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

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FORM 10-Q

[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934

For The Quarterly Period Ended June 30, 2006

or

[  ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934

For the Transition Period from __________ to ______________

Commission file number 333-114115

NATIONSRENT COMPANIES, INC.
(Exact name of registrant as specified in the charter)

|Delaware
(State or other jurisdiction of incorporation or organization) |  | 14-1875911
(I.R.S. Employer Identification Number)
|----------------------------------------------------------------------- |  | --------------------------------------------------

|450 East Las Olas Blvd., Suite 1400,
Fort Lauderdale, Florida
(Address of principal executive office) |  | 33301
(Zip Code)
|----------------------------------------------------------------------------------------------------- |  | ----------------

(954) 760-6550
(Registrant's telephone number including area code)

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

Indicate by check mark whether the registrant is a large
accelerated filer, an accelerated filer, or a non-accelerated filer. See
definition of accelerated filer and large accelerated filer in Rule
12b-2 of the Exchange Act (Check one):

|Large accelerated filer |_| | Accelerated filer |_| | Non-accelerated filer |X|
|--------------------------- | --------------------- | -------------------------

Indicate by check mark whether the registrant is a shell company
(as defined in the Exchange Act Rule 12b-2). Yes |_| No |X|

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APPLICABLE ONLY TO REGISTRANTS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS

Indicate by check mark whether the registrant has filed all
documents and reports required to be filed by Section 12, 13 or 15(d) of the
Securities Exchange Act of 1934 subsequent to the distribution of securities
under a plan confirmed by a court. Yes |X| No |_|

As of June 30, 2006 there were 1,729,091 shares of common stock,
$0.01 par value, outstanding.

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NATIONSRENT COMPANIES, INC.
Index

Page
No.

|PART I - FINANCIAL INFORMATION | 1
|------------------------------ | -

|Item 1: Financial Statements | 1
|---------------------------- | -

| | Condensed Consolidated Balance Sheets as of June 30, 2006 (unaudited)
and December 31, 2005 | 1
| | ------------------------------------------------------------------------------------------- | -

| | Unaudited Condensed Consolidated Statements of Operations for the
Three Months Ended June 30, 2006 and 2005 | 2
| | ----------------------------------------------------------------------------------------------------------- | -

| | Unaudited Condensed Consolidated Statements of Operations for the Six
Months Ended June 30, 2006 and 2005 | 3
| | --------------------------------------------------------------------------------------------------------- | -

| | Unaudited Condensed Consolidated Statements of Cash Flows for the
Six Months Ended June 30, 2006 and 2005 | 4
| | --------------------------------------------------------------------------------------------------------- | -

| | Notes to Condensed Consolidated Financial Statements | 5
| | ---------------------------------------------------- | -

|Item 2: Management's Discussion and Analysis of Financial Condition
and Results of Operations | 19
|--------------------------------------------------------------------------------------------- | --

|Item 3: Quantitative and Qualitative Disclosures About Market
Risk | 37
|------------------------------------------------------------------ | --

|Item 4: Controls and Procedures | 38
|------------------------------- | --

|PART II - OTHER INFORMATION | 39
|--------------------------- | --

|Item 6: Exhibits | 39
|---------------- | --

|Signatures | 45
|---------- | --

|Certifications | 51
|-------------- | --

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PART I - FINANCIAL INFORMATION

Item 1: Financial Statements

NATIONSRENT COMPANIES, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, except share data)

`June 30,               December 31,
                                                                                    2006                     2005
                                                                              --------------           --------------
                                                                                (unaudited)
                                  ASSETS

Cash and cash equivalents................................................   $         5,200          $       16,246
Marketable securities....................................................                35                      35
Accounts receivable, net of allowances of $11,908 at June 30, 2006, and
  $12,160 at December 31, 2005...........................................            84,396                  90,983
Inventories, net.........................................................            64,249                  67,875
Prepaid expenses and other assets (Note 10)..............................            11,117                  14,655
Debt issuance costs, net.................................................             6,075                   6,729
Rental equipment, net....................................................           553,328                 491,564
Property and equipment, net..............................................            86,961                  80,946
Intangible assets, net...................................................             7,995                   8,105
Goodwill.................................................................               307                     307
                                                                              --------------           --------------
  Total Assets...........................................................     $     819,663            $    777,445
                                                                              ==============           ==============
                   LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities:
Accounts payable.........................................................     $     91,604             $     81,844
Accrued compensation and related taxes...................................           16,173                   18,825
Accrued expenses and other liabilities...................................           30,073                   30,943
Accrued insurance claims.................................................           14,259                   13,824
Equipment floor plan and financing.......................................           40,651                   10,573
Debt, net (Note 4).......................................................          398,203                  397,534
Income taxes payable.....................................................               --                      489
Deferred income tax liability, net.......................................            5,317                    3,350
                                                                              --------------           --------------
  Total Liabilities......................................................          596,280                  557,382
                                                                              --------------           --------------
Commitments and Contingencies

Stockholders' Equity:
Preferred stock-- $0.01 par value, 1,000,000 shares authorized,
  Series A, $72,002 liquidation preference, 72,002 shares issued
  and outstanding at June 30, 2006 and December 31, 2005.................                1                        1
Common stock-- $0.01 par value, 3,000,000 shares authorized,
  1,729,091 shares issued and outstanding at
  June 30, 2006 and December 31, 2005....................................               17                       17
Additional paid-in capital...............................................          216,865                  217,239
Deferred stock compensation, net.........................................               --                     (548)
Retained earnings........................................................            6,500                    3,354
                                                                              --------------           --------------
  Total stockholders' equity.............................................          223,383                  220,063
                                                                              --------------           --------------
  Total liabilities and stockholders' equity.............................     $    819,663             $    777,445
                                                                              ==============           ==============`

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




NATIONSRENT COMPANIES, INC.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands)

`Three Months            Three Months
                                                                                     Ended                   Ended
                                                                                 June 30, 2006           June 30, 2005
                                                                               ------------------      ------------------
Revenue:
  Equipment rentals....................................................       $    132,834              $    123,389
  Sales of equipment, merchandise, service, parts and supplies.........             62,912                    50,277
                                                                              --------------            --------------
   Total revenue.......................................................            195,746                   173,666
                                                                              --------------            --------------
Cost of revenue:
  Cost of equipment rentals............................................             70,102                    64,102
  Rental equipment and vehicle depreciation and lease expense..........             30,093                    32,792
  Cost of sales of equipment, merchandise, service, parts and supplies.             38,369                    27,906
                                                                              --------------            --------------
   Total cost of revenue...............................................            138,564                   124,800
                                                                              --------------            --------------
Gross profit...........................................................             57,182                    48,866
Operating expenses:
  Selling, general and administrative expenses.........................             34,681                    32,283
  Other depreciation and amortization..................................              2,336                     2,109
                                                                              --------------            --------------
Operating income.......................................................             20,165                    14,474
                                                                              --------------            --------------
Other (income) expense:
  Interest expense, net................................................             11,092                     9,948
  Other, net...........................................................               (933)                     (624)
                                                                              --------------            --------------
   Total other expense.................................................             10,159                     9,324
                                                                              --------------            --------------
Income before provision for income taxes...............................             10,006                     5,150
  Provision for income taxes...........................................              3,797                        --
                                                                              --------------            --------------
Net income.............................................................       $      6,209              $      5,150
                                                                              ==============            ==============`

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




NATIONSRENT COMPANIES, INC.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands)

`Six Months              Six Months
                                                                                     Ended                   Ended
                                                                                 June 30, 2006           June 30, 2005
                                                                               -----------------       ------------------
Revenue:
  Equipment rentals....................................................       $    244,553             $     223,854
  Sales of equipment, merchandise, service, parts and supplies.........            112,362                    90,350
                                                                              --------------            --------------
   Total revenue.......................................................            356,915                   314,204
                                                                              --------------            --------------
Cost of revenue:
  Cost of equipment rentals............................................            135,855                   126,765
  Rental equipment and vehicle depreciation and lease expense..........             59,106                    63,278
  Cost of sales of equipment, merchandise, service, parts and supplies.             66,541                    49,802
                                                                              --------------            --------------
   Total cost of revenue...............................................            261,502                   239,845
                                                                              --------------            --------------
Gross profit...........................................................             95,413                    74,359
Operating expenses:
  Selling, general and administrative expenses.........................             65,475                    61,551
  Other depreciation and amortization..................................              4,548                     3,993
                                                                              --------------            --------------
Operating income ......................................................             25,390                     8,815
                                                                              --------------            --------------
Other (income) expense:
  Interest expense, net................................................             21,521                    17,779
  Reversal of pre-petition tax liabilities.............................                 --                       (98)
  Other, net...........................................................             (1,314)                   (1,060)
                                                                              --------------            --------------
   Total other expense.................................................             20,207                    16,621
                                                                              --------------            --------------
Income (loss) before reorganization items and provision for income taxes             5,183                    (7,806)
Reorganization items, net..............................................                 --                      (180)
                                                                              --------------            --------------
Income (loss) before provision for income taxes........................              5,183                    (7,626)
Provision for income taxes.............................................              2,037                        --
                                                                              --------------            --------------
Net income (loss) .....................................................       $      3,146              $     (7,626)
                                                                              ==============            ==============`

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




NATIONSRENT COMPANIES, INC.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)

`Six Months Ended        Six Months Ended
                                                                                 June 30, 2006           June 30, 2005
                                                                             ---------------------  ----------------------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss)......................................................        $    3,146               $   (7,626)
Adjustments to reconcile net income (loss) to net cash provided by
  operating activities:
  Depreciation and amortization........................................            63,305                   67,262
  Provision for doubtful accounts......................................             2,324                    3,549
  Non-cash reorganization items........................................                 -                     (180)
  Amortization of deferred stock compensation..........................               175                      426
  Amortization of deferred issuance costs and debt discount............             1,478                    1,798
  Deferred income taxes................................................             1,967                        -
  Loss on disposal of non-rental equipment.............................                63                       94
  Gain on disposal of rental equipment.................................           (34,769)                 (31,691)
  Changes in operating assets and liabilities:
   Accounts receivable.................................................             4,263                   (7,328)
   Inventories.........................................................             3,626                   (9,802)
   Prepaid expenses and other assets...................................             3,538                   (3,741)
   Accounts payable....................................................             9,760                   35,117
   Equipment floor plan payable........................................             7,298                    6,100
   Accrued expenses and other liabilities..............................            (3,576)                   1,036
                                                                              --------------           --------------
   Net cash provided by operating activities...........................            62,598                   55,014
                                                                              --------------           --------------
CASH FLOWS FROM INVESTING ACTIVITIES
Acquisition of business................................................                 -                   (6,703)
Purchases of marketable securities, net................................                 -                  (28,944)
Purchases of rental equipment..........................................          (138,953)                (196,493)
Purchases of property and equipment....................................            (8,712)                 (11,537)
Proceeds from disposal of rental equipment.............................            56,877                   56,311
                                                                              --------------           --------------
  Net cash used in investing activities................................           (90,788)                (187,366)
                                                                              --------------           --------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from debt issuance and revolving credit facility..............            75,600                  150,000
Proceeds from equipment financing......................................            24,964                        -
Redemption of convertible notes........................................                 -                  (23,723)
Payment of debt issuance costs.........................................                 -                   (6,020)
Repayment of equipment financing.......................................            (2,184)                       -
Repayments of debt ....................................................           (81,236)                    (488)
                                                                              --------------           --------------
  Net cash provided by financing activities............................            17,144                  119,769
                                                                              --------------           --------------
Net decrease in cash and cash equivalents..............................           (11,046)                 (12,583)
Cash and cash equivalents, beginning of period.........................            16,246                   40,625
                                                                              --------------           --------------
Cash and cash equivalents, end of period...............................        $    5,200               $   28,042
                                                                              ==============           ==============
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
 Cash paid for interest................................................        $   20,387               $   15,761
                                                                              ==============           ==============
 Cash paid for income taxes............................................        $    1,195               $        2
                                                                              ==============           ==============
SUPPLEMENTAL SCHEDULE OF NON-CASH
INVESTING AND FINANCING ACTIVITIES:
 Property and equipment acquired under financial obligations...........        $    5,480               $       --
                                                                              ==============           ==============
 Issuance of common stock on conversion of convertible notes...........        $        -               $   16,430
                                                                              ==============           ==============
 Reclassification of redeemed convertible notes to accrued expenses....        $        -               $    7,089
                                                                              ==============           ==============`

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




NATIONSRENT COMPANIES, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2006

1.     Description of the Business

Reporting Entity

NationsRent
Companies, Inc. together with its subsidiaries (the Company) is one of the
largest full-service equipment rental companies in the United States. The Company
specializes in rentals and also sells new and used equipment with related merchandise,
parts and supplies, and provides maintenance and repair services. The Company offers a
comprehensive line of equipment and related services to a broad range of construction,
industrial and homeowner customers. The accompanying consolidated financial statements
include the accounts of the Company and its wholly-owned subsidiaries. All significant
intercompany accounts and transactions have been eliminated.

Reorganization
Under Chapter 11

On
June 13, 2003 (the Effective Date), NationsRent, Inc., a Delaware corporation,
together with its subsidiaries (the Predecessor Company or the
Debtors) emerged from proceedings under Chapter 11 (the Chapter 11
Cases) of the United States Bankruptcy Code (the Bankruptcy Code) in the
United States Bankruptcy Court for the District of Delaware (the Bankruptcy
Court) pursuant to the terms of the First Amended Joint Plan of Reorganization of
NationsRent, Inc. and its debtor subsidiaries dated February 7, 2003, as modified (the
Plan). On the Effective Date, the Predecessor Company merged into an indirect
subsidiary of the Company. In connection with its emergence from bankruptcy, the Company
reflected the terms of the Plan in its consolidated financial statements by adopting the
principles of Fresh Start Reporting in accordance with the American Institute of Certified
Public Accountants (AICPA) Statement of Position (SOP) 90-7,
Financial Reporting by Entities in Reorganization under the Bankruptcy Code.
For accounting purposes, the effects of the consummation of the Plan, as well as
adjustments for Fresh-Start Reporting, were recorded in the consolidated financial
statements as of June 1, 2003. Under Fresh-Start Reporting, a new entity is deemed to be
created for financial reporting purposes and the recorded amounts of assets and
liabilities are adjusted to reflect their estimated fair values.

2.     Significant Accounting Policies

Basis of Presentation

The
unaudited condensed consolidated financial statements have been prepared in accordance
with accounting principles generally accepted in the United States and with rules and
regulations of the Securities and Exchange Commission (SEC) for interim
financial reporting. In the opinion of management, the financial information included
herein reflects all adjustments considered necessary for a fair presentation of interim
results and all such adjustments are of a normal recurring nature. The preparation of
financial statements in conformity with generally accepted accounting principles requires
management to make estimates and assumptions that




affect the amounts reported in the
financial statements and accompanying notes. Actual results could differ from those
estimates. Certain information and footnote disclosures normally included in complete
financial statements prepared in accordance with generally accepted accounting principles
have been condensed or omitted pursuant to such SEC rules and regulations. These unaudited
interim condensed consolidated financial statements should be read in conjunction with the
consolidated financial statements and the notes thereto included in our Annual Report on
Form 10-K for the year ended December 31, 2005. The results of operations for interim
periods are not necessarily indicative of the results which may be reported for the year
ending December 31, 2006.

The
unaudited interim condensed consolidated financial statements include the accounts of the
Company and its 100% wholly owned subsidiaries. All material intercompany transactions and
balances have been eliminated in consolidation. Comprehensive income (loss) was equal to
net income (loss) for all periods presented. Certain prior period amounts presented herein
have been reclassified to conform to the current periods presentation.

Inventories

Inventories
consist of equipment, merchandise, parts and supplies and are stated at the lower of cost
or market. The cost of new and used equipment is determined by specific identification.
The cost of merchandise, parts and supplies is determined using a weighted-average cost
basis. A provision is recorded to reduce excess or obsolete inventories to their estimated
net realizable value.

Revenue Recognition

The
Company recognizes revenue when all of the following criteria are met: (i) persuasive
evidence of an arrangement exists; (ii) delivery has occurred; (iii) the price is fixed or
determinable; and (iv) collectibility is probable.

