinder Agreement” means a joinder agreement, in substantially
the form of Exhibit A hereto or such other documentation acceptable to the
Agent pursuant to which any Subsidiary of either of the Borrowers becomes a
party to this Agreement, the Pledge Agreement and the Intercreditor Agreement
after the date of this Agreement.


 


“License” means any Copyright License, Patent License, Trademark
License or other license of rights or interests now held or hereafter acquired
by any Credit Party.


 


“Material Adverse Effect” means a material adverse effect on (a) the
business, operations, condition (financial or otherwise), assets, liabilities
or properties of the Borrowers and their Subsidiaries, taken as a whole, (b) the
validity or enforceability of any Note Document, (c) or material
impairment of the ability of the Borrowers and the other Credit Parties to pay
and perform their respective Note Obligations under this Agreement or the other
Note Documents, (d) the Collateral or the Agent’s Liens, on behalf of the
Secured Parties, on the Collateral or the priority of such Liens, or (e) the
Agent’s or any Secured Party’s rights and remedies under this Agreement or the
other Note Documents.


 


“Neff Corp.” means Neff Corp., a Delaware corporation and owner
of 100% of the membership interests of Neff LLC.


 


“Non-U.S. Person” means any Person that is not a Domestic
Person.


 


“Note Obligations” means all Obligations owing by any Credit
Party arising under the Note Documents.


 


“Parts Inventory” means Inventory owned by either Borrower or
any Eligible Credit Party which consists of parts for Rental Fleet and
Equipment and parts to be sold or leased by such Person in the ordinary course
of business of such Person, which parts are not incorporated or installed in or
on, or affixed or appurtenant to, any such Inventory or to any other property
and which parts are new, unused, in good condition and are resalable as new
products without repackaging or reconditioning, including Inventory that either
Borrower or any such Eligible Credit Party currently describes as “inventory
(including whole goods)” but excluding any Inventory that constitutes Rental
Fleet and Equipment.


 





















 


“Patent License” means rights under any written agreement now
owned or hereafter acquired by any Credit Party granting any right with respect
to any invention on which a Patent is in existence.


 


“Patent Security Agreements” means the Patent Security
Agreements made in favor of the Agent, on behalf of itself and the Secured
Parties, by each applicable Credit Party.


 


“Patents” means all of the following in which any Credit Party
now holds or hereafter acquires any interest: (a) all letters patent of
the United States or any other country, all registrations and recordings
thereof, and all applications for letters patent of the United States or of any
other country, including registrations, recordings and applications in the
United States Patent and Trademark Office or in any similar office or agency of
the United States, any State or any other country, and (b) all reissues,
continuations, continuations-in-part or extensions thereof.


 


“Pledge Agreement” means the Pledge Agreement of even date
herewith entered into by the Borrowers, NEFF and each other Credit Party that
is (or hereafter becomes) party thereto in favor of the Agent, for the benefit
of the Secured Parties, and any other pledge agreement entered into after the date
hereof by any Credit Party or any other Person.


 


“Power of Attorney” has the meaning specified in Section 7.


 


“Rental Fleet and Equipment” means Inventory which is of a type
offered for sale or lease by either Borrower or any Eligible Credit Party in
the ordinary course of business of the Borrower or any Eligible Credit Party,
including of Inventory that either Borrower or such Eligible Credit Party
currently described as “rental equipment, net” but excluding any Inventory that
constitutes Parts Inventory.


 


“Rental Payments” means rental payments due to either Borrower
or any of their Subsidiaries from the rental of Parts Inventory or Rental Fleet
and Equipment owned by such Person.


 


“Secured Parties” means, collectively, the Agent and the holders
of Note Obligations.


 


“Stock” means all shares, options, warrants, general or limited
partnership interests, membership interests or other equivalents (regardless of
how designated) of or in a corporation, partnership, limited liability company
or equivalent entity whether voting or nonvoting, including common stock,
preferred stock or any other “equity security” (as such term is defined in Rule 3a11-1
of the General Rules and Regulations promulgated by the SEC under the
Exchange Act).


 


“Termination Date” means the first date on which (a)(i) the
Notes have been repaid in full, (ii) there has been a satisfaction and
discharge of the Indenture as set forth under Article 8 of the Indenture
or (iii) there has been a Legal Defeasance or Covenant Defeasance of the
Notes as set forth under Article 8 of the Indenture and (b) all other
Obligations under the


 





















 


Indenture and
the other Note Documents (other than contingent indemnification Obligations to
the extent no claim has been asserted) have been completely discharged.


 


“Trademark License” means rights under any written agreement now
owned or hereafter acquired by any Credit Party granting any right to use any
Trademark.


 


“Trademark Security Agreements” means the Trademark Security
Agreements made in favor of the Agent, on behalf of itself and the Secured
Parties, by each applicable Credit Party.


 


“Trademarks” means all of the following now owned or hereafter
adopted or acquired by any Credit Party: (a) all trademarks, trade names,
corporate names, business names, trade styles, service marks, logos, internet
domain names, other source or business identifiers, prints and labels on which
any of the foregoing have appeared or appear, designs and general intangibles
of like nature (whether registered or unregistered), all registrations and
recordings thereof, and all applications in connection therewith, including
registrations, recordings and applications in the United States Patent and
Trademark Office or in any similar office or agency of the United States, any
state or territory thereof, or any other country or any political subdivision
thereof; (b) all reissues, extensions or renewals thereof; and (c) all
goodwill associated with or symbolized by any of the foregoing.


 


“Uniform Commercial Code Jurisdiction” means any jurisdiction
that has adopted all or substantially all of Article 9 of the Code.


 


2.                                       Grant
of Lien.


 


(a)                                  To
secure the prompt and complete payment, performance and observance of all of
the Note Obligations, each Grantor
hereby grants, assigns, conveys, mortgages, pledges, hypothecates and transfers
to the Agent, for the benefit of the Secured Parties and their respective
successors, endorsees, transferees and assigns, a Lien upon all of its right,
title and interest in, to and under all personal property and other assets,
whether now owned by or owing to, or hereafter acquired by or arising in favor
of such Grantor (including under
any trade names, styles or derivations thereof), and whether owned or consigned
by or to, or leased from or to, such Grantor,
and regardless of where located (all of which being hereinafter collectively
referred to as the “Collateral”), including:


 


(i)                                     all
Accounts;


 


(ii)                                  all
Chattel Paper;


 


(iii)                               all
Documents;


 


(iv)                              all General
Intangibles (including Payment Intangibles and Software);


 





















 


(v)                                 all
Goods (including Inventory, Equipment and Fixtures);


 


(vi)                              all
Instruments;


 


(vii)                           all
Investment Property;


 


(viii)                        all
Deposit Accounts;


 


(ix)                                all
money, cash or Cash Equivalents of such Grantor;


 


(x)                                   all
Supporting Obligations and Letter-of-Credit Rights of such Grantor;


 


(xi)                                the
Commercial Tort Claims described on Schedule V and on any supplement
thereto received by the Agent pursuant to Section 5(a)(ix); and


 


(xii)                             to
the extent not otherwise included, all Proceeds, tort claims, insurance claims
and other rights to payment not otherwise included in the foregoing and
products of the foregoing and all accessions to, substitutions and replacements
for, and rents and profits of, each of the foregoing;


 


provided,
however, that “Collateral” shall not include, nor shall security
interest granted under Section 2(a) hereof attach to, any Excluded
Property; and provided, further, that if and when any property
shall cease to be Excluded Property, immediately at and from such time, the
Collateral shall include, and the security interest granted by each Grantor
shall attach to, such property.


 


(b)                                 Subject
to the Intercreditor Agreement and the rights of the Credit Agreement Agent and
the Priority Lien Collateral Agent (each as defined in the Intercreditor
Agreement) thereunder, to secure the prompt and complete payment, performance
and observance of the Note Obligations and in order to induce the Agent as
aforesaid, each Grantor hereby
grants to the Agent, for the benefit of the Secured Parties, a right of setoff
against the property of such Grantor
held by the Agent or any Secured Party, consisting of Collateral now or
hereafter in the possession or custody of or in transit to the Agent or any Secured
Party, for any purpose, including safekeeping, collection or pledge, for the
account of such Grantor, or as
to which such Grantor may have
any right or power.


 


3.                                       The
Agent’s and the Secured Parties’ Rights; Limitations on the Agent’s and the Secured
Parties’ Obligations.


 


(a)                                  It
is expressly agreed by each Grantor
that, anything herein or in any other Note Document to the contrary
notwithstanding, each Grantor
shall remain liable under each of its respective Contractual Obligations,
including all Licenses, to observe and perform all the conditions and
obligations to be observed and performed by it thereunder.  Neither the Agent nor any Secured Party shall
have any obligation or liability under any Contractual Obligation by reason of
or arising out of this Agreement or any other Note Document or the granting
herein of


 





















 


a Lien thereon or the receipt by the Agent or any Secured
Party of any payment relating to any Contractual Obligation pursuant
hereto.  Neither the Agent nor any Secured
Party shall be required or obligated in any manner to perform or fulfill any of
the obligations of any Grantor
under or pursuant to any Contractual Obligation, or to make any payment, or to
make any inquiry as to the nature or the sufficiency of any payment received by
it or the sufficiency of any performance by any party under any Contractual
Obligation, or to present or file any claims, or to take any action to collect
or enforce any performance or the payment of any amounts which may have been
assigned to it or to which it may be entitled at any time or times.


 


(b)                                 Subject
to the Intercreditor Agreement and the rights of the Credit Agreement Agent and
the Priority Lien Collateral Agent (each as defined in the Intercreditor
Agreement) thereunder, at any time after an Event of Default has occurred and
is continuing, without prior notice to any Grantor, the Agent may notify each Grantor’s Account Debtors and
all other Persons obligated on any of the Collateral that the Agent has a
security interest therein, and that payments shall be made directly to the Agent,
for the benefit of the Secured Parties. 
At any time after an Event of Default has occurred and is continuing, upon
the request of the Agent, each Grantor shall so notify its Account Debtors and
other Persons obligated on the Collateral. 
Once any such notice has been given to any Account Debtor or other
Person obligated on the Collateral, none of the Grantors shall give any contrary instructions to such Account
Debtor or other Person without the Agent’s prior written consent.


 


(c)                                  Subject
to the Intercreditor Agreement and the rights of the Credit Agreement Agent and
the Priority Lien Collateral Agent (each as defined in the Intercreditor
Agreement) thereunder, at any time after an Event of Default has occurred and
is continuing, the Agent may in the Agent’s own name, in the name of a nominee
of the Agent or in the name of any Grantor
communicate (by mail, telephone, facsimile or otherwise) with Account Debtors,
parties to Contractual Obligations and obligors in respect of Instruments to
verify with such Persons, to the Agent’s reasonable satisfaction, the
existence, amount, terms of, and any other matter relating to, Accounts,
Instruments, Chattel Paper and/or payment intangibles.  If an Event of Default shall have occurred
and be continuing, at Grantor’s sole expense, the Agent shall have the right to
engage a consultant for, and each Grantor shall fully cooperate with such
consultant in, the preparation and delivery to the Agent and each Secured Party
at any time and from time to time the following reports with respect to such Grantor: (i) a reconciliation of
all Accounts; (ii) an aging of all Accounts; (iii) trial balances;
and (iv) a test verification of such Accounts as the Agent may request.


