Document:

exv10w80

 

Exhibit 10.80

Royalty Agreement

This Agreement (the “Agreement”), entered into this 27th day of November, 2007, by and
between SOUTH CHINA HOUSE OF TECHNOLOGY CONSULTANTS LTD., (“SCHOT”) a company duly
established and existing pursuant to the laws of Hong Kong with its registered office at Unit
1303-04, Block B Sea View Estate, 2-8 Watson Road. North Point, Hong Kong; OLEVIA (FAR EAST)
LIMITED (“Olevia Far East”) a company duly established and existing pursuant to the laws of Hong
Kong with its registered office at Room 1801, Wing On Central Building, 26 Des Voeux Road Central,
Central, Hong Kong and SYNTAX-BRILLIAN CORPORATION (“Syntax-Brillian”) a company duly
established and existing pursuant to the laws of Delaware with its register office at 1600 Desert
Drive, Tempe, Arizona 85281, collectively referred to as the “Parties”.

Recitals

	 	A.	 	Syntax-Brillian owns and controls the use of the OLEVIA trademark in the
People’s Republic of China as well as various other countries throughout the world.
	 
	 	B.	 	Syntax-Brillian has developed and designed various consumer electronic
products including LCD television products to its unique specifications and
requirements.
	 
	 	C.	 	Olevia Far East, which is an affiliated entity with Olevia (China), desires
to secure an exclusive license to perform direct drop ship business whereas it
directly delivers and sells goods as defined in Schedule III (hereinafter referred to
as “Licensed Goods”) from Taiwan to the Republic of China and Hong Kong (“Territory”).
The granting of such license rights is done with the full consent of Olevia (China)
which holds certain exclusive rights under a previously granted license of
Syntax-Brillian.
	 
	 	D.	 	SCHOT has developed strong connection with different channels within the
Territory and strong credibility with companies outside the Territory.

Now Therefore, for good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the parties hereby agree as follows.

1. Upon execution of this Agreement, Syntax-Brillian grants to Olevia Far East an exclusive
license to distribute, offer for sale, and sell the Licensed Goods bearing the Trade Marks,
on a royalty-bearing basis in respect of the Licensed Goods as provided in Section 1(B)
below. Such Licensed Goods may also be sold

 

 

to a licensed and authorized distributor of Syntax-Brillian Licensed Goods for the sale of
such Licensed Goods in the People’s Republic of China.

1(B). Olevia Far East shall pay a royalty to Syntax-Brillian on all Licensed Goods that are
sold within the Territory as defined. This royalty shall be in the amount of three percent
(3%) of the total sales price, net of any taxes, duties or other similar charges applied to
the sales price of the Licensed Goods.

1(C). SCHOT shall be responsible to manage the Olevia Far East royalty calculations and
shall collect the royalty fee on behalf of Syntax-Brillian on the Licensed Goods that are
sold within the Territory as defined.

1(D). Olevia Far East shall pay such royalty to Syntax-Brillian via SCHOT as established in
Section 1(B) and 1(C) herein on the following basis:

     (i) At the end of the second month of each calendar quarter (i.e., February
28th, May 31st, August 31st and November 30th),
Olevia Far East through SCHOT shall provide a good faith estimate of the royalties that
will be due for that calendar quarter based upon the estimated total net sales anticipated
for said quarter. Based upon said estimated total net sales, SCHOT shall collect from
Olevia Far East and shall be liable to pay to Syntax-Brillian the total quarterly royalty
of three percent (3%) of the quarterly estimated total net sales within five (5) business
days following the due date of such estimate.

     (ii) Within twenty (20) days of the end of each calendar quarter, Olevia Far East
through SCHOT shall provide to Syntax-Brillian a final report of the actual net sales for
the preceding calendar quarter. In the event the actual net sales were less than the
estimated total net sales for each respective quarter upon which a royalty payment was made
by Olevia Far East through SCHOT to Syntax-Brillian, a credit will be issued to be applied
to the royalties due in the succeeding calendar quarter. In the event the actual sales
exceeded the estimated total sales for each respective quarter upon which a royalty payment
was made by Olevia Far East through SCHOT to Syntax-Brillian, an additional royalty will be
paid by Olevia Far East through SCHOT to Syntax-Brillian in the amount of the underpayment.
This reconciliation payment shall be made within thirty (30) days of the end of the
respective calendar quarter.

