Document:

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                                                                    Exhibit 10.7

                         TRANSITIONAL SERVICES AGREEMENT

        TRANSITIONAL SERVICES AGREEMENT, dated as of December 20, 2001 but
effective as of the Effective Date (as defined below), by and among, MCGRATH
RENTCORP, a California corporation ("McGrath"), and Robert P. McGrath (the
"Executive").

        WHEREAS, McGrath and Tyco Acquisition Corp. 33, a Nevada corporation
("Acquisition"), have proposed to enter into an agreement and plan of merger
dated as of the date hereof (the "Merger Agreement"), pursuant to which McGrath
will merge (the "Merger") with and into Acquisition (references herein to the
"Company" shall mean McGrath, prior to consummation of the Merger, and
Acquisition, as successor to McGrath, following consummation of the Merger, as
applicable).

        WHEREAS, the Executive has served as the Chief Executive Officer of the
Company and performs services of a unique nature for the Company.

        WHEREAS, following the Merger, the Executive will no longer serve as the
Chief Executive Officer of the Company, but the Company desires to retain and
rely on the Executive for the performance of critical transitional services
following the Merger, promoting continuity of management at the Company,
assuring customers and other Company employees of stability at the Company and
providing operational and strategic direction for the Company (the "Services").

        WHEREAS, as described in this Agreement, the Company has determined to
offer the Executive certain benefits while the Executive is employed by the
Company, to provide an incentive to encourage the Executive to remain in the
employ of the Company so that the Company may receive his continued dedication
and to assure the continued availability of the Executive's advice and counsel
to the Company during the period immediately following the completion of the
Merger.

        WHEREAS, as of the date hereof, the Executive and the Company have
entered into a Confidentiality and Non-Competition Agreement (the
"Confidentiality Agreement"), and the Company has agreed to provide the
Executive with the benefits set forth herein as part of the consideration for
the Executive entering into the Confidentiality Agreement.

        WHEREAS, the Executive has agreed to continue to render services to the
Company pursuant to the terms and conditions hereinafter set forth.

        NOW, THEREFORE, in consideration of the respective agreements of the
parties contained herein, it is agreed as follows:

        1. Definitions. The following terms shall have their respective meanings
provided in this Section 1.

               1.1 "Affiliate" shall mean any entity, directly or indirectly,
controlled by, controlling or under common control with the Company or any
corporation or other entity acquiring, directly or indirectly, all or
substantially all the assets and business of the Company, whether by operation
of law or otherwise.

               1.2 "Successors and Assigns" shall mean, with respect to the
Company, a corporation or other entity acquiring all or substantially all the
assets and business of the Company (including this Agreement) whether by
operation of law or otherwise.

        2. Effective Date. The "Effective Date" of this Agreement shall be the
date of the Effective Time under the Merger Agreement.

        3. Retention Period. The Company hereby agrees to continue the Executive
in its employ, and the Executive hereby agrees to remain in the employ of the
Company, for the period commencing on the Effective Date and ending on the date
three (3) months after the Effective Date or such earlier period as may be
determined by the Company (the "Retention Period").

        4. Terms of Employment.

               (a) Position and Duties.

               (1) During the Retention Period, the Executive shall provide the
Services to the Company.

               (2) Excluding any periods of sick leave or vacation to which the
Executive is entitled, the Executive agrees to devote reasonable and customary
attention and time during the Retention Period to the business and affairs of
the Company and, to the extent necessary to discharge the responsibilities
assigned to the Executive hereunder, to use the Executive's reasonable best
efforts to perform faithfully and efficiently such responsibilities. It shall
not be a violation of this Agreement, however, for the Executive to (A) serve on
corporate, civic or charitable boards or committees, (B) deliver lectures,
fulfill speaking engagements or teach at educational institutions and (C) manage
personal investments, so long as such activities do not significantly interfere
with the performance of the Executive's responsibilities as an employee of the
Company in accordance with this Agreement.

               (b)  Compensation.

               (1) Base Salary. During the Retention Period, the Executive shall
receive a base salary payable at the same monthly rate as he was receiving
immediately prior to the Effective Date. The base salary shall be payable at
such intervals as the Company customarily makes its payroll payments.

               (2) Employee Benefits. During the Retention Period, the Executive
shall be entitled to such employee benefits as are comparable in the aggregate
to those provided to the Executive immediately prior to the Effective Date.

               (3) Retention Bonus. In consideration of the Executive's
performing services pursuant to this Agreement, the Executive shall receive
$1,000,000 (the "Retention Bonus") within 30 days after the expiration of the
Retention Period; provided, however, that if (i) the Executive is unable to
complete the Retention Period due to death or disability, or (ii) the Company
terminates the Executive's employment during the Retention Period for any reason
other than as the result of the

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Executive's commission or conviction of a felony or a guilty or nolo contendere
plea by the Executive with respect thereto, the Retention Bonus shall be paid
within 30 days after the date of such death or termination of employment due to
disability.

        5. Termination of Employment.

               (a) COBRA Coverage. Upon the termination of the Executive's
employment at the end of the Retention Period (or earlier if due to disability),
the Executive may elect continuation coverage under Section 4980B of the
Internal Revenue Code of 1986, as amended ("COBRA Coverage") at no cost to the
Executive.

               (b) Continued Health Coverage. Prior to the expiration the
Executive's COBRA Coverage, the Company shall provide the Executive with
assistance in selecting appropriate replacement medical and health insurance
coverage and, to the extent that the coverage selected is comparable to the
coverage provided under the Executive's COBRA Coverage, the Company shall pay
the premiums for such coverage until the third anniversary of the Executive's
termination of employment.

               (c) Computer Support. During the period ending on the third
anniversary of the Executive's termination of employment, the Company's
information services department shall provide support services to the Executive
on the same basis as such support services are provided to employees of the
Company.

               (d) No Other Severance. The payment of the Retention Bonus and
the payments and benefits provided for in this Section 5 shall be in lieu of any
other severance pay to which the Executive may be entitled under the Company'
severance plan or any other plan, agreement or arrangement of the Company or any
of its Affiliates.

        6. Right of Repayment. In the event that the Executive should violate
the Confidentiality Agreement, the Executive shall, upon request of the Company
repay to the Company the Retention Bonus paid pursuant to Section 4(b)(3).

        7. Notice. All notices and other communications given or made pursuant
hereto shall be in writing and shall be deemed to have been duly given or made
if and when delivered personally or by overnight courier to the parties at the
following addresses or sent by electronic transmission, with confirmation
received, to the facsimile numbers specified below:

               If to the Company:   McGrath RentCorp.
                                    5700 Las Positas Road
                                    Livermore, CA 94550
                                    Attention: President

                                    and

                                    Tyco Acquisition Corp. 33
                                    c/o Tyco International (US) Inc.
                                    One Tyco Park
                                    Exeter, NH 03833
                                    Attention: President

                 If to Executive:   Robert  P. McGrath

                  with a copy to:

or at such other address as shall be indicated to either party in writing by
like notice. Notice of change of address shall be effective only upon receipt.

        8. Nature of Rights. Except as provided in Section 5(d), nothing in this
Agreement shall prevent or limit the Executive's continuing or future
participation in any benefit, bonus, incentive or other plan or program provided
by the Company or any Affiliate of the Company and for which the Executive may
qualify, nor, except as explicitly provided herein, shall anything herein limit
or reduce such rights as the Executive may have under any other agreements with
the Company or any Affiliate of the Company. Amounts which are vested benefits
or which the Executive is otherwise entitled to receive under any plan or
program of the Company or any Affiliate of the Company shall be payable in
accordance with such plan or program, except as explicitly modified by this
Agreement.

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

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        10.   Successors; Binding Agreement.

        (a) This Agreement shall not be assigned by operation of law or
otherwise, except that all or any of the rights of the Company and its
Affiliates hereunder may be assigned to and enforced by the Company and its
Affiliates; provided that no such assignment shall relieve the assigning party
of its obligations hereunder. This Agreement shall be binding upon and shall
inure to the benefit of the Company and its Successors and Assigns. The Company
shall require its Successors and Assigns to expressly assume and agree to
perform this Agreement in the same manner and to the same extent that the
Company would be required to perform it if no such succession or assignment had
taken place.

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

        (c) This Agreement shall be binding upon and inure solely to the benefit
of each party hereto, and nothing in this Agreement, express or implied, is
intended to or shall confer upon any other person any right, benefit or remedy
of any nature whatsoever under or by reason of this Agreement, except that the
Affiliates of the Company are intended third-party beneficiaries of this
Agreement.

        11.Governing Law. This Agreement shall be governed by and construed and
enforced in accordance with the internal laws of the State of California.

        12.Entire Agreement. Subject to the next sentence, this Agreement
constitutes the entire agreement between the parties hereto, and supersedes all
prior agreements, if any, understandings and arrangements, oral or written,
between the parties hereto, with respect to the subject matter hereof, provided
however, that this Agreement does not supercede the Confidentiality Agreement.

        13.Counterparts. This Agreement may be executed in counterparts, and by
the different parties hereto in separate counterparts (by facsimile or original
signature), each of which when executed shall be deemed to be an original but
all of which taken together shall constitute one and the same agreement.

        14.WAIVER OF JURY TRIAL. EACH OF MCGRATH AND THE EXECUTIVE HEREBY
IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ALL RIGHTS TO TRIAL
BY JURY IN ANY ACTION, PROCEEDING, OR COUNTERCLAIM (WHETHER BASED UPON CONTRACT,
TORT OR OTHERWISE) ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OF THE
TRANSACTIONS CONTEMPLATED HEREBY.

        15. Termination. This Agreement shall terminate and be of no further
force and effect if the Merger Agreement shall terminate without the Merger
having been consummated.

        IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first written above.

                                                  MCGRATH RENTCORP

                                                  By:
                                                     --------------------------
                                                  Name:
                                                  Title:

                                                  -----------------------------
                                                  Robert P. McGrath<PAGE>
                                                                    Exhibit 10.8

                  CONFIDENTIALITY AND NON-COMPETITION AGREEMENT

               CONFIDENTIALITY AND NON-COMPETITION AGREEMENT, dated as of
December 20, 2001 but effective as of the Effective Time (as defined below), by
and among, MCGRATH RENTCORP ("McGrath"), TYCO ACQUISITION CORP. 33 ("Acquiror"),
a direct, wholly-owned subsidiary of Tyco International Ltd. ("Tyco"), and
Robert P. McGrath ("Shareholder").

               WHEREAS, McGrath and Acquiror have proposed to enter into a
merger agreement dated as of the date hereof (the "Merger Agreement") pursuant
to which McGrath will merge with and into Acquiror, with the surviving
corporation being a wholly-owned subsidiary of Tyco; and

               WHEREAS, Shareholder is a founding and substantial shareholder of
McGrath and will receive considerable monetary and other benefits by reason of
the consummation of the transactions contemplated by the Merger Agreement; and

               WHEREAS, McGrath and Acquiror wish to preserve the confidential
information of McGrath and to protect against Shareholder using his skills,
knowledge, experience, ideas and influence for the benefit of the competitors of
McGrath and its affiliates; and

               WHEREAS, Shareholder is willing to enter into an agreement to
provide such protection to McGrath, its successor and affiliates upon the terms
and conditions set forth in this Agreement and understands that Shareholder's
agreement to the terms set forth herein is a critical inducement to the entering
into the Merger Agreement by the parties thereto; and

               WHEREAS, as a condition of its entering into the Merger
Agreement, Acquiror has requested Shareholder to agree to enter into this
Agreement, and Shareholder is executing this Agreement as an inducement to
Acquiror to enter into and execute the Merger Agreement.

               NOW, THEREFORE, in consideration of the execution and delivery by
Acquiror of the Merger Agreement and the mutual covenants, conditions and
agreements contained herein and therein, and intending to be legally bound
hereby, the parties agree as follows:

        1. Definitions.

           "Business" means (i) the business of designing, manufacturing,
refitting, supplying, selling, leasing and renting modular buildings and
accessories and (ii) the business of renting, leasing and selling electronic
testing and measurement equipment, in each case as now or hereafter (during the
Non-Competition Period) conducted by the Company or any of its affiliates.

           "Business Affiliate" means any affiliate of the Company (including
Tyco and its subsidiaries) now or hereafter engaged in the Business.

           "Company" means McGrath and Acquiror as successor to McGrath
following the Merger and includes their respective subsidiaries.

           "Competing Business" mean any business engaged in any of the
activities constituting or included within the Business.

           "Confidential information" means and includes the following items
that relate to or are connected with the Business: (i) the name and address of
any customer, vendor or affiliate of the Company or any Business Affiliate and
any information concerning the transactions or relations of any customer, vendor
or affiliate of the Company or any Business Affiliate with the Company or any
Business Affiliate or any of its shareholders, directors, officers, employees,
agents, consultants, representatives and/or personnel; (ii) any information
concerning any product, technology or procedure employed by the Company or any
Business Affiliate but not generally known to its customers, vendors or
competitors, or under development by or being tested by the Company or any
Business Affiliate but not at the time offered generally to its customers or
vendors; (iii) any information relating to computer software or systems used by
the Company or any Business Affiliate other than off-the-shelf software and
systems furnished by third party vendors; (iv) any business plans, budgets,
advertising or marketing plans, pricing or marketing methods, sales margins,
cost of goods, cost of material, capital structure, operating results, or
borrowing arrangements of the Company or any Business Affiliate; (v) any
information belonging to customers, vendors or affiliates of the Company or any
Business Affiliate or any other person which the Company or any

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Business Affiliate has agreed to hold in confidence; (vi) know-how, trade
secrets, technical data, designs, processes and formulae of the Company or any
Business Affiliate; (vii) any other information which is generally regarded as
confidential or proprietary; and (viii) all written, graphic, electronic and
other materials and records relating to any of the foregoing. Information that
is not novel or copyrighted or patented may nonetheless be proprietary
information; provided, however, that "confidential information" does not include
information generally available to and known by the public (other than by reason
of a breach of this Agreement).

           "Effective Time" means the effective time of the merger contemplated
by the Merger Agreement.

           "Non-Competition Period" means the period beginning on the date of
the Effective Time and ending on the fifth anniversary of that date.

           "Territory" means the United States of America.

        2. Acknowledgement. Shareholder acknowledges, as the basis for his
covenants and agreements contained in this Agreement:

           (i) the accuracy of each of the Recitals above;

           (ii) that the Business is intensely competitive and Shareholder's
        former and current position with the Company has exposed, and will
        continue to expose, Shareholder to knowledge and possession of
        confidential information of the Company and/or its Business Affiliates;

           (iii) that the confidential information constitutes a sensitive and
        protectable business interest of the Company and/or its Business
        Affiliates, as the case may be;

           (iv) that the direct and indirect disclosure of any such confidential
        information to existing or potential competitors of the Company and its
        Business Affiliates, as well as the engaging by Shareholder in any of
        the other activities prohibited by this Agreement, would place the
        Company and its Business Affiliates at a competitive disadvantage and
        would do damage, monetary or otherwise, to the operations, goodwill,
        prospects and competitive position of the Company and its Business
        Affiliates; and

           (v) that Shareholder's engaging in any of the activities prohibited
        by this Agreement would constitute improper appropriation and/or use of
        and harm to the tangible and intangible property of the Company and its
        Business Affiliates.

        3. Confidentiality.

           (a) Shareholder shall not, directly or indirectly, whether
individually, as a director, stockholder, owner, partner, employee, principal or
agent of any business, or in any other capacity, make known, disclose, furnish,
make available or utilize any of the confidential information of the Company or
any Business Affiliate other than in the proper performance of his duties as an
officer, employee or consultant of the Company or such Business Affiliate.

           (b) Nothing in this Agreement shall prevent Shareholder from
disclosing any confidential information as required by a court of competent
jurisdiction or other administrative or legislative body; provided that prior to
disclosing any of the confidential information to a court or other
administrative or legislative body, Shareholder shall promptly notify the
Company or its Business Affiliate, as the case may be, shall cooperate with the
Company or such Business Affiliate in obtaining a protective order or other
means of protecting the confidentiality of the confidential information and
shall disclose only that information that is legally required to be disclosed.
The Company shall reimburse Shareholder for his reasonable expenses involved in
such cooperation and, if such cooperation requires more than 10 hours of
Shareholder's time, the Company and Shareholder shall agree on appropriate
remuneration to Shareholder.

           (c) Shareholder agrees promptly to return all confidential
information in his possession, including all photocopies, extracts, summaries,
memoranda, documents, data, records, notes, designs, drawings, and other written
information, samples and models and any such information stored electronically
on tapes, computer disks or in any other manner, to the Company at any time upon
request by the Company or to or at the request of any Business Affiliate, as the
case may be.

        4.  Non-Competition.

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        During the Non-Competition Period, Shareholder shall not, directly or
indirectly, own, manage, operate, join, control, participate in, invest in or
otherwise be connected or associated in a like manner with any Competing
Business in the Territory, in any manner, including as an officer, director,
employee, partner, consultant, advisor, proprietor, manager, trustee or
investor; provided, however, that nothing contained in this Agreement shall
prevent Shareholder from owning less than five percent (5%) of the voting stock
of a publicly held corporation for investment purposes.

        5. Non-Solicitation.

        During the Non-Competition Period, Shareholder will not, directly or
indirectly, for his benefit or for the benefit of any other person, firm or
entity or otherwise:

           (i) persuade or seek to persuade any customer of the Company or any
        Business Affiliate to cease to do business or to reduce the amount of
        business which the customer has customarily done or contemplates doing
        with the Company or any Business Affiliate, whether or not the
        relationship between the Company or any Business Affiliate and such
        customer, supplier, or independent contractor was originally established
        in whole or in part by the efforts of Shareholder;

           (ii) seek to employ or engage, or assist anyone else to seek to
        employ or engage, any person who, at the relevant time, is in the employ
        of the Company or any Business Affiliate, or, as an independent
        contractor provides material engineering, marketing, sales, financial or
        management consulting services in connection with the business of the
        Company or any Business Affiliate; or

           (iii) interfere in any manner in the relationship of the Company or
        any Business Affiliate with any of its customers, suppliers, or
        independent contractors, whether or not the relationship between the
        Company or any Business Affiliate and such customer, supplier, or
        independent contractor was originally established in whole or in part by
        the efforts of Shareholder.

        6. Non-Disparagement.

        During the Non-Competition Period, Shareholder will not, directly or
indirectly, for his benefit or for the benefit of any other person, firm or
entity or otherwise:

           (i) make any statements or comments of a defamatory or disparaging
        nature to third parties regarding the Company or any Business Affiliate
        or its or their officers, directors, personnel, products or services; or

           (ii) take any action which is intended, or would reasonably be
        expected, to harm the Company or any Business Affiliate or its
        reputation or which would reasonably be expected to lead to unwanted or
        unfavorable publicity to the Company or any Business Affiliate.

        7. Other Obligations. The obligations of Shareholder under this
Agreement are in addition to, and not in derogation of, any other obligations or
duties that Shareholder may have or owe towards the Company or any Business
Affiliate, including, without limitation, pursuant to any employment agreement
or arrangement or by law as a present or former officer and/or director of the
Company.

        8. Specific Performance. Shareholder acknowledges that the Company and
its Business Affiliates would sustain irreparable injury in the event of a
violation by Shareholder of any of the provisions of this Agreement, and by
reason thereof Shareholder consents and agrees that if Shareholder violates any
of the provisions of this Agreement, in addition to any other remedies
available, the Company or its Business Affiliate, as the case may be, shall be
entitled to a decree specifically enforcing such provisions, and shall be
entitled to a temporary and permanent injunction restraining Shareholder from
committing or continuing any such violation, from any court of competent
jurisdiction, without the necessity of proving actual damages, posting any bond,
or seeking arbitration in any forum.

        9. Enforceability. Shareholder acknowledges and agrees that due to the
uniqueness of his role with the Company, his services and position, the nature
of the confidential information he possesses or will possess and the benefits
that he will receive by reason of the transaction contemplated by the Merger
Agreement, the covenants set forth herein are reasonable and necessary for the
protection of the business and goodwill of the Company and its Business
Affiliates. Nevertheless, in the event that any court of competition
jurisdiction determines that any provisions of this Agreement are unreasonable
in respect of its geographic boundaries, scope or term, such court is empowered
and authorized to amend or modify the provisions of this Agreement to the
minimum extent necessary in order to render such provisions valid, lawful and
enforceable. Should any provision of this Agreement be held or declared invalid,
unlawful or unenforceable, such

<PAGE>

invalidity, unlawfulness or unenforceability shall not in any way affect the
validity, lawfulness or enforceability of any other provision of this Agreement.

        10. Entire Agreement. This Agreement sets forth the entire agreement
between the parties with respect to its subject matter and merges and supersedes
all prior discussions, agreements and understandings of every kind and nature
between any of them and neither party shall be bound by any term or condition
other than as expressly set forth or provided for in this Agreement. This
Agreement may not be changed or modified nor may any of its provisions be
waived, except by an agreement in writing, signed by the parties hereto.

        11. Waiver. The failure of the Company or any Business Affiliate to
enforce any of its terms, provisions or covenants shall not be construed as a
waiver of the same or of the right of the Company or such Business Affiliate to
enforce the same. Waiver by the Company or any Business Affiliate of any breach
or default by Shareholder of any term or provision of this Agreement shall not
operate as a waiver of any other breach or default.

        12. Notices. All notices and other communications given or made pursuant
hereto shall be in writing and shall be deemed to have been duly given or made
if and when delivered personally or by overnight courier to the parties at the
following addresses or sent by electronic transmission, with confirmation
received, to the facsimile numbers specified below:

               If to the Company:   McGrath RentCorp.
                                    5700 Las Positas Road
                                    Livermore, CA 94550
                                    Attention:  President

               If to Acquiror:      Tyco Acquisition Corp. 33
                                    c/o Tyco International (US) Inc.
                                    One Tyco Park
                                    Exeter, NH 03833
                                    Attention:  President

               If to Shareholder:   Robert P. McGrath
                                    #2 Sixth Ave
                                    San Francisco, CA 9418

               with a copy to:      Morrison & Foerster LLP
                                    425 Market Street
                                    San Francisco, CA 94105
                                    Attention: Walter Stella, Esq.

or at such other address as shall be indicated to either party in writing by
like notice. Notice of change of address shall be effective only upon receipt.

        13. Successors and Assigns. This Agreement shall inure to the benefit
of, and shall be enforceable by, the Company, any Business Affiliate and their
respective successors and assigns.

        14. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of California without regard to conflicts
of law principles.

        15. Headings. The section headings contained herein are for reference
purposes only and shall not in any way affect the meaning or interpretation of
this Agreement.

        16. Counterparts. This Agreement may be executed in counterparts (by
original or facsimile signature), each of which shall be deemed an original for
all purposes but which, together, shall constitute one and the same instrument.

        17. Effectiveness. This Agreement, and all rights and obligations of the
parties hereunder, shall become effective at the Effective Time and shall
terminate if the Merger Agreement is terminated in accordance with its terms
without consummation of the offer and merger transactions contemplated thereby.

<PAGE>

        IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first written above.

                                           MCGRATH RENTCORP

                                           By:
                                              --------------------------------
                                           Name:
                                           Title:

                                           TYCO ACQUISITION CORP. 33

                                           By:
                                              --------------------------------
                                           Name:
                                           Title:

                                           SHAREHOLDER

                                           -----------------------------------
                                           Name:  Robert P. McGrath

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