 


4.                                       Representations
and Warranties.  Each Grantor, jointly and severally,
represents and warrants that:


 


(a)                                  Each
Grantor has rights in and the
power to transfer each item of the Collateral upon which it purports to grant a
Lien hereunder, free and clear of any and all Liens other than (i) subject
to the Intercreditor Agreement, the Priority Liens and (ii) other
Permitted Liens.


 





















 


(b)                                 No
effective security agreement, financing statement, equivalent security or Lien
instrument or continuation statement covering all or any part of the Collateral
is on file or of record in any public office, except such as may have been
filed (i) by any Grantor in
favor of the Agent pursuant to this Agreement or the other Note Documents, (ii) by
any Grantor in favor of the ABL Facility Agent pursuant to the ABL Credit
Facility and (iii) in connection with any other Permitted Liens.


 


(c)                                  This
Agreement is effective to create a valid and continuing Lien and, upon the
filing of the appropriate financing statements listed on Schedule I
hereto, a perfected Lien in favor of the Agent, for the benefit of the Secured
Parties, on the Collateral with respect to which a Lien may be perfected by
filing pursuant to the Code.  Such Lien
is prior to all other Liens, except Permitted Liens that would be prior to
Liens in favor of the Agent for the benefit of the Secured Parties as a matter
of law, and is enforceable as such as against any and all creditors of and
purchasers from any of the Grantors
(other than purchasers and lessees of Inventory in the ordinary course of
business and non-exclusive licensees of General Intangibles in the ordinary
course of business).  Except as set forth
in Sections 4(d), 4(h) and 4(i) hereof, all action by each of
the Grantors necessary or reasonably
advisable to protect and perfect such Lien on each item of the Collateral (other
than insurance claims and money) has been duly taken; provided, that in
the case of Intellectual Property, to the extent that the perfection of such
can be perfected by (i) filing a financing statement under the Code or (ii) filing
with, and acceptance thereof by, the United States Copyright Office or the
United States Patent and Trademark Office. 
None of the Grantors
sells any Inventory to any Person on approval or on any other basis which
entitles the customer to return, or which may obligate any Grantor to repurchase, such
Inventory.  No authorization, approval or
consent is required to be obtained from any Governmental Authority or other
Person for the grant of the security interest herein, the perfection thereof or
the exercise by the Agent or any other Secured Party of its rights and remedies
hereunder.


 


(d)                                 Schedule II
hereto lists, as of the date hereof, all Stock, Instruments, Documents, Letter-of-Credit
Rights and Chattel Paper (other than
Chattel Paper (i) the value of which, in the aggregate for all such Chattel
Paper, does not exceed $500,000 or (ii) which evidences leases of
Inventory for a period of time that is less than one month in which each Grantor has an interest as of the date
hereof).  All actions by each Grantor necessary or reasonably
advisable to protect and perfect the Lien of the Agent on each item set forth
on Schedule II (including (to the extent not delivered pursuant to the
Pledge Agreement) the delivery of all originals thereof to the Designated Agent
and the legending of all Chattel Paper as required by Section 5(b) hereof)
have been duly taken.  The Lien of the Agent,
for the benefit of the Secured Parties, on the Collateral listed on Schedule II
hereto is prior to all other Liens, except Permitted Liens that would be prior
to the Liens in favor of the Agent as a matter of law, and is enforceable as
such against any and all creditors of and purchasers from each Grantor.


 


(e)                                  Set
forth on Schedule III hereto is (i) each Grantor’s name as it appears in official filings in the state of
its incorporation or other organization, all prior names of each Grantor, as they appeared from time to
time in official filings in the state of its incorporation or other
organization, (ii) the type of entity of each Grantor (including corporation, partnership,


 





















 


limited partnership or limited liability company), (iii) organizational
identification number issued by each Grantor’s
state of incorporation or organization or a statement that no such number has
been issued, (iv) each Grantor’s
state of organization or incorporation, (v) the location of each Grantor’s chief executive office or
principal place of business, (vi) other offices and other premises where Inventory
or Equipment is stored or located whether or not owned or leased by such
Grantor, and (vii) the locations of each Grantor’s books and records
concerning the Collateral, in each case as of the date hereof, and such Schedule III
also lists, with respect to this clause (i), (iv), (v), (vi) and
(vii), the applicable information for the five years preceding the date hereof.
 Schedule III hereto also sets forth
the name as it appears in official filings in the state of its incorporation or
other organization of any Person from whom each Grantor, as the case may be, has acquired assets during the five (5) years
preceding the date hereof, other than assets acquired in the ordinary course of
such Grantor’s business.  Each Grantor
has only one state of incorporation or organization.


 


(f)                                    With
respect to the Accounts:


 


(i) none of
the Grantors has made any
agreement with any of its Account Debtors for any compromise or settlement for
less than the full amount thereof, any release of any of its Account Debtors
from liability therefor, or any deduction therefrom except a discount or
allowance allowed by any Grantor
in the ordinary course of its business and consistent with its past practice;


 


(ii) to each Grantor’s knowledge, there are no
facts, events or occurrences which in any way impair the validity or
enforceability thereof or could reasonably be expected to reduce the amount
payable thereunder as shown on such Grantor’s
books and records and any invoices, statements or other collateral report
delivered to the Agent and Lenders with respect thereto;


 


(iii) none of
the Grantors has received any
notice of proceedings or actions which are threatened or pending against
any of its Account Debtors which might result in any adverse change in such
Account Debtor’s financial condition;


 


(iv) none of
the Grantors has knowledge that
any of its Account Debtors is unable generally to pay its debts as they become
due;


 


(v) to each
Grantor’s knowledge, such Accounts constitute the legally valid and binding
obligation of the applicable Account Debtors;


 


(vi) all
payments thereon have been or will be delivered to the Blocked Accounts or the Agent
to the extent required by, and in accordance with, Section 6(d); and


 


(vii) to each
Grantor’s knowledge, all of its
Account Debtors have the capacity to contract.


 





















 


(g)                                 With
respect to any Inventory:


 


(i) each Grantor has good, indefeasible and
merchantable title;


 


(ii) except
as specifically disclosed in the most recent Borrowing Base Certificate (as
defined in the ABL Credit Facility) or other collateral report delivered to the
ABL Facility Agent, such Inventory is of good and merchantable quality, free
from any defects;


 


(iii) such
Inventory is not subject to any licensing, patent, royalty, trademark, trade
name or copyright agreements with any third parties which would require any
consent of any third party upon sale or other disposition of that Inventory or
the payment of any monies to any third party upon such sale or other
disposition; and


 


(iv) the
completion of manufacture, sale or other disposition of such Inventory by the Agent
following an Event of Default shall not require the consent of any Person and
shall not constitute a breach or default under any contract or agreement to
which any Grantor is a party or
to which such property is subject.


 


(h)                                 None
of the Grantors has any interest
in, or title to, any Patent, Trademark or Copyright except as set forth in Schedule IV
to this Agreement.  This Agreement is
effective to create a valid and continuing Lien on and, upon filing of the Intellectual
Property Security Agreements substantially in the form attached hereto as Exhibit A,
with the United States Copyright Office or the United State Patent and
Trademark Office, as the case may be, and the filing of the financing
statements listed on Schedule I hereto, perfected Liens in favor of the Agent
on each Grantor’s registered
Patents, Trademarks and Copyrights and such perfected Liens are enforceable as
such as against any and all creditors of and purchasers from any Grantor.  Upon filing of the Copyright Security
Agreements with the United States Copyright Office and filing of the Patent
Security Agreements and the Trademark Security Agreements with the United State
Patent and Trademark Office and the filing of appropriate financing statements
listed on Schedule I hereto, all action necessary or reasonably advisable
to protect and perfect the Agent’s Lien on each Grantor’s registered Patents, Trademarks or Copyrights shall have
been duly taken.


 


(i)                                     Substantially
all motor vehicles owned by each of the Grantors
as of the date hereof are listed on Schedule V hereto, by model, model
year and, to the extent listed on the Schedule, vehicle identification number.  Also set forth on Schedule V is the
location of the title certificates for each motor vehicle listed on such Schedule V.  Each
Grantor shall after the occurrence and during the continuance of an Event of
Default, deliver to the Designated Agent motor vehicle title certificates for
all motor vehicles from time to time owned by it and shall cause those
title certificates to be filed (with the Agent’s Lien noted thereon) in the
appropriate state motor vehicle filing office.


 





















 


5.                                       Covenants.  Without limiting any Grantor’s covenants and
agreements contained in the Indenture and the other Note Documents, each Grantor covenants and agrees with the Agent,
for the benefit of the Agent and Secured Parties, that from and after the date
of this Agreement and until the Termination Date:


 


(a)                                  Further
Assurances; Pledge of Instruments; Chattel Paper; Motor Vehicles.


 


(i)                                     Each
Grantor shall make, or cause to be made, all recordings, registerings, filings,
re recordings, re-registerings and re-filings required to perfect and maintain
the Liens granted hereunder or under any Note Document.  At any time and from time to time, upon the
written request of the Agent and at the sole expense of such Grantor, such Grantor shall promptly and duly
execute and deliver any and all such further instruments and documents and take
such further actions as the Agent may reasonably deem necessary or advisable to
obtain the full benefits of this Agreement and of the rights and powers herein
granted, including (A) using its commercially
reasonable efforts to secure all consents and approvals necessary or
appropriate for the assignment to or for the benefit of the Agent of any
Contractual Obligation, including any License, held by such Grantor and to enforce the security
interests granted hereunder; (B) filing any financing or continuation
statements under the Code with respect to the Liens granted hereunder or under
any other Note Document, including any amendment or modification filings made
necessary in connection with any assignment of the Liens granted hereunder or
under any Note Document; and (C) obtaining landlord’s waivers and consent
agreements, mortgagee agreements or bailee letters in favor of the Agent with
respect to Collateral.


 


(ii)                                  Upon
(A) the Agent’s reasonable written request and (B) unless the Agent
shall otherwise consent in writing (which consent may be revoked), the
occurrence and during the continuance of an Event of Default, unless such
Collateral has been delivered pursuant to the Pledge Agreement, such Grantor shall deliver to the Designated
Agent all Collateral consisting of negotiable Documents, certificated Stock,
Chattel Paper and Instruments (in each case, accompanied by stock powers,
allonges or other instruments of transfer executed in blank) promptly after
such Credit Party receives the same, upon acquiring (A) any negotiable
Document or Instrument having a value in excess of $500,000, (B) any
certificated Stock (other than certificated Stock of Subsidiaries of such
Grantor delivered to the Agent pursuant to the Pledge Agreement) or (C) any
Chattel Paper (other than Chattel Paper (I) the value of which, in the
aggregate for all such Chattel Paper, does not exceed $500,000 or (II) which
evidences leases of Inventory for a period of time that is less than one month),
such Grantor will provide prompt
written notice thereof to the Agent.