     (iii) All sales reports shall be subject to audit by Syntax-Brillian. SCHOT and
Olevia Far East shall cooperate in the completion of such audit by the production of all
business documents at its place of business within five (5) days written notice of any
audit request by Syntax-Brillian.

     (iv) Olevia Far East shall restrict its distribution, offers for sale and sales of
goods within the Territory to only those defined in Schedule III as Licensed Goods bearing
the Trade Marks as indicated in Schedule II.

 

 

2. Olevia Far East shall pay for all costs associated with the distribution, offer for sale
and the manufacture of all Licensed Goods with the Territory.

3. Olevia Far East shall comply with any standard of quality as may be prescribed by
Syntax-Brillian from time to time and shall guarantee the quality of the Licensed Goods
provided under the Trade Marks.

4. All labels, tags and packaging bearing the Trade Marks shall be supplied by Olevia Far
East. All amendment on the existing artwork relating to the Trade Marks to be used on
labels, tags, packaging or any other materials bearing the Trade Marks used by Olevia Far
East must have the prior written approval from Syntax-Brillian.

5. Syntax-Brillian warrants and covenants that it shall not in any way interfere with the use
of the Trade Marks by Olevia Far East or any party authorized by Olevia Far East after the
date of this Agreement provided that the use of the Trademarks is consistent with the
requirements of this Agreement.

6. Should any infringement, suspected infringement, passing off, suspected passing off,
unfair competition or anything analogous thereto be brought to Olevia Far East’s attention,
Olevia Far East shall immediately notify Syntax-Brillian and the parties shall consult
concerning action required to protect the rights in the Trade Marks. All such costs of any
action taken shall be borne equally by Syntax-Brillian and Olevia Far East. If
Syntax-Brillian takes legal action to protect its rights, Olevia Far East will, at the
request of Syntax-Brillian, provide all reasonable assistance to Syntax-Brillian in that
action.

7. This Agreement shall be of the duration of two years unless varied, terminated or
superseded by subsequent agreement in writing between the parties. In the event this
Agreement is terminated, SCHOT may continue to distribute and sell Syntax-Brillian products
subject to separate procurement from Syntax-Brillian at that time under terms that are
mutually agreed to by the Parties.

8. Each party undertakes on behalf of itself and any of its subsidiaries or associated
companies and its successors and assignees to observe and to comply with all the terms of
this Agreement.

9. This Agreement shall be binding upon all successors in title, assigns, subsidiary company
and affiliates of the parties hereto.

10. This Agreement shall be governed by and construed in accordance with the laws of Hong
Kong and the parties hereby agree to submit to the non-exclusive jurisdiction of the courts
of Hong Kong.

 

 

Agreed To:

	 	 	 	 	 	 	 	 	 
	South China House of Technology	 	 	 	Syntax-Brillian Corporation
	Consultants Ltd.	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	By:

	 	/s/ Stanley Chan
	 	 	 	By:
	 	/s/ James Li
	 

	 	 
	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	Title:

	 	Managing Director
	 	 	 	Title:
	 	CEO
	 

	 	 
	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	Date:

	 	November 27, 2007
	 	 	 	Date:
	 	November 27, 2007
	 

	 	 
	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	Olevia (Far East) Limted	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	By:

	 	/s/ Lin Chi Hsin	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	Title:

	 	CEO	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	Date:

	 	November 27, 2007	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 

 

 

Schedule I

Territory

Republic of China

Hong Kong

 

 

Schedule II

Trademarks

Olevia

 

 

Schedule III

Licensed Goods

Televisions

Monitors<PAGE>

                              EXECUTIVE EMPLOYMENT
                          AND NONCOMPETITION AGREEMENT

     This Executive Employment and Noncompetition Agreement ("Agreement") is
entered into between RSC Holdings Inc. and RSC Equipment Rental, Inc. (the
"Company" or "RSC") and David Mathieson ("Executive"), effective as of January
2, 2008 (the "Effective Date").

                                    RECITALS

     WHEREAS, the Company operates its equipment rental business which has store
locations throughout North America (such business as operated by the Company is
referred to herein as the "Business").

     WHEREAS, the Company's life-blood is its Confidential Information,
including but not limited to customer databases, marketing and sales objectives
and strategies, customer lists, information regarding existing customer
preferences, habits, and needs, information regarding prospective customers,
details of past, pending and contemplated transactions, price lists, pricing
policies, sales data, training materials, and customer proposals, information
developed about the Company's competitors, systems, strategies, designs,
processes, procedures, market data, know-how, compilations of technical and
non-technical data, advertising and promotional plans, and financial and other
projections, which information has been collected over a significant amount of
time and at great effort and expense.