Equipment
rentals in the consolidated statements of operations includes revenue earned on equipment
rentals, rental equipment pick-up and delivery fees, loss damage waiver fees,
environmental fees and fuel sales. Revenue earned on equipment rentals, loss damage waiver
fees and environmental fees is recognized on a straight-line basis over the rental
contract period which may be daily, weekly or monthly. Because the terms and conditions of
the rental contract can extend across financial reporting periods, the Company records
unbilled rental revenue and deferred revenue adjustments at the end of the reporting
periods so rental revenue is appropriately stated in the periods presented. Revenue earned
on rental equipment pick-up and delivery fees is recognized at the time the service is
provided.

Revenue
from the sales of equipment, parts and supplies and retail merchandise is recognized at
the time of delivery to, or pick-up by, the customer and when all obligations under the
sales contract have been fulfilled. When used rental equipment is sold, the related cost
and accumulated depreciation are removed from the respective accounts. Proceeds from the
sale and the related book value of the equipment sold are reported as revenue from sales
of equipment, merchandise, service, parts and supplies and cost of sales of equipment,
merchandise, service, parts and supplies, respectively, in the accompanying consolidated
statements of operations.




Revenue
from the sale of equipment includes revenue earned in connection with sale/purchase
agreements between the Company and certain manufacturers from whom the Company purchases
new equipment. The Company accounts for these exchanges at fair value as monetary
exchanges under Accounting Principles Board (APB) Opinion No. 29,
Accounting for Nonmonetary Transactions, and Statement of Financial Accounting
Standard (SFAS) No. 153, Exchange of Nonmonetary Assets, and
revenue is recognized at the time of delivery to, or pick up by, the manufacturer. In
certain instances, the sale transaction may contain a limited subjective right of return
which extends the date of revenue recognition to the date the subjective right of return
period lapses. The Company establishes fair market value for each unit of equipment sold
in sale/purchase agreements based on independent appraisals and records sale/purchase
revenue up to but not exceeding such fair market value. Any excess sale price over the
estimated fair market value of the used equipment sold is accounted for as a reduction of
the cost of new rental equipment purchased by the Company from the same manufacturer and
is amortized as a reduction to depreciation expense over the average useful life of the
new rental equipment purchased from the same manufacturer. The following table sets forth
the amounts related to the sale/purchase agreements:

`Three Months Ended           Six Months Ended
                                                                       June 30                      June 30
                                                                  2006           2005          2006         2005
                                                               -----------   -----------   ------------ -------------
                                                                                  (in thousands)

Sale/Purchase revenue.......................................      $ 4,518     $   3,409        $   10,617    $   6,989

Excess sale price recorded as reduction of new equipment cost     $   668     $     307        $    1,251    $     557

Amortization of excess sale price...............................  $    86     $      44        $      149    $      78`

At
June 30, 2006 and December 31, 2005, the unamortized balance of excess sale price recorded
in the condensed consolidated balance sheet was approximately $2,504,000 and $1,402,000,
respectively.

Income Taxes

The
Company files a consolidated federal income tax return with its wholly-owned subsidiaries.
Under the liability method, deferred tax assets and liabilities are determined based on
differences between the financial reporting and tax bases of assets and liabilities using
the enacted tax rates and laws that will be in effect when the differences are expected to
reverse. Recognition of deferred tax assets is limited to amounts where expected
realization in future periods is deemed to be more likely than not.

New Accounting Pronouncement

In July 2006,
the Financial Accounting Standards Board (FASB) issued FASB Interpretation No.
48, Accounting for Uncertainty in Income Taxes-an interpretation of FASB
Statement No. 109 (FIN 48). FIN 48 clarifies the accounting for uncertainty in
tax positions by prescribing a financial statement recognition threshold and
measurement attribute for tax positions taken or expected to be taken in a tax
return. This interpretation requires the financial statement recognition of the
impact of a tax position, if that position will more likely than not be
sustained on audit, based on the technical merits of the position. FIN 48 also
provides guidance on derecognition, classification, interest and penalties,
accounting in interim periods, and disclosure.




The provisions of FIN 48 are effective January 1, 2007 and the cumulative effect
of adoption, if any, will result in an adjustment to the opening retained
earnings. The Company will evaluate the impact, if any, of adopting FIN 48 on
the consolidated financial statements.

3. Business
Acquisition

In January 2005,
the Company acquired substantially all of the assets of an equipment rental
company for total consideration of approximately $7,617,000, including
acquisition costs. The Company did not assume any liabilities. Of the total
purchase price, $500,000 was retained by the Company pending any post closing
adjustments related to deficiencies in the acquired assets. As a result of the
Companys post closing review, in July 2005, the Company paid approximately
$412,000 after post closing adjustments. Also, in connection with the
acquisition, the Company agreed to pay 50%, up to a maximum of $200,000, to the
former owner for certain potential income tax implications related to the tax
allocation of purchase price. The final amount will be determined upon review of
the former owners completed income tax returns. Any future payments made
related to this contingency will be considered additional purchase price and
allocated accordingly to goodwill.

The purchase
price of approximately $7,417,000 (excluding $200,000 of contingent purchase
price) was allocated to the assets acquired, primarily rental equipment, based
on their estimated fair values at the date of acquisition. The excess purchase
price over the fair values of assets acquired of $307,000 was allocated to
goodwill. The purchase price allocation is preliminary and will be adjusted once
the outcome of all purchase price contingencies are resolved. In accordance with
SFAS No. 142, Goodwill and Other Intangible Assets, goodwill is no
longer amortized, but is tested at least annually for impairment.

4.
Debt

Debt
consists of the following:

`June 30,     December 31,
                                                                                             2006           2005
                                                                                         ------------ ----------------
                                                                                                (in thousands)

Senior secured notes payable due 2010................................................     $  250,000    $   250,000
Unamortized debt discount--Senior Secured Notes......................................         (5,262)        (5,869)
Senior unsecured notes due 2015......................................................        150,000        150,000
Unamortized debt discount--Senior Unsecured Notes.....................................        (3,842)        (4,060)
Senior secured revolving credit facility.............................................          1,800             --
Capital lease obligations payable....................................................          5,146             --
Other notes payable..................................................................            361          7,463
                                                                                          ------------  -------------
Total debt...........................................................................     $   398,203   $   397,534
                                                                                          ============  =============`

Senior Secured Notes

In
October 2003, the Company completed a private offering of $250,000,000 aggregate principal
amount of 9.5% senior secured notes due 2010 (the Original Senior Secured
Notes). The Company pays interest on the notes semi-annually in cash, in arrears, on
October 15 and April 15, at an annual interest rate of 9.5%. The notes mature on October
15, 2010. The net proceeds were used to repay amounts outstanding under the Credit
Facility (as defined below), equipment-related purchase money obligations, equipment
leases and for other general corporate purposes.




In
September 2004, the Company completed a registered exchange offer with 100% of
the Original Senior Secured Notes being exchanged for new 9.5% senior secured
notes (the New Notes, and together with the Original Senior Secured
Notes, the Senior Secured Notes). The New Notes have substantially
identical terms as the Original Senior Secured Notes, except that the New Notes
are freely transferable. The New Notes evidence the same debt as the Original
Senior Secured Notes, are entitled to the benefits of the indenture governing
the Original Senior Secured Notes and are treated under the indenture as a
single class with the Original Senior Secured Notes.

The
Company may redeem all of the Senior Secured Notes on or after October 15, 2007.
The Company may also redeem up to 35% of the notes prior to October 15, 2006
with the net proceeds of an equity offering at 109.5% of their principal amount,
plus accrued interest; provided that at least 65% of the aggregate principal
amount of the notes issued must remain outstanding after such redemption.

The
Senior Secured Notes were issued by NationsRent Companies, Inc. and are
guaranteed by all of its direct and indirect subsidiaries. NationsRent
Companies, Inc. has no independent assets or operations, the guarantees are full
and unconditional and joint and several, and there are no other subsidiaries
other than the guarantors. There are no significant restrictions on the ability
of NationsRent Companies, Inc. to obtain funds from its subsidiaries.

The
Senior Secured Notes and the guarantees are secured by a first priority lien on
substantially all of the Companys and its subsidiaries rental
equipment (other than titled vehicles), subject to certain permitted liens. The
Company is required to certify each December and June during the term of the
Senior Secured Notes that its collateral value coverage ratio, as defined, is at
least 2.0 to 1.0. At June 30, 2006, the Company was in compliance with this
requirement.

The
indenture governing the Senior Secured Notes contains various affirmative and
negative covenants, subject to a number of important limitations and exceptions,
including limitations on the Companys ability to incur additional
indebtedness or enter into sale and leaseback transactions; limitations on the
Companys ability to repay or prepay subordinated indebtedness; certain
restrictions on dividends, stock redemptions and other distributions;
restrictions on making certain investments or acquisitions; and restrictions on
the Companys ability to grant liens on assets, enter into transactions
with stockholders and affiliates, merge, consolidate or transfer assets. The
indenture also contains various customary events of default.

In
April 2005, the Company amended the indenture governing the Senior Secured Notes
with approval from the requisite number of consents of the holders of the Senior
Secured Notes, to allow the Company to redeem all of its outstanding 6.5%
Convertible Subordinated Notes due 2008 which had an aggregate principal amount
of $45,211,000. In June 2005, the Company redeemed its convertible subordinated
notes. At December 31, 2005, the Company had approximately $90,000 of unpaid
principal plus $13,000 of accrued interest related to the redeemed Convertible
Subordinated Notes included in accrued expenses and other liabilities in the
accompanying condensed consolidated balance sheets. These amounts were paid in
April 2006.




In connection with the Merger, as defined and discussed in Note 12 below, the
Company had previously announced a tender offer and consent solicitation to
purchase for cash any and all of the Senior Secured Notes. As of 5:00 p.m., New
York City time, on July 31, 2006, which was the deadline for holders to tender
their Senior Secured Notes in order to receive the consent payment in connection
with the offer, tenders and consents had been received from holders of
$246,100,000 in aggregate principal amount of the Senior Secured Notes,
representing approximately 98.44% of the outstanding Senior Secured Notes.
Accordingly, on August 1, 2006, the Company, its subsidiaries that guarantee the
Senior Secured Notes and Wilmington Trust Company, entered into the Fourth
Supplemental Indenture (the Fourth Supplemental Indenture),
supplementing the indenture governing the Senior Secured Notes, to effect
proposed amendments to the satisfaction and discharge section in the indenture
governing the Senior Secured Notes. However, the amendments contained in the
Fourth Supplemental Indenture will not become operative unless and until certain
conditions are satisfied, including the condition that the Merger shall have
been consummated.

Senior Unsecured Notes

In
April 2005, the Company completed a private offering of $150,000,000 aggregate principal
amount of 9.5% senior unsecured notes due 2015 (the Original Senior Unsecured
Notes). The Company will pay interest on the notes semi-annually in cash, in
arrears, on May 1 and November 1, which payments began on November 1, 2005, at an annual
rate of interest of 9.5%. The Senior Unsecured Notes will mature on May 1, 2015. The
Company used a portion of the proceeds from the offering to redeem the Companys
outstanding 6.5% Convertible Subordinated Notes due 2008 and the Company will use the
remaining net proceeds from the offering for general corporate purposes.

In
July 2005, the Company completed a registered exchange offer with 100% of the
Original Senior Unsecured Notes being exchanged for new 9.5% senior unsecured
notes (the New Unsecured Notes, and together with the Original
Senior Unsecured Notes, the Senior Unsecured Notes). The New
Unsecured Notes have substantially identical terms as the Original Senior
Unsecured Notes, except that the New Unsecured Notes are freely transferable.
The New Unsecured Notes evidence the same debt as the Original Senior Unsecured
Notes, are entitled to the benefits of the indenture governing the Original
Senior Unsecured Notes and are treated under the indenture as a single class
with the Original Senior Unsecured Notes.

The
Company may redeem all of the Senior Unsecured Notes on or after May 1, 2010.
The Company may also redeem up to 35% of the Senior Unsecured Notes prior to May
1, 2009 with the net proceeds of an equity offering at 109.5% of their principal
amount, plus accrued interest; provided that at least 65% of the aggregate
principal amount of the notes issued must remain outstanding after such
redemption.

The
Senior Unsecured Notes were issued by NationsRent Companies, Inc. and are
guaranteed by all of its direct and indirect subsidiaries. NationsRent
Companies, Inc. has no independent assets or operations, the guarantees are full
and unconditional and joint and several, and there are no other subsidiaries
other than the guarantors. There are no significant restrictions on the ability
of NationsRent Companies, Inc. to obtain funds from its subsidiaries.




The
indenture governing the Senior Unsecured Notes contains various customary
affirmative and negative covenants, subject to a number of important limitations
and exceptions, including, limitations on the Companys ability to incur
additional indebtedness or enter into sale and leaseback transactions;
limitations on the Companys ability to repay or prepay subordinated
indebtedness; certain restrictions on dividends, stock redemptions and other
distributions; restrictions on making certain investments or acquisitions; and
restrictions on the Companys ability to grant liens on assets, enter into
transactions with stockholders and affiliates, merge, consolidate or transfer
assets. The indenture also contains various customary events of default.

In
connection with the Merger, the Company had previously announced a tender offer
and consent solicitation to purchase for cash any and all of its Senior
Unsecured Notes. As of 5:00 p.m., New York City time, on July 31, 2006, which
was the deadline for holders to tender their Senior Unsecured Notes in order to
receive the consent payment in connection with the offer, tenders and consents
had been received from holders of $150,000,000 in aggregate principal amount of
the Senior Unsecured Notes, representing 100% of the outstanding Senior
Unsecured Notes. Accordingly, on August 1, 2006, the Company, its subsidiaries
that guarantee the Senior Unsecured Notes and Wilmington Trust Company, entered
into a Supplemental Indenture (the First Supplemental Indenture),
supplementing the indenture governing the Senior Unsecured Notes, to effect
proposed amendments to eliminate substantially all of the restrictive covenants
and events of default contained in the indentures governing the Senior Unsecured
Notes. However, the amendments contained in the First Supplemental Indenture
will not become operative unless and until certain conditions are satisfied,
including the condition that the Merger shall have been consummated.

Credit Facility

In
June 2003, the Company entered into a senior secured revolving credit facility
(the Credit Facility) with an aggregate commitment of up to
$150,000,000 with a syndicate of lenders. The Credit Facility was used to
provide the exit financing for the Company pursuant to the Plan, to pay
transaction expenses incurred in connection therewith and to refinance then
existing indebtedness. In October 2003, the Company amended and restated the
Credit Facility to reduce the aggregate commitments to up to $75,000,000
(including a $30,000,000 sub-limit for letters of credit) and repaid all amounts
outstanding under the Credit Facility with the proceeds of the offering of
Senior Secured Notes. In December 2004, the Company entered into a second
amendment to the Credit Facility to amend certain items including extending the
maturity date. In April 2005, the Company amended and restated the Credit
Facility (the Amended and Restated Credit Facility) to, among other
things, increase the availability from $75,000,000 up to $100,000,000 (including
a $40,000,000 sub-limit for letters of credit) and extend the maturity of the
facility to April 2010. In April 2006, the Company entered into a fourth
amendment to the Amended and Restated Credit Facility to amend the definition of
permitted liens to include an additional category of permitted
liens.

Under the
terms of the Amended and Restated Credit Facility, availability is subject to a
borrowing base test based upon eligible trade accounts receivable, titled
vehicles and real estate. Borrowings under the Amended and Restated Credit
Facility bear interest at floating rates equivalent to either a base rate, as
defined therein, plus a margin ranging from 0.25% to 1.00% or the London
Interbank Offered Rate (LIBOR) plus a margin ranging from 1.50% to
2.50%.




At June 30, 2006, the interest rate was 9.0%. Letters of credit fees
range from 1.50% to 2.50%. There is an unused commitment fee ranging from 0.375%
to 0.50% and a letter of credit fronting fee of 0.125%. The Amended and Restated
Credit Facility is secured by a first lien on the Companys assets, except
for the Companys rental equipment and inventory. The facility is also
secured by a pledge of the capital stock of the Companys subsidiaries. The
Company may also grant to the lenders under such facility certain mortgages and
other security interests on certain real property owned by the Company.

The
Amended and Restated Credit Facility is available to (i) refinance existing
indebtedness, (ii) finance ongoing capital expenditures and working capital
needs, (iii) issue standby letters of credit and (iv) fund other general
corporate purposes. The facility contains various affirmative and negative
covenants customary for similar working capital facilities. The Amended and
Restated Credit Facility also contains certain customary events of default. In
addition, the Company must maintain a debt to cash flow ratio, as defined, of
not greater than 3.00 to 1.00 for the trailing 12-month period for each fiscal
quarter. At June 30, 2006, the Company was in compliance with this requirement.

As
of June 30, 2006, the Company had $1,800,000 outstanding under the Amended and
Restated Credit Facility. The amounts disclosed in the captions titled
Proceeds from debt issuance and revolving credit facility and
Repayments of debt in the accompanying unaudited condensed
consolidated statement of cash flows for the six months ended June 30, 2006
include the cumulative activity of the daily borrowings and repayments,
$75,600,000 and $73,800,000, respectively, under the Amended and Restated Credit
Facility. The availability under the Amended and Restated Credit Facility at
June 30, 2006, amounted to $64,676,000 after taking into account approximately
$25,498,000 in outstanding letters of credit. At December 31, 2005, the Company
had no cash borrowings under the Amended and Restated Credit Facility.

Capital Lease Obligations

Capital
lease obligations represent leases that meet the criteria for treatment as capital leases
under accounting principles generally accepted in the United States. During the first
quarter of 2006, the Company entered into a capital lease for the purchase of delivery
vehicles.

Lease
expense under such capital lease obligations is as follows:

`Three Months Ended           Six Months Ended
                                                                       June 30                      June 30
                                                                  2006           2005          2006         2005
                                                                ---------    -----------    -----------  -----------
                                                                                 (in thousands)

Lease expense..................................................  $262          $ --          $ 349          $--`

Other Notes Payable

Other
notes payable consist of short-term finance obligations for the purchase of certain rental
equipment and the payment of insurance premiums.




5.     Equipment Floor Plan and Financing

During
2005, the Company entered into equipment floor plan arrangements with CNH Capital America
LLC, an affiliate of Case Corporation, for Case equipment and with LBX Company LLC for
Link-Belt equipment. The terms of these arrangements generally include up to six months
interest free payment terms followed by a term during which interest is charged at
prevailing market rates. Principal payments are generally due at the earlier of sale of
the equipment or up to twenty-four months from the invoice date. Additionally, the Company
is required to pay curtailments on equipment that is placed in the Companys rental
fleet, based upon the original cost of the equipment and hourly usage. Curtailments are
applied against the outstanding principal of the equipment obligation. The floor plan
obligations are collateralized by the specific equipment. At June 30, 2006 and December
31, 2005, the Company had approximately $17,871,100 and $10,573,000, respectively,
outstanding under these floor plan arrangements.

In
April 2006, the Company entered into a Wholesale Financing Agreement (the
Facility) with an uncommitted initial maximum availability of up to
$25,000,000. The Facility is available to finance purchases of rental equipment and new
equipment inventory on a short-term basis. The Facility is secured on a first priority
basis by the equipment financed thereunder and a letter of credit in an amount equal to
10% of the maximum availability, currently $2,500,000. Advances with respect to each item
of the equipment financed under the Facility mature on the earlier of (i) 360 days after
the invoice date of such equipment or (ii) ten days after such item of equipment is sold
or disposed. Advances under the Facility bear interest at a floating rate equal to the
prime rate minus 0.35%, subject to a minimum interest rate of 5.15%. At June 30, 2006, the
interest rate was 6.38%. The facility requires that the Company maintain a minimum
collateral value equal to 105% of the appraised market value of the equipment being
financed. If the collateral value falls below the 105% requirement, then the Company is
required to deposit additional cash collateral to cover the deficiency. In an event of
default, termination or expiration of the Facility, the cash collateral may be applied to
the outstanding loan amount. The Facility contains various customary affirmative and
negative covenants and events of default. As of June 30, 2006, there was $22,780,000
outstanding under the Facility net of cash collateral of $685,000.




6.     Income Taxes

The
Companys provision for income taxes was $3,797,000 and $2,037,000 for the
three and six months ended June 30, 2006, respectively, and zero for the three
and six months ended June 30, 2005. The Companys calculation of its
estimated annual effective tax rate takes into account the geographical
distribution of the Companys taxable income for state purposes, changes to
the Companys valuation allowance for deferred tax assets for federal and
state purposes, and tax planning opportunities that may be available to the
Company in the various jurisdictions in which it operates. The assumptions used
in determining the estimated annual effective tax rate are subject to change and
may impact this calculation. Significant or unusual items are separately
recognized in the period in which they occur.

7.     Restricted Stock

In
June 2003, the Company adopted a restricted stock plan (the Restricted Stock
Plan), pursuant to which directors, officers, management and key employees of the
Company are eligible to receive grants of restricted shares of common stock. Under the
Restricted Stock Plan, the Company may grant up to an aggregate of 141,000 shares of
common stock. Such restricted shares are not transferable (except under limited
circumstances) and subject to forfeiture upon such terms and conditions as the
Companys Board of Directors or any committee thereof (if so delegated by the Board)
shall determine.

The
Company issued 3,292 and 125,617 shares of common stock valued at $71.59 per
share during 2004 and 2003, respectively, to certain of its officers and
directors under the Restricted Stock Plan. At the time of issuance, these shares
of restricted stock were subject to various vesting schedules. Effective January
1, 2006, the Company adopted SFAS No. 123(R), Share-Based Payment
(SFAS No. 123(R)). SFAS No. 123(R) requires that the cost relating to
share-based payment transactions, including share options, restricted share
plans, and employee share purchase plans, be recognized in financial statements.
The cost of these transactions will be measured based on the fair value of the
equity or liability instruments issued. Through December 31, 2005, the Company
used the intrinsic value method to account for stockbased awards to
employees under APB Opinion No. 25, Accounting for Stock Issued to
Employees. The Company has adopted SFAS 123(R) using the modified
prospective transition method in which compensation expense on the unvested
portion of the awards is recognized over the remaining vesting period.

The
impact of adopting SFAS 123(R) was not significant as the Company was already
recognizing compensation expense for these shares as they vest. Compensation
expense is included in selling, general and administrative expenses in the
accompanying consolidated statements of operations.




Compensation
expense is as follows:

`Three Months Ended           Six Months Ended
                                                                       June 30                      June 30
                                                                  2006           2005          2006         2005
                                                                ----------- -------------   ------------ -----------
                                                                                 (in thousands)

Compensation expense.....................................        $  88           $ 214         $ 175         $ 426`

Prior to the adoption of SFAS 123(R), deferred stock compensation, arising from
the issuance of restricted shares, was charged for the difference between the
market value of the restricted shares and the sales price of the shares and was
recorded as a reduction of stockholders equity in the accompanying
consolidated balance sheets. Upon the adoption of SFAS 123(R), the deferred
compensation balance at June 30, 2006, of approximately $374,000 was
reclassified to additional paid-in capital. The unamortized compensation expense
of $374,000, which is related to the 19,680 unvested restricted shares, will be
amortized over a weighted average period of 1.1 years.

8.     Rental Equipment, net

Rental equipment, net consists of the following:

`June 30,       December 31,
                                                                                          2006             2005
                                                                                      ------------    ----------------
                                                                                              (in thousands)


Rental equipment.................................................................     $     791,279    $     697,858
Less: accumulated depreciation...................................................          (237,951)        (206,294)
                                                                                     ---------------- ----------------
Rental equipment, net............................................................     $     553,328    $     491,564
                                                                                     ================ ================`

9.     Property and Equipment, net

Property
and equipment, net consists of the following:

`June 30,       December 31,
                                                                                          2006             2005
                                                                                      ------------    --------------
                                                                                              (in thousands)

Land, buildings and improvements................................................     $       48,170   $       46,679
Furniture, fixtures and office equipment........................................             18,785           15,900
Vehicles, delivery and shop equipment...........................................             62,956           55,115
Construction in progress........................................................              3,661            3,381
                                                                                     ---------------- ----------------
                                                                                            133,572          121,075
Less: accumulated depreciation and amortization.................................            (46,611)         (40,129)
                                                                                     ---------------- ----------------
Property and equipment, net.....................................................     $       86,961   $       80,946
                                                                                     ================ ================`

At
June 30, 2006 and December 31, 2005, construction in progress included
approximately $380,000 and $1,319,000 of software related costs, respectively.




10.     Related Party Transactions

TREC, LLC, an
entity affiliated with Bryan Rich, one of the Companys Co-Chairmen, and
certain affiliates of TREC, LLC, are currently leasing three locations to the
Company. Payments for such locations totaled approximately $173,000 for each of
the three months ended June 30, 2006 and 2005, and $346,000 for each of the six
months ended June 30, 2006 and 2005.

The
Company leases certain facilities from family members of one of its Co-Chairmen.
Payments for such leases totaled approximately $58,000 and $52,000 for the three
months ended June 30, 2006 and 2005, respectively, and $111,000 and $135,000 for
the six months ended June 30, 2006 and 2005, respectively.

In
November 2003, the Company created a limited housing assistance program for
certain key employees, which consisted of certain interest free short-term
bridge loans and interest free long-term loans to assist with relocation to Ft.
Lauderdale, Florida. The short-term bridge loans were repaid in full during
2004. The outstanding aggregate balance of the three long-term loans was
$2,249,000 and $2,373,000 at June 30, 2006 and December 31, 2005, respectively.
These amounts are included in prepaid expenses and other assets in the
accompanying condensed consolidated balance sheets.

In
2006, the Company purchased SmartWasher parts washers from ChemFree, a company
affiliated with Irv Levine, a member of the Board of Directors of the Company.
As of June 30, 2006, the Companys purchases from ChemFree were
approximately $78,000.

11.     Commitments and Contingencies

In
June 2006, a suit entitled Todd Horton and Brad Barnard d/b/a Barnard
Construction v. NationsRentwas filed in the United States District Court
for the Southern District of Florida claiming, among other things, that the
Company charge a damage waiver fee as part of the Companys standard
equipment rental agreement that constitutes an unconscionable, unfair or
deceptive act or practice under Florida law. The plaintiffs in the
Horton/Barnardcase are seeking to represent a class consisting of every
person who entered into an equipment rental agreement with the Company who paid
a damage waiver fee. Plaintiffs in the Horton/Barnardcase are seeking an
unspecified amount of damages, plus costs and fees, and declaratory and
injunctive relief. In addition, in July 2006, a suit entitled David Jacov
v. NationsRentwas filed in the United States District Court for the
Southern District of Florida, similarly alleging, among other things, that the
Company charge a damage waiver fee, as well as an environmental fee, as part of
the Companys standard equipment rental agreement that constitutes an
unconscionable, unfair or deceptive act or practice under Florida law. The
plaintiff in the Jacovcase is seeking to represent a similar class of
persons. The plaintiff in the Jacovcase is seeking an unspecified amount
of damages, plus costs and fees, and declaratory and injunctive relief. In July
2006, plaintiffs in the Horton/Barnardcase and the Jacovcase agreed to consolidate these two cases into one case and
file a new consolidated amended complaint which is expected to be filed in August 2006.
NationsRent intends to vigorously defend each of these cases. The ultimate outcome of
these cases cannot be determined at this time.

The
Company is also a party to other pending legal proceedings arising in the
ordinary course of business, the results of which cannot be predicted with
certainty.




12.     Subsequent Events

On
July 18, 2006, the Company entered into an Agreement and Plan of Merger (the
Merger Agreement) with Ashtead Group plc, a United Kingdom company
(Ashtead), Sunbelt Rentals, Inc., a Delaware company and an indirect
subsidiary of Ashtead and Neptune Ventures Group, Inc., a Delaware company and a
direct subsidiary of Sunbelt Rentals, Inc. pursuant to which the Company will be
merged with Neptune Ventures Group, Inc., with the Company surviving as a
wholly-owned indirect subsidiary of Ashtead (the Merger).

At
the time when the Merger becomes effective (the Effective Time),
each issued and outstanding share of the Companys common stock shall be
converted into the right to receive its pro rata share of the Common Stock
Consideration. The aggregate Common Stock Consideration will consist of:

| |  | an aggregate of $494,998,000, less the transaction expenses incurred by the Company;
| | - | ------------------------------------------------------------------------------------

| |  | the amount of the $28,000,000 escrow fund (the Escrow Amount) (and interest,
net of taxes) available after settlement of any claims against the escrow fund pursuant to
the Merger Agreement and a related escrow agreement;
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | the balance of a reserve account (initially $5,000,000) established to cover the third
party costs which may be incurred by the stockholders representative in disputing
claims by Ashtead against the Escrow Amount and to resolve any other disagreements,
including any disagreements over the Common Stock Deferred Payment (as described below);
and
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | the "Common Stock Deferred Payment" of up to $89,000,000, if achieved.
| | - | ----------------------------------------------------------------------

The
Common Stock Deferred Payment is payable in full if Ashteads share price
equals or exceeds 140% of its reference price of 223.5 pence (with
payments being earned in installments of approximately $5,000,000 each for each
percentage point between 123.2% and 140%) based on measurements on certain
trading days over the period lasting until the third anniversary date of the
closing. The reference price will be adjusted to account for dilution
resulting from a rights offering being conducted by Ashtead in connection with
its financing of the Merger, and the reference price will be subject to further
adjustments if certain dilution events occur in the future.

At
the Effective Time, each issued and outstanding share of the Companys
Series A Preferred Stock shall be converted into the right to receive $1,000,
the liquidation preference, in cash, for an aggregate of $72,002,000.

The
obligations of each party to consummate the Merger are subject to the
satisfaction or waiver of certain conditions as specified in the Merger
Agreement, including, among other things, the following:




| |  | the Companys consummation of bond tender offers for its two
outstanding issues of senior notes (and receipt of related consents from holders
of a majority of the outstanding amount of each such series of notes to amend
the related indenture). As discussed in Note 4, as of July 31, 2006, the Company
had received the requisite number of tenders and consents;
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | Ashtead obtaining shareholder approval of the Merger and a rights
offering it is conducting in connection with the Merger, which approval was
received on August 4, 2006;
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | Ashtead consummating financing necessary to fund the payments of merger
consideration;
| | - | --------------------------------------------------------------------------------------

| |  | No material adverse effect having occurred with respect to the Company nor any
change, event or condition, individually or in the aggregate, that would
reasonably be expected to have a material adverse effect on the Company; and
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | Expiration or early termination of the applicable waiting period
under the Hart-Scott-Rodino Antitrust Improvements Act. Early termination was
granted on August 9, 2006.
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------

The
Merger Agreement may be terminated and the Merger may be abandoned at any time
prior to the Closing under certain circumstances as specified in the Merger
Agreement. Either party may terminate if the Merger has not occurred by
September 30, 2006. Subject to certain conditions, the Company will be entitled
to a $11.3 million breakup fee if the Merger Agreement is terminated
due to (a) the failure of Ashteads shareholders to approve the rights
offering mentioned above, or of Ashtead to effect the admission of certain
shares for listing under United Kingdom procedures or (b) Ashteads
inability to consummate financing.

In
connection with the execution of the Merger Agreement, certain of our
stockholders adopted resolutions which, in part, approved and adopted the Merger
Agreement in an action by written consent pursuant to Section 228 of the
Delaware General Corporation Law, which approval constituted the stockholder
approval required under the terms of our Amended and Restated Certificate of
Incorporation and Delaware law. As a result, the approval of the Merger by the
our stockholders has been obtained.

The
Merger is expected to close on or about August 31, 2006.

In
addition, in connection with the Merger, the Company commenced a cash tender
offer for any and all of the Senior Secured Notes and Senior Unsecured Notes and
in connection with such offers, holders of such notes were solicited to provide
consents to certain amendments that would eliminate most of the restrictive
covenants and events of default contained in the indenture for the Senior
Unsecured Notes and amend the satisfaction and discharge section of the
indenture for the Senior Secured Notes. The tender offers and consent
solicitations are more fully described in Note 4.




Item 2: Management's Discussion and Analysis of Financial
Condition and Results of Operations

You
should read the following discussion of our results of operations and financial condition
in conjunction with our financial statements and related notes.

Overview

In
June 2003 we embarked on a new strategy to become a premier full service equipment
provider in the construction equipment industry in terms of safety, reputation and
financial performance. Since then we have focused on rebuilding our customer
relationships, repositioning and renewing our rental fleet, and providing the motivation
and training to our people to make them more effective. We believe that we have achieved
several important milestones on the road to building a premier full-service equipment
company. We have replaced a substantial portion of our rental fleet with newer name brand
fleet. We have upgraded our information systems to the industry standard. We have
implemented training and compensation programs to facilitate our transition from a
rental-only focus to a full service customer-oriented model. Our recent results of
operations reflect these and other key initiatives launched since our emergence from
bankruptcy in June 2003 as well as certain economic and industry factors.

Recent Developments

On
July 18, 2006, we entered into an Agreement and Plan of Merger, or Merger
Agreement, with Ashtead Group plc, a United Kingdom company, or Ashtead, Sunbelt
Rentals, Inc., a Delaware company and an indirect subsidiary of Ashtead and
Neptune Ventures Group, Inc., a Delaware company and a direct subsidiary of
Sunbelt Rentals, Inc. pursuant to which the Company will be merged with Neptune
Ventures Group, Inc., with the Company surviving as a wholly-owned indirect
subsidiary of Ashtead, this transaction being referred to herein as the Merger.

At
the time when the Merger becomes effective, or the Effective Time, each issued
and outstanding share of our common stock shall be converted into the right to
receive its pro rata share of the Common Stock Consideration. The aggregate
Common Stock Consideration will consist of:

| |  | an aggregate of $494.9 million, less the transaction expenses
incurred by the Company;
| | - | --------------------------------------------------------------------------------------

| |  | the amount of the $28.0 million escrow fund, or the Escrow Amount
(and interest, net of taxes) available after settlement of any claims against
the escrow fund pursuant to the Merger Agreement and a related escrow
agreement;
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | the balance of a reserve account (initially $5.0 million) established to cover
the third party costs which may be incurred by the stockholders
representative in disputing claims by Ashtead against the Escrow Amount and to
resolve any other disagreements, including any disagreements over the Common
Stock Deferred Payment (as described below); and
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------




| |  | the "Common Stock Deferred Payment" of up to $89.0 million, if
achieved.
| | - | ------------------------------------------------------------------------

The
Common Stock Deferred Payment is payable in full if Ashteads share price
equals or exceeds 140% of its reference price of 223.5 pence (with
payments being earned in installments of approximately $5.0 million each for
each percentage point between 123.2% and 140%) based on measurements on certain
trading days over the period lasting until the third anniversary date of the
closing. The reference price will be adjusted to account for dilution
resulting from a rights offering being conducted by Ashtead in connection with
its financing of the Merger, and the reference price will be subject to further
adjustments if certain dilution events occur in the future.

At
the Effective Time, each issued and outstanding share of our Series A Preferred Stock
shall be converted into the right to receive $1,000, the liquidation preference, in cash,
for an aggregate of $72.0 million.

The
obligations of each party to consummate the Merger are subject to the satisfaction or
waiver of certain conditions as specified in the Merger Agreement, including, among other
things, the following:

| |  | Our consummation of bond tender offers for our two outstanding
issues of senior notes (and receipt of related consents from holders of a
majority of the outstanding amount of each such series of notes to amend the
related indenture). As of July 31, 2006, we had received the requisite number of
tenders and consents;
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | Ashtead obtaining shareholder approval of the Merger and a rights offering it is
conducting in connection with the Merger which approval was received on August 4, 2006;
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | Ashtead consummating financing necessary to fund the payments of
merger consideration;
| | - | --------------------------------------------------------------------------------------

| |  | No material adverse effect having occurred with respect to the
Company nor any change, event or condition, individually or in the aggregate,
that would reasonably be expected to have a material adverse effect on the
Company; and
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | Expiration or early termination of the applicable waiting period
under the Hart-Scott-Rodino Antitrust Improvements Act. Early termination was
granted on August 9, 2006.
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------

The
Merger Agreement may be terminated and the Merger may be abandoned at any time prior to
the Closing under certain circumstances as specified in the Merger Agreement. Either party
may terminate if the Merger has not occurred by September 30, 2006. Subject to certain
conditions, the Company will be entitled to a $11.3 million breakup fee if the
Merger Agreement is terminated due to (a) the failure of Ashteads shareholders to
approve the rights offering mentioned above, or of Ashtead to effect the admission of
certain shares for listing under United Kingdom procedures or (b) Ashteads inability
to consummate financing.




In
connection with the execution of the Merger Agreement, certain of our stockholders adopted
resolutions which, in part, approved and adopted the Merger Agreement in an action by
written consent pursuant to Section 228 of the Delaware General Corporation Law, which
approval constituted the stockholder approval required under the terms of our Amended and
Restated Certificate of Incorporation and Delaware law. As a result, the approval of the
Merger by the our stockholders has been obtained.

The
Merger is expected to close on or about August 31, 2006.

In
addition, in connection with the Merger, we have commenced a cash tender offer
for any and all of our Senior Unsecured Notes due May 1, 2015 and Senior Secured
Notes due October 15, 2010 and, in connection with such offers, holders of such
notes are being solicited to provide consents to certain amendments that would
eliminate most of the restrictive covenants and events of default contained in
the indenture for the Senior Unsecured Notes and amend the satisfaction and
discharge section of the indenture for the Senior Secured Notes.

As
of 5:00 p.m., New York City time, on July 31, 2006, which was the deadline for
holders to tender their Senior Secured Notes in order to receive the consent
payment in connection with the offer, tenders and consents had been received
from holders of $246,100,000 in aggregate principal amount of the Senior Secured
Notes, representing approximately 98.44% of the outstanding Senior Secured
Notes. As of 5:00 p.m., New York City time, on July 31, 2006, which was the
deadline for holders to tender their Senior Unsecured Notes in order to receive
the consent payment in connection with the offer, tenders and consents had been
received from holders of $150,000,000 in aggregate principal amount of the
Senior Unsecured Notes, representing 100% of the outstanding Senior Unsecured
Notes.

Completion
of the offers and consent solicitations is subject to the satisfaction of
certain conditions, including, but not limited to, the consummation of the
Merger contemplated by the Merger Agreement.

Our Initiatives

In
the first half of 2006, we continued to execute on several of our core strategies that
impacted our results of operations:

| |  | We continue to reinvest the proceeds of used equipment sales to replenish our
rental fleet. This is allowing us to continue to reduce our fleet age and
improve our overall fleet mix. It is also allowing us to accelerate the
transition of our fleet to a core group of leading brands and dispose of fleet
that does not meet our return hurdles.
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | We believe that the improvements in our rental fleet discussed above have
contributed to higher deployment and pricing which has led to growth in our
rental revenue. In the first half of 2006 our rental fleet had an average first
cost of approximately $969.7 million.
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------




| |  | During the first half of 2005, we completed the implementation of a new point of
sale system to better support our key initiatives. We believe that the
distractions associated with this implementation coupled with the ramp up time
in getting the system to operate as expected negatively impacted our operating
results, including our rental revenue growth, for 2005. We believe that most of
the disruptions caused by the transition to this new point of sale system are
behind us.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | We continued to emphasize sales of equipment through implementing training and
targeted incentive compensation programs, establishing dealer and distributor
relationships and increasing inventories of new equipment available for sale.
The result was that a significant portion of our revenue growth was from the
sale of new equipment. In addition, we continued our pace of sales of used
equipment to take advantage of the strong market pricing for used equipment.
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | As part of our continuing strategy to expand our customer service offerings and
as an authorized dealer and distributor of several major brands of new equipment
at certain of our locations, we continued to build up our new equipment and
parts inventories. We generally align our inventories of new equipment and parts
with the types and brands of equipment and parts that we purchase for our rental
fleet in order to provide flexibility to our customers, reduce maintenance costs
and improve operator and mechanic training.
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Economic and Industry Factors

In
the first half of 2006, we believe that the following external factors had an impact on
our results of operations:

| |  | Non-residential construction activity continued to grow in the second quarter of
2006 which has had a positive impact on our rental and sales revenue.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | Demand for construction equipment in the U.S. relative to supply remains strong,
as reflected by continued strong market pricing for used equipment. As discussed
above, we continue to take advantage of this favorable market and accelerate the
replacement of a significant portion of our rental fleet.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | Throughout 2005, increased demand for construction equipment resulted in
extended delivery times for our purchases of rental fleet and new equipment
inventory. This required us to plan for our equipment purchases well in advance
of our expected needs. We believe that these extended delivery times are
returning to more manageable levels in 2006.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | Worldwide price increases for raw materials and energy have led to an increase
in our equipment costs from many of our manufacturers. Our sales prices and
rental rates generally have increased in advance of these cost increases. We
believe that as long as the demand for construction equipment exceeds the
supply, rental rates and the resale value of used equipment will continue to
rise, thereby offsetting much of the increased equipment costs.
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------




| |  | Recent significant increases in the cost of fuel in the United States have led
to increased expense for both off-road and on-road fuel. We purchase a
significant quantity of off-road and on-road diesel and gasoline fuel. Off-road
fuel is primarily sold to customers for use in our rental equipment, and on-road
fuels are consumed primarily in the operation of our delivery vehicles. In
response to these increases, we raised the price we charge our customers for use
of off-road fuels. Increased costs for on-road fuels, however, are not as
directly offset by increased prices to our customers. Competitive pressures
often do not allow us to pass on these increased costs to our customers, and we
must therefore absorb a portion of the increased costs of fuel. Further
significant fuel price increases may potentially reduce our gross profit margin
on rentals to the extent we are unable to pass these higher fuel costs on to our
customers.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Impact of Fresh-Start Reporting

On
June 13, 2003, or the Effective Date, NationsRent emerged from bankruptcy
proceedings under Chapter 11 of Title 11 of the U.S. Bankruptcy Code pursuant to
the Plan of Reorganization. We recognized the effects of the reorganization for
accounting purposes on June 1, 2003. Accounting for the reorganization had a
significant effect on the carrying value of our assets and liabilities, which
makes comparing and understanding the results of our operations from prior to
the Effective Date to after the Effective Date more difficult.

In
connection with our emergence from bankruptcy, we determined the fair value of our assets
and liabilities pursuant to the AICPAs SOP 90-7, Financial Reporting by
Entities in Reorganization Under the Bankruptcy Code. The excess of the fair value
of our assets, net of the fair value of our liabilities, over our reorganization value
(negative goodwill) at the Effective Date was recorded as a pro rata reduction of the
carrying value of our long-lived assets in accordance with SFAS No. 141, Business
Combinations. Accordingly, on the Effective Date, our rental fleet and property and
equipment were written down by approximately 44% below fair value, representing a
write-down of approximately $179.1 million and $34.4 million, respectively.

Until
these assets are disposed, the write-downs recorded as a result of fresh-start reporting
increase our operating income (or decrease our operating loss), because:

| |  | they increase the gain, or reduce the loss, on sale or disposal of
these assets;
| | - | --------------------------------------------------------------------------------

| |  | they reduce the depreciation expense we record on these assets
while in our rental fleet; and
| | - | ---------------------------------------------------------------------------------------------

| |  | they reduce depreciation expense on non-rental assets, such as our delivery
vehicles, our leasehold improvements and our information systems.
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------

These
favorable effects on our results of operations will continue until all of the assets
written down have been sold, disposed or fully depreciated. At June 30, 2006, there was
approximately $7.0 million of estimated fresh start adjustments remaining in our rental
fleet, and approximately $17.4 million remaining in our property and equipment accounts.
We expect that most of the remaining fresh start adjustments in our rental fleet will
affect our results of




operations in 2006 and 2007 either through reduced depreciation or
adjustments to the gain (loss) on disposal. The majority of the remaining fresh start
adjustments in our property and equipment accounts relate to adjustments recorded to
leasehold improvements and owned real property. These assets have much longer lives and
are not generally disposed of at the same rate as our rental fleet. As a result, the
remaining adjustments in our property and equipment accounts will reduce depreciation
expense on these long-lived assets over the remaining useful lives of 5 to 20 years.

Results of Operations

Three Months Ended June 30, 2006 as Compared to Three
Months Ended June 30, 2005

`Variance
                                                    Three Months Ended June 30,        Favorable/(Unfavorable)
                                                  -------------------------------  ------------------------------
                                                       2006             2005              $                %
                                                  ---------------- --------------  ---------------- --------------
                                                                       (dollars in thousands)
Revenue:
Equipment rentals.............................    $   132,834      $   123,389     $      9,445             7.7%
Sales of rental equipment.....................         30,817           31,020             (203)           (0.7)
Sales of new equipment........................         23,007           12,198           10,809            88.6
Sales of merchandise,
  service, parts and supplies.................          9,088            7,059            2,029            28.7
                                                  --------------   --------------   --------------    ------------
Total revenue.................................        195,746          173,666           22,080            12.7
                                                  --------------   --------------   --------------    ------------
Cost of revenue:
Cost of equipment rentals.....................         70,102           64,102           (6,000)           (9.4)
Rental equipment and vehicle depreciation
  and lease expense...........................         30,093           32,792            2,699             8.2
Cost of sales of equipment,
  merchandise, service, parts and supplies....         38,369           27,906          (10,463)          (37.5)
                                                  --------------   --------------   --------------    ------------
Total cost of revenue.........................        138,564          124,800          (13,764)          (11.0)
                                                  --------------   --------------   --------------    ------------
Gross profit:
Gross profit on equipment rentals
  including  equipment and vehicle  depreciation
  and lease
  expense...........................                   32,639           26,495            6,144            23.2
Gross profit on sales of equipment,
  merchandise, service, parts and supplies....         24,543           22,371            2,172             9.7
                                                  --------------   --------------   --------------    ------------
Total gross profit............................         57,182           48,866            8,316            17.0
                                                  --------------   --------------   --------------    ------------
Operating expenses:
Selling, general and administrative expenses..         34,681           32,283           (2,398)           (7.4)
Other depreciation and amortization...........          2,336            2,109             (227)          (10.8)
                                                  --------------   --------------   --------------    ------------
Operating income..............................         20,165           14,474            5,691            39.3
                                                  --------------   --------------   --------------    ------------
Interest expense, net.........................         11,092            9,948           (1,144)          (11.5)
Other, net....................................           (933)            (624)             309            49.5
                                                  --------------   --------------   --------------    ------------
                                                       10,159            9,324             (835)           (9.0)
                                                  --------------   --------------   --------------    ------------
Income before provision for income taxes .....         10,006            5,150            4,856            94.3
Provision for income taxes....................          3,797               --           (3,797)            --
                                                  --------------   --------------   --------------    ------------
  Net income..................................    $     6,209      $     5,150     $      1,059            20.6%
                                                  ==============   ==============   ==============    ============`

Revenue. Equipment rentals revenue increased in the second quarter of
2006 as compared to the same period in 2005 as a result of improved pricing and
higher deployment, which resulted from:

| |  | increased non-residential construction activity;
| | - | ------------------------------------------------




| |  | continued strong demand for our equipment; and
| | - | ----------------------------------------------

| |  | a greater number of rental units deployed.
| | - | ------------------------------------------

Utilization
in the second quarter of 2006 was 54.1% compared to 50.5% in the same period in 2005. We
believe that the higher deployment discussed above was the key factor in the increase.

Utilization,
measured as total annualized rental revenue divided by the average first cost of the
rental fleet over the applicable period, is used as a relative measure of financial return
on the investment in our rental fleet. For equipment acquired new or used, first cost is
the purchase price paid for the equipment. For equipment acquired in connection with
business acquisitions, first cost is the estimated fair value of such equipment.
Utilization is affected by changes in pricing, deployment and average first cost of rental
fleet. Pricing is affected by changes in rental rates, contract length and mix of fleet on
rent.

Sales
of new equipment increased in the second quarter of 2006 as compared to the same period in
2005 primarily as a result of our continued emphasis on sales of new equipment.

Gross
profit. Gross profit margin on equipment rentals, including equipment and vehicle
depreciation and lease expense, increased from 21.5% in the second quarter of 2005 to
24.6% in the second quarter of 2006.

Gross profit on equipment rentals increased primarily as a result of:

| |  | the $9.4 million increase in revenue; and
| | - | -----------------------------------------

| |  | a $2.7 million decrease in depreciation expense primarily related
to rental equipment that became fully depreciated in 2005.
| | - | ----------------------------------------------------------------------------------------------------------------------------

The increase in gross profit on equipment rentals was partially offset by:

| |  | a $2.4 million increase in employee-related expenses primarily related to
increased headcount to support our key initiatives as well as increased labor
costs in general; and
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | a $1.3 million increase in fuel expense.
| | - | ----------------------------------------

Gross
profit margin on sales of equipment, merchandise, service, parts and supplies decreased
from 44.5% in the second quarter of 2005 to 39.0% for the same period in 2006. The
decrease was primarily a result of the increase in new equipment sales which have lower
gross profit margins.

Gross
profit on rental equipment sales increased from 60.1% in the second quarter of 2005 to
61.3% in the same period in 2006 primarily as a result of continued improvement in pricing
due to strong demand for equipment.




In
addition, gross profit on the sale of rental equipment was positively impacted as a result
of implementing fresh start reporting. The following table presents normalized gross
profit and gross profit margins for rental equipment sales after removing the estimated
effect of fresh start reporting ($ in millions):

`Three Months Ended March 31,
                                                              -------------------------- -----------------------------
                                                                            2006                  2005
                                                              -------------------------- -----------------------------
Reported gross profit.......................................  $     18.9          61.3%     $  18.6           60.1%
                                                              --------------                -----------
Write-down on Effective Date(1).............................       (10.4)                     (11.0)
Additional depreciation expense(2)..........................         9.8                        9.1
                                                              --------------                -----------
Net change resulting from fresh-start.......................       (0.6)                       (1.9)
                                                              --------------                -----------
Normalized gross profit.....................................  $     18.3          59.4%     $  16.7           53.7%
                                                              ==============                ============`

(1) Represents the write down on the Effective Date as a result of fresh start
reporting on rental fleet sold in the respective periods.

(2) Represents the estimated additional depreciation expense on the rental fleet
that would have been recorded since the Effective Date had such equipment not
been written down on the Effective Date.

Operating
expenses. Operating expenses increased in the second quarter of 2006 as compared to
the same period in 2005 primarily as a result of:

| |  | a $1.8 million increase in labor expenses required to support our growth
initiatives and increased commissions and incentive compensation related to
higher revenue; and
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | a $1.1 million increase in professional fees primarily related to
the Merger and the pursuit of certain other strategic transactions.
| | - | -------------------------------------------------------------------------------------------------------------------------------------

The
increase in operating expenses was partially offset by a $0.9 million decrease in
administrative expenses relating to the provision for doubtful accounts.

Selling,
general and administrative expenses as a percentage of total revenue were 17.7% in the
second quarter of 2006 compared to 18.6% for the same period in 2005.

Interest
expense, net. The increase in interest expense, net in the second quarter of 2006
compared to the same period in 2005 primarily relates to the decrease in interest income
from the reduction in cash, cash equivalents and marketable securities.

Provision
for income taxes. The provision for income taxes in the second quarter of 2006 relates
to achieving income before income taxes of approximately $10.0 million. During the second
quarter of 2005, the provision for income taxes was zero primarily as a result of net
operating loss carryforwards.




Six Months Ended June 30, 2006 as Compared to Six Months
Ended June 30, 2005

`Variance
                                                       Six Months Ended June 30,    Favorable/(Unfavorable)
                                                     ---------------------------- ---------------------------
                                                          2006           2005           $            %
                                                     --------------  ------------ ------------ --------------
                                                                     (dollars in thousands)
  Revenue:
Equipment rentals................................... $  244,553     $  223,854     $   20,699         9.2%
Sales of rental equipment...........................     56,876         56,311            565         1.0
Sales of new equipment..............................     39,070         20,885         18,185        87.1
Sales of merchandise, service, parts and supplies...     16,416         13,154          3,262        24.8
                                                     -------------  -------------  ------------- -----------
Total revenue.......................................    356,915        314,204         42,711        13.6
                                                     -------------  -------------  ------------- -----------
Cost of revenue:
Cost of equipment rentals...........................    135,855        126,765         (9,090)       (7.2)
Rental equipment and vehicle depreciation and lease
  expense...........................................     59,106         63,278          4,172         6.6
Cost of sales of equipment, merchandise, service,
  parts and supplies................................     66,541         49,802        (16,739)      (33.6)
                                                     -------------  -------------  ------------- -----------
Total cost of revenue...............................    261,502        239,845        (21,657)       (9.0)
                                                     -------------  -------------  ------------- -----------
Gross profit:
Gross profit  on equipment rentals including
  equipment and vehicle depreciation and lease
  expense...........................................     49,593         33,811         15,782        46.7
Gross profit on sales of equipment, merchandise,
  service, parts and supplies.......................     45,820         40,548          5,272        13.0
                                                     -------------  -------------  ------------- -----------
Total gross profit .................................     95,413         74,359         21,054        28.3
                                                     -------------  -------------  ------------- -----------
Operating expenses:
Selling, general and administrative expenses........     65,475         61,551         (3,924)       (6.4)
Other depreciation and amortization.................      4,548          3,993           (555)      (13.9)
                                                     -------------  -------------  ------------- -----------
Operating income....................................     25,390          8,815         16,575       188.0
                                                     -------------  -------------  ------------- -----------
Interest expense, net...............................     21,521         17,779         (3,742)      (21.0)
Reversal of pre-petition tax liabilities............         --            (98)           (98)         --
Other, net..........................................     (1,314)        (1,060)           254        24.0
                                                     -------------  -------------  ------------- -----------
                                                         20,207         16,621         (3,586)      (21.6)
                                                     -------------  -------------  ------------- -----------

Income (loss) before reorganization items and
  provision for income taxes........................      5,183         (7,806)        12,989       166.4
Reorganization items, net...........................         --           (180)           180          --
                                                     -------------  -------------  ------------- -----------
Income (loss) before provision for income taxes.....      5,183         (7,626)        12,809       168.0
Provision for income taxes..........................      2,037             --         (2,037)         --
                                                     -------------  -------------  ------------- -----------
Net income (loss)................................... $    3,146     $   (7,626)       $10,772       141.3%
                                                     =============  =============  ============= ===========`

Revenue. Equipment rentals revenue increased in the first half of 2006 as
compared to the same period in 2005 as a result of improved pricing and higher
deployment, which resulted from:

| |  | increased non-residential construction activity;
| | - | ------------------------------------------------

| |  | continued strong demand for our equipment; and
| | - | ----------------------------------------------

| |  | a greater number of rental units deployed.
| | - | ------------------------------------------

Utilization
in the first half of 2006 was 50.4% compared to 47.0% in the same period in 2005. We
believe that the higher deployment discussed above was the key factor in the increase.

Sales
of new equipment increased in the first half of 2006 as compared to the same period in
2005 primarily as a result of our continued emphasis on sales of new equipment.




Gross
Profit. Gross profit margin on equipment rentals, including equipment and vehicle
depreciation and lease expense, increased from 15.1% in the first half of 2005 to 20.3% in
the first half of 2006.

Gross
profit on equipment rentals increased primarily as a result of:

| |  | the $20.7 million increase in revenue; and
| | - | ------------------------------------------

| |  | a $4.2 million decrease in depreciation expense primarily related
to rental equipment that became fully depreciated in 2005.
| | - | ----------------------------------------------------------------------------------------------------------------------------

The
increase in gross profit on equipment rentals was partially offset by:

| |  | a $3.2 million increase in employee-related expenses primarily related to
increased headcount to support our key initiatives as well as increased labor
costs in general;
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | a $1.2 million increase in personal property taxes related to the replacement of
fully depreciated equipment and vehicles with new equipment and vehicles;
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | a $2.2 million increase in fuel expense; and
| | - | --------------------------------------------

| |  | a $1.2 million increase in facilities expense primarily related to
increasing rents resulting from amendments, renewals and relocations of
facilities and increases in utility expenses.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Gross
profit margin on sales of equipment, merchandise, service, parts and supplies decreased
from 44.9% in the first half of 2005 to 40.8% for the same period in 2006. The decrease
was primarily a result of the increase in new equipment sales which have lower gross
profit margins.

Gross
profit on rental equipment sales increased from 59.0% in the first half of 2005 to 63.2%
in the same period in 2006 primarily as a result of continued improvement in pricing due
to strong demand for equipment.

In
addition, gross profit on the sale of rental equipment was positively impacted as a result
of implementing fresh start reporting. The following table presents normalized gross
profit and gross profit margins for rental equipment sales after removing the estimated
effect of fresh start reporting ($ in millions):

`Six months ended June 30,
                                                   --------------------------------------------------------------
                                                                  2006                              2005
                                                   --------------------------------   ----------------------------
Gross profit..................................     $       35.9          63.2%          $     33.2         59.0%
                                                   ----------------                     --------------
Write-down on Effective Date(1)...............            (18.7)                             (19.1)
Additional depreciation expense(2)............             17.6                               15.3
                                                   ----------------                     --------------
Net change resulting from fresh-start.........             (1.1)                              (3.8)
                                                   ----------------                     --------------
Normalized gross profit.......................     $       34.8          61.1%          $     29.4         52.3%
                                                   ================                     ==============`




|(1) | Represents the write down on the Effective Date as a result of
fresh start reporting on rental fleet sold in the respective periods.
|--- | ------------------------------------------------------------------------------------------------------------------------------------

|(2) | Represents the estimated additional depreciation expense on the rental fleet
that would have been recorded since the Effective Date had such equipment not
been written down on the Effective Date.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Operating Expenses. Operating expenses increased in the first half of
2006 as compared to the same period in 2005 primarily as a result of a $4.5
million increase in labor expenses required to support our growth initiatives
and increased commissions and incentive compensation related to higher revenue.

The increase in operating expenses was partially offset by a $1.2 million
decrease in administrative expenses relating to the provision for doubtful
accounts.

Selling, general and administrative expenses as a percentage of total revenue
was 18.3% in the first half of 2006 compared to 19.6% for the same period in
2005.

Interest expense, net. The increase in interest expense, net in the first
half of 2006 compared to the same period in 2005 primarily relates to:

| |  | interest incurred on our 9.5% Senior Unsecured Notes due 2015 which were issued
in April 2005, partially offset by a reduction in interest incurred on our
Convertible Subordinated Notes payable, which were redeemed or converted into
equity in June 2005; and
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | a decrease in interest income from the reduction in cash, cash equivalents and
marketable securities.
| | - | -----------------------------------------------------------------------------------------------------

Provision for income taxes. The provision for income taxes in the first
half of 2006 relates to achieving income before income taxes of approximately
$5.2 million. During the six months ended June 30, 2005, the provision for
income taxes was zero primarily as a result of net operating loss carryforwards.

Liquidity and Capital Resources

In our statements of cash flows included elsewhere in this report, cash flows
from operations do not include purchases of rental equipment and proceeds from
the sale of rental equipment, which are included in cash flows from investing
activities. When evaluating our cash flow it is important to consider cash flows
from the purchase and sale of our rental equipment in conjunction with operating
cash flow. Purchasing and selling rental fleet to manage fleet mix and fleet age
is an integral part of our business and failure to consider cash flows from
these activities would not accurately reflect the operating cash needs of our
business.

Sources and Uses of Cash

Our business is highly capital intensive as a result of our significant
investment in rental equipment and delivery vehicles. The annual capital
expenditures necessary to maintain, replace and grow our fleet are substantial.
While during any given year we can manage the replacement requirements by
reducing or increasing the amount of used equipment we sell or by deferring the




purchase of replacement rental fleet, the annual cash needs are
nonetheless considerable. In addition, while less significant, we must make
annual expenditures to maintain and invest in new and improved information
systems, and to upgrade and maintain our store locations.

In connection with the completion of our reorganization, certain of our current
stockholders invested $80.0 million through the purchase of a combination of
common stock, preferred stock and convertible subordinated notes. These funds,
along with funds obtained from our then existing credit facility, were used to
pay the costs of our reorganization, to purchase rental fleet previously
financed under leases, and for general working capital purposes. In October
2003, we issued $250.0 million in senior secured notes and used the net proceeds
to fund the purchase of new and replacement rental fleet, and to retire then
existing other indebtedness. In April 2005, we issued $150.0 million in senior
unsecured notes and used the net proceeds for general corporate purposes and to
redeem a portion of our outstanding convertible subordinated notes. Detailed
descriptions of our Credit Facility, Senior Secured Notes and Senior Unsecured
Notes are included in the discussion under Debt and Other
Obligations which follows.

Cash Flows

In the first half of 2006, we had sufficient cash on hand and cash generated
from operations and financing activities to meet our cash needs. We generated
cash primarily from the following sources (in thousands):

`Six Months Ended
                                                           June 30,
                                                      -------------------
                                                        2006       2005
                                                      --------   --------

          Cash from operations....................    $ 62,598   $ 55,014
          Proceeds from the disposal of rental
            equipment.............................      56,877     56,311
          Proceeds from equipment financing.......      24,964          -
                                                      --------   --------
                                                      $144,439   $111,325
                                                      ========   ========`

We used cash primarily for (in thousands):

`Six Months Ended
                                                           June 30,
                                                      -------------------
                                                        2006       2005
                                                      --------   --------

          Purchases of rental equipment...........    $138,953   $196,493
          Purchase of property and equipment......       8,712     11,537
          Acquisition of business.................           -      6,703
          Repayment of equipment financing........       2,184          -
                                                      --------   --------
                                                      $149,849   $214,733
                                                      ========   ========`

As of June 30, 2006, we had $1.8 million outstanding under the Amended and
Restated Credit Facility. The amounts disclosed in the captions titled "Proceeds
from debt issuance and revolving credit facility" and "Repayments of debt" in
the accompanying unaudited condensed consolidated statement of cash flows for
the six months ended June 30, 2006 include the cumulative activity of the daily
borrowings and repayments, $75.6 million and $73.8 million, respectively, under
the Amended and Restated Credit Facility. The availability under the Amended and
Restated Credit Facility at June 30, 2006, amounted to $64.7 million after
taking into account approximately $25.5 million in outstanding letters of
credit. At June 30, 2005, we had no cash borrowings under the Amended and
Restated Credit Facility.




Adequacy of Capital Resources

Our sources of cash over the next twelve months are expected to be cash on hand,
cash generated from operations, proceeds from the sale of rental equipment,
floor plan and other short-term financings and borrowings under our credit
facility. We also may use operating leases to finance delivery vehicles.

Our uses of cash over the next twelve months are expected to be principally for
the purchase of new and replacement rental equipment and other non-rental
capital expenditures, for working capital needs and for debt service, which is
primarily payment of $38.0 million of interest on our Senior Secured Notes and
Senior Unsecured Notes. We are currently planning rental equipment expenditures
over the next twelve months, net of proceeds from sales of rental equipment, of
approximately $70.0 million. We estimate that capital expenditures for
non-rental assets over the next twelve months will approximate $15.0 million,
primarily for delivery vehicles, information systems and store improvements.
Capital expenditures in future years will depend on several factors, including
economic conditions and our growth prospects at the time.

We believe that our existing infrastructure of stores is largely sufficient to
support our current and near-term operating activities. In addition, while we
are presently focused primarily on internal growth, we may explore additional
new store openings and strategic acquisitions that may be available in desirable
locations or at favorable prices. If these activities are significant, we may be
required to raise additional capital through debt or equity financing.

We believe we can fund our planned business activities during the next twelve
months with the sources of cash described above.

Debt and Other Obligations

Senior Secured Notes. In October 2003, we completed a private offering of
$250.0 million aggregate principal amount of 9.5% senior secured notes due 2010,
or the Original Senior Secured Notes. We pay interest on the notes semi-annually
in cash, in arrears, on October 15 and April 15, at an annual interest rate of
9.5%. The notes mature on October 15, 2010. The net proceeds were used to repay
amounts outstanding under the Credit Facility (as defined below),
equipment-related purchase money obligations, equipment leases, and for other
general corporate purposes.

In September 2004, we completed a registered exchange offer with 100% of the
Original Senior Secured Notes being exchanged for new 9.5% senior secured notes,
or the New Notes, and together with the Original Senior Secured Notes, the
Senior Secured Notes. The New Notes have substantially identical terms as the
Original Senior Secured Notes, except that the New Notes are freely
transferable. The New Notes evidence the same debt as the Original Senior
Secured Notes, are entitled to the benefits of the indenture governing the
Original Senior Secured Notes and will be treated under the indenture as a
single class with the Original Senior Secured Notes.

We can redeem all of the Senior Secured Notes on or after October 15, 2007. We
may also redeem up to 35% of the notes prior to October 15, 2006 with the net
proceeds of an equity offering at 109.5% of their principal amount, plus accrued
interest; provided that at least 65% of




the aggregate principal amount of the
notes issued must remain outstanding after such redemption.

The Senior Secured Notes were issued by NationsRent Companies, Inc. and are
guaranteed by all of our direct and indirect subsidiaries. NationsRent
Companies, Inc. has no independent assets or operations, the guarantees are full
and unconditional and joint and several, and there are no other subsidiaries
other than the guarantors. There are no significant restrictions on our ability
to obtain funds from our subsidiaries.

The Senior Secured Notes and the guarantees are secured by a first priority lien
on substantially all of our rental equipment (other than titled vehicles),
subject to certain permitted liens. We are required to certify each December and
June during the term of the Senior Secured Notes that our collateral value
coverage ratio is at least 2.0 to 1.0. At June 30, 2006, we were in compliance
with this requirement.

The indenture governing the notes contains various affirmative and negative
covenants, subject to a number of important limitations and exceptions,
including, limitations on our ability to incur additional indebtedness or enter
into sale and leaseback transactions; limitations on our ability to repay or
prepay subordinated indebtedness; certain restrictions on dividends, stock
redemptions and other distributions; restrictions on making certain investments
or acquisitions; and restrictions on our ability to grant liens on assets, enter
into transactions with stockholders and affiliates, merge, consolidate or
transfer assets. The indenture also contains various customary events of
default.

In April 2005, we amended the indenture governing the Senior Secured Notes, with
approval from the requisite number of holders of the Senior Secured Notes, to
allow us to redeem all of our outstanding 6.5% Convertible Subordinated Notes
due 2008. In June 2005, we redeemed our convertible subordinated notes using a
portion of the proceeds of our offering of Senior Unsecured Notes.
SeeSenior Unsecured Notes.

In
connection with the Merger, we had previously announced a tender offer and
consent solicitation to purchase for cash any and all of the Senior Secured
Notes. As of 5:00 p.m., New York City time, on July 31, 2006, which was the
deadline for holders to tender their Senior Secured Notes in order to receive
the consent payment in connection with the offer, tenders and consents had been
received from holders of $246,100,000 in aggregate principal amount of the
Senior Secured Notes, representing approximately 98.44% of the outstanding
Senior Secured Notes. Accordingly, on August 1, 2006, we entered into a fourth
supplemental indenture, or the Fourth Supplemental Indenture, supplementing the
indenture governing the Senior Secured Notes, to effect proposed amendments to
the satisfaction and discharge section in the indenture governing the Senior
Secured Notes. However, the amendments contained in the Fourth Supplemental
Indenture will not become operative unless and until certain conditions are
satisfied, including the condition that the Merger shall have been consummated.

Credit Facility. In June, 2003, we entered into a senior secured
revolving credit facility, the Credit Facility, with an aggregate commitment of
up to $150.0 million with a syndicate of lenders. The Credit Facility was used
to provide the exit financing for the Company pursuant to the Plan of
Reorganization, to pay transaction expenses incurred in connection therewith and
to




refinance the Companys then existing indebtedness. In October 2003, we
amended and restated the Credit Facility to reduce the aggregate commitments to
up to $75.0 million (including a $30.0 million sub-limit for letters of credit)
and repaid all amounts outstanding under the Credit Facility with the proceeds
of the offering of the Senior Secured Notes. In December 2004, we entered into a
second amendment to the Credit Facility to amend certain items including
extending the maturity date. In April 2005, we amended and restated the Credit
Facility to, among other things, increase the availability from $75.0 million up
to $100.0 million (including a $40.0 million sub-limit for letters of credit)
and extend the maturity of the facility to April 2010. In April 2006, we entered
into a fourth amendment to the Credit Facility to amend the definition of
permitted liens to include an additional category of permitted
liens.

Under the terms of the Amended and Restated Credit Facility, availability is
subject to a borrowing base test based upon eligible trade accounts receivable,
titled vehicles and real estate. Borrowings under the Amended and Restated
Credit Facility bear interest at floating rates equivalent to either a base
rate, as defined therein, plus a margin ranging from 0.25% to 1.00% or the
London Interbank Offered Rate (LIBOR) plus a margin ranging from
1.50% to 2.50%. At June 30, 2006, the interest rate was 9.0%. Letters of credit
fees range from 1.50% to 2.50%. There is an unused commitment fee ranging from
0.375% to 0.50% and a letter of credit fronting fee of 0.125%. The Amended and
Restated Credit Facility is secured by a first lien on our assets, except for
our rental equipment and inventory. The facility is also secured by a pledge of
the capital stock of our subsidiaries. We may also grant to the lenders under
such facility certain mortgages and other security interests on certain of our
real property.

The Amended and Restated Credit Facility is available to (i) refinance existing
indebtedness, (ii) finance ongoing capital expenditures and working capital
needs, (iii) issue standby letters of credit and (iv) fund other general
corporate purposes. The facility contains various affirmative and negative
covenants customary for similar working capital facilities. The Amended and
Restated Credit Facility also contains certain customary events of default. In
addition, we must maintain a debt to cash flow ratio, as defined, of not greater
than 3.00 to 1.00 for the trailing 12-month period for each fiscal quarter. At
June 30, 2006, we were in compliance with this requirement.

Senior Unsecured Notes. In April 2005, we completed a private offering of
$150 million aggregate principal amount of 9.5% senior unsecured notes due 2015,
or the Original Senior Unsecured Notes. We pay interest on the notes
semi-annually in cash, in arrears, on May 1 and November 1, beginning on
November 1, 2005, at an annual rate of interest of 9.5%. The Senior Unsecured
Notes will mature on May 1, 2015. We used a portion of the proceeds from the
offering to redeem our outstanding 6.5% Convertible Subordinated Notes due 2008
that had not been converted and the remaining net proceeds from the offering for
general corporate purposes.

In July 2005, we completed a registered exchange offer with 100% of the Original
Senior Unsecured Notes being exchanged for new 9.5% senior unsecured notes, or
the New Unsecured Notes, and together with the Original Senior Unsecured Notes,
the Senior Unsecured Notes. The New Unsecured Notes have substantially identical
terms as the Original Senior Unsecured Notes, except that the New Unsecured
Notes are freely transferable. The New Unsecured Notes evidence the same debt as
the Original Senior Unsecured Notes, are entitled to the benefits of the




indenture governing the Original Senior Unsecured Notes and are treated under
the indenture as a single class with the Original Senior Unsecured Notes.

We may redeem all of the Senior Unsecured Notes on or after May 1, 2010. We may
also redeem up to 35% of the Senior Unsecured Notes prior to May 1, 2009 with
the net proceeds of an equity offering at 109.5% of their principal amount, plus
accrued interest; provided that at least 65% of the aggregate principal amount
of the notes issued must remain outstanding after such redemption.

The Senior Unsecured Notes were issued by NationsRent Companies, Inc. and are
guaranteed by all of its direct and indirect subsidiaries. NationsRent
Companies, Inc. has no independent assets or operations, the guarantees are full
and unconditional and joint and several, and there are no other subsidiaries
other than the guarantors. There are no significant restrictions on the ability
of NationsRent Companies, Inc. to obtain funds from its subsidiaries.

The indenture governing the Senior Unsecured Notes contains various customary
affirmative and negative covenants, subject to a number of important limitations
and exceptions, including, limitations on our ability to incur additional
indebtedness or enter into sale and leaseback transactions; limitations on our
ability to repay or prepay subordinated indebtedness; certain restrictions on
dividends, stock redemptions and other distributions; restrictions on making
certain investments or acquisitions; and restrictions on our ability to grant
liens on assets, enter into transactions with stockholders and affiliates,
merge, consolidate or transfer assets. The indenture also contains various
customary events of default.

We used a portion of the proceeds from the offering of the Senior Unsecured
Notes to redeem $30.8 million aggregate principal amount of our 6.5% Convertible
Subordinated Notes due 2008 plus accrued and unpaid interest of $4.3 million.

In connection with the Merger, we had previously announced a tender offer and
consent solicitation to purchase for cash any and all of our Senior Unsecured
Notes. As of 5:00 p.m., New York City time, on July 31, 2006, which was the
deadline for holders to tender their Senior Unsecured Notes in order to receive
the consent payment in connection with the offer, tenders and consents had been
received from holders of $150,000,000 in aggregate principal amount of the
Senior Unsecured Notes, representing 100% of the outstanding Senior Unsecured
Notes. Accordingly, on August 1, 2006, we entered into a supplemental indenture,
or the First Supplemental Indenture, supplementing the indenture governing the
Senior Unsecured Notes, to effect proposed amendments to eliminate substantially
all of the restrictive covenants and events of default contained in the
indentures governing the Senior Unsecured Notes. However, the amendments
contained in the First Supplemental Indenture will not become operative unless
and until certain conditions are satisfied, including the condition that the
Merger shall have been consummated.

Wholesale Financing Facility. In April 2006, we entered into a Wholesale
Financing Agreement, or the Facility, with an uncommitted initial maximum
availability of up to $25.0 million. The Facility is available to finance
purchases of rental equipment and new equipment inventory on a short-term basis.
The Facility is secured on a first priority basis by the equipment financed
thereunder and a letter of credit in an amount equal to 10% of the maximum
availability,




currently $2.5 million. Advances with respect to each item of the
equipment financed under the Facility mature on the earlier of (i) 360 days
after the invoice date of such equipment or (ii) ten days after such item of
equipment is sold or disposed. Advances under the Facility bear interest at a
floating rate equal to the prime rate minus 0.35%, subject to a minimum interest
rate of 5.15%. At June 30, 2006, the interest rate was 6.38%. The facility
requires that the Company maintain a minimum collateral value equal to 105% of
the appraised market value of the equipment being financed. If the collateral
value falls below the 105% requirement then we are required to deposit
additional cash collateral to cover the deficiency. In an event of default,
termination or expiration of the Facility, the cash collateral may be applied to
the outstanding loan amount. The Facility contains various customary affirmative
and negative covenants and events of default. As of June 30, 2006, there was
$22.8 million outstanding under the Facility net of cash collateral of $685,000.

Seasonality and Fluctuations in Operating Results

Our operating results are dependent upon activity in the construction industry,
which is dependent upon weather and other seasonal factors affecting
construction in the geographic areas where we have operations. Because of this
variability in demand, our operating results fluctuate. Accordingly, quarterly
or other interim results should not be considered indicative of results to be
expected for any other quarter or for a full year.

Operating results may fluctuate due to other factors including, but not limited
to:

| |  | changes in general economic conditions including changes in national, regional
or local construction or industrial activities;
| | - | ------------------------------------------------------------------------------------------------------------------------------

| |  | the timing of expenditures for new rental equipment and the disposition of used
equipment;
| | - | ------------------------------------------------------------------------------------------

| |  | competitive pricing pressures; and
| | - | ----------------------------------

| |  | changes in interest rates.
| | - | --------------------------

When we purchase new rental equipment, the depreciation related to such
equipment, which begins upon receipt of the equipment into our rental fleet, may
contribute to near-term margin decline because such equipment may not initially
generate revenue at a rate that is sufficient to match such increased
depreciation expense. As such, the purchase of rental equipment may reduce our
operating margins during a start-up period.

Factors That May Affect Future Results

From time to time we make statements concerning our expectations, beliefs,
plans, objectives, goals, strategies, future events or performance and
underlying assumptions and other statements that are not historical facts. These
statements are forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995. Forward-looking statements
include statements concerning our expectations, plans, objectives, goals,
strategies, future events, future revenue or performance, capital expenditures,
financing needs, plans or intentions relating to acquisitions, business trends
and other information that is not historical information and, in




particular, appear under the headings Managements
Discussion and Analysis of Financial Condition and Results of Operations.
The words could, estimate, expect,
anticipate, project, plan,
intend, believe, goal, forecast
and variations of such words or similar expressions are intended to identify
forward-looking statements. All forward-looking statements, including, without
limitation, managements review of historical operating trends, are based
upon our current expectations and various assumptions. Our expectations, beliefs
and projections are expressed in good faith and we believe there is a reasonable
basis for them. However, there can be no assurance that our expectations,
beliefs and projections will result or be achieved.

There may be factors not presently known to us or which we currently consider to
be immaterial that may cause our actual results to differ materially from the
forward-looking statements. Some of the risks and uncertainties that could cause
our actual results to differ materially from the forward-looking statements are
described below and elsewhere in this report as well as in our Annual Report on
Form 10-K for the year ended December 31, 2005 and other filings with the SEC,
and include, among others:

| |  | The closing of the Merger is subject to certain conditions, which must be
satisfied or waived. The failure of the Merger to close may adversely affect our
business and operating results.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | Our substantial level of indebtedness could materially adversely affect our
ability to execute our business strategy.
| | - | ---------------------------------------------------------------------------------------------------------------------

| |  | Disruptions in our information technology systems could limit our ability to
effectively monitor and control our operations.
| | - | ----------------------------------------------------------------------------------------------------------------------------

| |  | Hurricanes or other severe weather events or other natural disasters may cause
significant disruptions to our operations and may adversely affect the economy,
including by increasing fuel costs and limiting fuel availability.
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | Increases in fuel prices or limited availability of fuel may adversely affect
our business and operating results.
| | - | -----------------------------------------------------------------------------------------------------------------

| |  | Failure to achieve and maintain effective internal controls and procedures could
adversely impact our business and operating results, our ability to raise
capital and the market value of our outstanding securities.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | As we dispose of our rental fleet in the ordinary course of business, we may not
realize as much cash as we anticipate which could negatively impact our cash
flow. As we operate a capital-intensive business, reductions in operating cash
flow could severely impact our ability to purchase new rental fleet, which in
turn could put us at a competitive disadvantage in the marketplace.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | Contraction in the private non-residential construction industry may weaken
demand and pricing for our equipment.
| | - | -----------------------------------------------------------------------------------------------------------------




| |  | All of our existing leases for our NationsRent at Lowe's locations expire on the
same date in October 2008 with an option to renew through October 2010 and an
additional option, subject to Lowe's approval, through October 2012. If we are
not able to further renew these leases we may be forced to close or relocate up
to 100 locations at or around the same time.
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | Competitors with greater financial resources may have a competitive advantage
over us by being able to sustain reduced rental rates for longer periods of time
and being able to offer a broader range and volume of rental equipment. If they
employ such strategies, our cash flows and profitability may be reduced.
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | Although we are actively negotiating to establish dealership and distributor
relationships with equipment manufactures to diversify our revenue base, our
strategy may not succeed as quickly as anticipated, or at all.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | We have made, and will likely continue to make, strategic acquisitions. If we
are not successful in operating or integrating these newly acquired businesses
in an effective and timely manner, our ability to take advantage of further
growth opportunities and our revenue and gross margins could be adversely
affected.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | Costs associated with compliance with, and changes in, environmental laws and
regulations could subject us to increased liabilities and expenses.
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------

| |  | Potential and certain existing claims against the Company may not be covered by
our insurance. Additionally, we may not be able to renew our coverage on terms
favorable to us that could lead to increased costs in the event of future
claims.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

All forward-looking statements and projections attributable to us or persons
acting on our behalf apply only as of the date of the particular statement, and
are expressly qualified in their entirety by the cautionary statements included
in this report and our other filings with the SEC. We undertake no obligation to
publicly update or revise forward-looking statements, including any of the
projections presented herein, to reflect events or circumstances after the date
made or to reflect the occurrence of unanticipated events.

Item 3: Quantitative and Qualitative Disclosures About Market Risk

The inherent risk in market risk sensitive instruments and positions primarily
relates to potential losses arising from adverse changes in foreign currency
exchange rates and interest rates. Our exposure to market risk is limited
primarily to the fluctuating interest rates associated with our Amended Credit
Facility, capital lease obligations and our Wholesale Financing Agreement. Our
variable interest rates are subject to interest rate changes in the United
States and the Eurodollar market. At June 30, 2006, we had approximately
$29.7 million of variable rate debt outstanding.




Item 4: Controls and Procedures

Our management, including the Chief Executive Officer and Chief Financial
Officer, conducted an evaluation of the effectiveness of disclosure controls and
procedures. Based on that evaluation, the Chief Executive Officer and Chief
Financial Officer concluded that as of June 30, 2006, the disclosure controls
and procedures are effective in ensuring that all material information required
to be filed in this report has been made known to them in a timely fashion.

We continue to document and test our internal control procedures in order to
satisfy the requirements of Section 404 of the Sarbanes-Oxley Act. During the
course of our testing, we may identify deficiencies which we may not be able to
remediate prior to the reporting deadline imposed by the Sarbanes-Oxley Act,
which is currently required for our December 31, 2007 Annual Report. In
addition, if we fail to achieve and maintain the adequacy of our internal
controls, as such standards are modified, supplemented or amended from time to
time, we may not be able to conclude on an ongoing basis that we have effective
internal controls over financial reporting in accordance with Section 404 of the
Sarbanes-Oxley Act and therefore, we may report material weaknesses in internal
controls in the future.




PART II - OTHER INFORMATION

Item 1. Legal Proceedings.

In June 2006, a suit entitled Todd Horton and Brad Barnard d/b/a Barnard
Construction v. NationsRent was filed in the United States District Court
for the Southern District of Florida claiming, among other things, that we
charge a damage waiver fee as part of our standard equipment rental agreement
that constitutes an unconscionable, unfair or deceptive act or practice under
Florida law. The plaintiffs in the Horton/Barnard case are seeking to
represent a class consisting of every person who entered into an equipment
rental agreement with us who paid a damage waiver fee. Plaintiffs in the
Horton/Barnard case are seeking an unspecified amount of damages, plus
costs and fees, and declaratory and injunctive relief. In addition, in July
2006, a suit entitled David Jacov v. NationsRent was filed in the United
States District Court for the Southern District of Florida, similarly alleging,
among other things, that we charge a damage waiver fee, as well as an
environmental fee, as part of our standard equipment rental agreement that
constitutes an unconscionable, unfair or deceptive act or practice under Florida
law. The plaintiff in the Jacov case is seeking to represent a similar
class of persons. The plaintiff in the Jacov case is seeking an
unspecified amount of damages, plus costs and fees, and declaratory and
injunctive relief. In July 2006, plaintiffs in the Horton/Barnard case
and the Jacov case agreed to consolidate these two cases into one case
and file a new consolidated amended complaint which is expected to be filed in
August 2006. We intend to vigorously defend each of these cases. The ultimate
outcome of these cases cannot be determined at this time.

We are also party to other pending legal proceedings arising in the ordinary
course of business, the results of which cannot be predicted with certainty.

Item 1A. Risk Factors

In addition to the other information set forth in the report, you should
carefully consider the factors discussed in Part I, Item 1A. Risk
Factors in our Annual Report on Form 10-K for the year ended December 31,
2005, which could have a material adverse effect on our business, financial
condition, results of operations or prospects. Additional risks and
uncertainties that we are unaware of, or that are currently deemed immaterial,
also may become important factors that affect us.

Item 6: Exhibits

|ExhibitNumber | Description
|------------- | -----------

|2.1 | First Amended Joint Plan of Reorganization of NationsRent, Inc. and its Debtor
Subsidiaries, dated February 7, 2003, as filed in the United States Bankruptcy
Court District of Delaware on February 11, 2003(1)
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|2.1.1 | Modifications to First Amended Joint Plan of Reorganization of NationsRent, Inc.
and its Debtor Subsidiaries(1)
|----- | ---------------------------------------------------------------------------------------------------------------

|2.1.2 | Modifications (Second) to First Amended Joint Plan of Reorganization of
NationsRent, Inc. and its Debtor Subsidiaries(1)
|----- | ------------------------------------------------------------------------------------------------------------------------




|2.1.3 | Modifications (Third) to First Amended Joint Plan of Reorganization of
NationsRent, Inc. and its Debtor Subsidiaries(1)
|----- | -----------------------------------------------------------------------------------------------------------------------

|3.1 | Certificate of Incorporation of the Company(1)
|--- | ----------------------------------------------

|3.2 | Certificate of Amendment of Certificate of Incorporation of the Company(1)
|--- | --------------------------------------------------------------------------

|3.3 | Certificate of Amendment of Certificate of Incorporation of the Company(1)
|--- | --------------------------------------------------------------------------

|3.4 | Certificate of Designation for Series A Preferred Stock of the Company(1)
|--- | -------------------------------------------------------------------------

|3.5 | Certificate of Amendment to Certificate of Designation for Series A Preferred Stock(1)
|--- | --------------------------------------------------------------------------------------

|3.6 | By-Laws of the Company(1)
|--- | -------------------------

|4.1 | Form of 9.5% Senior Secured Notes due 2010(1)
|--- | ---------------------------------------------

|4.2 | Indenture, dated as of October 23, 2003, by and among Company, the Guarantors
and Wilmington Trust Company, governing the Company's 9.5% Senior Secured Notes
due 2010(1)
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|4.2.1 | First Supplement, dated as of July 27, 2004, to the Indenture, dated as of
October 23, 2003, by and among Company, the Guarantors and Wilmington Trust
Company(1)
|----- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------

|4.2.2 | Second Supplemental Indenture, dated as of March 31, 2005, to the Indenture,
dated as of October 23, 2003, by and among Company, the guarantors named therein
and Wilmington Trust Company(6)
|----- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|4.2.3 | Third Supplemental Indenture, dated as of April 26, 2005, to the Indenture,
dated as of October 23, 2003, by and among Company, the guarantors named therein
and Wilmington Trust Company(5)
|----- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|4.2.4 | Fourth Supplemental Indenture, dated as of August 1, 2006 to the Indenture,
dated as of October 23, 2003, by and among the Company, the guarantors named
therein and Wilmington Trust Company(13)
|----- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|4.3 | Registration Rights Agreement, dated as of October 23, 2003, by and among the
Company, the guarantors named therein and the initial purchasers(1)
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------

|4.4 | Form of 6.5% Unsecured Convertible Subordinated Promissory Note due 2008(1)
|--- | ---------------------------------------------------------------------------

|4.5 | Form of 9.5% Senior Unsecured Notes due 2015(6)
|--- | -----------------------------------------------

|4.6 | Indenture, dated April 26, 2005, by and among the Company, the guarantors party
thereto and Wilmington Trust Company, governing the Company's 9.5% Senior
Unsecured Notes due 2015(5)
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|4.6.1 | Supplemental Indenture, dated as of August 1, 2006 to the Indenture, dated as of
April 26, 2005, among the Company, the guarantors named therein and Wilmington
Trust Company(13)
|----- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|4.7 | Registration Rights Agreement, dated April 26, 2005, by and among the Company,
the guarantors named therein and Jefferies & Company, Inc.(5)
|--- | --------------------------------------------------------------------------------------------------------------------------------------------

|10.1 | NationsRent Liquidating Trust Agreement, dated as of June 13, 2003, by and among
NationsRent, Inc. and its subsidiaries, as settlors, and Perry Mandarino, as
trustee of the NationsRent Unsecured Creditor's Liquidating Trust(1)
|---- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------




|10.2 | Call Agreement, dated as of June 13, 2003, by and between NR Holdings, Inc. and
Perry Mandarino, as trustee on behalf of NationsRent Unsecured Creditor's
Liquidating Trust(1)
|---- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|10.3 | 2003 Restricted Stock Plan of NR Holdings, Inc.(1)
|---- | --------------------------------------------------

|10.4 | Stockholders' Agreement, dated as of June 13, 2003, by and among NR Holdings,
Inc. and the stockholders party thereto(1)
|---- | ------------------------------------------------------------------------------------------------------------------------

|10.5 | First Amendment to Stockholders' Agreement, dated as of July 9, 2003, by and
among NR Holdings, Inc. and the stockholders party thereto(1)
|---- | ------------------------------------------------------------------------------------------------------------------------------------------

|10.5.1 | Second Amendment to Stockholders' Agreement, dated as of December 10, 2004, by
and among NationsRent Companies, Inc. and the stockholders party thereto(4)
|------ | ----------------------------------------------------------------------------------------------------------------------------------------------------------

|10.5.2 | Third Amendment to Stockholders' Agreement, dated as of September 14, 2005, by
and among NationsRent Companies, Inc. and the stockholders party thereto(8)
|------ | ----------------------------------------------------------------------------------------------------------------------------------------------------------

|10.6 | Amended and Restated Indemnification Agreement, dated as of June 13, 2003, by
and among NationsRent Companies, Inc. and the indemnities signatory thereto(2)
|---- | ------------------------------------------------------------------------------------------------------------------------------------------------------------

|10.7 | Employment Agreement, effective June 13, 2003, by and between the Company and
Thomas J. Putman(1)
|---- | -------------------------------------------------------------------------------------------------

|10.8 | Employment Agreement, effective July 9, 2003, by and between the Company and
Bryan T. Rich(1)
|---- | ---------------------------------------------------------------------------------------------

|10.9 | Employment Agreement, effective July 9, 2003, by and between the Company and
Douglas M. Suliman, Jr.(1)
|---- | -------------------------------------------------------------------------------------------------------

|10.10 | Employment Agreement, effective June 23, 2003, by and between the Company and
Thomas J. Hoyer(1)
|----- | ------------------------------------------------------------------------------------------------

|10.11 | Employment Agreement, effective June 13, 2003, by and between the Company and
Joseph H. Izhakoff(1)
|----- | ---------------------------------------------------------------------------------------------------

|10.12 | Employment Agreement, effective July 9, 2003, by and between the Company and
John Scherer(1)
|----- | --------------------------------------------------------------------------------------------

|10.13 | Form of Key Employee Housing Assistance Program(1)
|----- | --------------------------------------------------

|10.14 | Indenture, dated March 1, 1998, between Francis P. Richard/or Catherine L. Rich
and Logan Equipment Corporation(1)
|----- | ------------------------------------------------------------------------------------------------------------------

|10.15 | First Amendment to Lease, dated April 21, 2000, between Francis P. Rich and/or
Catherine L. Rich and NationsRent USA, Inc. (successor-in-interest to Logan
Equipment Corporation)(1)
|----- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|10.16 | Lease Agreement, dated December 14, 1998, between Jim Joy Holdings, LLC and
NationsRent of New Hampshire, Inc.(1)
|----- | -----------------------------------------------------------------------------------------------------------------

|10.17 | Lease Assignment, dated September 17, 1999, between Jim Joy Holdings, LLC and
1216 West Hammond Street, LLC(1)
|----- | --------------------------------------------------------------------------------------------------------------

|10.18 | First Amendment to Lease, dated January 10, 2000, between 1216 Hammond Street,
LLC and NationsRent USA, Inc.(successor-in-interest to NationsRent of New
Hampshire, Inc.)(1)
|----- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|10.19 | Lease Agreement, dated March 15, 2000, between Jim Joy Holdings, LLC and
NationsRent USA, Inc.(1)
|----- | -------------------------------------------------------------------------------------------------




|10.20 | Lease Agreement, dated December 7, 1999, between TREC, LLC and NationsRent USA,
Inc.(1)
|----- | ---------------------------------------------------------------------------------------

|10.21 | Lease Agreement, dated December 14, 1998, between TREC, LLC and NRI/LEC Merger
Corp., Inc.(1)
|----- | ---------------------------------------------------------------------------------------------

|10.22 | Lease Agreement, dated March 1, 2000, between TREC, LLC and NationsRent USA,
Inc.(1)
|----- | ------------------------------------------------------------------------------------

|10.23 | First Amendment to Lease, dated May 24, 2001, between TREC, LLC and NationsRent
USA, Inc.(1)
|----- | --------------------------------------------------------------------------------------------

|10.24 | Subscription Agreement, dated June 13, 2003, among NR Holdings, Inc. and the
subscribers party thereto(1)
|----- | ---------------------------------------------------------------------------------------------------------

|10.25 | Asset Purchase Agreement, dated June 13, 2003, among Boston Rental Partners,
LLC, NationsRent, Inc. and its subsidiaries(1)
|----- | ---------------------------------------------------------------------------------------------------------------------------

|10.26 | Rental Agreement, dated January 31, 2003, by and between Boston Rental Partners,
LLC, and NationsRent, Inc. and Term Sheet Regarding Settlement Program
referenced therein(1)
|----- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|10.27 | Strategic Alliance Agreement, dated October 12, 2000, between NationsRent, Inc.
and Lowe's Companies, Inc.(1)
|----- | -------------------------------------------------------------------------------------------------------------

|10.28 | Employment agreement, effective May 20, 2004, by and between the Company and
Gary N. Golden(1)
|----- | ----------------------------------------------------------------------------------------------

|10.29 | Employment agreement, effective July 9, 2003, by and between the Company and
Robert W. Schiller(1)
|----- | --------------------------------------------------------------------------------------------------

|10.30 | Amended and Restated Credit Agreement, dated as of October 23, 2003, by and
among the Company, certain of its subsidiaries, Wachovia Bank, National
Association, as administrative agent and as a lender, and the other lending
institutions party thereto(1)
|----- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|10.30.1 | First Amendment, dated as of December 22, 2003, to Amended and Restated Credit
Agreement, by and among the Company, certain of its subsidiaries, Wachovia Bank,
National Association, as administrative agent and a lender, and the other
lending institutions party thereto(1)
|------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|10.30.2 | Second Amendment, dated as of December 20, 2004, to Amended and Restated Credit
Agreement, by and among the Company, certain of its subsidiaries, Wachovia Bank,
National Association, as administrative agent and a lender and the other lending
institutions party thereto(4)
|------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|10.30.3 | Third Amendment, dated as of April 21, 2005, to the Amended and Restated Credit
Agreement, by and among the Company, certain of its subsidiaries, Wachovia Bank,
National Association, as administrative agent and a lender and the other lending
institutions party therein(5)
|------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|10.30.4 | Fourth Amendment, dated as of April 24, 2006, to the Amended and Restated Credit
Agreement, by and among the Company, certain of its subsidiaries, Wachovia Bank,
National Association, as administrative agent and a lender and the other lending
institutions party therein(14)
|------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|10.31 | Amended and Restated Security Agreement, dated as of October 23, 2003, between
the Company, certain of its subsidiaries, and Wachovia Bank, National
Association, as administrative agent(1)
|----- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------




|10.32 | First Amendment to Lease Agreement, dated as of November 3, 2005, by and between
NationsRent, Inc., through its operating subsidiaries, (each as to the
particular leases or subleases as to which they are a party) and Lowe's Centers,
Inc. and Lowe's HIW, Inc.(7)
|----- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|10.33 | Employment Agreement, effective July 7, 2003, by and between the Company and
Charles H. Snyder (10)
|----- | ---------------------------------------------------------------------------------------------------

|10.34 | Agreement for Wholesale Financing, dated April 27, 2006, by and among the
Company, its direct and indirect subsidiaries and GE Commercial Distribution
Finance Corporation.(11)
|----- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|10.35 | Agreement and Plan of Merger dated July 18, 2006, by and among NationsRent
Companies, Inc., Ashtead Group plc, Sunbelt Rentals, Inc. and Neptune Ventures
Group, Inc.(12)
|----- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|21 | List of Subsidiaries(9)
|-- | -----------------------

|31.1 | Certification of Thomas J. Putman pursuant to Section 302 of the Sarbanes-Oxley
Act of 2002(14)
|---- | -----------------------------------------------------------------------------------------------

|31.2 | Certification of Thomas J. Hoyer pursuant to Section 302 of the Sarbanes-Oxley
Act of 2002(14)
|---- | ----------------------------------------------------------------------------------------------

|32.1 | Certification of Thomas J. Putman pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002(14)
|---- | ----------------------------------------------------------------------------------------------------------------------------------------------

|32.2 | Certification of Thomas J. Hoyer pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002(14)
|---- | ---------------------------------------------------------------------------------------------------------------------------------------------

____________________

|(1) | Filed as an exhibit to the Company's Registration Statement on Form S-4
(Registration No. 333-114115), filed April 1, 2004, as amended, and incorporated
herein by reference.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(2) | Filed as an exhibit to the Company's Quarterly Report on Form 10-Q for the
quarterly period ended June 30, 2004, and incorporated herein by reference.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------

|(3) | Filed as an exhibit to the Company's Quarterly Report on Form 10-Q for the
quarterly period ended September 30, 2004, and incorporated herein by reference.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------

|(4) | Filed as an exhibit to the Company's Annual Report on Form 10-K for the year
ended December 31, 2004, and incorporated herein by reference.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------

|(5) | Filed as an exhibit to the Company's Current Report on Form 8-K filed on April
27, 2005, and incorporated herein by reference.
|--- | ------------------------------------------------------------------------------------------------------------------------------

|(6) | Filed as an exhibit to the Company's Quarterly Report on Form 10-Q for the
quarterly period ended March 31, 2005, and incorporated herein by reference.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------

|(7) | Filed as an exhibit to the Company's Current Report on Form 8-K filed on
November 9, 2005, and incorporated herein by reference.
|--- | --------------------------------------------------------------------------------------------------------------------------------

|(8) | Filed as an exhibit to the Company's Quarterly Report on Form 10-Q for the
quarterly period ended September 30, 2005, and incorporated herein by reference.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------

|(9) | Filed as an exhibit to the Company's Registration Statement on Form S-4
(Registration No. 333-25519), filed June 3, 2005, as amended, and incorporated
herein by reference.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(10) | Filed as an exhibit to the Company's Annual Report on Form 10-K for the year
ended December 31, 2005, and incorporated herein by reference.
|---- | -------------------------------------------------------------------------------------------------------------------------------------------

|(11) | Filed as an exhibit to the Company's Current Report on Form 8-K filed on May 2,
2006, and incorporated herein by reference.
|---- | ---------------------------------------------------------------------------------------------------------------------------

|(12) | Filed as an exhibit to the Company's Current Report on Form 8-K filed on July
21, 2006, and incorporated herein by reference.
|---- | -----------------------------------------------------------------------------------------------------------------------------

|(13) | Filed as an exhibit to the Company's Current Report on Form 8-K filed on August
7, 2006, and incorporated herein by reference.
|---- | ------------------------------------------------------------------------------------------------------------------------------

|(14) | Filed herewith.
|---- | ---------------




|(*) | The Company agrees to furnish supplementally a copy of any omitted schedule to
the Commission upon request.
|--- | -----------------------------------------------------------------------------------------------------------