 


(iii)                               Such Grantor, as required by Section 6(e),
shall obtain authenticated Control Agreements from (A) each issuer of Uncertificated
Securities, (B)


 





















 


each Securities Intermediary
issuing or holding any Financial Assets to or for such Grantor and (C) each
Commodities Intermediary holding commodities for such Grantor.


 


(iv)                              As
required by Section 6(e) or otherwise by this Agreement, such Grantor shall obtain a Control
Agreement with each bank or financial institution holding a Deposit Account for
such Grantor.


 


(v)                                 If
such Grantor is or becomes the
beneficiary of a letter of credit, such Grantor
shall promptly, and in any event within ten (10) Business Days after
becoming a beneficiary, notify the Agent thereof and unless otherwise consented
by the Agent, use commercially reasonable efforts to enter into a tri-party
agreement with the Designated Agent and the issuer and/or confirmation bank
with respect to Letter-of-Credit Rights assigning such Letter-of-Credit Rights
to the Agent and directing all payments thereunder to a Deposit Account subject
to a Control Agreement, all in form and substance reasonably satisfactory to
the Agent.


 


(vi)                              Upon
(A) the Agent’s reasonable written request or (B) unless the Agent
shall otherwise consent in writing (which consent may be revoked), the
occurrence and during the continuance, of an Event of Default, such Grantor shall take all steps necessary
to grant the Agent control of all Electronic Chattel Paper in accordance with
the Code and all “transferable records” as defined in each of the Uniform
Electronic Transactions Act and the Electronic Signatures in Global and
National Commerce Act.


 


(vii)                           Such Grantor hereby irrevocably
authorizes the Agent at any time and from time to time to file in any filing
office in any Uniform Commercial Code Jurisdiction any initial financing
statements and amendments thereto that (a) indicate the Collateral (i) as
all assets of such Grantor or
words of similar effect, regardless of whether any particular asset comprised
in the Collateral falls within the scope of Article 9 of the Code or such
jurisdiction, or (ii) as being of an equal or lesser scope or with greater
detail, and (b) contain any other information required by part 5 of Article 9
of the Code for the sufficiency or filing office acceptance of any financing
statement or amendment, including (i) whether such Grantor is an organization, the type of organization and any
organization identification number issued to such Grantor, and (ii) in the case of a financing statement filed
as a fixture filing or indicating Collateral as As-Extracted Collateral or timber
to be cut, a sufficient description of real property to which the Collateral
relates.  Such Grantor agrees to furnish any such information to the Agent
promptly upon request therefor.  Such Grantor also hereby ratifies its
authorization for the Agent to have filed in any Uniform Commercial Code Jurisdiction
any initial financing statements or amendments thereto if filed prior to the
date hereof.


 


(viii)                        Such Grantor shall promptly, and in
any event within ten (10) Business Days after the same is acquired by it,
notify the Agent of Commercial Tort Claims in excess of $1,000,000,
individually or in the aggregate, acquired by it
and unless otherwise consented by the Agent, such Grantor shall enter into a supplement to


 





















 


this Agreement, granting
to the Agent a Lien in such Commercial Tort Claim. Any supplement to Schedule V
delivered pursuant to this Section 5(a)(ix) shall, after the receipt
thereof by the Agent, become part of Schedule V for all purposes hereunder
other than in respect of representations and warranties made prior to the date
of such receipt.


 


(ix)                                Upon
delivery by any Credit Party of a landlord’s waiver and consent agreement,
mortgagee agreement or bailee letter with respect to any Collateral in favor of
the Designated Agent pursuant to Section 2.6(a) or 2.6(b) of the
ABL Facility Agreement, such Credit Party shall deliver a landlord’s waiver and
consent agreement, mortgagee agreement or bailee letter, as applicable, with
respect to the same Collateral in favor of the Agent.


 


(x)                                   The
Borrowers and NEFF shall comply with Section 2.10 of the ABL Facility
Agreement.


 


(b)                                 Covenants
Regarding Patent, Trademark and Copyright Collateral.


 


(i)                                     Such Grantor shall notify the Agent
immediately if it knows or has reason to know that any application or registration
relating to any Patent, Trademark or Copyright that is material to the conduct
of any Grantor’s business or operations (now or hereafter existing) may become
abandoned or dedicated, or of any adverse determination or material adverse development
(including the institution of, or any such determination or development in, any
proceeding in the United States Patent and Trademark Office, the United States
Copyright Office or any court) regarding such Grantor’s ownership of any Patent, Trademark or Copyright, its
right to register the same, or to keep and maintain the same.


 


(ii)                                  In
no event shall such Grantor,
either directly or through any agent, employee, licensee or designee, file an
application for the registration of any Patent, Trademark or Copyright with the
United States Patent and Trademark Office, the United States Copyright Office
or any similar office or agency without giving the Agent prior written notice
thereof, and, upon request of the Agent, such Grantor shall execute and deliver any and all Patent Security
Agreements, Copyright Security Agreements or Trademark Security Agreements as
the Agent may request to evidence the Agent’s Lien on such Patent, Trademark or
Copyright, and the General Intangibles of Grantor relating thereto or represented thereby.


 


(iii)                               Such Grantor shall take all actions
necessary or reasonably requested by the Agent to maintain and pursue (and not
abandon) each application, to obtain the relevant registration and to maintain
the registration of each of the Patents, Trademarks and Copyrights (now or
hereafter existing that is material to the conduct of any Grantor’s business or
operations), including the filing of applications for renewal, affidavits of
use, affidavits of noncontestability and opposition and interference and


 





















 


cancellation
proceedings, unless such Grantor shall determine that such Patent, Trademark or
Copyright is not material to the conduct of its business or operations.


 


(iv)                              In
the event that any of the Patent, Trademark or Copyright Collateral that is material to the conduct of any Grantor’s business
or operations is infringed upon, or misappropriated or diluted by a third
party, each Grantor shall promptly
notify the Agent and, if applicable, comply with Section 5(a)(ix) of this
Agreement.  Such Grantor shall, unless it shall reasonably determine that such
Patent, Trademark or Copyright Collateral is not material to the conduct of its
business or operations, promptly sue for infringement, misappropriation or
dilution and to recover any and all damages for such infringement,
misappropriation or dilution, and shall take such other actions as the Agent
shall deem appropriate under the circumstances to protect such Patent,
Trademark or Copyright Collateral.


 


(c)                                  Compliance
with Terms of Accounts, etc.  Such Grantor will perform and comply in all
material respects with all obligations in respect of the Collateral and all
other agreements to which it is a party or by which it is bound relating to the
Collateral.


 


(d)                                 Limitation
on Liens on Collateral.  Such Grantor will not create, permit or
suffer to exist, and will defend the Collateral against, and take such other
action as is necessary to remove, any Lien on any of the Collateral except
Permitted Liens, and will defend the right, title and interest of the Agent and
the Secured Parties in and to any of such Grantor’s rights under the Collateral against the claims and
demands of all Persons whomsoever.


 


(e)                                  Further
Identification of Collateral.  Such Grantor will, if so reasonably requested
by the Agent, furnish to the Agent, as often as the Agent requests, statements
and schedules further identifying and describing the Collateral and such other
reports in connection with the Collateral as the Agent may reasonably request,
all in such detail as the Agent may specify. 
Such Grantor shall
promptly notify the Agent in writing upon acquiring any interest hereafter in
property that is of a type where a security interest or Lien must be or may be
registered, recorded or filed under, or notice thereof given under, any federal
statute or regulation.


 


(f)                                    Notices.  Such Grantor
will advise the Agent promptly, in reasonable detail, (i) of any Lien
(other than Permitted Liens) or claim made or asserted against a material
portion of the Collateral, and (ii) of the occurrence of any other event
which could reasonably be expected to have a Material Adverse Effect on the
aggregate value of the Collateral or on the Liens created hereunder or under
any other Note Document.


 


(g)                                 Good
Standing Certificates.  If and
whenever requested by the Agent, such Grantor
shall provide to the Agent a certificate of good standing from its state of
incorporation or organization.


 





















 


(h)                                 Organizational/Collateral
Location Changes; No Reincorporation. 
Such Grantor will give
the Agent at least fifteen (15) days prior written notice of any change to the
information set forth on Schedule III, as applicable to the extent needed
to make Schedule III up to date and accurate.  Without limiting the prohibitions on mergers
involving any Grantor as contained
in the Indenture, none of the Grantors
shall reincorporate or reorganize itself under the laws of any jurisdiction
other than the jurisdiction in which it is incorporated or organized as of the
date hereof without the prior written consent of the Agent.


 


(i)                                     Terminations;
Amendments Not Authorized.  Such Grantor acknowledges that it is not
authorized to file any financing statement or amendment or termination
statement with respect to any financing statement filed in favor of the Agent
without the prior written consent of the Agent and agrees that it will not do
so without the prior written consent of the Agent, subject to such Grantor’s rights under Section 9-509(d)(2) of
the Code.


 


(j)                                     Authorized
Terminations.  Following the
Termination Date or any Asset Sale expressly permitted by the Indenture, the Agent
will promptly deliver to such Grantor
for filing or authorize such Grantor
to prepare and file termination statements and releases in accordance with Section 9-513(c) of
the Code.


 


(k)                                  Use
of Collateral.  Such Grantor will do
nothing to impair the rights of the Agent in any of the Collateral.  Such Grantor
will not use or permit any Collateral to be used unlawfully or in violation of
any provision of applicable law, or any insurance policy covering any of the
Collateral.  Without limiting the
foregoing, such Grantor will not
permit the production of Inventory in violation of any provision of the Fair
Labor Standards Act and such Grantor
will not adjust, settle or compromise the amount or payment of any Account, or
release wholly or partly any Account Debtor thereof or allow any credit or
discount thereon (other than credits and discounts in the ordinary course of
business).


 


(l)                                     Federal
and State Claims.  Such Grantor shall notify the Agent
promptly of any of the Collateral which constitutes a claim against the United
States government or any instrumentality or agent thereof or any state thereof,
the assignment of which claim is restricted by federal law or state law as the
case may be.  Upon the request of the Agent,
such Grantor shall take such
steps as may be reasonably necessary to comply with any applicable federal
assignment of claims laws or other comparable laws.


 


6.                                       Bank
Accounts; Collection of Accounts and Payments.


 


(a)                                  Each
Grantor shall enter into a
Control Agreement, in a form specified by the Designated Agent, with each
financial institution with which such Grantor
maintains from time to time any Deposit Account in accordance with Section 6(d).  Each Control Agreement shall provide, among other
things, that (i) all items of payment deposited in each Deposit Account
subject thereto shall be held by the applicable financial institution as Agent
or bailee-in-possession for the Agent, on behalf of itself and the Secured
Parties, (ii) the financial institution executing such agreement has no
rights of offset or recoupment of any other claim against any 


 





















 


Deposit
Account subject thereto, as the case may be, other than for payment of its
services and other charges directly related to the administration of each such
Deposit Account and for returned checks or other items of payment, and (iii) in
accordance with this Section 6, the financial institution will transfer
all amounts held or deposited from time to time in any such Deposit Account as the
Agent may so direct.  Each Grantor hereby grants to the Agent,
for the benefit of the Secured Parties, a continuing Lien upon, and security
interest in, all such Deposit Accounts and all funds at any time paid,
deposited, credited or held in such Deposit Accounts (whether for collection,
provisionally or otherwise) or otherwise in the possession of such financial
institutions, and each such financial institution shall act as the Agent’s
agent in connection therewith.  Except as
specifically permitted under Section 6(d), none of the Grantors shall establish any Deposit
Account with any financial institution unless prior thereto the Agent and the
applicable Grantor shall have
entered into a Control Agreement with such financial institution.