     WHEREAS, the Company would be placed at an unfair competitive disadvantage
if Executive were able to use the Company's Confidential Information and
goodwill for his or her own benefit, or for the benefit of anyone other than the
Company.

     WHEREAS, with the assurances contained in the agreement, the Company
desires to employ Executive as a Senior Vice President and Chief Financial
Officer, in which position he will not only have access to the Company's
Confidential Information but also will have the duty to expand and improve such
information.

     WHEREAS, Executive desires to be employed by the Company in this position
and is willing to do so upon the terms contained herein.

                                    AGREEMENT

     NOW, THEREFORE, as a condition of employment, and for other good and
valuable consideration, including without limitation continued employment, which
Executive agrees is sufficient consideration for this Agreement, and in
consideration of the mutual promises and covenants set forth below, the Company
and Executive agree as follows:

<PAGE>

                                    ARTICLE I

                                   EMPLOYMENT

     SECTION 1.1. EMPLOYMENT & POSITION. The Company shall employ Executive as
Senior Vice President and Chief Financial Officer at the Company's location in
Scottsdale, AZ. Executive shall report to the President and Chief Executive
Officer, and the Board of Directors of the Company. During Executive's
employment hereunder, Executive shall devote all necessary energies, experience,
skills, abilities, knowledge and productive time to the performance of duties
under this Agreement and shall not render to others services that interfere with
the performance of his duties with the Company under this Agreement. The
rendering of services to others shall be subject to the approval of the Board.

     SECTION 1.2. DUTIES. Executive will be responsible for the full range of
responsibility customarily performed by an Executive in the position of Senior
Vice President and Chief Financial Officer of the Company and render such
services as are from time to time necessary or requested in connection with the
affairs of the Company.

     SECTION 1.3. TERM OF EMPLOYMENT. Executive shall be employed as herein set
forth, commencing on the date set forth above and continuing until terminated by
either party in accordance with section 2.5 below (the "Employment Term").

                                   ARTICLE II

                                  COMPENSATION

     SECTION 2.1. BASE SALARY. Executive's salary (the "Base Salary") shall be
four hundred thousand dollars ($400,000) per annum for the term of this
Agreement and/or as increased, after review by the Board at the time and in
accordance with Company policies as in effect from time to time. Base Salary
shall be payable in accordance with the standard payroll practices of the
Company.

     SECTION 2.2. VARIABLE COMPENSATION. In addition to his Base Salary,
Executive will be eligible to receive Variable Compensation, in accordance with
the Company's Variable Compensation Plan as in effect from time to time, and
which will provide him with additional incentive opportunity with a target of
seventy-five percent (75%) of his Base Salary and a maximum of one-hundred fifty
percent (150%) of his Base Salary.

     SECTION 2.3. EQUITY INCENTIVE. Executive will be eligible to participate in
the Company's discretionary long term incentive plan during the course of
employment with the Company, subject to the discretion of the Compensation
Committee and/or the Board of Directors and the terms and conditions of the
applicable plan. Awards will be determined utilizing the valuation methodology
used for other similarly situated executive officers of the Company.

     On January 2, 2008, Executive will be granted non-qualified stock options
to purchase common stock of the Company with an aggregate value of $400,000, and
will be evidenced by

                                       2

<PAGE>

the Company's stock option agreement. The actual number of shares will be
determined by dividing $400,000 by the fair value as determined by the
Black-Scholes valuation model utilizing the closing price on the date of grant.
In addition, the stock options shall have an exercise price equal to the fair
market value of the Company common stock on the date of grant. The grant of
option shares has a ten year term and will vest in annual installments of 25%
each, with full vesting after four years.

     SECTION 2.4. OTHER BENEFITS. During the Employment Term, Executive shall be
entitled to all benefits and conditions of employment generally provided to
other RSC Company executives, subject to the same eligibility and other
reasonable conditions of Company benefit programs and to country related
differences, including, but not limited to, medical, dental, life insurance,
non-qualified deferred compensation programs, sick leave, disability, automobile
allowance ($1,200 per month) and participation in any retirement plan. In
addition, benefits shall include, but not be limited to five (5) weeks vacation
per year and an annual tax and financial planning services allowance of up to
two thousand five hundred dollars ($2,500).