SIGNATURES

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

| | NATIONSRENT COMPANIES, INC.
(Registrant)
| | ----------------------------------------

|Dated: August 11, 2006 | By     
/s/ Thomas J. Putman
Name:     Thomas J. Putman
Title:       President and Chief Executive Officer
|---------------------- | ----------------------------------------------------------------------------------------------------------

|Dated: August 11, 2006 | By     
/s/ Thomas J. Hoyer
Name:     Thomas J. Hoyer
Title:       Executive Vice President and Chief Financial Officer
|---------------------- | -----------------------------------------------------------------------------------------------------------------------

|Dated: August 11, 2006 | By     
/s/ Robert W. Schiller
Name:     Robert W. Schiller
Title:       Vice President and Controller
|---------------------- | ------------------------------------------------------------------------------------------------------




EXHIBIT INDEX

|ExhibitNumber | Description
|------------- | -----------

|2.1 | First Amended Joint Plan of Reorganization of NationsRent, Inc. and its Debtor
Subsidiaries, dated February 7, 2003, as filed in the United States Bankruptcy
Court District of Delaware on February 11, 2003(1)
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|2.1.1 | Modifications to First Amended Joint Plan of Reorganization of NationsRent, Inc.
and its Debtor Subsidiaries(1)
|----- | ---------------------------------------------------------------------------------------------------------------

|2.1.2 | Modifications (Second) to First Amended Joint Plan of Reorganization of
NationsRent, Inc. and its Debtor Subsidiaries(1)
|----- | ------------------------------------------------------------------------------------------------------------------------

|2.1.3 | Modifications (Third) to First Amended Joint Plan of Reorganization of
NationsRent, Inc. and its Debtor Subsidiaries(1)
|----- | -----------------------------------------------------------------------------------------------------------------------

|3.1 | Certificate of Incorporation of the Company(1)
|--- | ----------------------------------------------

|3.2 | Certificate of Amendment of Certificate of Incorporation of the Company(1)
|--- | --------------------------------------------------------------------------

|3.3 | Certificate of Amendment of Certificate of Incorporation of the Company(1)
|--- | --------------------------------------------------------------------------

|3.4 | Certificate of Designation for Series A Preferred Stock of the Company(1)
|--- | -------------------------------------------------------------------------

|3.5 | Certificate of Amendment to Certificate of Designation for Series A Preferred
Stock(1)
|--- | --------------------------------------------------------------------------------------

|3.6 | By-Laws of the Company(1)
|--- | -------------------------

|4.1 | Form of 9.5% Senior Secured Notes due 2010(1)
|--- | ---------------------------------------------

|4.2 | Indenture, dated as of October 23, 2003, by and among Company, the Guarantors
and Wilmington Trust Company, governing the Company's 9.5% Senior Secured Notes
due 2010(1)
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|4.2.1 | First Supplement, dated as of July 27, 2004, to the Indenture, dated as of
October 23, 2003, by and among Company, the Guarantors and Wilmington Trust
Company(1)
|----- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------

|4.2.2 | Second Supplemental Indenture, dated as of March 31, 2005, to the Indenture,
dated as of October 23, 2003, by and among Company, the guarantors named therein
and Wilmington Trust Company(6)
|----- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|4.2.3 | Third Supplemental Indenture, dated as of April 26, 2005, to the Indenture,
dated as of October 23, 2003, by and among Company, the guarantors named therein
and Wilmington Trust Company(5)
|----- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|4.2.4 | Fourth Supplemental Indenture, dated as of August 1, 2006 to the Indenture,
dated as of October 23, 2003, by and among the Company, the guarantors named
therein and Wilmington Trust Company(13)
|----- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|4.3 | Registration Rights Agreement, dated as of October 23, 2003, by and among the
Company, the guarantors named therein and the initial purchasers(1)
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------

|4.4 | Form of 6.5% Unsecured Convertible Subordinated Promissory Note due 2008(1)
|--- | ---------------------------------------------------------------------------

|4.5 | Form of 9.5% Senior Unsecured Notes due 2015(6)
|--- | -----------------------------------------------

|4.6 | Indenture, dated April 26, 2005, by and among the Company, the guarantors party
thereto and Wilmington Trust Company, governing the Company's 9.5% Senior
Unsecured Notes due 2015(5)
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------




|4.6.1 | Supplemental Indenture, dated as of August 1, 2006 to the Indenture, dated as of
April 26, 2005, among the Company, the guarantors named therein and Wilmington
Trust Company(13)
|----- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|4.7 | Registration Rights Agreement, dated April 26, 2005, by and among the Company,
the guarantors named therein and Jefferies & Company, Inc.(5)
|--- | --------------------------------------------------------------------------------------------------------------------------------------------

|10.1 | NationsRent Liquidating Trust Agreement, dated as of June 13, 2003, by and among
NationsRent, Inc. and its subsidiaries, as settlors, and Perry Mandarino, as
trustee of the NationsRent Unsecured Creditor's Liquidating Trust(1)
|---- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|10.2 | Call Agreement, dated as of June 13, 2003, by and between NR Holdings, Inc. and
Perry Mandarino, as trustee on behalf of NationsRent Unsecured Creditor's
Liquidating Trust(1 )
|---- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|10.3 | 2003 Restricted Stock Plan of NR Holdings, Inc.(1)
|---- | --------------------------------------------------

|10.4 | Stockholders' Agreement, dated as of June 13, 2003, by and among NR Holdings,
Inc. and the stockholders party thereto(1)
|---- | ------------------------------------------------------------------------------------------------------------------------

|10.5 | First Amendment to Stockholders' Agreement, dated as of July 9, 2003, by and
among NR Holdings, Inc. and the stockholders party thereto(1)
|---- | ------------------------------------------------------------------------------------------------------------------------------------------

|10.5.1 | Second Amendment to Stockholders' Agreement, dated as of December 10, 2004, by
and among NationsRent Companies, Inc. and the stockholders party thereto(4)
|------ | ----------------------------------------------------------------------------------------------------------------------------------------------------------

|10.5.2 | Third Amendment to Stockholders' Agreement, dated as of September 14, 2005, by
and among NationsRent Companies, Inc. and the stockholders party thereto(8)
|------ | ----------------------------------------------------------------------------------------------------------------------------------------------------------

|10.6 | Amended and Restated Indemnification Agreement, dated as of June 13, 2003, by
and among NationsRent Companies, Inc. and the indemnities signatory thereto(2)
|---- | ------------------------------------------------------------------------------------------------------------------------------------------------------------

|10.7 | Employment Agreement, effective June 13, 2003, by and between the Company and
Thomas J. Putman(1)
|---- | -------------------------------------------------------------------------------------------------

|10.8 | Employment Agreement, effective July 9, 2003, by and between the Company and
Bryan T. Rich(1)
|---- | ---------------------------------------------------------------------------------------------

|10.9 | Employment Agreement, effective July 9, 2003, by and between the Company and
Douglas M. Suliman, Jr.(1)
|---- | -------------------------------------------------------------------------------------------------------

|10.10 | Employment Agreement, effective June 23, 2003, by and between the Company and
Thomas J. Hoyer(1)
|----- | ------------------------------------------------------------------------------------------------

|10.11 | Employment Agreement, effective June 13, 2003, by and between the Company and
Joseph H. Izhakoff(1)
|----- | ---------------------------------------------------------------------------------------------------

|10.12 | Employment Agreement, effective July 9, 2003, by and between the Company and
John Scherer(1)
|----- | --------------------------------------------------------------------------------------------

|10.13 | Form of Key Employee Housing Assistance Program(1)
|----- | --------------------------------------------------

|10.14 | Indenture, dated March 1, 1998, between Francis P. Richard/or Catherine L. Rich
and Logan Equipment Corporation(1)
|----- | ------------------------------------------------------------------------------------------------------------------

|10.15 | First Amendment to Lease, dated April 21, 2000, between Francis P. Rich and/or
Catherine L. Rich and NationsRent USA, Inc. (successor-in-interest to Logan
Equipment Corporation)(1)
|----- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------




|10.16 | Lease Agreement, dated December 14, 1998, between Jim Joy Holdings, LLC and
NationsRent of New Hampshire, Inc.(1)
|----- | -----------------------------------------------------------------------------------------------------------------

|10.17 | Lease Assignment, dated September 17, 1999, between Jim Joy Holdings, LLC and
1216 West Hammond Street, LLC(1)
|----- | --------------------------------------------------------------------------------------------------------------

|10.18 | First Amendment to Lease, dated January 10, 2000, between 1216 Hammond Street,
LLC and NationsRent USA, Inc.(successor-in-interest to NationsRent of New
Hampshire, Inc.)(1)
|----- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|10.19 | Lease Agreement, dated March 15, 2000, between Jim Joy Holdings, LLC and
NationsRent USA, Inc.(1)
|----- | -------------------------------------------------------------------------------------------------

|10.20 | Lease Agreement, dated December 7, 1999, between TREC, LLC and NationsRent USA,
Inc.(1)
|----- | ---------------------------------------------------------------------------------------

|10.21 | Lease Agreement, dated December 14, 1998, between TREC, LLC and NRI/LEC Merger
Corp., Inc.(1)
|----- | ---------------------------------------------------------------------------------------------

|10.22 | Lease Agreement, dated March 1, 2000, between TREC, LLC and NationsRent USA,
Inc.(1)
|----- | ------------------------------------------------------------------------------------

|10.23 | First Amendment to Lease, dated May 24, 2001, between TREC, LLC and NationsRent
USA, Inc.(1)
|----- | --------------------------------------------------------------------------------------------

|10.24 | Subscription Agreement, dated June 13, 2003, among NR Holdings, Inc. and the
subscribers party thereto(1)
|----- | ---------------------------------------------------------------------------------------------------------

|10.25 | Asset Purchase Agreement, dated June 13, 2003, among Boston Rental Partners,
LLC, NationsRent, Inc. and its subsidiaries(1)
|----- | ---------------------------------------------------------------------------------------------------------------------------

|10.26 | Rental Agreement, dated January 31, 2003, by and between Boston Rental Partners,
LLC, and NationsRent, Inc. and Term Sheet Regarding Settlement Program
referenced therein(1)
|----- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|10.27 | Strategic Alliance Agreement, dated October 12, 2000, between NationsRent, Inc.
and Lowe's Companies, Inc.(1)
|----- | -------------------------------------------------------------------------------------------------------------

|10.28 | Employment agreement, effective May 20, 2004, by and between the Company and
Gary N. Golden(1)
|----- | ----------------------------------------------------------------------------------------------

|10.29 | Employment agreement, effective July 9, 2003, by and between the Company and
Robert W. Schiller(1)
|----- | --------------------------------------------------------------------------------------------------

|10.30 | Amended and Restated Credit Agreement, dated as of October 23, 2003, by and
among the Company, certain of its subsidiaries, Wachovia Bank, National
Association, as administrative agent and as a lender, and the other lending
institutions party thereto(1)
|----- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|10.30.1 | First Amendment, dated as of December 22, 2003, to Amended and Restated Credit
Agreement, by and among the Company, certain of its subsidiaries, Wachovia Bank,
National Association, as administrative agent and a lender, and the other
lending institutions party thereto(1)
|------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|10.30.2 | Second Amendment, dated as of December 20, 2004, to Amended and Restated Credit
Agreement, by and among the Company, certain of its subsidiaries, Wachovia Bank,
National Association, as administrative agent and a lender and the other lending
institutions party thereto(4)
|------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------




|10.30.3 | Third Amendment, dated as of April 21, 2005, to the Amended and Restated Credit
Agreement, by and among the Company, certain of its subsidiaries, Wachovia Bank,
National Association, as administrative agent and a lender and the other lending
institutions party therein(5)
|------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|10.30.4 | Fourth Amendment, dated as of April 24, 2006, to the Amended and Restated Credit
Agreement, by and among the Company, certain of its subsidiaries, Wachovia Bank,
National Association, as administrative agent and a lender and the other lending
institutions party therein(14)
|------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|10.31 | Amended and Restated Security Agreement, dated as of October 23, 2003, between
the Company, certain of its subsidiaries, and Wachovia Bank, National
Association, as administrative agent(1)
|----- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|10.32 | First Amendment to Lease Agreement, dated as of November 3, 2005, by and between
NationsRent, Inc., through its operating subsidiaries, (each as to the
particular leases or subleases as to which they are a party) and Lowe's Centers,
Inc. and Lowe's HIW, Inc.(7)
|----- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|10.33 | Employment Agreement, effective July 7, 2003, by and between the Company and
Charles H. Snyder (10)
|----- | ---------------------------------------------------------------------------------------------------

|10.34 | Agreement for Wholesale Financing, dated April 27, 2006, by and among the
Company, its direct and indirect subsidiaries and GE Commercial Distribution
Finance Corporation.(11)
|----- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|10.35 | Agreement and Plan of Merger dated July 18, 2006, by and among NationsRent
Companies, Inc., Ashtead Group plc, Sunbelt Rentals, Inc. and Neptune Ventures
Group, Inc.(12)
|----- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|21 | List of Subsidiaries(9)
|-- | -----------------------

|31.1 | Certification of Thomas J. Putman pursuant to Section 302 of the Sarbanes-Oxley
Act of 2002(14)
|---- | -----------------------------------------------------------------------------------------------

|31.2 | Certification of Thomas J. Hoyer pursuant to Section 302 of the Sarbanes-Oxley
Act of 2002(14)
|---- | ----------------------------------------------------------------------------------------------

|32.1 | Certification of Thomas J. Putman pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002(14)
|---- | ----------------------------------------------------------------------------------------------------------------------------------------------

|32.2 | Certification of Thomas J. Hoyer pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002(14)
|---- | ---------------------------------------------------------------------------------------------------------------------------------------------

|(1) | Filed as an exhibit to the Company's Registration Statement on Form S-4
(Registration No. 333-114115), filed April 1, 2004, as amended, and incorporated
herein by reference.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(2) | Filed as an exhibit to the Company's Quarterly Report on Form 10-Q for the
quarterly period ended June 30, 2004, and incorporated herein by reference.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------

|(3) | Filed as an exhibit to the Company's Quarterly Report on Form 10-Q for the
quarterly period ended September 30, 2004, and incorporated herein by reference.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------

|(4) | Filed as an exhibit to the Company's Annual Report on Form 10-K for the year
ended December 31, 2004, and incorporated herein by reference.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------

|(5) | Filed as an exhibit to the Company's Current Report on Form 8-K filed on April
27, 2005, and incorporated herein by reference.
|--- | ------------------------------------------------------------------------------------------------------------------------------

|(6) | Filed as an exhibit to the Company's Quarterly Report on Form 10-Q for the
quarterly period ended March 31, 2005, and incorporated herein by reference.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------

|(7) | Filed as an exhibit to the Company's Current Report on Form 8-K filed on
November 9, 2005, and incorporated herein by reference.
|--- | --------------------------------------------------------------------------------------------------------------------------------




|(8) | Filed as an exhibit to the Company's Quarterly Report on Form 10-Q for the
quarterly period ended September 30, 2005, and incorporated herein by reference.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------

|(9) | Filed as an exhibit to the Company's Registration Statement on Form S-4
(Registration No. 333-25519), filed June 3, 2005, as amended, and incorporated
herein by reference.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(10) | Filed as an exhibit to the Company's Annual Report on Form 10-K for the year
ended December 31, 2005, and incorporated herein by reference.
|---- | -------------------------------------------------------------------------------------------------------------------------------------------

|(11) | Filed as an exhibit to the Company's Current Report on Form 8-K filed on May 2,
2006, and incorporated herein by reference.
|---- | ---------------------------------------------------------------------------------------------------------------------------

|(12) | Filed as an exhibit to the Company's Current Report on Form 8-K filed on July
21, 2006, and incorporated herein by reference.
|---- | -----------------------------------------------------------------------------------------------------------------------------

|(13) | Filed as an exhibit to the Company's Current Report on Form 8-K filed on August
7, 2006, and incorporated herein by reference.
|---- | ------------------------------------------------------------------------------------------------------------------------------

|(14) | Filed herewith.
|---- | ---------------

|(*) | The Company agrees to furnish supplementally a copy of any omitted schedule to
the Commission upon request.
|--- | -----------------------------------------------------------------------------------------------------------