 


(b)                                 From
and after receipt by any Blocked Account Bank of written notice from the Designated
Agent to such Blocked Account Bank that an Event of Default has occurred and is
continuing, all amounts held or deposited from time to time in the Blocked
Accounts held by such Blocked Account Bank shall be transferred on a daily
basis to the Designated Agent or to any of the Concentration Accounts, as the Designated
Agent may direct.  Subject to the
foregoing, each Grantor hereby agrees that all payments received by the Agent
or any Secured Parties whether by cash, check, wire transfer or any other
instrument, made to such Deposit Accounts or otherwise received by the Agent or
any Secured Parties and whether on the Accounts or as proceeds of other
Collateral or otherwise will be, subject to the Intercreditor Agreement, the
sole and exclusive property of the Secured Parties.  Each Grantor, and any of its Affiliates,
employees, agents and other Persons acting for or in concert with any Grantor
shall, acting as trustee for the Agent and Secured Parties, receive, as the
sole and exclusive property of the Secured Parties, any moneys, checks, notes,
drafts or other payments relating to and/or constituting proceeds of Accounts
or other Collateral which come into the possession or under the control of such
Grantor or any Affiliates, employees, agent, or other Persons acting for or in
concert with any Grantor, and immediately upon receipt thereof, such Grantor or
such Persons shall, to the extent required by Section 6(d), deposit the
same or cause the same to be deposited in kind, in a Deposit Account or other
account subject to a Control Agreement.


 


(c)                                  If
at any time a Blocked Account Bank is obligated to transfer to the Agent or any
Concentration Account, all amounts held or deposited in the Blocked Accounts
held by such Blocked Account Bank, no Grantor
shall and no Grantor shall
permit any Subsidiary to, accumulate or maintain cash in any disbursement or
payroll account, as of any date, in an amount in excess of checks outstanding
against such account as of such date and amounts necessary to meet minimum
balance requirements.


 


(d)                                 (x)  The Borrowers and NEFF shall, and shall cause
each other Credit Party to (i) enter into Control Agreements with respect
to each deposit account, securities account and commodities account maintained
by either Borrower, NEFF or any such Credit Party as of or after the date of
this Agreement, (ii) deposit in a deposit account subject to a


 





















 


Control
Agreement all cash received on each Business Day and (iii) not establish
or maintain any deposit account, securities account or commodities account
unless such deposit account, securities account or commodities account is
subject to a Control Agreement as provided in Section 6(e), in each case,
other than (A) any payroll account so long as such payroll account is a
zero balance account, (B) any disbursement account so long as (I) such
disbursement account is a zero balance account or (II) the cash and Cash
Equivalents on deposit in such disbursement account shall not exceed $250,000, (C) any
disbursement cash and Cash Equivalents on deposit in or credited to the balance
of withholding tax and other fiduciary accounts and (D) cash and Cash
Equivalents in an amount not to exceed $100,000 in the aggregate.  Each such Control Agreement shall be in form
and substance satisfactory to the Designated Agent.  Each Borrower and each Grantor shall enter
into and maintain with one or more banks and pursuant to agreements in form and
substance reasonably satisfactory to the Designated Agent, lock-box
arrangements.


 


(y)                                 The
Borrowers and NEFF shall, and shall cause each Credit Party, to (i) provide
each Account Debtor or other Person obligated to make a payment to any of them
under any Account or General Intangible with an envelope addressed to the
applicable Credit Party for such Account Debtor or other Person to make such
payment directly to a lockbox account or other deposit account subject to a
Control Agreement and (ii) deposit in a deposit account or securities
account (as applicable) subject to a Control Agreement promptly (but in any
event within three (3) Business Days) upon receipt of all Proceeds of such
Accounts and General Intangibles received by either Borrower or any such Credit
Party from any other Person.


 


(z)                                   Notwithstanding
anything to the contrary in the foregoing clauses (x) or (y), it is understood
and agreed that:


 


(i)                                     the
Agent shall not, unless it is the Designated Agent, deliver a notice of control
or other similar notice to any depository institution, securities intermediary
or commodities intermediary, as applicable, pursuant to any Control Agreement,
and if the Agent is the Designated Agent, it shall not deliver such notice
unless an Event of Default shall be continuing; and


 


(ii)                                  if
an Event of Default shall be continuing, a notice of control or similar notice
has been given by the Designated Agent in accordance with the applicable
Control Agreement and the immediately preceding clause (i), amounts deposited
in or credited to deposit accounts, securities accounts or commodities accounts
subject to Control Agreements or credited to the lock-box account will be
transferred on a daily basis to the Concentration Account and shall be
available to the applicable Credit Party.


 


(e)                                  The
Credit Parties shall not:


 





















 


(i)                                     establish
any new bank accounts without prior written notice to the Agent and unless the
Designated Agent and the depository institution at which the account is to be
opened enter into a Control Agreement; provided, that the Agent (if it
shall be the Designated Agent) shall not cause (or deliver notice to the
applicable depository institution to cause) amounts credited to such deposit
accounts to be transferred on a daily basis to the Concentration Account or
otherwise unless an Event of Default shall have occurred and be continuing;


 


(ii)                                  establish
any new securities accounts without prior written notice to the Agent and
unless the Designated Agent and the securities intermediary at which the
account is to be opened enter into a Control Agreement; provided, that
the Agent (if it shall be the Designated Agent) shall not cause (or deliver
notice to the applicable securities intermediary to cause) amounts credited to
such securities accounts to be transferred on a daily basis to the
Concentration Account or otherwise unless an Event of Default shall have
occurred and be continuing; and


 


(iii)                               establish
any new commodities accounts without prior written notice to the Agent and
unless the Designated Agent and the commodities intermediary at which the
account is to be opened enter into a Control Agreement; provided, that
the Agent (if it shall be the Designated Agent) shall not cause (or deliver
notice to the applicable commodities intermediary to cause) amounts credited to
such commodities accounts to be transferred on a daily basis to the
Concentration Account or otherwise unless an Event of Default shall have
occurred and be continuing.


 


7.                                       The
Agent’s Appointment as Attorney-In-Fact.


 


On the date of this Agreement, each Grantor shall execute and deliver to the Agent a power of attorney
(the “Power of Attorney”) substantially in the form attached hereto as Exhibit B.  The power of attorney granted pursuant to the
Power of Attorney is a power coupled with an interest and shall be irrevocable
until the Termination Date.  The powers
conferred on the Agent, for the benefit of the Agent and Secured Parties, under
the Power of Attorney are solely to protect the Agent’s interests (for the
benefit of the Agent and Secured Parties) in the Collateral and shall not
impose any duty upon the Agent or any Secured Parties to exercise any such
powers.  The Agent agrees that (a) except
for the powers granted in clause (h) of the Power of Attorney, it
shall not exercise any power or authority granted under the Power of Attorney
unless an Event of Default has occurred and is continuing, (b) the Agent
shall account for any moneys received by the Agent in respect of any
foreclosure on or disposition of Collateral pursuant to the Power of Attorney
provided that none of the Agent nor any Secured Parties shall have any duty as
to any Collateral, and the Agent and Secured Parties shall be accountable only
for amounts they actually receive as a result of the exercise of such powers,
and (c) any action taken pursuant to the Power of Attorney shall be subject
to the Intercreditor Agreement and the rights of the Credit Agreement Agent and
the Priority Lien Collateral Agent (each as defined in the Intercreditor
Agreement) thereunder.  NONE OF THE AGENT,
SECURED PARTIES OR THEIR RESPECTIVE AFFILIATES, OFFICERS, DIRECTORS, EMPLOYEES,
AGENTS OR


 





















 


REPRESENTATIVES
SHALL BE RESPONSIBLE TO ANY GRANTOR
FOR ANY ACT OR FAILURE TO ACT UNDER ANY POWER OF ATTORNEY OR OTHERWISE, EXCEPT
IN RESPECT OF DAMAGES ATTRIBUTABLE SOLELY TO THEIR OWN GROSS NEGLIGENCE OR
WILLFUL MISCONDUCT AS FINALLY DETERMINED BY A COURT OF COMPETENT JURISDICTION,
NOR FOR ANY PUNITIVE, EXEMPLARY, INDIRECT OR CONSEQUENTIAL DAMAGES.


 


8.                                       Remedies;
Rights Upon Default.


 


(a)                                  Subject
to the Intercreditor Agreement and the rights of the Credit Agreement Agent and
the Priority Lien Collateral Agent (each as defined in the Intercreditor
Agreement) thereunder, in addition to all other rights and remedies granted to
it under this Agreement, the Notes, the Indenture, the other Note Documents and
under any other instrument or agreement securing, evidencing or relating to any
of the Note Obligations, if any Event of Default shall have occurred and be
continuing, the Agent may exercise all rights and remedies of a secured party
under the Code.  Without limiting the
generality of the foregoing, each Grantor
expressly agrees that in any such event the Agent, without demand of
performance or other demand, advertisement or notice of any kind (except the
notice specified below of time and place of public or private sale) to or upon
any Grantor or any other Person
(all and each of which demands, advertisements and notices are hereby expressly
waived to the maximum extent permitted by the Code and other applicable law),
may forthwith (personally or through its agents or attorneys) enter upon the
premises where any Collateral is located, without any obligation to pay rent,
through self-help, without judicial process, without first obtaining a final
judgment or giving any Grantor
or any other Person notice and opportunity for a hearing on the Agent’s claim
or action and may take possession of, collect, receive, assemble, process,
appropriate, remove and realize upon the Collateral, or any part thereof, and
may forthwith sell, lease, license, assign, give an option or options to
purchase, or otherwise dispose of and deliver said Collateral (or contract to
do so), or any part thereof, in one or more parcels at a public or private sale
or sales, at any exchange at such prices as it may deem acceptable, for cash or
on credit or for future delivery without assumption of any credit risk.  To facilitate the foregoing, the Agent shall
have the right to take possession of each Grantor’s original books and records, to obtain access to each Grantor’s data processing equipment,
computer hardware and Software and to use all of the foregoing and the
information contained therein in any manner which the Agent deems
appropriate.  The Agent or any Secured
Parties shall have the right upon any such public sale or sales and, to the
extent permitted by law, upon any such private sale or sales, to purchase for
the benefit of the Agent and Secured Parties, the whole or any part of said
Collateral so sold, free of any right or equity of redemption, which equity of
redemption each Grantor hereby
releases.  Such sales may be adjourned
and continued from time to time with or without notice.  The Agent shall have the right to conduct
such sales on each Grantor’s
premises or elsewhere and shall have the right to use each Grantor’s premises without charge for
such time or times as the Agent deems necessary or advisable.