     In connection with this Agreement, Executive and his family are being
relocated from Wisconsin to Arizona. The Company will provide its standard
relocation benefits offered through a third party relocation assistance firm to
Executive for similarly situated executives, including, but not limited to,
professional move, temporary lodging in the Scottsdale, Arizona area and house
hunting, as well as reimbursement of reasonable commuting expenses, moving
expenses, home purchase expenses, and other associated travel and relocation
related expenses.

     SECTION 2.5. EMPLOYMENT SEPARATION.

     (a) Severance Benefits: The Company may, at its sole discretion, terminate
Executive's employment at any time, provided however, that if the Company severs
Executive's employment for any reason other than For Cause or if Executive
terminates his employment for Good Reason the Company shall provide the
following severance payments and benefits (collectively "Severance Benefits"),
less all applicable federal and state income and withholding taxes, in exchange
for a full and complete release of all claims against the Company, in the form
customarily used by the Company, executed by Executive, and Executive allows
such release to become effective:

          1.   Twenty-four (24) months of Base Salary (the "Severance Period"),
               plus a pro-rata portion of variable compensation for the calendar
               year, or if variable compensation is to be paid quarterly then
               for the calendar quarter, in which the severance occurs up to the
               separation date, such pro rata bonus to be equal to the variable
               compensation Executive would have earned had Executive remained
               employed through the end of the applicable period (pro rated
               based on the number of days employed in such period). Executive's
               entitlement to and the amount of any variable compensation under
               this Section 2.5(a) (1) shall be determined at the sole
               discretion of the Company. The Base Salary shall be payable in
               accordance with the Company's regular payroll practices, and the
               pro rata variable compensation payments shall be payable at the
               time that other variable compensation payments are made under the
               applicable Variable

                                       3

<PAGE>

               Compensation Plan. Notwithstanding the payment schedule described
               in this paragraph, if Executive is a Specified Employee (as
               defined in Section 409A of the Internal Revenue Code of 1986, as
               amended (the "Code")) and becomes entitled to the payment
               described in this Section 2.5 as a result of a separation of
               service as defined by Section 409A(a)(2)(i) of the Code, then the
               portion of such payment treated as "separation pay" for purposes
               of Section 409A shall not be paid prior to the date which is six
               (6) months after the date of the Executive's separation of
               service with the Company if such payment would result in the
               imposition of an excise tax under Section 409A of the Code. Any
               amount described in the preceding sentence otherwise payable
               during the first six months following Executive's separation from
               service shall be accumulated and paid to Executive in a lump sum
               amount on the first date of the seventh month following the date
               of separation from service.

               Executive's entitlement to the foregoing severance payments is
               contingent on his continued compliance with the confidentiality,
               non-competition and non-solicitation provisions outlined in
               Sections 3.1, 3.2, 4.2 and 4.3 herein. Executive understands that
               if the Company determines that he has violated the
               confidentiality provisions, covenant not to compete or
               non-solicitation provisions, the Company will not make any
               further severance payments, and will be entitled to reimbursement
               from Executive of any severance amounts already paid to him, all
               in addition to any other remedy to which the Company may have.

          2.   Upon his separation from service, if Executive is eligible and
               enrolled in the Company's medical and dental benefit programs,
               the Company will provide the necessary forms, including COBRA
               notifications, to transfer the responsibility and right to
               continue those benefits to Executive, which under COBRA are
               typically at his expense, for the time period allowed by law or
               under the applicable programs. However, assuming Executive is
               eligible and elects to continue those benefits, the Company will
               continue to pay the same proportion of Executive's medical and
               dental insurance premiums under COBRA as during active employment
               (for Executive and eligible dependents) until the earlier of: (1)
               the expiration of the Severance Period; or (2) the date Executive
               is eligible for medical and dental insurance benefits by another
               employer.

          3.   Upon termination of employment, Executive is not eligible to
               continue participation in the Company group life insurance
               program. The Company will therefore pay, at the Company's option,
               the premiums during the Severance Period that are either (i)
               applicable to a conversion of the coverage (equal to the amount
               normally provided to an employee without payment by the employee)
               from group to individual coverage; or (ii) that will support the
               same level of coverage in a term life policy. The company's
               obligation under this sub-section is to provide the required

                                       4

<PAGE>

               insurance and Executive is not entitled to a cash payment in
               substitution thereof.

          4.   If Executive is not fully vested in the Company's 401(k) and/or
               other retirement/pension plan on the date of separation, the
               Company shall pay Executive an amount equal to the unvested
               portion of such account(s).

          5.   The Company on the date of separation will provide professional
               outplacement counseling and services consistent with other
               Executives at similar compensation levels. No cash lump sum
               payment in lieu of outplacement services will be provided to
               Executive.

          6.   During the twenty-four (24) month period during which Severance
               Benefits under this Section 2.5 are paid, the Company will
               continue to pay for Executive's reasonable association fees
               related to Executive's former duties and responsibilities if and
               to the extent previously paid by the Company.

          7.   The Company shall, except in the case of any termination of
               Executive's employment for Cause, give the Executive no less than
               30 days' prior written notice of termination of employment. In
               the event the Company gives such notice, the Executive shall be
               under no obligation to render additional services and shall be
               allowed to seek other employment, provided that the Severance
               Period shall be reduced accordingly if Executive so ceases to
               provide services to the Company.

"Good Reason" shall mean the occurrence, without Executive's consent, of any of
the following: (i) a material diminution in, or assignment of duties material
inconsistent with Executive's position (including status, offices, titles and
reporting relationships), (ii) a reduction in Base Salary that is not part of
across-the-board reduction, (iii) a relocation of Executive's principal place of
business to a location that is greater than fifty (50) miles from its current
location or (iv) the Company's material breach of the Agreement.

     (b) For Cause. The Company may, at its sole discretion, terminate
Executive's employment at any time during the Employment Term "For Cause". The
term "For Cause" means: (1) the failure of Executive to implement or adhere to
material policies, practices, or directives of the Company, including of the
Board; (2) conduct of a fraudulent and/or criminal nature; (3) any action of
Executive outside the scope of his employment duties that results in material
financial harm to the Company, (4) conduct that is in violation of any provision
of this Agreement or any other agreement between the Company or any of its
affiliates and Executive (including any noncompetition, noninterference,
nonsolicitation or confidentiality agreement); or (5) solely for purposes of
this Section 2.5, death or disability as defined hereinafter.

     (c) Disability. Within the parameters allowed by federal and state law, the
Company reserves the right to terminate Executive's employment or place him on
unpaid leave if Executive is incapacitated due to physical or mental illness and
cannot perform the essential functions of his job with or without a reasonable
accommodation.

                                       5
<PAGE>

     (d) Voluntary Resignation by Executive. Executive shall have the right to
terminate this Agreement at any time. Executive agrees to provide the Company
with thirty (30) days prior written notice of any such intended resignation. The
Company's obligation to pay Executive's Base Salary, variable compensation and
other benefits shall cease as of Executive's date of separation. Executive shall
not be entitled to any Severance Benefits if he resigns other than for Good
Reason.

     SECTION 2.6. SIGNING BONUS. As additional consideration for this Agreement,
the Company shall pay to Employee a signing bonus of $300,000, payable not later
than 20 days after the Effective Date and subject to customary withholdings.

     SECTION 2.7 LIMITATION ON PAYMENTS. In the event that the payments or other
benefits provided for in this Agreement or otherwise payable to Executive (i)
constitute "parachute payments" within the meaning of Section 280G of the Code,
and (ii) would be subject to the excise tax imposed by Section 4999 of the Code
(the "Excise Tax"), then Executive's benefits under this Agreement shall be
either (a) delivered in full, or (b) delivered to such lesser extent which would
result in no portion of such benefits being subject to the Excise Tax, whichever
of the foregoing amounts, taking into account the applicable federal, state and
local income taxes and the Excise Tax, results in the receipt by Executive on an
after-tax basis, of the greatest amount of benefits, notwithstanding that all or
some portion of such benefits may be taxable under Section 4999 of the Code. If
a reduction in payments or benefits constituting "parachute payments" is
necessary pursuant to the foregoing provision, reduction shall occur in the
following order unless the Executive elects in writing a different order
(provided, however, that such election shall be subject to Company approval if
made on or after the date on which the event that triggers the parachute payment
occurs): reduction of cash payments; cancellation of accelerated vesting of
stock awards; reduction of employee benefits. If acceleration of vesting of
stock award compensation is to be reduced, such acceleration of vesting shall be
cancelled in the reverse order of the date of grant of the Executive's stock
awards unless the Executive elects in writing a different order for
cancellation.

     Unless the Company and Executive otherwise agree in writing, any
determination required under this Section 2.7 shall be made in writing by the
Company's independent public accountants (the "Accountants"), whose
determination shall be conclusive and binding upon Executive and the Company for
all purposes and may be relied upon by the Company. For purposes of making the
calculations required by this Section 2.7, the Accountants may make reasonable
assumptions and approximations concerning applicable taxes and may rely on
reasonable, good faith interpretations concerning the application of Section
280G and 4999 of the Code. The Company and Executive shall further to the
Accountants such information and documents as the Accountants may reasonably
request in order to make a determination under this Section 2.7. The Company
shall bear all costs the Accountants may reasonably incur in connection with any
calculations contemplated by this Section 2.7.

                                       6

<PAGE>

                                   ARTICLE III

                            CONFIDENTIAL INFORMATION

     SECTION 3.1. CONFIDENTIAL INFORMATION. Executive's position with the
Company will, and have, necessarily give him access to, contact with and
knowledge of certain trade secrets, and confidential and proprietary business
information of the Company. This information includes but is not limited to
employee information, union information, employment and union litigation and
claim information, marketing and sales objectives and strategies, customer
lists, information regarding existing customer preferences, habits and needs,
information regarding prospective customers, details of past, pending and
contemplated transactions, price lists, pricing policies, sales data, training
materials, customer proposals, information developed about Company's
competitors, systems, strategies, designs, processes, procedures, growth plans,
market data, know-how, compilations of technical and non-technical data,
advertising and promotional plans and strategies, and financial and other
projections relating to the Business, which are not generally known to or
readily ascertainable through legitimate means by the public or by competitors
of the Company (hereinafter collectively referred to as "Confidential
Information"). Executive shall not at any time disclose the Confidential
Information to anyone, except on a need-to-know basis in connection with
Executive's duties in carrying out the business of the Company. Executive shall
not use any Confidential Information for his own benefit, or for the benefit of
anyone other than the Company or its affiliates.

     SECTION 3.2. OWNERSHIP OF RECORDS, ETC. All records, reports, notes,
compilations or other recorded matter, and copies or reproductions thereof, in
whatever media form, relating to the Confidential Information of the Company,
operations, activities or business, made or received by Executive during any
past employment or future period of employment with the Company are and shall be
the exclusive property of the Company. Executive shall keep the same at all
times in his custody, subject to control by the Company and Executive shall
surrender the same at the end of his employment, if not before. Failure to
return such property upon the request of the Company during Executive's
Employment Term or thereafter shall be a material breach of this Agreement.

     SECTION 3.3. INJUNCTIVE RELIEF. Executive acknowledges that (a) the
provisions of Section 3.1 and Section 3.2 are reasonable and necessary to
protect the legitimate interests of the Company, and (b) any violation of
Section 3.1 or Section 3.2 will result in irreparable injury to the Company, the
exact amount of which will be difficult to ascertain, and that the remedies at
law for any such violation would not be reasonable or adequate compensation to
the Company for such a violation. Accordingly Executive agrees that if he
violates, or under the then existing circumstances it seems reasonable likely
that there may occur a violation of, the provisions of Section 3.1 or Section
3.2, in addition to any other remedy which may be available at law or in equity,
the Company shall be entitled to specific performance and injunctive relief,
without posting bond or other security, and without the necessity of proving
actual damages.

                                       7

<PAGE>

                                   ARTICLE IV

                             COVENANT NOT TO COMPETE

     SECTION 4.1. RECITALS. Executive acknowledges and agrees that he has
technical and other extensive expertise associated with the Business and is well
known in the equipment rental industry. In addition, Executive has valuable
business contacts with employees, potential employees, clients, and potential
clients of the Business and with professionals in the equipment rental industry.
Furthermore, Executive's reputation and goodwill are an integral part of the
Company's success throughout the areas where the Business is and will be
conducted. If Executive deprives the Company of any of his goodwill or in any
manner uses his reputation and goodwill in competition with the Company, the
Company will be deprived of the benefits it has bargained for pursuant to this
Agreement. Since Executive has the ability to compete with the Company in the
operation of the Business, the Company therefore desires that Executive enter
into this Covenant Not To Compete.

     SECTION 4.2. COVENANT NOT TO COMPETE. Executive agrees that during his
employment with RSC and for a period of twelve (12) months commencing
immediately after the end of his employment (the "Time Period"), he shall not,
unless acting with the Company's prior written consent (which may be withheld at
the Company's sole discretion), directly or indirectly own, manage, join,
operate or control, participate in the ownership, operation or control of, or be
connected as a director, officer, partner, or consultant, or permit his name to
be used in connection with the following businesses or organizations that rent
or lease construction or construction-related equipment within the United
States, Canada and Mexico (collectively "the Territory"): Caterpillar, United
Rentals, Sunbelt Rentals and its parent Ashtead Group plc, Neff Rental, Hertz,
Volvo, National Equipment Services and Maxim Crane Works or, in the alternative,
any business or organization not listed above that rents or leases construction
or construction-related equipment that has gross revenues of $100 million or
more, or has a total employee base of 500 employees or more or that has plans to
enter into the construction-related equipment rental or leasing business in the
Territory.

The parties agree that if a court of competent jurisdiction determines that the
Time Period for purposes of this Section 4.2 is unreasonably long and found to
be an unenforceable term, the Time Period for purposes of this Section 4.2 shall
be shortened to the maximum duration enforceable under applicable law.

If a court of competent jurisdiction determines that the Territory is an
unreasonable geographic scope for this provision, the Territory shall be deemed
reformed to include the United States and Canada, excluding Mexico. If a court
of competent jurisdiction determines that the Territory of the United States and
Canada is an unreasonable geographic scope for this provision, the Territory
shall be deemed reformed to include the United States.

     SECTION 4.3. NO SOLICITATION OF CUSTOMERS OR EMPLOYEES. Executive agrees
that:

     (a) During his employment with RSC and for the Time Period, he shall not,
directly or indirectly, call on or solicit or divert or take away from RSC or
any of its affiliates (including by divulging to any competitor or potential
competitor of RSC) any person, firm, corporation, or

                                       8

<PAGE>

other entity who is a customer of RSC or its affiliates and whom Executive had
contact with through any of his employment with RSC.

     (b) During his employment with RSC and for the Time Period, he shall not,
directly or indirectly, solicit employment of any employee of RSC or any
employee of any affiliate of RSC for employment with any entity that rents or
leases construction or construction-related equipment in the Territory as
defined in Section 4.2.

     (c) The parties agree that if a court of competent jurisdiction determines
that the Time Period is unreasonably long and deemed unenforceable as defined
herein in Sections 4.3(a) or (b), the Time Period for purposes of Sections
4.3(a) or (b), as applicable, shall be shortened to the maximum duration
enforceable under applicable law.

     SECTION 4.4. SEVERABILITY OF PROVISIONS. In the event that the provisions
of this Section should ever be adjudicated by a court of competent jurisdiction
to exceed the time or geographic or other limitations permitted by applicable
law, then such provisions shall be deemed reformed to the maximum time or
geographic or other limitations permitted by applicable law, as determined by
such court in such action. Each breach of the covenants set forth herein shall
give rise to a separate and independent cause of action.

     SECTION 4.5. INJUNCTIVE RELIEF. Executive acknowledges that (a) the
provisions of Section 4.2 and Section 4.3 are reasonable and necessary to
protect the legitimate interests of the Company, and (b) any violation of
Section 4.2 or Section 4.3 will result in irreparable injury to the Company, the
exact amount of which will be difficult to ascertain, and that the remedies at
law for any such violation would not be reasonable or adequate compensation to
the Company for such a violation. Accordingly, Executive agrees that if he
violates, or under the then existing circumstances it seems reasonable likely
that there may occur a violation of, the provisions of Section 4.2 or Section
4.3, in addition to any other remedy which may be available at law or in equity,
the Company shall be entitled to specific performance and injunctive relief,
without posting bond or other security, and without the necessity of proving
actual damages.

     SECTION 4.6. EQUITABLE TOLLING. The restrictive time periods referred to in
Sections 4.2 and 4.3 shall be tolled and extended by one month for each month or
portion of each month during which Employee is in violation of the restrictions.
If Company initiates legal action to enforce the restrictions and obtains an
injunction against Employee; then the appropriate restrictive time period(s)
will begin to run on the date that the injunction is entered.

                                    ARTICLE V

                               GENERAL PROVISIONS

     SECTION 5.1. ASSIGNMENT. Neither this Agreement nor any of the rights or
obligations hereunder may be assigned by any party without the prior written
consent of the other parties except that the Company may, without such consent,
assign all such rights and obligations to a wholly-owned subsidiary or newly
created legal entity (or a partnership controlled by the Company) or
subsidiaries of the Company or to a successor in interest to the Company which
shall assume all obligations and liabilities hereunder.

                                       9

<PAGE>

     SECTION 5.2. SOLE AND ENTIRE AGREEMENT. This Agreement constitutes the
entire existing agreement between the parties with respect to the subject matter
hereof, and completely and correctly expresses all of the rights and obligations
of the parties, except that the parties acknowledge that a special severance
benefit and a special retention benefit have been offered and accepted by
Executive contemporaneously with the Prior Agreement. It is the intent of the
parties that if the conditions set forth in the General Terms applicable to the
special severance benefit and the special retention benefit have been fulfilled,
Executive shall become entitled to the benefits set forth in the letters
offering the same to him, and such letters, together with the said General Terms
shall supersede this Agreement, but only to the extent that the same are
inconsistent herewith. All prior agreements including but not limited to prior
employment agreements, severance agreements and/or change in control agreements,
are completely superseded and revoked. Executive expressly agrees that reliance
on any oral representation(s) is unreasonable.

     SECTION 5.3. WAIVERS. The waiver in any particular instance or series of
instances of any term or condition of this Agreement or any breach hereof by any
party shall not constitute a waiver of such term or condition or of any breach
thereof in any other instance.

     SECTION 5.4. AMENDMENT. This Agreement is subject to amendment only by
subsequent written agreement between, and executed by, the parties hereto.

     SECTION 5.5. SEPARABILITY. If any one or more provisions, clauses,
paragraphs, subclauses or subparagraphs contained in this Agreement shall for
any reason be held to be invalid, illegal, void or unenforceable, the same shall
not affect any other provision, clause, paragraph, subclause or subparagraph of
this Agreement, but this Agreement shall be construed as if such invalid,
illegal, void or unenforceable provision, clause, paragraph, subclause or
subparagraph had never been contained herein.

     SECTION 5.6. TIME IS OF THE ESSENCE. Time is of the essence in this
Agreement. Any time limit mentioned herein has been carefully considered and
represents the agreed absolute outside limit of time within which the applicable
right must be exercised. The parties may extend such time limit only by mutual
agreement in writing.

     SECTION 5.7. DURATION OF OBLIGATIONS. Executive's obligations under Article
III and Article IV of this Agreement (especially those relating to
confidentiality, non-competition and non-solicitation) shall continue after his
employment with the Company is ended, regardless of the nature or reason for
such termination.

     SECTION 5.8. ATTORNEYS' FEES. In the event of a dispute, a court or an
arbitrator may award attorneys' fees to the prevailing party.

     SECTION 5.9. CAPTIONS; DEFINITIONS. Any captions of articles, sections,
subsections or paragraphs of this Agreement are solely for the convenience of
the parties and are not a part of this Agreement or to be used for the
interpretation of this Agreement or any provision hereof.

     SECTION 5.10. APPLICABLE LAW. This Agreement shall be construed and
interpreted in accordance with the internal substantive laws, and not the choice
of law rules of the State of

                                       10

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Arizona. Except where this Agreement provides for injunctive relief, all
disputes arising out of or in connection with this Agreement shall be finally
settled under the Rules of Arbitration of the American Arbitration Association
by a single arbitrator appointed in accordance with the said Rules.

     SECTION 5.11. CONFIDENTIALITY. The parties agree that the terms of this
Agreement are to be held confidential and shall not be disclosed to any other
person or entity, except as required by law or legal process, and except that
either party may disclose the terms thereof to its or his legal counsel or tax
advisors.

     SECTION 5.12. VOLUNTARY AGREEMENT AND LEGAL COUNSEL. Executive has been
encouraged to review this Agreement with his legal and other expert counsel and
has freely entered into this Agreement.

     IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement or
caused this Agreement to be duly executed on their respective behalf, by their
respective officers thereunto duly authorized, all effective as of the day and
year first above written.

RSC HOLDINGS INC. AND RSC              EXECUTIVE: DAVID MATHIESON
EQUIPMENT RENTAL, INC.

By: /s/ Erik Olsson                    /s/ David Mathieson
    --------------------------------   -----------------------------------------
    Erik Olsson                        David Mathieson
    President and CEO

                                       11

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