 


If any Event of Default shall have occurred and be continuing, each Grantor further agrees, at the Agent’s
request, to assemble the Collateral and make it available to the


 





















 


Agent at a place
or places designated by the Agent which are reasonably convenient to the Agent
and such Grantor, whether at
such Grantor’s premises or
elsewhere.  Without limiting the
foregoing, the Agent shall also have the right to require that each Grantor store and keep any Collateral
pending further action by the Agent, and while Collateral is so stored or kept,
provide such guards and maintenance services as shall be necessary to protect
the same and to preserve and maintain Collateral in good condition.  Until the Agent is able to effect a sale,
lease, license or other disposition of Collateral, the Agent shall have the
right to hold or use Collateral, or any part thereof, to the extent that it
deems appropriate for the purpose of preserving Collateral or its value or for
any other purpose deemed appropriate by the Agent.  The Agent shall not have any obligation to
any Grantor to maintain or
preserve the rights of any Grantor
as against third parties with respect to Collateral while Collateral is in the
possession of the Agent.  The Agent may,
if it so elects, seek the appointment of a receiver or keeper to take
possession of Collateral and to enforce any of the Agent’s remedies (for the
benefit of the Agent and Secured Parties), with respect to such appointment without
prior notice or hearing as to such appointment. The Agent shall apply the net
proceeds of any sale, lease, license, other disposition of, or any collection,
recovery, receipt, or realization on, the Collateral to the Note Obligations as
provided in the Indenture, and only after so paying over such net proceeds, and
after the payment by the Agent of any other amount required by any provision of
law, need the Agent account for the surplus, if any, to any Grantor.  To the maximum extent permitted by applicable
law, each Grantor waives all
claims, damages, and demands against the Agent or any Secured Parties arising
out of the repossession, retention or sale of the Collateral except such as
arise solely out of the gross negligence or willful misconduct of the Agent or
such Secured Party as finally determined by a court of competent
jurisdiction.  Each Grantor agrees that ten (10) days
prior notice by the Agent of the time and place of any public sale or of the
time after which a private sale may take place is reasonable notification of
such matters.  Notwithstanding any such
notice of sale, the Agent shall not be obligated to make any sale of
Collateral.  In connection with any sale,
lease, license or other disposition of Collateral, the Agent may disclaim any
warranties that might arise in connection therewith and the Agent shall have no
obligation to provide any warranties at such time.  Each Grantor
shall remain liable for any deficiency if the proceeds of any sale or
disposition of the Collateral are insufficient to pay all Note Obligations,
including any attorneys’ fees or other expenses incurred by the Agent or any Secured
Parties to collect such deficiency.


 


(b)                                 Except
as otherwise specifically provided herein, each Grantor hereby waives presentment, demand, protest or any notice
(to the maximum extent permitted by applicable law) of any kind in connection
with this Agreement or any Collateral.


 


(c)                                  To
the extent that applicable law imposes duties on the Agent to exercise remedies
in a commercially reasonable manner, each Grantor acknowledges and agrees that it is not commercially
unreasonable for the Agent (i) to fail to incur expenses reasonably deemed
significant by the Agent to prepare Collateral for disposition or otherwise to
complete raw material or work in process into finished goods or other finished
products for disposition, (ii) to fail to obtain third party consents for
access to Collateral to be disposed of, or to obtain or, if not required by
other law, to fail to obtain governmental or third party consents for the
collection or disposition of Collateral to be collected or disposed of, (iii) to
fail to exercise collection remedies


 





















 


against Account Debtors or other Persons obligated on
Collateral or to remove Liens on or any adverse claims against Collateral, (iv) to
exercise collection remedies against Account Debtors and other Persons
obligated on Collateral directly or through the use of collection agencies and
other collection specialists, (v) to advertise dispositions of Collateral
through publications or media of general circulation, whether or not the
Collateral is of a specialized nature, (vi) to contact other Persons,
whether or not in the same business as any Grantor, for expressions of interest in acquiring all or any
portion of such Collateral, (vii) to hire one or more professional
auctioneers to assist in the disposition of Collateral, whether or not the
Collateral is of a specialized nature, (viii) to dispose of Collateral by
utilizing internet sites that provide for the auction of assets of the types
included in Collateral or that have the reasonable capacity of doing so, or
that match buyers and sellers of assets, (ix) to dispose of assets in
wholesale rather than retail markets, (x) to disclaim disposition
warranties, such as title, possession or quiet enjoyment, (xi) to purchase
insurance or credit enhancements to insure the Agent against risks of loss,
collection or disposition of Collateral or to provide to the Agent a guaranteed
return from the collection or disposition of Collateral, or (xii) to the
extent deemed appropriate by the Agent, to obtain the services of other
brokers, investment bankers, consultants and other professionals to assist the
Agent in the collection or disposition of any of the Collateral.  Each Grantor
acknowledges that the purpose of this Section 8(c) is to provide
non-exhaustive indications of what actions or omissions by the Agent would not
be commercially unreasonable in the Agent’s exercise of remedies against the
Collateral and that other actions or omissions by the Agent shall not be deemed
commercially unreasonable solely on account of not being indicated in this Section 8(c).  Without limitation upon the foregoing,
nothing contained in this Section 8(c) shall be construed to grant
any rights to any Grantor or to
impose any duties on the Agent that would not have been granted or imposed by this
Agreement or by applicable law in the absence of this Section 8(c).


 


(d)                                 Neither
the Agent nor any Secured Parties shall be required to make any demand upon, or
pursue or exhaust any of their rights or remedies against, any Grantor, any other obligor, guarantor,
pledgor or any other Person with respect to the payment of the Note Obligations
or to pursue or exhaust any of their rights or remedies with respect to any
Collateral therefor or any direct or indirect guarantee thereof.  Neither the Agent nor any Secured Parties
shall be required to marshal the Collateral or any guarantee of the Note Obligations
or to resort to the Collateral or any such guarantee in any particular order,
and all of its and their rights hereunder or under any other Note Document
shall be cumulative.  To the extent it
may lawfully do so, each Grantor
absolutely and irrevocably waives and relinquishes the benefit and advantage
of, and covenants not to assert against the Agent or any Secured Parties, any
valuation, stay, appraisement, extension, redemption or similar laws and any
and all rights or defenses it may have as a surety now or hereafter existing
which, but for this provision, might be applicable to the sale of any
Collateral made under the judgment, order or decree of any court, or privately
under the power of sale conferred by this Agreement, or otherwise.


 


9.                                       Grant
of License to Use Property.  Subject
to the Intercreditor Agreement and the rights of the Credit Agreement Agent and
the Priority Lien Collateral Agent (each as defined in the Intercreditor
Agreement) thereunder, for the purpose of enabling the Agent to


 





















 


exercise rights
and remedies under Section 8 hereof (including, without limiting the terms
of Section 8 hereof, in order to take possession of, collect, receive,
assemble, process, appropriate, remove, realize upon, sell, lease, license,
assign, give an option or options to purchase or otherwise dispose of Collateral)
at such time as the Agent shall be lawfully entitled to exercise such rights
and remedies, each Grantor
hereby grants to the Agent, for the benefit of the Agent and Secured Parties,
an irrevocable, nonexclusive license (exercisable without payment of royalty or
other compensation to such Grantor)
to use, license or sublicense any Intellectual Property now owned or hereafter
acquired by such Grantor, and
wherever the same may be located, and including in such license access to all
media in which any of the licensed items may be recorded or stored and to all
Software and programs used for the compilation or printout thereof and an
irrevocable license (exercisable without payment of rent or other compensation
to such Grantor) to use and
occupy all real estate owned or leased by such Grantor.


 


10.                                 Limitation
on the Agent’s and the Secured Parties’ Duty in Respect of Collateral.  The Agent and each Secured Party shall use
reasonable care with respect to the Collateral in its possession or under its
control.  Neither the Agent nor any Secured
Parties shall have any other duty as to any Collateral in its possession or
control or in the possession or control of any agent or nominee of the Agent or
such Secured Party, or any income thereon or as to the preservation of rights
against prior parties or any other rights pertaining thereto.  The Agent shall be deemed to have exercised
reasonable care in the custody and preservation the Collateral in its
possession if the Collateral is accorded treatment substantially equal to that
which it accords its own property.  The Agent
shall not be liable or responsible for any loss or damage to any of the
Collateral, or for any diminution in the value thereof, by reason of the act or
omission of any warehousemen, carrier, forwarding agency, consignee or other
agent or bailee selected by the Agent in good faith.


 


11.                                 Reinstatement.  This Agreement shall remain in full force and
effect and continue to be effective should any petition be filed by or against
any Grantor for liquidation or
reorganization, should any Grantor
become insolvent or make an assignment for the benefit of any creditor or
creditors or should a receiver or trustee be appointed for all or any
significant part of any Grantor’s
assets, and shall continue to be effective or be reinstated, as the case may
be, if at any time payment and performance of the Note Obligations, or any part
thereof, is, pursuant to applicable law, rescinded or reduced in amount, or
must otherwise be restored or returned by any obligee of the Note Obligations,
whether as a “voidable preference,” “fraudulent conveyance,” or otherwise, all
as though such payment or performance had not been made.  In the event that any payment, or any part
thereof, is rescinded, reduced, restored or returned, the Note Obligations
shall be reinstated and deemed reduced only by such amount paid and not so
rescinded, reduced, restored or returned.


 


12.                                 Expenses
and Attorneys Fees.  Without limiting
any Grantor’s obligations under
the Notes, the Indenture or the other Note Documents, each Grantor agrees to promptly pay all reasonable
fees, costs and expenses (including reasonable attorneys’ fees and expenses
incurred in connection with (a) protecting, storing, warehousing,
appraising, insuring, handling, maintaining and shipping the Collateral, (b) creating,
perfecting, maintaining and enforcing the


 





















 


Agent’s Liens and (c) collecting,
enforcing, retaking, holding, preparing for disposition, processing and
disposing of Collateral.


 


13.                                 Notices.  Except as otherwise provided herein, whenever
it is provided herein that any notice, demand, request, consent, approval,
declaration or other communication shall or may be given to or served upon any
of the parties by any other party, or whenever any of the parties desires to
give and serve upon any other party any communication with respect to this
Agreement, each such notice, demand, request, consent, approval, declaration or
other communication shall be in writing and shall be given in the manner, and
deemed received, as provided for in the Indenture.


 


14.                                 Limitation
by Law.  All rights, remedies and
powers provided in this Agreement may be exercised only to the extent that the
exercise thereof does not violate any applicable provision of law, and all the
provisions of this Agreement are intended to be subject to all applicable
mandatory provisions of law that may be controlling, and to be limited to the
extent necessary so that they shall not render this Agreement invalid,
unenforceable, in whole or in part, or not entitled to be recorded, registered
or filed under the provisions of any applicable law.


 


15.                                 Termination
of this Agreement.  Subject to Section 11
hereof, this Agreement shall terminate upon the Termination Date.


 


16.                                 Successors
and Assigns.  This Agreement shall be
binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns, except that no Grantor may assign any of its rights or obligations hereunder
without the written consent of the Agent. 
No sales of participations, other sales, assignments, transfers or other
dispositions of any agreement governing or instrument evidencing the Note Obligations
or any portion thereof or interest therein shall in any manner impair the Lien
granted to the Agent, for the benefit of the Agent and the Secured Parties,
hereunder.


 


17.                                 Counterparts.  This Agreement and any amendments, waivers,
consents or supplements may be executed in any number of counterparts and by
different parties hereto in separate counterparts, each of which when so
executed and delivered shall be deemed an original, but all of which
counterparts taken together shall constitute but one in the same
instrument.  This Agreement shall become
effective upon the execution of a counterpart hereof by each of the parties
hereto.  This Agreement may be
authenticated by manual signature, facsimile or, if approved in writing by the
Agent, electronic means, all of which shall be equally valid.


 


18.                                 Applicable
Law.  THIS AGREEMENT SHALL BE
GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE
INTERNAL LAWS OF THE STATE OF NEW YORK,
WITHOUT REGARD TO CONFLICTS OF LAW PRINCIPLES.


 





















 


19.                                 Additional Grantors  If, pursuant to Section 4.18 of
the Indenture, the Borrowers shall be required to cause any Subsidiary that is
not a Grantor to become a Grantor hereunder, such Subsidiary shall execute and
deliver to the Agent a Joinder Agreement substantially in the form of Exhibit C to this Agreement and
shall thereafter for all purposes be a party hereto and have the same rights,
benefits and obligations as a Grantor party hereto on the date of this
Agreement.


 


20.                                 Headings.  Section headings are included herein for
convenience of reference only and shall not constitute a part of this Agreement
for any other purposes or be given substantive effect.


 


21.                                 Benefit
of the Secured Parties.  All Liens
granted or contemplated hereby shall be for the benefit of the Agent on behalf
of the Secured Parties, and all proceeds or payments realized from Collateral
in accordance herewith shall be applied to the Note Obligations in accordance
with the terms of the Indenture.


 


22.                                 Additional
Rights of Agent.


 


(a)                                  The
Agent shall be entitled to all of the rights, protections, immunities and
indemnities of the Trustee set forth in the Indenture.


 


(b)                                 Neither
the Agent, nor any of its respective officers, directors, employees, agents or
counsel shall be liable for any action lawfully taken or omitted to be taken by
it or them hereunder or in connection herewith, except for actions taken or
omitted to be taken as a result of its or their own gross negligence or wilful
misconduct as finally determined by a court of competent jurisdiction.


 


23.                                 INTERCREDITOR
AGREEMENT GOVERNS. NOTWITHSTANDING ANYTHING HEREIN TO THE CONTRARY, THE
SECURITY INTEREST GRANTED TO WELLS FARGO BANK, NATIONAL ASSOCIATION, AS AGENT,
FOR THE BENEFIT OF THE SECURED PARTIES, PURSUANT TO THIS AGREEMENT AND THE
EXERCISE OF ANY RIGHT OR REMEDY BY THE AGENT AND THE OTHER SECURED PARTIES
HEREUNDER ARE SUBJECT TO THE PROVISIONS OF THE INTERCREDITOR AGREEMENT. IN THE
EVENT OF ANY CONFLICT OR INCONSISTENCY BETWEEN THE PROVISIONS OF THE
INTERCREDITOR AGREEMENT AND THIS AGREEMENT, THE PROVISIONS OF THE INTERCREDITOR
AGREEMENT SHALL CONTROL.


 


[Remainder of Page Intentionally
Left Blank]


 





















 


 IN WITNESS WHEREOF, each of the
parties hereto has caused this Agreement to be executed and delivered by its
duly authorized officer as of the date first set forth above. 


 


	
   

  	
  NEFF RENTAL LLC,

  
	
   

  	
   

  
	
   

  	
  by

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  NEFF FINANCE CORP.,

  
	
   

  	
   

  
	
   

  	
  by

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  NEFF RENTAL, INC.,

  
	
   

  	
   

  
	
   

  	
  by

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  WELLS FARGO BANK, NATIONAL

  ASSOCIATION, as Agent,

  
	
   

  	
   

  
	
   

  	
  by

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  



 





















 


EXHIBIT A


 


FORM OF INTELLECTUAL
PROPERTY SECURITY AGREEMENT


 


THIS INTELLECTUAL PROPERTY SECURITY AGREEMENT (together with all
amendments, if any, from time to time, this “Intellectual Property Security
Agreement”), dated as            ,
200 , is made by EACH OF THE GRANTORS LISTED ON THE SIGNATURE PAGES HERETO
AND EACH ADDITIONAL PARTY WHICH BECOMES A GRANTOR HERETO PURSUANT TO SECTION 8
HEREOF (collectively, “Grantors” and each, a “Grantor”), in favor
of Wells Fargo Bank, National Association, in its capacity as Agent for the
Secured Parties (each as defined in the Security Agreement referred to below).


 


W I T N E S S E T
H:


 


WHEREAS, pursuant to the Indenture dated as of the date hereof (as
amended, restated, supplemented or otherwise modified from time to time, the “Indenture”),
among the Borrowers, NEFF, each of the other Persons named therein as a
Guarantor (as defined in the Indenture) and Wells Fargo Bank, National
Association, as Trustee, the Borrowers are co-issuing $245,000,000 aggregate
principal amount of their 111⁄4% Second Priority Senior Secured Notes Due 2012
and may issue, from time to time, additional notes in accordance with the
provisions of the Indenture (collectively, the “Notes”);


 


WHEREAS, the Grantors have entered into a Security Agreement (the “Security
Agreement”) of even date herewith, with the Agent for the benefit of the Secured
Parties;


 


WHEREAS, each Grantor will derive direct and indirect economic benefits
from the issuance of the Notes and other financial accommodations provided to
the Borrower and the other Grantors pursuant to the Indenture;


 


WHEREAS, in order to induce the Agent to enter into the Indenture and
the other Note Documents, each Grantor has agreed to grant a continuing Lien on
the Collateral to secure the Note Obligations;


 


NOW, THEREFORE, in consideration of the premises and mutual covenants
herein contained and to induce the Trustee to enter into the Indenture and the
other Note Documents, it is agreed as follows:


 


1.                                       DEFINED
TERMS.  All capitalized terms used
(including in the Recitals hereto) but not otherwise defined herein have the
meanings given to them in the Security Agreement.


 


2.                                       GRANT
OF SECURITY INTEREST IN INTELLECTUAL PROPERTY COLLATERAL.  (a)  To secure the prompt and
complete payment, performance and observance of all the Note Obligations, each
Grantor hereby grants, assigns, conveys, mortgages, pledges, hypothecates and
transfers to the Agent, for the benefit of the Secured Parties, a continuing second
priority security interest in and Lien upon all of its right, title and
interest in, to and under the following, whether presently existing or
hereafter created or acquired by or arising in favor of


 





















 


such Grantor and
whether owned or consigned by or to, or licensed from or to, such Grantor
(collectively, the “Intellectual Property Collateral”):


 


(i)                           [all of
its Patents and Patent Licenses to which it is a party including those referred
to on Schedule I hereto;]


 


(ii)                        [all of
its Trademarks and Trademark Licenses to which it is a party including those
referred to on Schedule I hereto;]


 


(iii)                     [all of its
Copyrights and Copyright Licenses to which it is a party including those
referred to on Schedule I hereto;]


 


(iv)                    all reissues,
continuations or extensions of the foregoing;


 


(v)                       all
goodwill of the business connected with the use of, and symbolized by, each
Patent, each Patent License, each Trademark, each Trademark License, each
Copyright and each Copyright License; and


 


(vi)                    all products
and proceeds of the foregoing, including, without limitation, any claim by such
Grantor against third parties for past, present or future (A) infringement
or dilution of any Patent or Patent licensed under any Patent License, (B) injury
to the goodwill associated with any Patent or any Patent licensed under any
Patent License, (C) infringement or dilution of any Trademark or Trademark
licensed under any Trademark License, (D) injury to the goodwill
associated with any Trademark or any Trademark licensed under any Trademark
License, (E) infringement or dilution of any Copyright or Copyright
licensed under any Copyright License, and (F) injury to the goodwill associated
with any Copyright or any Copyright licensed under any Copyright License.


 


(b)                                 In
addition, to secure the prompt and complete payment, performance and observance
of the Note Obligations and in order to induce the Agent and Trustee as
aforesaid, each Grantor hereby grants to the Agent, for the benefit of the Secured
Parties, a right of setoff, against the property of such Grantor held by the
Agent or any Lender, consisting of property described above in Section 2(a) now
or hereafter in the possession or custody of or in transit to the Agent or any
Lender, for any purpose, including safekeeping, collection or pledge, for the
account of such Grantor, or as to which such Grantor may have any right or
power.


 


3.                                       REPRESENTATIONS
AND WARRANTIES.  Each Grantor,
jointly and severally, represents and warrants, as of the date of this
Agreement, that (a) each Patent, (b) each Trademark that is
registered or pending registration with the US Patent and Trademark Office, (c) each
Copyright that is registered or pending registration with the US Copyright
Office, (d) material unregistered trademarks, service marks and trade
names, (e) material unregistered copyrights, (f) computer software
(other than commercially available off-the-shelf software purchased or licensed
for less than a total cost of $500,000 in the aggregate); and (g) each
License, is set forth on the schedules hereto.  
This Intellectual Property Security Agreement is


 


2





















 


effective to create a valid and continuing Lien on
and, upon the filing hereof with the United States Patent and Trademark Office
and the United States Copyright Office, as applicable and the filing of
appropriate financing statements listed on Schedule I to the Security
Agreement, perfected security interests in favor of the Agent in all of
Grantors’ Patents, Trademarks and Copyrights and such perfected security
interests are enforceable as such as against any and all creditors of, and
purchasers from, Grantors.  Upon filing
of this Intellectual Property Security Agreement with the United States Patent
and Trademark Office and the United States Copyright Office, as applicable and
the filing of appropriate financing statements listed on Schedule I
to the Security Agreement, all action necessary or otherwise requested by the
Agent to protect and perfect the Agent’s Lien on Grantor’s Patents, Trademarks
and Copyrights shall have been duly taken.


 


In addition to
any representations and warranties contained herein, each Grantor hereby
acknowledges and affirms the representations and warranties made to the Agent
with respect to the Intellectual Property Collateral made in the Security
Agreement, the terms and provisions of which are incorporated by reference
herein as if fully set forth herein.


 


4.                                       COVENANTS;
SECURITY AGREEMENT.  The security
interests granted pursuant to this Intellectual Property Security Agreement are
granted in conjunction with the security interests granted to the Agent
pursuant to the Security Agreement.  In
addition to the covenants contained herein, each Grantor hereby acknowledges
and affirms the covenants of such Grantor with respect to the Intellectual
Property Collateral in the Security Agreement, the terms and provisions of
which are incorporated herein as if fully set forth herein.  In addition, each Grantor hereby acknowledges
and affirms that the rights and remedies of the Agent with respect to the
security interest in the Intellectual Property Collateral made and granted
hereby are more fully set forth in the Security Agreement, the terms and
provisions of which are incorporated by reference herein as if fully set forth
herein.


 


5.                                       REINSTATEMENT.  This Intellectual Property Security Agreement
shall remain in full force and effect and continue to be effective should any
petition be filed by or against any Grantor or other Credit Party for
liquidation or reorganization, should any Grantor or other Credit Party become
insolvent or make an assignment for the benefit of any creditor or creditors or
should a receiver or trustee be appointed for all or any significant part of
any Grantor’s or other Credit Party’s assets, and shall continue to be
effective or be reinstated, as the case may be, if at any time payment and
performance of the Note Obligations, or any part thereof, is, pursuant to
applicable law, rescinded or reduced in amount, or must otherwise be restored
or returned by any obligee of the Note Obligations, whether as a “voidable
preference,” “fraudulent conveyance,” or otherwise, all as though such payment
or performance had not been made.  In the
event that any payment, or any part thereof, is rescinded, reduced, restored or
returned, the Note Obligations shall be reinstated and deemed reduced only by
such amount paid and not so rescinded, reduced, restored or returned.


 


6.                                       NOTICES.
Whenever it is provided herein that any notice, demand, request, consent,
approval, declaration or other communication shall or may be given to or


 


3





















 


served upon any of the parties by any other party, or
whenever any of the parties desires to give or serve upon another any such
communication with respect to this Intellectual Property Security Agreement,
each such notice, demand, request, consent, approval, declaration or other
communication shall be in writing and shall be addressed to the party to be
notified at the address set forth in Section 12.02 of the Indenture.


 


7.                                       ADDITIONAL
GRANTORS.  The initial Grantors
hereunder are the Credit Parties as are signatories hereto on the date hereof.  From time to time subsequent to the date
hereof, additional Credit Parties may become parties hereto, as additional
Grantors (each, an “Additional Grantor”), by executing a counterpart of
this Intellectual Property Security Agreement substantially in the form of Exhibit A
attached hereto.  Upon delivery of any
such counterpart to the Agent, notice of which is hereby waived by the
Grantors, each Additional Grantor shall be a Grantor and shall be as fully a
party hereto as if such Additional Grantor were an original signatory
hereto.  Each Grantor expressly agrees
that its obligations arising hereunder shall not be affected or diminished by
the addition or release of any other Grantor hereunder nor by any election of the
Agent not to cause any Credit Party or any other Person to become an Additional
Grantor hereunder.  This Intellectual
Property Security Agreement shall be fully effective as to any Grantor that is
or becomes a party hereto regardless of whether any other Person becomes or
fails to become or ceases to be a Grantor hereunder.


 


8.                                       TERMINATION
OF THIS SECURITY AGREEMENT.  Subject
to Section 5 hereof, this Intellectual Property Security Agreement shall
terminate upon the Termination Date.


 


9.                                       NO
STRICT CONSTRUCTION. The parties hereto have participated jointly in the
negotiation and drafting of this Intellectual Property Security Agreement.  In the event an ambiguity or question of
intent or interpretation arises, this Intellectual Property Security Agreement
shall be construed as if drafted jointly by the parties hereto and no
presumption or burden of proof shall arise favoring or disfavoring any party by
virtue of the authorship of any provisions of this Intellectual Property
Security Agreement.


 


10.                                 ADVICE
OF COUNSEL. Each of the parties represents to each other party hereto that
it has discussed this Intellectual Property Security Agreement with its
counsel.


 


[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]


 


4





















 


IN WITNESS WHEREOF, each Grantor has caused this Intellectual Property
Security Agreement to be executed and delivered by its duly authorized officer
as of the date first set forth above.


 


	
   

  	
  [NAME OF GRANTOR],

  
	
   

  	
   

  	
   

  
	
   

  	
  by

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  	
  [NAME OF GRANTOR],

  
	
   

  	
   

  	
   

  
	
   

  	
  by

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Acknowledged
  and Agreed

  
	
   

  	
   

  	
   

  
	
   

  	
  WELLS FARGO
  BANK, NATIONAL

  ASSOCIATION, as Agent,

  
	
   

  	
   

  	
   

  
	
   

  	
  by

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  



 





















 


ACKNOWLEDGMENT OF
GRANTORS


 


	
  STATE OF

  	
  )

  	
   

  
	
   

  	
  )

  	
  ss.

  
	
  COUNTY OF

  	
  )

  	
   

  



 


On this     day of         ,
200  , before me personally appeared                       ,
proved to me on the basis of satisfactory evidence to be the person who
executed the foregoing instrument on behalf of [                    ],
who being by me duly sworn did depose and say that he is an authorized officer
of said corporation, that the said instrument was signed on behalf of said
corporation as authorized by its Board of Directors and that he acknowledged
said instrument to be the free act and deed of said corporation.


 


	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Notary
  Public

  



 


 


{seal}


 





















 


[SCHEDULE I

to

INTELLECTUAL PROPERTY SECURITY AGREEMENT]


 


I.                                         PATENT
REGISTRATIONS


 


	
  Grantor

  	
   

  	
  Patent

  	
   

  	
  Reg. No.

  	
   

  	
  Date

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  



 


II.                                     PATENT
APPLICATIONS


 


	
  Grantor

  	
   

  	
  Patent

  	
   

  	
  Application
  No.

  	
   

  	
  Date

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  



 


III.                                 PATENT
LICENSES


 


	
  Grantor

  	
   

  	
  Name of
  Agreement

  	
   

  	
  Date of
  Agreement

  	
   

  	
  Parties

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  



 





















 


I.                                         TRADEMARK
REGISTRATIONS


 


	
  Grantor

  	
   

  	
  Mark

  	
   

  	
  Reg. No.

  	
   

  	
  Date

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  



 


II.                                     TRADEMARK
APPLICATIONS


 


	
  Grantor

  	
   

  	
  Mark

  	
   

  	
  Application
  No.

  	
   

  	
  Date

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  



 


III.                                 TRADEMARK
LICENSES


 


	
  Grantor

  	
   

  	
  Name of
  Agreement

  	
   

  	
  Date of
  Agreement

  	
   

  	
  Parties

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  



 





















 


I.                                         COPYRIGHT
REGISTRATIONS


 


	
  Grantor

  	
   

  	
  Copyright

  	
   

  	
  Reg. No.

  	
   

  	
  Date

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  



 


II.                                     COPYRIGHT
APPLICATIONS


 


	
  Grantor

  	
   

  	
  Copyright

  	
   

  	
  Application
  No.

  	
   

  	
  Date

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  



 


III.                                 COPYRIGHT
LICENSES


 


	
  Grantor

  	
   

  	
  Name of
  Agreement

  	
   

  	
  Date of
  Agreement

  	
   

  	
  Parties

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  



 





















 


EXHIBIT A


 


COUNTERPART TO INTELLECTUAL

PROPERTY SECURITY AGREEMENT


 


This counterpart, dated          
is delivered pursuant to Section 8 of that certain Intellectual Property
Security Agreement dated as of            ,
200   (as from time to time amended, modified or supplemented, the “IP
Security Agreement”; the terms defined therein and not otherwise defined
herein being used as therein defined), among [                  ],
as Grantor[s] and Wells Fargo Bank, National Association, as Agent.  The undersigned hereby agrees (i) that
this counterpart may be attached to the IP Security Agreement, and (ii) that
the undersigned will comply with and be subject to, including representations
and warranties, all the terms and conditions of the IP Security Agreement as if
it were an original signatory thereto. 


 


	
   

  	
  [NAME OF ADDITIONAL GRANTOR],

  
	
   

  	
   

  
	
   

  	
  by

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  



 





















 


EXHIBIT B



POWER OF ATTORNEY


 


This Power of Attorney is executed and delivered by [INSERT NAME OF
APPLICABLE GRANTORS] (collectively, the “Grantors” and each a “Grantor”)
to Wells Fargo Bank, National Association (hereinafter referred to as “Attorney”),
as Agent for the benefit of the Secured Parties, under an Indenture and a
Security Agreement, both dated as of July 8, 2005, and other related
documents (the “Note Documents”). 
No person to whom this Power of Attorney is presented, as authority for
Attorney to take any action or actions contemplated hereby, shall be required
to inquire into or seek confirmation from any Grantor as to the authority of Attorney to take any action
described below, or as to the existence of or fulfillment of any condition to
this Power of Attorney, which is intended to grant to Attorney unconditionally
the authority to take and perform the actions contemplated herein, and each Grantor irrevocably waives any right
to commence any suit or action, in law or equity, against any person or entity
which acts in reliance upon or acknowledges the authority granted under this
Power of Attorney.  The power of attorney
granted hereby is coupled with an interest, may not be revoked or canceled by
any Grantor without Attorney’s
written consent and shall terminate on the Termination Date.


 


Each Grantor hereby
irrevocably constitutes and appoints Attorney (and all officers, employees or
agents designated by Attorney), with full power of substitution, as such Grantor’s true and lawful
attorney-in-fact with full irrevocable power and authority in the place and
stead of such Grantor and in the name of such Grantor or in its own name, from time to time in Attorney’s
discretion, to take any and all appropriate action and to execute and deliver
any and all documents and instruments which may be necessary or reasonably advisable
to accomplish the purposes of the Note Documents and, without limiting the
generality of the foregoing, each Grantor
hereby grants to Attorney the power and right, on behalf of such Grantor, without notice to or assent
by any Grantor, and at any time
following the occurrence of and during the continuance of an Event of Default
and subject to the terms of the Intercreditor Agreement, to do the
following:  (a) change the mailing
address of such Grantor, open a
post office box on behalf of such Grantor,
open mail for such Grantor, and
ask, demand, collect, give acquittances and receipts for, take possession of,
endorse any invoices, freight or express bills, bills of lading, storage or
warehouse receipts, drafts against debtors, assignments, verifications, and
notices in connection with any property of such Grantor; (b) effect any repairs to any asset of such Grantor, or continue to obtain any
insurance required to be maintained by such Grantor pursuant to the Note
Documents and pay all or any part of the premiums therefor and costs thereof,
and make, settle and adjust all claims under such policies of insurance, and
make all determinations and decisions with respect to such policies; (c) pay
or discharge any taxes, liens, security interests, or other encumbrances levied
or placed on or threatened against such Grantor
or its property; (d) defend any suit, action or proceeding brought against
such Grantor if such Grantor does not defend such suit,
action or proceeding or if Attorney believes that such Grantor is not pursuing such defense in a manner that will
maximize the recovery to Attorney, and settle, compromise or adjust any suit,
action, or proceeding described above and, in connection therewith, give such
discharges or releases as Attorney may deem appropriate; (e) file or
prosecute any claim, litigation, suit or proceeding in any court of competent
jurisdiction or before any arbitrator, or take any other action otherwise
deemed appropriate by Attorney for the purpose of collecting any and all such
moneys due to such Grantor
whenever payable and to enforce any other right in


 





















 


respect of
such Grantor’s property; (f) cause
the certified public accountants then engaged by such Grantor to prepare and deliver to Attorney at any time and from
time to time, promptly upon Attorney’s request, the following reports:  (1) a reconciliation of all accounts, (2) an
aging of all accounts, (3) trial balances, (4) test verifications of
such accounts as Attorney may request, and (5) the results of each
physical verification of inventory; (g) communicate in its own name with
any party to any contract with regard to the assignment of the right, title and
interest of such Grantor in and
under the contract and other matters relating thereto; (h) to file such
financing statements with respect to the Security Agreement, with or without
such Grantor’s signature, or to
file a photocopy of the Security Agreement in substitution for a financing
statement, as the Agent may deem appropriate, and to execute in such Grantor’s name such financing
statements and amendments thereto and continuation statements which may require
such Grantor’s signature; (i) execute,
in connection with any sale provided for in any Note Document, any endorsements,
assignments or other instruments of conveyance or transfer with respect to any
collateral subject to the Note Documents and to otherwise direct such sale or
resale; (j) exercise the rights of such Grantor with respect to the obligation of all account debtors to
make payment or otherwise render performance to such Grantor; (k) exercise the rights of such Grantor to, and take
any and all actions that Attorney deems appropriate to realize the benefit of,
any intellectual property; and (l) assert any claims such Grantor may have, from time to time,
against any other party to any contract to which such Grantor is a party and to otherwise exercise any right or remedy
of such Grantor thereunder, all
as though Attorney were the absolute owner of the property of such Grantor for all purposes, and to do,
at Attorney’s option and such Grantor’s
expense, at any time or from time to time, all acts and other things that
Attorney reasonably deems necessary to perfect, preserve, or realize upon such Grantor’s property or assets and
Attorney’s liens thereon, all as fully and effectively as such Grantor might do.  Each Grantor
hereby ratifies, to the extent permitted by law, all that said Attorney shall
lawfully do or cause to be done by virtue hereof.


 


IN THE EVENT OF ANY CONFLICT OR INCONSISTENCY BETWEEN THE PROVISIONS OF
THE INTERCREDITOR AGREEMENT AND THIS POWER OF ATTORNEY, THE PROVISIONS OF THE
INTERCREDITOR AGREEMENT SHALL CONTROL.


 


2





















 


IN WITNESS WHEREOF, this Power of Attorney is
executed by each Grantor
pursuant to the authority of its board of directors this     day
of     , 20  .


 


	
   

  	
  [NAME OF GRANTOR],

  
	
   

  	
   

  	
   

  
	
   

  	
  by

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  	
  [NAME OF GRANTOR],

  
	
   

  	
   

  	
   

  
	
   

  	
  by

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  



 


3





















 


NOTARY
PUBLIC CERTIFICATE


 


On this       
day of    , 20  ,               
who is personally known to me appeared before me in his/her capacity as the [INSERT TITLE] of              ,
a               
[INSERT TYPE OF ENTITY] (“Grantor”) and executed on behalf of Grantor
the Power of Attorney in favor of Wells Fargo Bank, National Association, to
which this Certificate is attached.


 


 


	
   

  	
   

  	
   

  
	
   

  	
  Notary Public

  



 


4





















 


NOTARY
PUBLIC CERTIFICATE


 


On this       
day of    , 20  ,               
who is personally known to me appeared before me in his/her capacity as the [INSERT TITLE] of              ,
a               
[INSERT TYPE OF ENTITY] (“Grantor”) and executed on behalf of Grantor
the Power of Attorney in favor of Wells Fargo Bank, National Association, to
which this Certificate is attached.


 


 


	
   

  	
   

  	
   

  
	
   

  	
  Notary Public

  



 


5





















 


EXHIBIT A


 


FORM OF
JOINDER AGREEMENT


 


JOINDER AGREEMENT (this “Agreement”)
dated as of           , 20  
is by and among              ,
a           
[corporation][limited liability company] (the “New Subsidiary”) and
Wells Fargo Bank, National Association, as collateral agent (in such capacity,
the “Agent”) for the holders of Note Obligations (as defined below).


 


Pursuant to the Indenture dated as of July 8,
2005 (as the same may be amended, restated, supplemented or otherwise modified
from time to time, the “Indenture”), among Neff Rental LLC, a Delaware
limited liability company (“Neff LLC”), Neff Finance Corp., a Delaware
corporation (“Neff Finance” and, together with Neff LLC, the “Borrowers”
and each, a “Borrower”), Neff Rental, Inc., a Florida corporation (“NEFF”),
each of the other Persons named therein as a Guarantor (as defined in the
Indenture), and Wells Fargo Bank, National Association, as Trustee, and the Security
Agreement dated as of July 8, 2005 (as the same may be amended, restated,
supplemented or otherwise modified from time to time, the “Security
Agreement”; capitalized terms used herein and not otherwise defined herein
shall have the meanings ascribed to such terms in the Security Agreement) the
Credit Parties are required by Section 4.18 of the Indenture and Section 19
of the Security Agreement to cause the new Subsidiary (“New Subsidiary”)
to become a Credit Party thereunder. 
Accordingly, the New Subsidiary hereby agrees as follows with the Agent,
for the benefit of the Secured Parties, that:


 


1.                                       The
New Subsidiary hereby acknowledges, agrees and confirms that, by its execution
of this Agreement, the New Subsidiary will be deemed to be a party to the
Indenture for all purposes of the Indenture and the other Note Documents, and
shall have all of the obligations of a Credit Party thereunder as if it had
executed the Indenture.  The New
Subsidiary hereby ratifies, as of the date hereof, and agrees to be bound by,
all of the terms, provisions and conditions applicable to the Credit Parties in
the Indenture and the other Note Documents.


 


2.                                       The
New Subsidiary hereby acknowledges, agrees and confirms that, by its execution
of this Agreement, the New Subsidiary will be deemed to be a party to the
Security Agreement as a Grantor for all purposes of the Security Agreement and
the other Note Documents, and shall have all the obligations of a Grantor
thereunder as if it had executed the Security Agreement.  The New Subsidiary hereby ratifies, as of the
date hereof, and agrees to be bound by, all of the terms, provisions and
conditions contained in the Security Agreement. 
Without limiting generality of the foregoing terms of this paragraph 2,
the New Subsidiary hereby grants, assigns, conveys, mortgages, pledges,
hypothecates and transfers to Agent, for the benefit of the Secured Parties, a
Lien upon all of its right, title and interest in, to and under all of the
Collateral of such New Subsidiary, whether owned or consigned by or to, or
leased from or to, such New Subsidiary,
and regardless of where located, to secure the prompt payment and performance
in full when due, whether by lapse of time, acceleration, mandatory prepayment
or otherwise, of the Note Obligations.


 


3.                                       The
New Subsidiary hereby acknowledges, agrees and confirms that, by its execution
of this Agreement, the New Subsidiary will be deemed to be a party to the
Pledge Agreement and a Pledgor (as defined in the Pledge Agreement) for all
purposes of the Pledge Agreement and the other Note Documents, and shall have
all the obligations of a Pledgor thereunder as if it had executed the Pledge
Agreement.  The New Subsidiary hereby
ratifies, as


 





















 


of the date hereof, and agrees
to be bound by, all of the terms, provisions and conditions contained in the
Pledge Agreement.  Without limiting
generality of the foregoing terms of this paragraph 3, the New Subsidiary
hereby grants and pledges to Agent, for the benefit of the Secured Parties, a
second priority security interest in the Pledged Collateral (as defined in the
Pledge Agreement) of the New Subsidiary identified on Schedule 1 hereto
and all other Pledged Collateral of the New Subsidiary to secure the prompt
payment and performance in full when due, whether by lapse of time,
acceleration, mandatory prepayment or otherwise, of the Secured Obligations (as
defined in the Pledge Agreement).


 


4.                                       The
Subsidiary hereby represents and warrants to the Agent that:


 


(a)                                  The New Subsidiary’s
official name, type of entity and state of organization or incorporation are as
set forth on the signature pages hereto.


 


(b)                                 The New Subsidiary’s
chief executive office and principal place of business and other offices are
located at the locations set forth on Schedule 2 hereto.


 


(c)                                  Other than as set
forth on Schedule 3 hereto, the New Subsidiary has not changed its
official name or changed its state of organization or incorporation, been party
to a merger, consolidation or other change in structure or used any tradename
in the prior five years.


 


(d)                                 Schedule 4 hereto
includes all warehouses, consignees and processors with whom Inventory is
stored or located and other premises where Collateral is stored or located.


 


(e)                                  Schedule 5
hereto includes all the locations of the New Subsidiary’s books and records
concerning the Collateral.


 


(f)                                    Schedule 6
hereto includes a list of Persons from whom the New Subsidiary has acquired
assets during the past five (5) years, other than assets acquired in the
ordinary course of the New Subsidiary’s business.


 


(g)                                 Schedule 7
hereto includes all Patents, Trademarks and Copyrights owned by or licensed to
the New Subsidiary in its own name, or to which the New Subsidiary is a party,
as of the date hereof, that is used in or necessary for the conduct of its
business as currently conducted that is material to the condition (financial or
otherwise).


 


(h)                                 Schedule 8
hereto includes all Commercial Tort Claims before any Governmental Authority by
or in favor of the New Subsidiary.


 


(i)                                     Schedule 9
hereto lists all real property that is owned, leased or subleased by the New
Subsidiary as of the date hereof.  Schedule 9
hereto further lists any real property with respect to which the New Subsidiary
or any of its Subsidiaries is a lessor, sublessor or assignor as of the date
hereof.


 


2





















 


(h)                                 Schedule 10
hereto lists all locations of tangible personal property that is owned or
leased by the New Subsidiary as of the date.


 


5.                                       The
New Subsidiary hereby acknowledges, agrees and confirms that, by its execution
of this Agreement, the New Subsidiary will be deemed to be a party to the
Intercreditor Agreement and a Credit Party (as defined in the Intercreditor
Agreement) for all purposes of the Intercreditor Agreement and the other Note
Documents, and shall have all the obligations of a Credit Party thereunder as
if it had executed the Intercreditor Agreement. 
The New Subsidiary hereby ratifies, as of the date hereof, and agrees to
be bound by, all of the terms, provisions and conditions contained in the
Intercreditor Agreement.


 


6.                                       This Agreement
may be executed in any number of counterparts and by different parties in
separate counterparts, each of which when so executed shall be deemed to be an
original and all of which taken together shall constitute one and the same
agreement.  Signature pages may be
detached from multiple separate counterparts and attached to a single
counterpart so that all signature pages are attached to the same
document.  Delivery of an executed
signature page of this Agreement by facsimile transmission shall be as
effective as delivery of a manually executed counterpart hereof.


 


7.                                       THIS AGREEMENT
AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HERETO SHALL BE GOVERNED BY, AND
SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE
STATE OF NEW YORK, WITHOUT
REGARD TO CONFLICTS OF LAW PRINCIPLES.


 


3





















 


IN WITNESS WHEREOF, each of the undersigned
has caused this Joinder Agreement to be duly executed and delivered as of the
date first above written.


 


	
   

  	
  [NEW SUBSIDIARY],

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  by:

  	
   

  	
   

  
	
   

  	
   

  	
   Name:

  
	
   

  	
   

  	
   Title:

  



 


Acknowledged and accepted as of the date

first written above:


 


WELLS FARGO BANK, NATIONAL ASSOCIATION,

as Agent,


 


	
  by:

  	
   

  	
   

  
	
   

  	
   Name:

  
	
   

  	
   Title: