filings.toolsUnited Rentals (URI) 10-K risk factor changes: FY2017 vs FY2016
The 2017-12-31 10-K against the 2016-12-31 one, compared heading by heading and sentence by sentence. One of these filings carries no fiscal year tag, so its year is the calendar year of the period end.
Item 1A25 rewritten7 added5 removed446 unchanged
All filing items973 rewritten607 added308 removed2,388 unchanged
Summary
counted, not written
- Item 1A headings could not be compared: only 0 carried over between the two years, which usually means one filing was read wrongly, so none is reported as new or removed.
- Sentence by sentence, 607 added, 308 removed, 973 rewritten and 2,388 unchanged across 16 items that differ.
Sentences by item
20 items, with every count and a link to each item that changed
Underlined words on a shaded ground are new in FY2017; struck-through words were in FY2016. Sentences that are wholly new or wholly gone are labelled rather than marked.
Item 1A. Risk Factors
25 rewritten, 7 added, 5 removed, 446 unchanged
In connection with any investment decision with respect to our securities, you should carefully consider the following risk factors, as well as [removed: the other information contained in this report and our other filings with the SEC.]
A [removed: slowdown in the economic recovery or] worsening of economic conditions, in particular with respect to North American construction and industrial activities, could cause weakness in our end markets and adversely affect our revenues and operating results.
At December 31, [removed: 2016,] [added: 2017,] our total indebtedness was [removed: $7.8] [added: $9.4] billion.
Our [removed: substantial] [added: significant] indebtedness could adversely affect our business, results of operations and financial condition in a number of ways by, among other things:
| • | restricting our ability to move operating cash flows to Holdings. URNA’s payment capacity is restricted under the covenants in [added: our senior secured asset-based revolving credit facility (“ABL facility”) and] the indentures governing its outstanding indebtedness; |
At December 31, [removed: 2016,] [added: 2017,] we had [removed: $2.2] [added: $2.4] billion of indebtedness that bears interest at variable rates.
Our variable rate indebtedness currently represents [removed: 28] [added: 25] percent of our total indebtedness.
The only financial [added: maintenance] covenant that currently exists under our [removed: senior secured asset-based revolving credit] [added: ABL] facility [removed: (“ABL facility”)] is the fixed charge coverage ratio.
As of December 31, [removed: 2016,] [added: 2017,] specified availability under the ABL facility exceeded the required threshold and, as a result, [removed: the] [added: this financial] maintenance covenant was inapplicable.
Under our accounts receivable securitization facility, we are required, among other things, to maintain certain financial tests relating to: (i) the default ratio, (ii) the [added: delinquency ratio, (iii) the dilution ratio]
[removed: delinquency ratio, (iii) the dilution ratio] and (iv) days sales outstanding.
We have historically achieved a significant portion of our growth through [removed: acquisitions.][added: acquisitions and we will continue to consider potential acquisitions on a selective basis.]
There can be no assurance that we will be able to identify suitable acquisition opportunities in the [removed: future, with respect to our specialty business or otherwise,] [added: future] or that we will be able to consummate any such transactions on terms and conditions acceptable to us.
Although the Board of Directors has authorized [removed: a] [added: the] share repurchase program, the share repurchase program does not obligate the Company to repurchase any specific dollar amount or to acquire any specific number of shares.
The existence of a share repurchase program could cause our stock price to be higher than it would be in the absence of such a program and could potentially reduce the market [added: liquidity for our stock.]
[removed: Although our share repurchase program is intended to] enhance long-term stockholder value, there is no assurance that it will do so and short-term stock price fluctuations could reduce the program’s effectiveness.
Further, delinquencies and credit losses generally would be expected to increase if there was a [removed: slowdown in the economic recovery or] worsening of economic conditions.
At December 31, [removed: 2016,] [added: 2017,] we had [removed: $3.3] [added: $4.1] billion of goodwill on our consolidated balance sheet.
For a discussion of [removed: the] [added: our] goodwill impairment [removed: testing for our Pump Solutions reporting unit,] [added: testing,] see “Critical Accounting Policies-Evaluation of Goodwill Impairment” in Part II, Item 7A-Management’s Discussion and Analysis of Financial Condition and Results of Operations.
The extent to which these strategies will achieve our desired efficiencies and goals in [removed: 2017] [added: 2018] and beyond is uncertain, as their success depends on a number of factors, some of which are beyond our control.
[removed: Any disruptions in these systems or] the failure of these systems to operate as expected could, depending on the magnitude of the problem, adversely affect our operating results by limiting our ability to effectively monitor and control our operations, adjust to changing market conditions, implement strategic initiatives and service online orders.
Our [removed: 769] [added: 874] branch locations in the United States are located in 49 states, which exposes us to a host of different state and local regulations, in addition to federal law and regulatory and contractual requirements we face as a government contractor.
We currently have approximately [removed: 850] [added: 1,100] employees who are represented by unions and covered by collective bargaining agreements and approximately [removed: 11,650] [added: 13,700] employees who are not represented by unions.
[added: Union organizing efforts or collective bargaining negotiations could potentially] lead to work stoppages and/or slowdowns or strikes by certain of our employees, which could adversely affect our ability to serve our customers.
A multiemployer pension plan is a plan that covers the [removed: union-represented workers of various unrelated companies.][added: union-]
the other information contained in this report and our other filings with the SEC.
As discussed in note 3 to the consolidated financial statements, we completed the acquisitions of NES in April 2017 and Neff in October 2017.
In October 2017, our Board authorized the resumption of the $1 billion share repurchase program, and we intend to complete the program in 2018.
The Company had completed $655 million of repurchases under the program as of December 31, 2017.
Although our share repurchase program is intended to
Any disruptions in these systems or
represented workers of various unrelated companies.
We will continue to consider potential acquisitions on a selective basis, including potential growth opportunities for our trench, power and pump specialty business.
As discussed in note 18 to the consolidated financial statements, on January 25, 2017, we entered into a definitive merger agreement with NES Rentals Holdings II, Inc. (“NES”), pursuant to which we have agreed to acquire NES in an all cash transaction.
We intend to complete the share repurchase program; however, we will re-evaluate the decision to do so as we integrate NES and assess other potential uses of capital.
liquidity for our stock.
Union organizing efforts or collective bargaining negotiations could potentially
Item 7A. Quantitative and Qualitative Disclosures About Market Risk
8 rewritten, 0 added, 0 removed, 9 unchanged
As of December 31, [removed: 2016,] [added: 2017,] we had an aggregate of [removed: $2.2] [added: $2.4] billion of indebtedness that bears interest at variable rates, comprised of borrowings under the ABL facility and the accounts receivable securitization facility.
See "Liquidity and Capital Resources" above for the amounts outstanding, and the interest rates thereon, as of December 31, [removed: 2016] [added: 2017] under the ABL facility and the accounts receivable securitization facility.
As of December 31, [removed: 2016,] [added: 2017,] based upon the amount of our variable rate debt outstanding, our annual after-tax earnings would decrease by approximately $14 for each one percentage point increase in the interest rates applicable to our variable rate debt.
For additional information concerning the terms of our variable rate debt, see note [removed: 11] [added: 12] to our consolidated financial statements.
At December 31, [removed: 2016,] [added: 2017,] we had an aggregate of [removed: $5.6] [added: $7.1] billion of indebtedness that bears interest at fixed rates.
A one percentage point decrease in market interest rates as of December 31, [removed: 2016] [added: 2017] would increase the fair value of our fixed rate indebtedness by approximately [removed: six] [added: seven] percent.
For additional information concerning the fair value and terms of our fixed rate debt, see note [removed: 10] [added: 11] (see “Fair Value of Financial Instruments”) and note [removed: 11] [added: 12] to our consolidated financial statements.
Based upon the level of our Canadian operations during [removed: 2016] [added: 2017] relative to the Company as a whole, a 10 percent change in this exchange rate would cause our annual after-tax earnings to change by approximately [removed: $5.][added: $6.]
Item 1. Business
50 rewritten, 16 added, 9 removed, 195 unchanged
The table below presents key information about our business as of and for the years ended December 31, [removed: 2016] [added: 2017] and [removed: 2015.][added: 2016.]
The data below should be read in conjunction with, and is qualified by reference to, our Management’s Discussion and Analysis and our consolidated financial statements and notes thereto contained [added: elsewhere in this report.]
| Total revenues (in millions) | [removed: $5,762] [added: $6,641] | | [removed: $5,817] [added: $5,762] |
| Equipment rental revenue percent of total revenues | 86% | | [removed: 85%] [added: 86%] |
| Year-over-year [removed: (decrease) increase] [added: decrease] in rental rates | [removed: (2.2)%] [added: (0.2)%] | | [removed: 0.5%] [added: (2.2)%] |
| Year-over-year increase in the volume of equipment on rent | [removed: 3.1%] [added: 18.2%] | | [removed: 3.2%] [added: 3.1%] |
| Time utilization | [removed: 67.9%] [added: 69.5%] | | [removed: 67.3%] [added: 67.9%] |
| Key account percent of equipment rental revenue [removed: (1)] | [removed: 70%] [added: 69%] | | [removed: 64%] [added: 70%] |
| National account percent of equipment rental revenue | [removed: 45%] [added: 43%] | | [removed: 44%] [added: 45%] |
| Fleet original equipment cost (“OEC”) (in billions) | [removed: $8.99] [added: $11.51] | | [removed: $8.73] [added: $8.99] |
| Equipment classes | [removed: 3,200] [added: 3,400] | | [removed: 3,300] [added: 3,200] |
| Equipment units | [removed: 440,000] [added: 520,000] | | [removed: 430,000] [added: 440,000] |
| Fleet age in months | [removed: 45.2] [added: 47.0] | | [removed: 43.1] [added: 45.2] |
| Percent of fleet that is current on manufacturer's recommended maintenance | [removed: 90%] [added: 86%] | | [removed: 92%] [added: 90%] |
| General tools and light equipment | [removed: 8%] [added: 7%] | | [removed: 10%] [added: 8%] |
| Power and HVAC (heating, ventilating and air conditioning) equipment | 7% | | [removed: 6%] [added: 7%] |
| Trench safety equipment | 6% | | [removed: 5%] [added: 6%] |
| Pumps | [removed: 4%] [added: 5%] | | 4% |
| Rental locations | [removed: 887] [added: 997] | | [removed: 897] [added: 887] |
| Approximate number of districts per region | [removed: 7-9] [added: 6-10] | | [removed: 6-9] [added: 7-9] |
| Total employees | [removed: 12,500] [added: 14,800] | | [removed: 12,700] [added: 12,500] |
| Estimated market share [removed: (2)] [added: (1)] | [removed: 9.7%] [added: 11.4%] | | [removed: 10.1%] [added: 9.7%] |
| Estimated North American equipment rental industry revenue growth | [removed: 4%] [added: 4.2%] | | [removed: 6%] [added: 3.9%] |
| United Rentals equipment rental revenue [removed: (decrease)] increase [added: (decrease)] | [removed: (0.2)%] [added: 15.7%] | | [removed: 2.7%] [added: (0.2)%] |
| [removed: 2017] [added: 2018] projected North American industry equipment rental revenue growth | [removed: 3.5%] [added: 4.4%] | | \- |
| Top 10 customers percent of total revenues | [removed: 6%] [added: 5%] | | 6% |
| Largest supplier percent of capital expenditures | [removed: 22%] [added: 18%] | | [removed: 21%] [added: 22%] |
| Top 10 supplier percent of capital expenditures | [removed: 62%] [added: 57%] | | [removed: 66%] [added: 62%] |
In [removed: 2017,] [added: 2018,] we expect to continue our disciplined focus on increasing our profitability and return on invested capital.
| • | A continued focus on “Lean” management techniques, including kaizen processes focused on continuous improvement. [removed: As of December 31, 2016, we have trained over 3,100 employees, over 70 percent of our district managers and over 60 percent of our branch managers on the Lean kaizen process.] We continue to implement [removed: this program] [added: Lean kaizen processes] across our branch network, with the objectives of: reducing the cycle time associated with renting our equipment to customers; improving invoice accuracy and service quality; reducing the elapsed time for equipment pickup and delivery; and improving the effectiveness and efficiency of our repair and maintenance operations. [removed: As discussed in note 4 to our consolidated financial statements, in the fourth quarter of 2015, we initiated a restructuring program focused on cost savings throughout the organization partially due to the Lean initiatives not fully generating the anticipated cost savings due to lower than expected rental volume in 2015.] We [removed: closed this restructuring program in the fourth quarter of 2016. We] achieved the anticipated run rate savings from the Lean [removed: initiatives] [added: initiatives, including those included] in [removed: 2016] [added: the Project XL work streams discussed below, in 2017] and [added: 2016, and] expect to continue to generate savings from these initiatives; |
| • | The continued expansion of our trench, power and pump footprint, as well as our tools offering, and the cross-selling of these services throughout our network. We plan to open at least [removed: 17] [added: 18] specialty rental branches/tool hubs in [removed: 2017] [added: 2018] and continue to invest in specialty rental fleet to further position United Rentals as a single source provider of total jobsite solutions through our extensive product and service resources and technology [removed: offerings.] [added: offerings; and] |
In [removed: 2016,] [added: 2017,] based on an analysis of our charge account customers’ Standard Industrial Classification (“SIC”) codes:
| • | Industrial and other non-construction rentals represented approximately [removed: 51] [added: 50] percent of our rental revenue, primarily reflecting rentals to manufacturers, energy companies, chemical companies, paper mills, railroads, shipbuilders, utilities, retailers and infrastructure entities; |
| • | Commercial construction rentals represented approximately [removed: 45] [added: 46] percent of our rental revenue, primarily reflecting rentals related to the construction and remodeling of facilities for office space, lodging, healthcare, entertainment and other commercial purposes; and |
We estimate that, in [removed: 2016,] [added: 2017,] North American equipment rental industry revenue grew approximately 4 percent year-over-year, with [removed: substantially all of the growth] [added: similar growth, on a constant currency basis,] in [added: both] the U.S. [removed: In 2016, our full year rental revenue decreased by approximately 0.2 percent year-over-year.][added: and Canada.]
In [removed: 2017,] [added: 2018,] based on our analyses of industry forecasts and macroeconomic indicators, we expect that the majority of our end markets will continue to experience solid demand for equipment rental services.
Specifically, we expect that North American industry equipment rental revenue will increase approximately 4 percent, with [removed: similar] [added: slightly higher] growth, on a constant currency basis, [removed: expected] in [removed: both] the U.S. [removed: and] [added: than] Canada.
[removed: We have a wide variety of] [added: Our] information technology systems, some [added: of which are] proprietary and some [added: of which are] licensed, [removed: that supports] [added: support] our operations.
[removed: This back-up facility also allows us to perform] system upgrades and maintenance without interfering with the normal ongoing operation of our information technology systems.
We have [removed: 887] [added: 997] rental locations in 49 U.S. states and every Canadian province and serve customers that range from Fortune 500 companies to small businesses and homeowners.
As discussed in note 3 to the consolidated financial statements, we completed the acquisitions of NES Rentals Holdings II, Inc. (“NES”) and Neff Corporation ("Neff") in April 2017 and October 2017, respectively.
The results of
NES and Neff subsequent to their acquisition dates are reflected in the table below.
| | 2017 | | 2016 |
(1) As discussed above, we completed the acquisitions of NES and Neff in April 2017 and October 2017, respectively.
Estimated market share as of December 31, 2017 includes the standalone, pre-acquisition revenues of NES and Neff.
Estimated market share as of December 31, 2016 does not include NES and Neff because we had not acquired them as of December 31, 2016.
If the standalone, pre-acquisition revenues of NES and Neff were included for the year ended December 31, 2016, estimated market share as of December 31, 2016 would have been 11.0 percent.
| • | The pursuit of strategic acquisitions to continue to expand our core equipment rental business, as exhibited by our recently completed acquisitions of NES and Neff. Strategic acquisitions allow us to invest our capital to expand our business, further driving our ability to accomplish our strategic goals. |
In 2017, our full year rental revenue increased by 15.7 percent year-over-year, including the impact of the NES and Neff acquisitions.
On a pro forma basis including the standalone, pre-acquisition results of NES and Neff, equipment rental revenue increased 7.6 percent year-over-year.
| • | allow our mobile sales and service team members to support our customers efficiently while in the field; |
This back-up facility also allows us to perform
Online Rental Platform (UROne®).
This software can be
As discussed above, we completed the acquisitions of NES and Neff in April 2017 and October 2017, respectively.
elsewhere in this report.
| | December 31, | | |
| | 2016 | | 2015 |
| (1) | The key account percent of equipment rental revenue reflects the customers designated as key accounts as of December 31, 2016 or 2015. The increase in the key account percent of equipment rental revenue in 2016 primarily reflects additional customers that were designated as key accounts in 2016. If the list of customers designated as key accounts as of December 31, 2016 was applied to 2015, the key account percent of equipment rental revenue for 2015 would have been 69 percent. |
| (2) | Market share is calculated based on total equipment rental industry revenues as measured by the American Rental Association ("ARA"). In 2015, we reported an estimated market share of 11.7 percent. ARA subsequently increased the total amount of estimated equipment rental industry revenues based on new data from the economic census. The |
estimated 2015 market share reported above reflects this increase in the total estimated equipment rental industry revenues.
Excluding the adverse impact from currency, rental revenue would have increased 0.2 percent year-over-year.
Information Technology Systems.
E-Rentals.
An excerpt. Shown here: 40 of 50 rewritten, all 16 added and all 9 removed. The counts are complete. For every sentence, read Item 1. Business in the FY2017 filing and the FY2016 filing.
Item 3. Legal Proceedings
1 rewritten, 0 added, 0 removed, 2 unchanged
A description of legal proceedings can be found in note [removed: 13] [added: 14] to our consolidated financial statements, included in this report at Item 8—Financial Statements and Supplementary Data, and is incorporated by reference into this Item 3.
Cover and table of contents
32 rewritten, 10 added, 4 removed, 155 unchanged
FOR THE FISCAL YEAR ENDED DECEMBER 31, [removed: 2016][added: 2017]
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, [removed: or] a smaller reporting [added: company or an emerging growth] company.
See [added: the] definitions of “large accelerated filer,” “accelerated [removed: filer” and] [added: filer”,] “smaller reporting company” [added: and “emerging growth company”] in Rule 12b-2 of the Exchange Act.
| [removed: Large Accelerated] [added: Non-Accelerated] Filer [removed: þ] | [removed: Accelerated Filer o] | [removed: Non-Accelerated Filer] o | Smaller Reporting Company [added: | |] o |
As of June 30, [removed: 2016] [added: 2017] there were [removed: 86,725,103] [added: 84,538,835] shares of United Rentals, Inc. common stock outstanding.
The aggregate market value of common stock held by non-affiliates (defined as other than directors, executive officers and 10 percent beneficial owners) at June 30, [removed: 2016] [added: 2017] was approximately [removed: $5.18] [added: $9.49] billion, calculated by using the closing price of the common stock on such date on the New York Stock Exchange of [removed: $67.10.][added: $112.71.]
As of January [removed: 23, 2017,] [added: 22, 2018,] there were [removed: 84,310,531] [added: 84,427,665] shares of United Rentals, Inc. common stock outstanding.
Documents incorporated by reference: Portions of United Rentals, Inc.’s Proxy Statement related to the [removed: 2017] [added: 2018] Annual Meeting of Stockholders, which is expected to be filed with the Securities and Exchange Commission on or before March [removed: 21, 2017,] [added: 27, 2018,] are incorporated by reference into Part III of this annual report.
| Item 1 | [removed: [Business](#s5F678FB562A9B9D6C7E9689FA2A01400)] [added: [Business](#sE54A31242D265ABABF8F1704247CD515)] | [removed: [1](#s5F678FB562A9B9D6C7E9689FA2A01400)] [added: [1](#sE54A31242D265ABABF8F1704247CD515)] |
| Item 1A | [Risk [removed: Factors](#sD9217AAE920F2DB526F2689FA2DA81C8)] [added: Factors](#s9A442A1FCEB75DC4B2CFA47304171300)] | [removed: [7](#sD9217AAE920F2DB526F2689FA2DA81C8)] [added: [7](#s9A442A1FCEB75DC4B2CFA47304171300)] |
| Item 1B | [Unresolved Staff [removed: Comments](#s382B42AF2180A0C10B79689FA2F8A0BD)] [added: Comments](#sE793ABD55C90535E8AC6CEBBB77DBA29)] | [removed: [18](#s382B42AF2180A0C10B79689FA2F8A0BD)] [added: [18](#sE793ABD55C90535E8AC6CEBBB77DBA29)] |
| Item 2 | [removed: [Properties](#sD482361C015981B3D5F5689FA31492CC)] [added: [Properties](#s51CCEC1F72EB5B64BB42A9C98A044740)] | [removed: [18](#sD482361C015981B3D5F5689FA31492CC)] [added: [18](#s51CCEC1F72EB5B64BB42A9C98A044740)] |
| Item 3 | [Legal [removed: Proceedings](#s45AE73ED550786146E4E689FA346D55B)] [added: Proceedings](#s6BD2DD0CFA5757AD8007C806798BC147)] | [removed: [19](#s45AE73ED550786146E4E689FA346D55B)] [added: [19](#s6BD2DD0CFA5757AD8007C806798BC147)] |
| Item 4 | [(Removed and [removed: Reserved)](#s22317C742A6CFBCEC5D1689FA3680F97)] [added: Reserved)](#s5BA4B608E86957B3A3EBE7BD6D0CB0C6)] | [removed: [19](#s22317C742A6CFBCEC5D1689FA3680F97)] [added: [19](#s5BA4B608E86957B3A3EBE7BD6D0CB0C6)] |
| Item 5 | [Market for the Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity [removed: Securities](#sA96779A765D9237A1333689F87F50DF6)] [added: Securities](#s8EA54E342E465A74A0121B565DFFC5E2)] | [removed: [19](#sA96779A765D9237A1333689F87F50DF6)] [added: [19](#s8EA54E342E465A74A0121B565DFFC5E2)] |
| Item 6 | [Selected Financial [removed: Data](#s3E243F037EA7EF83A13D689F826CBFA4)] [added: Data](#s827BFB847EED5EC083F691E787D38ACC)] | [removed: [21](#s3E243F037EA7EF83A13D689F826CBFA4)] [added: [21](#s827BFB847EED5EC083F691E787D38ACC)] |
| Item 7 | [Management’s Discussion and Analysis of Financial Condition and Results of [removed: Operations](#s1BE00FE7ABC7A3395E59689F832E535E)] [added: Operations](#sD1C636564119541D8F0304B21BF09B67)] | [removed: [22](#s1BE00FE7ABC7A3395E59689F832E535E)] [added: [22](#sD1C636564119541D8F0304B21BF09B67)] |
| Item 7A | [Quantitative and Qualitative Disclosures About Market [removed: Risk](#sEAC29FE7492F1826A717689FA51C2B1F)] [added: Risk](#s6D662CC94ECB5DF3A17C473D9CAF0400)] | [removed: [39](#sEAC29FE7492F1826A717689FA51C2B1F)] [added: [39](#s6D662CC94ECB5DF3A17C473D9CAF0400)] |
| Item 8 | [Financial Statements and Supplementary [removed: Data](#s33E1370D048D89649812689FA53A175E)] [added: Data](#sE786FE2CD315571084D09BA47A1FBAF5)] | [removed: [41](#s33E1370D048D89649812689FA53A175E)] [added: [40](#sE786FE2CD315571084D09BA47A1FBAF5)] |
| Item 9 | [Changes in and Disagreements with Accountants on Accounting and Financial [removed: Disclosure](#sA6A8C0BCB67D7FEE92A4689FAC106055)] [added: Disclosure](#s0D2B149497165B6CB8FFBE017A284B12)] | [removed: [82](#sA6A8C0BCB67D7FEE92A4689FAC106055)] [added: [88](#s0D2B149497165B6CB8FFBE017A284B12)] |
| Item 9A | [Controls and [removed: Procedures](#s0102C6DD0A93C12403E6689FAC3FF88D)] [added: Procedures](#sE11DF6B4442156FA9625F42CFEE941DC)] | [removed: [82](#s0102C6DD0A93C12403E6689FAC3FF88D)] [added: [88](#sE11DF6B4442156FA9625F42CFEE941DC)] |
| Item 9B | [Other [removed: Information](#s2FC48E40E7D3BEACC752689FACB7B31C)] [added: Information](#sEAC8BE7AF1325C3288F237DE3D690F91)] | [removed: [84](#s2FC48E40E7D3BEACC752689FACB7B31C)] [added: [91](#sEAC8BE7AF1325C3288F237DE3D690F91)] |
| Item 10 | [Directors, Executive Officers and Corporate [removed: Governance](#sD31C570FC3666716CE14689FAD0EB4A9)] [added: Governance](#s66222D99DE5956AE8C4E392A186A80B9)] | [removed: [85](#sD31C570FC3666716CE14689FAD0EB4A9)] [added: [92](#s66222D99DE5956AE8C4E392A186A80B9)] |
| Item 11 | [Executive [removed: Compensation](#sA4251D431D2C7A7A5EA2689FAD2D008B)] [added: Compensation](#s8E25388F82E7555FBCA29C5E3ABE7BAF)] | [removed: [85](#sA4251D431D2C7A7A5EA2689FAD2D008B)] [added: [92](#s8E25388F82E7555FBCA29C5E3ABE7BAF)] |
| Item 12 | [Security Ownership of Certain Beneficial Owners and Management and Related Stockholder [removed: Matters](#sB9CC3FEB63BF1C7610A8689FAD6B8888)] [added: Matters](#s7A70231796D054E2B2B8573AE5B56058)] | [removed: [85](#sB9CC3FEB63BF1C7610A8689FAD6B8888)] [added: [92](#s7A70231796D054E2B2B8573AE5B56058)] |
| Item 13 | [Certain Relationships and Related Transactions, and Director [removed: Independence](#s008E2C9C158E4556642C689FAD8022BC)] [added: Independence](#s3637A51BBA985CCD8C5E21025739A7EB)] | [removed: [85](#s008E2C9C158E4556642C689FAD8022BC)] [added: [92](#s3637A51BBA985CCD8C5E21025739A7EB)] |
| Item 14 | [Principal Accountant Fees and [removed: Services](#s26E5B82C62AE8686E31B689FADB268D9)] [added: Services](#sE514A20218B45A7F885E0012C30EE0EA)] | [removed: [85](#s26E5B82C62AE8686E31B689FADB268D9)] [added: [92](#sE514A20218B45A7F885E0012C30EE0EA)] |
| Item 15 | [Exhibits and Financial Statement [removed: Schedules](#s089B318868F33F828336689F8DA88A59)] [added: Schedules](#sB89A8C9B0BDB5BB69472B5576FAFEF89)] | [removed: [86](#s089B318868F33F828336689F8DA88A59)] [added: [93](#sB89A8C9B0BDB5BB69472B5576FAFEF89)] |
| • | the possibility that companies that we have acquired or may acquire, [removed: in our specialty business or otherwise,] [added: including NES Rentals Holdings II, Inc. (“NES”) and Neff Corporation ("Neff"),] could have undiscovered liabilities or involve other unexpected costs, may strain our management capabilities or may be difficult to integrate; |
| • | our significant indebtedness (which totaled [removed: $7.8] [added: $9.4] billion at December 31, [removed: 2016)] [added: 2017)] requires us to use a substantial portion of our cash flow for debt service and can constrain our flexibility in responding to unanticipated or adverse business conditions; |
| • | increases in our maintenance and replacement costs and/or decreases in the residual value of our equipment; [removed: and] |
Unless otherwise indicated, the information under Items 1, 1A and 2 is as of January 1, [removed: 2017.][added: 2018.]
10-K 1 uri-2017123110k.htm 10-K
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| Large Accelerated Filer | | þ | Accelerated Filer | | o |
| Emerging Growth Company | | o | | | |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
| • | the effect of changes in tax law, such as the effect of the Tax Cuts and Jobs Act that was enacted on December 22, 2017; and |
| | |
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10-K 1 uri-2016123110k.htm 10-K
(Check one):
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Item 2. Properties
24 rewritten, 0 added, 0 removed, 23 unchanged
As of January 1, [removed: 2017,] [added: 2018,] we operated [removed: 887] [added: 997] rental locations.
[removed: 769] [added: 874] of these locations are in the United States and [removed: 118] [added: 123] are in Canada.
| ● | Alabama (GR [removed: 19,] [added: 22,] TPP 5) | ● | Maine (GR [removed: 2)] [added: 4)] | ● | Ohio (GR [removed: 12,] [added: 15,] TPP 4) |
| ● | Alaska (GR 2) | ● | Maryland (GR [removed: 10,] [added: 11,] TPP 4) | ● | Oklahoma (GR [removed: 23,] [added: 20,] TPP 4) |
| ● | Arizona (GR [removed: 12,] [added: 14,] TPP 2) | ● | Massachusetts (GR [removed: 6,] [added: 9,] TPP [removed: 2)] [added: 3)] | ● | Oregon (GR [removed: 9,] [added: 10,] TPP 2) |
| ● | Arkansas (GR 11, TPP 1) | ● | Michigan (GR [removed: 4,] [added: 7,] TPP 2) | ● | Pennsylvania (GR [removed: 12,] [added: 14,] TPP 5) |
| ● | California (GR [removed: 61,] [added: 65,] TPP [removed: 18)] [added: 21)] | ● | Minnesota (GR 9, TPP 3) | ● | Rhode Island (GR [removed: 1)] [added: 2)] |
| ● | Colorado (GR [removed: 11,] [added: 12,] TPP 3) | ● | Mississippi (GR 12) | ● | South Carolina (GR [removed: 12,] [added: 17,] TPP 4) |
| ● | Connecticut (GR 6, TPP 2) | ● | Missouri (GR 12, TPP [removed: 3)] [added: 4)] | ● | South Dakota (GR 2) |
| ● | Delaware (GR 2, TPP 1) | ● | Montana (GR 1) | ● | Tennessee (GR [removed: 16,] [added: 20,] TPP [removed: 4)] [added: 6)] |
| ● | Florida (GR [removed: 25,] [added: 41,] TPP [removed: 12)] [added: 14)] | ● | Nebraska (GR [removed: 3,] [added: 2,] TPP 1) | ● | Texas (GR [removed: 95,] [added: 106,] TPP [removed: 26)] [added: 27)] |
| ● | Georgia (GR [removed: 22,] [added: 32,] TPP 5) | ● | Nevada (GR [removed: 4,] [added: 5,] TPP 3) | ● | Utah (GR [removed: 2,] [added: 3,] TPP 3) |
| ● | Idaho (GR 2) | ● | New Hampshire (GR 1, TPP 1) | ● | Vermont (GR [removed: 1)] [added: 2)] |
| ● | Illinois (GR 14, TPP 3) | ● | New Jersey (GR [removed: 8,] [added: 9,] TPP 4) | ● | Virginia (GR [removed: 18,] [added: 19,] TPP [removed: 5)] [added: 6)] |
| ● | Indiana (GR [removed: 8,] [added: 6,] TPP 1) | ● | New Mexico (GR 8) | ● | Washington (GR 18, TPP [removed: 5)] [added: 6)] |
| ● | Iowa (GR 9, TPP 1) | ● | New York (GR [removed: 16)] [added: 23)] | ● | West Virginia (GR 5) |
| ● | Kansas (GR 12) | ● | North Carolina (GR [removed: 20,] [added: 26,] TPP 6) | ● | Wisconsin (GR [removed: 8,] [added: 9,] TPP 1) |
| ● | Kentucky (GR [removed: 9)] [added: 10)] | ● | North Dakota (GR [removed: 6,] [added: 5,] TPP 2) | ● | Wyoming (GR [removed: 5)] [added: 4)] |
| ● | Louisiana (GR [removed: 25,] [added: 34,] TPP 10) | | | | |
| ● | Alberta (GR [removed: 22,] [added: 24,] TPP 9) | | | | |
| ● | Quebec (GR [removed: 5,] [added: 7,] TPP [removed: 1)] [added: 2)] | | | | |
We own [removed: 106] [added: 116] of our branch locations and lease the other branch locations.
We have a fleet of approximately [removed: 7,800] [added: 9,300] vehicles.
Approximately [removed: 50] [added: 43] percent of this fleet is leased and the balance is owned.
Item 5. Market For Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
4 rewritten, 9 added, 9 removed, 30 unchanged
As of January 1, [removed: 2017,] [added: 2018,] there were [removed: 72] [added: 69] holders of record of our common stock.
The following table provides information about acquisitions of Holdings’ common stock by Holdings during the fourth quarter of [removed: 2016:][added: 2017:]
| (1) | In October [removed: 2016,] [added: 2017,] November [removed: 2016] [added: 2017] and December [removed: 2016, 443, 153] [added: 2017, 1,042, 5,831] and [removed: 1,267] [added: 7,911] shares, respectively, were withheld by Holdings to satisfy tax withholding obligations upon the vesting of restricted stock unit awards. These shares were not acquired pursuant to any repurchase plan or program. |
| (2) | On July 21, 2015, our Board authorized a $1 billion share repurchase program. In October 2016, we paused repurchases under the program as we evaluated [removed: a number of] potential acquisition opportunities. As discussed in note [removed: 18] [added: 3] to the consolidated financial statements, [removed: on January 25, 2017,] we [removed: entered into a definitive merger agreement to acquire] [added: completed the acquisitions of] NES in [removed: an all cash transaction. We intend to complete] [added: April 2017 and Neff in October 2017. In October 2017, our Board authorized] the [added: resumption of the] share repurchase [removed: program; however,] [added: program, and] we [removed: will re-evaluate the decision] [added: intend] to [removed: do so as we integrate NES and assess other potential uses of capital.] [added: complete the program in 2018.] |
| 2017: | | | | | | | | |
| First Quarter | | $ | 134.28 | | | $ | 105.33 | |
| Second Quarter | | 126.77 | | | | 100.62 | | |
| Third Quarter | | 139.98 | | | | 106.52 | | |
| Fourth Quarter | | 174.40 | | | | 136.84 | | |
| October 1, 2017 to October 31, 2017 | 1,042 | | (1) | $ | 137.62 | | | — | | | — | | |
| November 1, 2017 to November 30, 2017 | 5,831 | | (1) | $ | 145.23 | | | — | | | — | | |
| December 1, 2017 to December 31, 2017 | 175,471 | | (1) | $ | 168.39 | | | 167,560 | | | — | | |
| Total | 182,344 | | | $ | 167.48 | | | 167,560 | | | $ | 344,701,141 | |
| 2015: | | | | | | | | |
| First Quarter | | $ | 103.85 | | | $ | 81.25 | |
| Second Quarter | | 105.83 | | | | 86.88 | | |
| Third Quarter | | 87.99 | | | | 56.66 | | |
| Fourth Quarter | | 80.18 | | | | 57.41 | | |
| October 1, 2016 to October 31, 2016 | 506,380 | | (1) | $ | 79.06 | | | 505,937 | | | — | | |
| November 1, 2016 to November 30, 2016 | 153 | | (1) | $ | 84.48 | | | — | | | — | | |
| December 1, 2016 to December 31, 2016 | 1,267 | | (1) | $ | 106.18 | | | — | | | — | | |
| Total | 507,800 | | | $ | 79.13 | | | 505,937 | | | $ | 372,997,032 | |
Item 6. Selected Financial Data
229 rewritten, 133 added, 97 removed, 434 unchanged
The following selected financial data reflects the results of operations and balance sheet data as of and for the years ended December 31, [removed: 2012] [added: 2013] to [removed: 2016.][added: 2017.]
[added: | • |] In April 2014, we acquired certain assets of the following entities: National Pump & Compressor, Ltd., Canadian Pump and Compressor Ltd., GulfCo Industrial Equipment, LP and LD Services, LLC (collectively “National Pump”). [added: National Pump had annual revenues of approximately $210; |]
| [removed: 2016] [added: 2017] | | | | [removed: 2015] [added: 2016] | | | | [removed: 2014] [added: 2015] | | | | [removed: 2013] [added: 2014] | | | | [removed: 2012] [added: 2013] | | | |
| Total revenues | $ | [removed: 5,762] [added: 6,641] | | | $ | [removed: 5,817] [added: 5,762] | | | $ | [removed: 5,685] [added: 5,817] | | | $ | [removed: 4,955] [added: 5,685] | | | $ | [removed: 4,117] [added: 4,955] | |
| Total cost of revenues | [removed: 3,359] [added: 3,872] | | | | [removed: 3,337] [added: 3,359] | | | | [removed: 3,253] [added: 3,337] | | | | [removed: 2,968] [added: 3,253] | | | | [removed: 2,530] [added: 2,968] | | |
| Gross profit | [removed: 2,403] [added: 2,769] | | | | [removed: 2,480] [added: 2,403] | | | | [removed: 2,432] [added: 2,480] | | | | [removed: 1,987] [added: 2,432] | | | | [removed: 1,587] [added: 1,987] | | |
| Selling, general and administrative expenses | [removed: 719] [added: 903] | | | | [removed: 714] [added: 719] | | | | [removed: 758] [added: 714] | | | | [removed: 642] [added: 758] | | | | [removed: 588] [added: 642] | | |
| Merger related costs | [added: 50 | | | |] — | | | | (26 | | ) | | 11 | | | | 9 | | | [removed: | 111 | | |]
| Restructuring charge | [added: 50 | | | |] 14 | | | | 6 | | | | (1 | | ) | | 12 | | | [removed: | 99 | | |]
| Non-rental depreciation and amortization | [removed: 255] [added: 259] | | | | [removed: 268] [added: 255] | | | | [removed: 273] [added: 268] | | | | [removed: 246] [added: 273] | | | | [removed: 198] [added: 246] | | |
| Operating income | [removed: 1,415] [added: 1,507] | | | | [removed: 1,518] [added: 1,415] | | | | [removed: 1,391] [added: 1,518] | | | | [removed: 1,078] [added: 1,391] | | | | [removed: 591] [added: 1,078] | | |
| Interest expense, net | [removed: 511] [added: 464] | | | | [removed: 567] [added: 511] | | | | [removed: 555] [added: 567] | | | | [removed: 475] [added: 555] | | | | [removed: 512] [added: 475] | | |
| Interest expense-subordinated convertible debentures | — | | | | — | | | | — | | | | [removed: 3] [added: —] | | | | [removed: 4] [added: 3] | | |
| Other income, net | (5 | | ) | | [removed: (12] [added: (5] | | ) | | [removed: (14] [added: (12] | | ) | | [removed: (5] [added: (14] | | ) | | [removed: (13] [added: (5] | | ) |
| Income before [added: (benefit)] provision for income taxes | [removed: 909] [added: 1,048] | | | | [removed: 963] [added: 909] | | | | [removed: 850] [added: 963] | | | | [removed: 605] [added: 850] | | | | [removed: 88] [added: 605] | | |
| [removed: Provision] [added: (Benefit) provision] for income taxes [added: (1)] | [removed: 343] [added: (298] | | [added: )] | | [removed: 378] [added: 343] | | | | [removed: 310] [added: 378] | | | | [removed: 218] [added: 310] | | | | [removed: 13] [added: 218] | | |
| Net income [added: (1)] | [removed: 566] [added: 1,346] | | | | [removed: 585] [added: 566] | | | | [removed: 540] [added: 585] | | | | [removed: 387] [added: 540] | | | | [removed: 75] [added: 387] | | |
| Basic earnings per share [added: (1)] | $ | [removed: 6.49] [added: 15.91] | | | $ | [removed: 6.14] [added: 6.49] | | | $ | [removed: 5.54] [added: 6.14] | | | $ | [removed: 4.14] [added: 5.54] | | | $ | [removed: 0.91] [added: 4.14] | |
| Diluted earnings per share [added: (1)] | $ | [removed: 6.45] [added: 15.73] | | | $ | [removed: 6.07] [added: 6.45] | | | $ | [removed: 5.15] [added: 6.07] | | | $ | [removed: 3.64] [added: 5.15] | | | $ | [removed: 0.79] [added: 3.64] | |
| | [removed: 2016] [added: 2017] | | | | [removed: 2015] [added: 2016] | | | | [removed: 2014] [added: 2015] | | | | [removed: 2013] [added: 2014] | | | | [removed: 2012] [added: 2013] | | |
| Total assets | $ | [removed: 11,988] [added: 15,030] | | | $ | [removed: 12,083] [added: 11,988] | | | $ | [removed: 12,129] [added: 12,083] | | | $ | [removed: 10,876] [added: 12,129] | | | $ | [removed: 10,648] [added: 10,876] | |
| Total debt | [removed: 7,790] [added: 9,440] | | | | [removed: 8,162] [added: 7,790] | | | | [removed: 7,962] [added: 8,162] | | | | [removed: 7,078] [added: 7,962] | | | | [removed: 7,196] [added: 7,078] | | |
| Stockholders’ equity | [removed: 1,648] [added: 3,106] | | | | [removed: 1,476] [added: 1,648] | | | | [removed: 1,796] [added: 1,476] | | | | [removed: 1,828] [added: 1,796] | | | | [removed: 1,543] [added: 1,828] | | |
Our customer service network consists of [removed: 887] [added: 997] rental locations in the United States and Canada as well as centralized call centers and online capabilities.
These include a fleet of rental equipment with a total original equipment cost (“OEC”), based on the initial consideration paid, of [removed: $9.0] [added: $11.5] billion, and a national branch network that operates in 49 U.S. states and every Canadian province, and serves 99 of the 100 largest metropolitan areas in the United States.
We offer approximately [removed: 3,200] [added: 3,400] classes of equipment for rent to construction and industrial companies, manufacturers, utilities, municipalities, homeowners, government entities and other customers.
In [removed: 2016,] [added: 2017,] equipment rental revenues represented 86 percent of our total revenues.
In [removed: 2017,] [added: 2018,] we expect to continue our disciplined focus on increasing our profitability and return on invested capital.
| • | A continued focus on “Lean” management techniques, including kaizen processes focused on continuous improvement. [removed: As of December 31, 2016, we have trained over 3,100 employees, over 70 percent of our district managers and over 60 percent of our branch managers on the Lean kaizen process.] We continue to implement [removed: this program] [added: Lean kaizen processes] across our branch network, with the objectives of: reducing the cycle time associated with renting our equipment to customers; improving invoice accuracy and service quality; reducing the elapsed time for equipment pickup and delivery; and improving the effectiveness and efficiency of our repair and maintenance operations. [removed: As discussed in note 4 to our consolidated financial statements, in the fourth quarter of 2015, we initiated a restructuring program focused on cost savings throughout the organization partially due to the Lean initiatives not fully generating the anticipated cost savings due to lower than expected rental volume in 2015.] We [removed: closed this restructuring program in the fourth quarter of 2016. We] achieved the anticipated run rate savings from the Lean [removed: initiatives] [added: initiatives, including those included] in [removed: 2016] [added: the Project XL work streams discussed below, in 2017] and [added: 2016, and] expect to continue to generate savings from these initiatives; |
| • | The implementation of Project XL, which is a set of eight specific work streams focused on driving profitable growth through revenue opportunities and generating incremental profitability through cost savings across our business; [removed: and] |
| • | The continued expansion of our trench, power and pump footprint, as well as our tools offering, and the cross-selling of these services throughout our network. We plan to open at least [removed: 17] [added: 18] specialty rental branches/tool hubs in [removed: 2017] [added: 2018] and continue to invest in specialty rental fleet to further position United Rentals as a single source provider of total jobsite solutions through our extensive product and service resources and technology [removed: offerings.] [added: offerings; and] |
In [removed: 2017,] [added: 2018,] based on our analyses of industry forecasts and macroeconomic indicators, we expect that the majority of our end markets will continue to experience solid demand for equipment rental services.
Specifically, we expect that North American industry equipment rental revenue will increase approximately 4 percent, with [removed: similar] [added: slightly higher] growth, on a constant currency basis, [removed: expected] in [removed: both] the U.S. [removed: and] [added: than] Canada.
For the full year [removed: 2016:][added: 2017:]
| [removed: • | Rental] [added: Year-over-year decrease in rental] rates [removed: decreased 2.2 percent year-over-year;] [added: (1)] | [added: | | | | | | | | | | | | (0.2)% | | (2.2)% |]
| • | The volume of OEC on rent increased [removed: 3.1] [added: 18.2] percent [removed: year-over-year;] [added: and 7.1 percent year-over-year, on an actual and a pro forma basis, respectively;] |
| • | [removed: 70] [added: 69] percent of equipment rental revenue was derived from key accounts, as compared to [removed: 64 percent in 2015. The increase in the key account] [added: 70] percent [removed: of equipment rental revenue primarily reflects additional customers that were designated as key accounts] in 2016. [removed: If the list of customers designated as key accounts as of December 31, 2016 was applied to 2015, the key account percent of equipment rental revenue would have increased slightly from 2015.] Key accounts are each managed by a single point of contact to enhance customer service; and |
| • | The number of rental locations in our higher margin trench, power and pump (also referred to as "specialty") segment increased by [removed: eight year-over-year, after the addition of 14] [added: thirteen year-over-year due to] cold starts. |
In [removed: 2016] [added: 2017] and [removed: 2015,] [added: 2016,] we took a number of positive actions related to our capital structure that have significantly improved our financial flexibility and liquidity, including:
| • | Redeemed all of our [removed: 5 3/4] [added: 8 1/4] percent Senior [removed: Secured] Notes, [removed: 8 3/8] [added: 7 5/8] percent Senior [removed: Subordinated] Notes, [removed: 8 1/4] [added: 7 3/8] percent Senior Notes and [removed: 7 3/8] [added: 6 1/8] percent Senior Notes; |
The following acquired companies are reflected in our results of operations for all periods subsequent to the noted acquisition dates:
| • | In April 2017, we completed the acquisition of NES Rentals Holdings II, Inc. (“NES”). NES had annual revenues of approximately $369; and |
| • | In October 2017, we completed the acquisition of Neff Corporation ("Neff"). Neff had annual revenues of approximately $413. |
See note 3 to the consolidated financial statements for additional detail on the NES and Neff acquisitions.
(1)2017 includes the significant impact of the enactment of the Tax Cuts and Jobs Act discussed further in note 13 to the consolidated financial statements.
| • | The pursuit of strategic acquisitions to continue to expand our core equipment rental business, as exhibited by our recently completed acquisitions of NES and Neff. Strategic acquisitions allow us to invest our capital to expand our business, further driving our ability to accomplish our strategic goals. |
As discussed above, we completed the acquisitions of NES and Neff in April 2017 and October 2017, respectively.
The pro forma metrics below include the standalone, pre-acquisition results of NES and Neff.
| • | Rental rates decreased 0.2 percent and increased 0.4 percent year-over-year, on an actual and a pro forma basis, respectively; |
| • | Time utilization was 69.5 percent and 69.1 percent on an actual and a pro forma basis, respectively, reflecting increases of 160 basis points and 150 basis points year-over-year, respectively. Time utilization was a full-year record on both an actual and a pro forma basis; |
| • | Issued $1.675 billion principal amount of 4 7/8 percent Senior Notes due 2028, comprised of separate and distinct issuances of $925 in August 2017 and $750 in September 2017; |
Net income and diluted earnings per share for the year ended December 31, 2017 include a substantial benefit associated with the enactment of the Tax Cuts and Jobs Act (the "Act").
The enactment of the Act resulted in an estimated net income increase of $689, or $8.05 per diluted share, primarily due to a one-time revaluation of our net deferred tax liability based on a U.S. federal tax rate of 21 percent, which was partially offset by the impact of a one-time transition tax on our unremitted foreign earnings and profits, which we will elect to pay over an eight-year period.
We expect to meaningfully benefit from the Act in future periods, primarily due to the impact of the lower U.S. federal tax rate.
The EBITDA and adjusted EBITDA margins represent EBITDA or adjusted EBITDA divided by total revenue.
| Net income | $ | 1,346 | | | $ | 566 | | | $ | 585 | |
| EBITDA | 2,895 | | | | 2,665 | | | | 2,774 | | |
| Merger related costs (1) | 50 | | | | — | | | | (26 | | ) |
| Restructuring charge (2) | 50 | | | | 14 | | | | 6 | | |
| Stock compensation expense, net (3) | 87 | | | | 45 | | | | 49 | | |
| Impact of the fair value mark-up of acquired fleet (4) | 82 | | | | 35 | | | | 29 | | |
| Adjusted EBITDA | $ | 3,164 | | | $ | 2,759 | | | $ | 2,832 | |
| (1) | This reflects transaction costs associated with the NES and Neff acquisitions discussed in note 3 to the consolidated financial statements, and the April 2014 National Pump acquisition. The income for the year ended December 31, 2015 reflects a decline in the fair value of the contingent cash consideration component of the National Pump purchase price. Merger related costs only include costs associated with major acquisitions that significantly impact our operations. For additional information, see "Results of Operations-Other costs/(income)-merger related costs" below. |
| (4) | This reflects additional costs recorded in cost of rental equipment sales associated with the fair value mark-up of rental equipment acquired in the RSC, NES and Neff acquisitions that was subsequently sold. |
The EBITDA increase primarily reflects increased profit from equipment rentals, partially offset by i) increased selling, general and administrative ("SG&A") compensation costs, including stock compensation costs, largely due to the impact of the NES and Neff acquisitions, increased revenue, improved profitability, and increases in our stock price and in the volume of stock awards, and ii) increased merger related costs and restructuring charges associated with the NES and Neff acquisitions.
The adjusted EBITDA increase primarily reflects increased profit from equipment rentals and sales of rental equipment, partially offset by increased SG&A compensation costs, largely due to the impact of the NES and Neff acquisitions, increased revenue and improved profitability.
The decrease in the EBITDA margin primarily reflects i) increased SG&A compensation costs, including stock compensation costs, largely due to the impact of the NES and Neff acquisitions, increased revenue, improved profitability, and increases in our stock price and in the volume of stock awards, and ii) increased merger related costs and restructuring charges associated with the NES and Neff acquisitions.
The decrease in the adjusted EBITDA margin primarily reflects increased SG&A compensation costs largely due to the impact of the NES and Neff acquisitions, increased revenue and improved profitability, partially offset by increased profit from sales of rental equipment.
| | 2017 | | | | 2016 | | | | 2015 | | | | 2017 | | 2016 |
| *Pro forma equipment rentals information (3): | | | | | | | | | | | | | | | |
| Equipment rentals variance | | | | | | | | | | | | | 7.6% | | |
| Year-over-year increase in the volume of equipment on rent | | | | | | | | | | | | | 7.1% | | |
| Time utilization (2) | 69.1 | | % | | 67.6 | | % | | | | | | 150 bps | | |
| (3) | As discussed in note 3 to the consolidated financial statements, we completed the acquisitions of NES and Neff in April 2017 and October 2017, respectively. The pro forma information includes the standalone, pre-acquisition results of NES and Neff. |
See note 2 to our consolidated financial statements for further discussion of our revenue recognition accounting.
On a pro forma basis including the standalone, pre-acquisition results of NES and Neff, 2017 total revenues increased 7.7 percent.
On the pro forma basis including the standalone, pre-acquisition results of NES and Neff, equipment rental revenue increased 7.6 percent year-over-year, primarily reflecting a 7.1 percent increase in the volume of OEC on rent and a 0.4 percent rental rate increase.
We believe that the increase in the volume of OEC on rent reflects improving demand in many of our core markets.
Sales of rental equipment increased 10.9 percent primarily due to increased volume.
Sales of new equipment increased 23.6 percent primarily due to increased volume and increased sales of larger equipment.
On April 30, 2012, we acquired RSC Holdings Inc. ("RSC").
RSC has been included in our results of operations since that date.
RSC was one of the largest equipment rental providers in North America and had total revenue of $1.5 billion for 2011.
National Pump had annual revenues of approximately $210.
The results of National Pump's operations have been included in our consolidated financial statements since the acquisition date.
National Pump was the second largest specialty pump rental company in North America, and was a leading supplier of pumps for energy and petrochemical customers.
| Subordinated convertible debentures | — | | | | — | | | | — | | | | — | | | | 55 | | |
| • | Time utilization was 67.9 percent, an increase of 60 basis points year-over-year; |
| • | Issued $750 principal amount of 5 1/2 percent Senior Notes due 2027; |
The EBITDA increase primarily reflects increased profit from equipment rentals, decreased selling, general and administrative expense and reduced merger costs associated with a decline in the fair value of the contingent cash consideration component of the National Pump purchase price due to lower than expected financial performance compared to agreed upon financial targets.
The adjusted EBITDA increase primarily reflects increased profit from equipment rentals.
The increase in the EBITDA margin primarily reflects increased margins from equipment rentals, improved selling, general and administrative leverage, and reduced merger costs.
The increase in the adjusted EBITDA margin primarily reflects increased margins from equipment rentals and improved selling, general and administrative leverage.
Customers have the option of purchasing a damage waiver when they rent our equipment to protect against potential loss or damage; we refer to the fee we charge for the waiver as Rental Protection Plan (or "RPP") revenue.
RPP revenue, which represented about two percent of equipment rental revenue in 2016, is recognized ratably over the contract term.
Fees related to the consumption of fuel by our customers are recognized when the equipment is returned by the customer (and consumption, if any, can be measured).
As discussed above, in April 2014, we acquired National Pump, and the results of National Pump's operations have been included in our consolidated financial statements since the acquisition date.
Excluding the adverse impact from currency, rental revenue would have increased 4.3 percent year-over-year.
RPP revenue is recognized ratably over the contract term.
Changes in assumptions or estimates could
In connection with this impairment testing, we generally utilized discount rates of 10.0 percent for our general rentals segment, and Trench Safety and Power and HVAC reporting units, and 13.5 percent for our Pump Solutions reporting unit, as well as a long-term terminal growth rate for all reporting units of 3.0 percent beyond our planning period.
Most of the assets in the Pump Solutions reporting unit were acquired in the April 2014 National Pump acquisition discussed above.
Based on the October 1, 2015 test, the Pump Solutions reporting unit’s estimated fair value exceeded its carrying amount by 3.3 percent.
In light of continuing pressures on the Pump Solutions reporting unit related primarily to upstream oil and gas customers, we continued to monitor the Pump Solutions reporting unit for impairment through the end of 2015, and performed another impairment test as of November 30, 2015.
As of the November 30, 2015 testing date, the estimated fair value of the Pump Solutions reporting unit exceeded its carrying amount by 1 percent.
No additional impairment indicators were noted as of December 31, 2015.
Specifically, we performed the sensitivity analysis by: (i) increasing the discount rate by 50 basis points and (ii) reducing the long-term growth rate by 25 basis points.
The Pump Solutions reporting unit failed step one of the goodwill impairment test under the sensitivity test, and would have required step two testing to determine potential goodwill impairment.
We continued to monitor the Pump Solutions reporting unit for impairment following the November 30, 2015 test.
For the goodwill impairment test that was conducted as of October 1, 2016 for our Pump Solutions reporting unit, we utilized a discount rate of 14.0 percent and a long-term terminal growth rate of 3.0 percent beyond our planning period.
The improvement in the margin by which the Pump Solutions reporting unit’s estimated fair value exceeded its carrying amount in the October 1, 2016 test as compared to the November 30, 2015 test primarily reflects (i) a reduction in the Pump Solutions reporting unit’s carrying value primarily due to the depreciation and amortization of its assets, as well as a reduction in its working capital and (ii) improvement in the Pump Solutions reporting unit’s revenue mix in its long term forecast largely due to having a smaller portion of revenue attributable to upstream oil and gas customers, which have experienced significant
volatility in recent years, and a larger portion of revenue attributable to downstream oil and gas, construction, municipality and mining customers.
We also performed a sensitivity analysis related to the discount rate and long-term growth rate used in the October 1, 2016 test by: (i) increasing the discount rate by 50 basis points and (ii) reducing the long-term growth rate by 25 basis points.
The October 1, 2016 impairment test assumed earnings growth for the Pump Solutions reporting unit over the next 10 years.
Should this growth not occur, if the reporting unit otherwise fails to meet its current financial plans, or if there were changes to any other key assumption used in the test, the Pump Solutions reporting unit could fail step one of the goodwill impairment test in a future period.
As of December 31, 2016, there was $312 of goodwill in the Pump Solutions reporting unit.
We will continue to monitor the Pump Solutions reporting unit for impairment.
| Equipment rentals | $ | 4,222 | | | $ | 597 | | | $ | 4,819 | |
| Total revenue | $ | 5,002 | | | $ | 683 | | | $ | 5,685 | |
2015 equipment rentals of $4.9 billion increased $0.1 billion, or 2.7 percent, as compared to 2014.
An excerpt. Shown here: 40 of 229 rewritten, 40 of 133 added and 40 of 97 removed. The counts are complete. For every sentence, read Item 6. Selected Financial Data in the FY2017 filing and the FY2016 filing.
Item 8. Financial Statements and Supplementary Data
484 rewritten, 413 added, 168 removed, 874 unchanged
[removed: The] [added: To the Stockholders and the] Board of Directors [removed: and Stockholders] of United Rentals, Inc.
We have audited the accompanying consolidated balance sheets of United [removed: Rentals,] [added: Rentals] Inc. [added: (“the Company”)] as of December 31, [removed: 2016] [added: 2017] and [removed: 2015,] [added: 2016,] and the related consolidated statements of income, comprehensive income, stockholders' equity and cash flows for each of the three years in the period ended December 31, [removed: 2016.][added: 2017, and the related notes and the financial statement schedule listed in the Index at Item 15(a) (collectively referred to as the “financial statements”).]
These financial statements [removed: and schedule] are the responsibility of the [removed: Company's] [added: Company’s] management.
Our responsibility is to express an opinion on [removed: these] [added: the Company’s] financial statements [removed: and schedule] based on our audits.
Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material [removed: misstatement.][added: misstatement, whether due to error or fraud.]
[removed: An audit includes] [added: Such procedures included] examining, on a test basis, evidence [removed: supporting] [added: regarding] the amounts and disclosures in the financial statements.
[removed: An audit] [added: Our audits] also [removed: includes assessing] [added: included evaluating] the accounting principles used and significant estimates made by management, as well as evaluating the overall [added: presentation of the] financial [removed: statement presentation.][added: statements.]
In our opinion, the financial statements referred to above present fairly, in all material respects, the consolidated financial position of [removed: United Rentals, Inc.] [added: the Company] at December 31, [removed: 2016] [added: 2017] and [removed: 2015,] [added: 2016,] and the consolidated results of its operations and its cash flows for each of the three years in the period ended December 31, [removed: 2016,] [added: 2017,] in conformity with U.S. generally accepted accounting principles.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United [removed: States), United Rentals, Inc.’s] [added: States) (PCAOB), the Company’s] internal control over financial reporting as of December 31, [removed: 2016,] [added: 2017,] based on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 [removed: framework),] [added: framework)] and our report dated January [removed: 25, 2017] [added: 24, 2018] expressed an unqualified opinion thereon.
| | [added: 2017 | | | |] 2016 | | | | 2015 | | |
| Cash and cash equivalents | $ | [removed: 312] [added: 352] | | | $ | [removed: 179] [added: 312] | |
| Accounts receivable, net of allowance for doubtful accounts of [removed: $54] [added: $68] at December 31, [removed: 2016] [added: 2017] and [removed: $55] [added: $54] at December 31, [removed: 2015] [added: 2016] | [removed: 920] [added: 1,233] | | | | [removed: 930] [added: 920] | | |
| Inventory | [removed: 68] [added: 75] | | | | [removed: 69] [added: 68] | | |
| Prepaid expenses and other assets | [removed: 61] [added: 112] | | | | [removed: 116] [added: 61] | | |
| Total current assets | [removed: 1,361] [added: 1,772] | | | | [removed: 1,294] [added: 1,361] | | |
| Rental equipment, net | [removed: 6,189] [added: 7,824] | | | | [removed: 6,186] [added: 6,189] | | |
| Property and equipment, net | [removed: 430] [added: 467] | | | | [removed: 445] [added: 430] | | |
| Goodwill | [removed: 3,260] [added: 4,082] | | | | [removed: 3,243] [added: 3,260] | | |
| Other intangible assets, net | [removed: 742] [added: 875] | | | | [removed: 905] [added: 742] | | |
| Other long-term assets | [removed: 6] [added: 10] | | | | [removed: 10] [added: 6] | | |
| Total assets | $ | [removed: 11,988] [added: 15,030] | | | $ | [removed: 12,083] [added: 11,988] | |
| Short-term debt and current maturities of long-term debt | $ | [removed: 597] [added: 723] | | | $ | [removed: 607] [added: 597] | |
| Accounts payable | [removed: 243] [added: 409] | | | | [removed: 271] [added: 243] | | |
| Accrued expenses and other liabilities | [removed: 344] [added: 536] | | | | [removed: 355] [added: 344] | | |
| Total current liabilities | [removed: 1,184] [added: 1,668] | | | | [removed: 1,233] [added: 1,184] | | |
| Long-term debt | [removed: 7,193] [added: 8,717] | | | | [removed: 7,555] [added: 7,193] | | |
| Deferred taxes | [removed: 1,896] [added: 1,419] | | | | [removed: 1,765] [added: 1,896] | | |
| Other long-term liabilities | [removed: 67 | | | | 54] [added: (5] | | [added: )] |
| Total liabilities | [removed: 10,340] [added: 11,924] | | | | [removed: 10,607] [added: 10,340] | | |
| Common stock—$0.01 par value, 500,000,000 shares authorized, [removed: 111,985,215] [added: 112,394,395] and [removed: 84,222,042] [added: 84,463,662] shares issued and outstanding, respectively, at December 31, [removed: 2016] [added: 2017] and [removed: 111,586,585] [added: 111,985,215] and [removed: 91,776,436] [added: 84,222,042] shares issued and outstanding, respectively, at December 31, [removed: 2015] [added: 2016] | 1 | | | | 1 | | |
| Additional paid-in capital | [removed: 2,288] [added: 2,356] | | | | [removed: 2,197] [added: 2,288] | | |
| Retained earnings | [removed: 1,654] [added: 3,005] | | | | [removed: 1,088] [added: 1,654] | | |
| Treasury stock at [removed: cost—27,763,173] [added: cost—27,930,733] and [removed: 19,810,149] [added: 27,763,173] shares at December 31, [removed: 2016] [added: 2017] and December 31, [removed: 2015,] [added: 2016,] respectively | [removed: (2,077] [added: (2,105] | | ) | | [removed: (1,560] [added: (2,077] | | ) |
| Accumulated other comprehensive loss | [removed: (218] [added: (151] | | ) | | [removed: (250] [added: (218] | | ) |
| Total stockholders’ equity | [removed: 1,648] [added: 3,106] | | | | [removed: 1,476] [added: 1,648] | | |
| Total liabilities and stockholders’ equity | $ | [removed: 11,988] [added: 15,030] | | | $ | [removed: 12,083] [added: 11,988] | |
| | [removed: 2016] [added: 2017] | | | | [removed: 2015] [added: 2016] | | | | [removed: 2014] [added: 2015] | | |
| Equipment rentals | $ | [removed: 4,941] [added: 5,715] | | | $ | [removed: 4,949] [added: 4,941] | | | $ | [removed: 4,819] [added: 4,949] | |
| Sales of rental equipment | [removed: 496] [added: 550] | | | | [removed: 538] [added: 496] | | | | [removed: 544] [added: 538] | | |
| Sales of new equipment | [removed: 144] [added: 178] | | | | [removed: 157] [added: 144] | | | | [removed: 149] [added: 157] | | |
Opinion on the Financial Statements
Basis of Opinion
We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audit in accordance with the standards of the PCAOB.
Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks.
We have served as the Company’s auditor since 1997.
| Net income | $ | 1,346 | | | $ | 566 | | | $ | 585 | |
| Balance at December 31, 2016 | 84 | | | $ | 1 | | | $ | 2,288 | | | $ | 1,654 | | | 28 | | | $ | (2,077 | ) | | $ | (218 | ) |
| Neff acquisition (note 3) | — | | | | | | | 7 | | | | | | | | | | | | | | | | | |
| Cumulative effect of a change in accounting for share-based payments (note 2) | | | | | | | | | | | | 5 | | | | | | | | | | | | | |
| Balance at December 31, 2017 | 84 | | | $ | 1 | | | $ | 2,356 | | | $ | 3,005 | | | 28 | | | $ | (2,105 | ) | | $ | (151 | ) |
(2)Includes net stock compensation expense as reported as a separate component in our consolidated statements of cash flows, and net stock compensation expense included in “Restructuring charge” as reported in our consolidated statements of cash flows.
| Net income | $ | 1,346 | | | $ | 566 | | | $ | 585 | |
During the years ended December 31, 2017, 2016 and 2015, we recognized expenses of $40, $24 and $32, respectively, within selling, general and administrative expenses in our consolidated statements of income, associated with our allowances for doubtful accounts.
Rental equipment is valued utilizing either a cost, market or income approach, or a combination of certain of these methods, depending on the asset being valued and the availability of market or income data.
As discussed below (see "New Accounting Pronouncements-Simplifying the Test for Goodwill Impairment"), we expect to adopt accounting guidance that eliminates the second step from the goodwill impairment test when it becomes effective (for annual or interim goodwill impairment tests in fiscal years beginning after December 15, 2019).
We continue to monitor the Pump Solutions reporting unit for impairment, and the Pump Solution reporting unit’s operating results improved significantly in 2017, as evidenced in its fair value exceeding its carrying value by 62 percent in the goodwill impairment test that was conducted as of October 1, 2017.
As discussed below (see "New Accounting Pronouncements-Revenue from Contracts with Customers"), we expect to adopt updated FASB revenue recognition guidance ("Topic 606") on January 1, 2018.
Topic 606 is an update to Topic 605, which was the revenue recognition standard in effect for each of the three years in the period ended December 31, 2017.
For each of the three years in the period ended December 31, 2017, we recognized revenue in accordance with two different accounting standards: 1) Topic 605 and 2) Topic 840, which is the lease standard.
The table below reflects our revenue disaggregated by type and by the accounting standard used to determine the accounting.
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | Topic 840 | | | | Topic 605 | | | | Total | | | | Topic 840 | | | | Topic 605 | | | | Total | | | | Topic 840 | | | | Topic 605 | | | | Total | | |
| Revenues: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Owned equipment rentals | $ | 4,928 | | | $ | — | | | $ | 4,928 | | | $ | 4,273 | | | $ | — | | | $ | 4,273 | | | $ | 4,288 | | | $ | — | | | $ | 4,288 | |
| Re-rent revenue | 106 | | | | — | | | | 106 | | | | 93 | | | | — | | | | 93 | | | | 89 | | | | — | | | | 89 | | |
| Ancillary and other rental revenues: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Delivery and pick-up | — | | | | 389 | | | | 389 | | | | — | | | | 340 | | | | 340 | | | | — | | | | 337 | | | | 337 | | |
| Other | 228 | | | | 64 | | | | 292 | | | | 186 | | | | 49 | | | | 235 | | | | 187 | | | | 48 | | | | 235 | | |
| Total ancillary and other rental revenues | 228 | | | | 453 | | | | 681 | | | | 186 | | | | 389 | | | | 575 | | | | 187 | | | | 385 | | | | 572 | | |
| Total equipment rentals | 5,262 | | | | 453 | | | | 5,715 | | | | 4,552 | | | | 389 | | | | 4,941 | | | | 4,564 | | | | 385 | | | | 4,949 | | |
| Sales of rental equipment | — | | | | 550 | | | | 550 | | | | — | | | | 496 | | | | 496 | | | | — | | | | 538 | | | | 538 | | |
| Sales of new equipment | — | | | | 178 | | | | 178 | | | | — | | | | 144 | | | | 144 | | | | — | | | | 157 | | | | 157 | | |
| Total revenues | $ | 5,262 | | | $ | 1,379 | | | $ | 6,641 | | | $ | 4,552 | | | $ | 1,210 | | | $ | 5,762 | | | $ | 4,564 | | | $ | 1,253 | | | $ | 5,817 | |
Topic 840 revenues
The accounting for the types of revenue that are accounted for under Topic 840 is discussed below.
As discussed below (see "New Accounting Pronouncements-Leases"), we expect to adopt Topic 842, which is an update to Topic 840, on January 1, 2019.
While our review of the revenue accounting under Topic 842 is ongoing, we have tentatively concluded that no significant changes are expected to our revenue accounting upon adoption of Topic 842.
Our audits also included the financial statement schedule listed in the Index at Item 15(a).
We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States).
Also, in our opinion, the related financial statement schedule, when considered in relation to the basic financial statements taken as a whole, presents fairly in all material respects the information set forth therein.
January 25, 2017
| | | | | | | | |
| --- | --- | --- | --- | --- | --- | --- | --- |
| Balance at January 1, 2014 | 93 | | | $ | 1 | | | $ | 2,054 | | | $ | (37 | ) | | 5 | | | $ | (209 | ) | | $ | 19 | |
| Fixed price diesel swaps | | | | | | | | | | | | | | | | | | | | | | | (3 | | ) |
(1)Primarily reflects amortization of the original issue discount on our 4 percent Convertible Senior Notes and cash received from the option counterparties to our convertible note hedges associated with conversions of a portion of our 4 percent Convertible Senior Notes.
The 4 percent Convertible Senior Notes matured in 2015.
In April 2014, we completed the acquisition of the following entities: National Pump & Compressor, Ltd., Canadian Pump and Compressor Ltd., GulfCo Industrial Equipment, LP and LD Services, LLC (collectively “National Pump”).
Most of the assets in the Pump Solutions reporting unit were acquired in the National Pump acquisition.
Based on the October 1, 2015 test, the Pump Solutions reporting unit’s estimated fair value exceeded its carrying amount by 3.3 percent.
In light of continuing pressures on the Pump Solutions reporting unit related primarily to upstream oil and gas customers, we continued to monitor the Pump Solutions reporting unit for impairment through the end of 2015, and performed another impairment test as of November 30, 2015.
As of the November 30, 2015 testing date, the estimated fair value of the Pump Solutions reporting unit exceeded its carrying amount by 1 percent.
No additional impairment indicators were noted as of December 31, 2015.
Specifically, we performed the sensitivity analysis by: (i) increasing the discount rate by 50 basis points and (ii) reducing the long-term growth rate by 25 basis points.
The Pump Solutions reporting unit failed step one of the goodwill impairment test under the sensitivity test, and would have required step two testing to determine potential goodwill impairment.
We continued to monitor the Pump Solutions reporting unit for impairment following the November 30, 2015 test.
For the goodwill impairment test that was conducted as of October 1, 2016 for our Pump Solutions reporting unit, we utilized a discount rate of 14.0 percent and a long-term terminal growth rate of 3.0 percent beyond our planning period.
The improvement in the margin by which the Pump Solutions reporting unit’s estimated fair value exceeded its carrying amount in the October 1, 2016 test as compared to the November 30, 2015 test primarily reflects (i) a reduction in the Pump Solutions reporting unit’s carrying value primarily due to the depreciation and amortization of its assets, as well as a reduction in its working capital and (ii) improvement in the Pump Solutions reporting unit’s revenue mix in its long term forecast largely due to having a smaller portion of revenue attributable to upstream oil and gas customers, which have experienced significant volatility in recent years, and a larger portion of revenue attributable to downstream oil and gas, construction, municipality and mining customers.
We also performed a sensitivity analysis related to the discount rate and long-term growth rate used in the October 1, 2016 test by: (i) increasing the discount rate by 50 basis points and (ii) reducing the long-term growth rate by 25 basis points.
The October 1, 2016 impairment test assumed earnings growth for the Pump Solutions reporting unit over the next 10 years.
Should this growth not occur, if the reporting unit otherwise fails to meet its current financial plans, or if there were changes to any other key assumption used in the test, the Pump Solutions reporting unit could fail step one of the goodwill impairment test in a future period.
As of December 31, 2016, there was $312 of goodwill in the Pump Solutions reporting unit.
We will continue to monitor the Pump Solutions reporting unit for impairment.
The trade names and associated trademarks are being amortized using the sum of the years' digits method over an initial period of 5 years.
Equipment rentals include our revenues from renting equipment, as well as revenue related to the fees we charge customers: for equipment delivery and pick-up; to protect the customer against liability for damage to our equipment while on rent; and for fuel.
Customers have the option of
RPP revenue is recognized ratably over the contract term.
Sales of contractor supplies are also recognized at the time of delivery to, or pick-up by, the customer.
contingencies (including legal contingencies) and the fair values of financial instruments.
We classify cash flows from tax benefits resulting from tax deductions in excess of the compensation cost recognized for stock-based awards (“excess tax benefits”) as financing cash flows.
The accounting applied by lessors under Topic 842 is largely unchanged from previous GAAP.
periods beginning after December 15, 2017, and early adoption is permitted.
The presentation of insurance proceeds received for damage to our equipment is the primary item that we expect to change as a result of this guidance.
For the year ended December 31, 2016, $12 of insurance proceeds received for damage to equipment was included in operating activities on our consolidated statements of cash flows.
Under the new guidance, these proceeds would be included in investing activities on our consolidated statements of cash flows.
Different components of the guidance require modified retrospective and/or prospective adoption.
| 2014 | | | | | | | | | | | |
An excerpt. Shown here: 40 of 484 rewritten, 40 of 413 added and 40 of 168 removed. The counts are complete. For every sentence, read Item 8. Financial Statements and Supplementary Data in the FY2017 filing and the FY2016 filing.
Item 9A. Controls and Procedures
11 rewritten, 5 added, 1 removed, 25 unchanged
The Company’s management carried out an evaluation, under the supervision and with participation of our Chief Executive Officer and Chief Financial Officer, of the effectiveness of our disclosure controls and procedures, as defined in Rules 13a–15(e) and 15d–15(e) of the Exchange Act, as of December 31, [removed: 2016.][added: 2017.]
Based on the evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that the Company’s disclosure controls and procedures were effective as of December 31, [removed: 2016.][added: 2017.]
Under the supervision of our Chief Executive Officer and Chief Financial Officer, our management assessed the effectiveness of the Company’s internal control over financial reporting as of December 31, [removed: 2016.][added: 2017.]
Based on this assessment, our management has concluded that the Company’s internal control over financial reporting was effective as of December 31, [removed: 2016.][added: 2017.]
[removed: The] [added: To Stockholders and the] Board of Directors [removed: and Stockholders] of United Rentals, Inc.
We have audited United [removed: Rentals, Inc.] [added: Rentals Inc.’s] internal control over financial reporting as of December 31, [removed: 2016,] [added: 2017,] based on [added: the] criteria established in Internal [removed: Control-Integrated] [added: Control - Integrated] Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 [removed: framework),] [added: framework)] (the COSO criteria).
[removed: United Rentals, Inc.’s] [added: The Company’s] management is responsible for maintaining effective internal control over financial [removed: reporting,] [added: reporting] and for its assessment of the effectiveness of internal control over financial reporting included in the accompanying Management’s Annual Report on Internal Controls over Financial Reporting.
We conducted our audit in accordance with the standards of the [removed: Public Company Accounting Oversight Board (United States).][added: PCAOB.]
In our opinion, United Rentals, Inc. [added: (“The Company’)] maintained, in all material respects, effective internal control over financial reporting as of December 31, [removed: 2016,] [added: 2017,] based on the COSO criteria.
We [removed: also] have [added: also] audited, in accordance with the standards of the Public Company Accounting Oversight Board (United [removed: States),] [added: States) (PCAOB),] the consolidated balance sheets of [removed: United Rentals, Inc.] [added: the Company] as of December 31, [removed: 2016] [added: 2017] and [removed: 2015,] [added: 2016,] and the related consolidated statements of income, comprehensive income, [removed: stockholders'] [added: stockholder’s] equity and cash flows for each of the three years in the period ended December 31, [removed: 2016] [added: 2017 of the Company] and our report dated January [removed: 25, 2017] [added: 24, 2018] expressed an unqualified opinion thereon.
There were no changes in our internal control over financial reporting during the quarter ended December 31, [removed: 2016] [added: 2017] that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
Opinion on Internal Control over Financial Reporting
Basis for Opinion
We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities Exchange Commission and the PCAOB.
Definition and Limitations of Internal Control Over Financial Reporting
January 24, 2018
January 25, 2017
Item 10. Directors, Executive Officers and Corporate Governance
1 rewritten, 0 added, 0 removed, 2 unchanged
The information required by this Item is incorporated by reference to the applicable information in our Proxy Statement related to the [removed: 2017] [added: 2018] Annual Meeting of Stockholders (the [removed: “2017] [added: “2018] Proxy Statement”), which is expected to be filed with the SEC on or before March [removed: 21, 2017.][added: 27, 2018.]
Item 11. Executive Compensation
1 rewritten, 0 added, 0 removed, 2 unchanged
The information required by this Item is incorporated by reference to the applicable information in the [removed: 2017] [added: 2018] Proxy Statement, which is expected to be filed with the SEC on or before March [removed: 21, 2017.][added: 27, 2018.]
Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
1 rewritten, 0 added, 0 removed, 2 unchanged
The information required by this Item is incorporated by reference to the applicable information in the [removed: 2017] [added: 2018] Proxy Statement, which is expected to be filed with the SEC on or before March [removed: 21, 2017.][added: 27, 2018.]
Item 13. Certain Relationships and Related Transactions, and Director Independence
1 rewritten, 0 added, 0 removed, 2 unchanged
The information required by this Item is incorporated by reference to the applicable information in the [removed: 2017] [added: 2018] Proxy Statement, which is expected to be filed with the SEC on or before March [removed: 21, 2017.][added: 27, 2018.]
Item 14. Principal Accountant Fees and Services
1 rewritten, 0 added, 0 removed, 3 unchanged
The information required by this Item is incorporated by reference to the applicable information in the [removed: 2017] [added: 2018] Proxy Statement, which is expected to be filed with the SEC on or before March [removed: 21, 2017.][added: 27, 2018.]
Item 15. Exhibits and Financial Statement Schedules
100 rewritten, 14 added, 15 removed, 171 unchanged
United Rentals, Inc. Consolidated Balance Sheets at December 31, [removed: 2016] [added: 2017] and [removed: 2015][added: 2016]
United Rentals, Inc. Consolidated Statements of Income for the years ended December 31, [removed: 2016, 2015] [added: 2017, 2016] and [removed: 2014][added: 2015]
United Rentals, Inc. Consolidated Statements of Comprehensive Income for the years ended December 31, [removed: 2016, 2015] [added: 2017, 2016] and [removed: 2014][added: 2015]
United Rentals, Inc. Consolidated Statements of Stockholders' Equity for the years ended December [removed: 2016, 2015] [added: 2017, 2016] and [removed: 2014][added: 2015]
United Rentals, Inc. Consolidated Statements of Cash Flows for the years ended December 31, [removed: 2016, 2015] [added: 2017, 2016] and [removed: 2014][added: 2015]
| 2 | | (a) | [removed: Agreement] [added: [Agreement] and Plan of Merger, dated as of December 15, 2011, by and between United Rentals, Inc. and RSC Holdings Inc. (incorporated by reference to Exhibit 2.1 of the United Rentals, Inc. Report on Form 8-K filed on December 21, [removed: 2011)] [added: 2011)](http://www.sec.gov/Archives/edgar/data/1047166/000119312511348597/d272512dex21.htm)] |
| 2 | | (b) | [removed: Agreement] [added: [Agreement] and Plan of Merger, dated as of April 30, 2012, by and between United Rentals (North America), Inc. and UR Merger Sub Corporation (incorporated by reference to Exhibit 1.1 of the United Rentals, Inc. Report on Form 8-K filed on May 3, [removed: 2012)] [added: 2012)](http://www.sec.gov/Archives/edgar/data/1047166/000119312512208840/d342342dex11.htm)] |
| 2 | | (c) | [removed: Asset] [added: [Asset] Purchase Agreement, dated as of March 7, 2014, by and among United Rentals (North America), Inc. and United Rentals of Canada, Inc., on the one hand, and LD Services, LLC, National Pump & Compressor, Ltd., Canadian Pump & Compressor Ltd., GulfCo Industrial Equipment, L.P. (collectively, the “Sellers”) and the general partner and limited partners, members, shareholders or other equity holders of each Seller, as the case may be, on the other hand (incorporated by reference to Exhibit 2.1 of the United Rentals, Inc. Report on Form 8-K filed on March 10, [removed: 2014)] [added: 2014)](http://www.sec.gov/Archives/edgar/data/1047166/000119312514090200/d690146dex21.htm)] |
| 3 | | (a) | [added: [Fourth] Restated Certificate of Incorporation of United Rentals, Inc., dated [removed: March 16, 2009] [added: June 1, 2017] (incorporated by reference to Exhibit [removed: 3.1] [added: 3.2] of the United Rentals, Inc. [added: and United Rentals (North America), Inc. Current] Report on Form 8-K filed on [removed: March 17, 2009)] [added: June 2, 2017)](http://www.sec.gov/Archives/edgar/data/1047166/000119312517193138/d407563dex32.htm)] |
| 3 | | (c) | [removed: Restated] [added: [Restated] Certificate of Incorporation of United Rentals (North America), Inc., dated April 30, 2012 (incorporated by reference to Exhibit 3(c) of the United Rentals, Inc. Report on Form 10-Q for the quarter ended June 30, [removed: 2013)] [added: 2013)](http://www.sec.gov/Archives/edgar/data/1047166/000106770113000016/uri-6302013xex3c.htm)] |
| 3 | | (d) | [removed: By-laws] [added: [By-laws] of United Rentals (North America), Inc., dated May 8, 2013 (incorporated by reference to Exhibit 3(d) of the United Rentals, Inc. Report on Form 10-Q for the quarter ended June 30, [removed: 2013)] [added: 2013)](http://www.sec.gov/Archives/edgar/data/1047166/000106770113000016/uri-6302013xex3d.htm)] |
| 4 | | (a) | [removed: Form] [added: [Form] of Certificate representing United Rentals, Inc. Common Stock (incorporated by reference to Exhibit 4 of Amendment No. 2 to the United Rentals, Inc. Registration Statement on Form S-l, Registration No. 333-39117, filed on December 3, [removed: 1997)] [added: 1997)](http://www.sec.gov/Archives/edgar/data/1047166/0000950130-97-005379.txt)] |
| 4 | | (b) | [removed: Indenture,] [added: [Indenture for the 5 3/4 percent Notes due 2024,] dated as of March [removed: 9, 2012, relating to 7 5/8 percent Senior Notes due 2022, between UR Financing Escrow Corporation] [added: 26, 2014, among United Rentals (North America), Inc., United Rentals, Inc., United Rentals (North America), Inc.’s subsidiaries named therein] and Wells Fargo Bank, National Association, as Trustee (including the Form of [added: 2024] Note) (incorporated by reference to Exhibit 4.1 of the United Rentals, Inc. [added: and United Rentals (North America), Inc.] Report on Form 8-K filed on March [removed: 12, 2012)] [added: 26, 2014)](http://www.sec.gov/Archives/edgar/data/1047166/000110465914022967/a14-7870_6ex4d1.htm)] |
| 4 | | [removed: (c)] [added: (e)] | [removed: First Supplemental Indenture, dated as of April 30, 2012, relating to 7 5/8] [added: [Indenture for the 5 7/8] percent [removed: Senior] Notes due [removed: 2022,] [added: 2026, dated as of May 13, 2016,] among [removed: UR Financing Escrow Corporation, UR Merger Sub Corporation,] United [added: Rentals (North America), Inc. (the “Company”), United] Rentals, Inc., the [added: Company’s] subsidiaries named therein and Wells Fargo Bank, National Association, as Trustee [added: (including the Form of 2026 Note)] (incorporated by reference to Exhibit 4.1 of the United Rentals, Inc. Report on Form 8-K filed on May [removed: 3, 2012)] [added: 13, 2016)](http://www.sec.gov/Archives/edgar/data/1047166/000110465916120914/a16-10962_1ex4d1.htm)] |
| 4 | | [removed: (d)] [added: (f)] | [removed: Indenture, dated as of October 30, 2012, relating to 6 1/8] [added: [Indenture for the 5 1/2] percent [removed: Senior] Notes due [removed: 2023,] [added: 2027, dated as of November 7, 2016,] among United Rentals (North America), [removed: Inc.,] [added: Inc. (the “Company”),] United Rentals, Inc., the [added: Company’s] subsidiaries named therein and Wells Fargo Bank, National Association, as Trustee (including the Form of [added: 2027] Note) (incorporated by reference to Exhibit 4.1 of the United Rentals, Inc. Report on Form 8-K filed on [removed: October 30, 2012)] [added: November 7, 2016)](http://www.sec.gov/Archives/edgar/data/1047166/000104746916016559/a2230212zex-4_1.htm)] |
| 4 | | [removed: (e)] [added: (c)] | [removed: Indenture] [added: [Indenture] for the [removed: 5 3/4] [added: 4 5/8] percent Notes due [removed: 2024,] [added: 2023,] dated as of March 26, [removed: 2014,] [added: 2015,] among United Rentals (North America), [removed: Inc.,] [added: Inc. (the “Company”),] United Rentals, Inc., [removed: United Rentals (North America), Inc.’s] [added: the Company’s] subsidiaries named therein and Wells Fargo Bank, National Association, as Trustee [added: and Notes Collateral Agent] (including the Form of [removed: 2024] [added: 2023] Note) (incorporated by reference to Exhibit 4.1 of the United Rentals, Inc. [removed: and United Rentals (North America), Inc.] Report on Form 8-K filed on March 26, [removed: 2014)] [added: 2015)](http://www.sec.gov/Archives/edgar/data/1047166/000110465915023091/a15-7669_1ex4d1.htm)] |
| 4 | | [removed: (f)] [added: (d)] | [removed: Indenture] [added: [Indenture] for the [removed: 4 5/8] [added: 5 1/2] percent Notes due [removed: 2023,] [added: 2025,] dated as of March 26, 2015, among United Rentals (North America), Inc. (the “Company”), United Rentals, Inc., the Company’s subsidiaries named therein and Wells Fargo Bank, National Association, as Trustee [removed: and Notes Collateral Agent] (including the Form of [removed: 2023] [added: 2025] Note) (incorporated by reference to Exhibit [removed: 4.1] [added: 4.2] of the United Rentals, Inc. Report on Form 8-K filed on March 26, [removed: 2015)] [added: 2015)](http://www.sec.gov/Archives/edgar/data/1047166/000110465915023091/a15-7669_1ex4d2.htm)] |
| 4 | | [removed: (g)] [added: (h)] | [removed: Indenture] [added: [Indenture] for the [removed: 5 1/2] [added: 4 5/8] percent Notes due 2025, dated as of [removed: March 26, 2015,] [added: September 22, 2017,] among United Rentals (North America), Inc. (the “Company”), United Rentals, Inc., the Company’s subsidiaries named therein and Wells Fargo Bank, National Association, as Trustee (including the Form of 2025 Note) (incorporated by reference to Exhibit [removed: 4.2] [added: 4.1] of the United Rentals, Inc. Report on Form 8-K filed on [removed: March 26, 2015)] [added: September 22, 2017)](http://www.sec.gov/Archives/edgar/data/1047166/000110465917058485/a17-22401_1ex4d1.htm)] |
| 4 | | [removed: (h)] [added: (g)] | [removed: Indenture] [added: [Indenture] for the [removed: 5] [added: 4] 7/8 percent Notes due [removed: 2026,] [added: 2028,] dated as of [removed: May 13, 2016,] [added: August 11, 2017,] among United Rentals (North America), Inc. (the “Company”), United Rentals, Inc., the Company’s subsidiaries named therein and Wells Fargo Bank, National Association, as Trustee (including the Form of [removed: 2026] [added: 2028] Note) (incorporated by reference to Exhibit 4.1 of the United Rentals, Inc. Report on Form 8-K filed on [removed: May 13, 2016)] [added: August 11, 2017)](http://www.sec.gov/Archives/edgar/data/1047166/000110465917051370/a17-19891_1ex4d1.htm)] |
| 4 | | (i) | [removed: Indenture] [added: [Indenture] for the [removed: 5 1/2] [added: 4 7/8] percent Notes due [removed: 2027,] [added: 2028,] dated as of [removed: November 7, 2016,] [added: September 22, 2017,] among United Rentals (North America), Inc. (the “Company”), United Rentals, Inc., the Company’s subsidiaries named therein and Wells Fargo Bank, National Association, as Trustee (including the Form of [removed: 2027] [added: 2028] Note) (incorporated by reference to Exhibit [removed: 4.1] [added: 4.2] of the United Rentals, Inc. Report on Form 8-K filed on [removed: November 7, 2016)] [added: September 22, 2017)](http://www.sec.gov/Archives/edgar/data/1047166/000110465917058485/a17-22401_1ex4d2.htm)] |
| 10 | | (a) | [removed: 2001] [added: [2001] Comprehensive Stock Plan of United Rentals, Inc. (formerly the 2001 Senior Stock Plan) (incorporated by reference to Exhibit 10(f) of the United Rentals, Inc. Report on Form 10-Q for the quarter ended June 30, 2006, Commission File No. [removed: 001-14387)‡] [added: 001-14387)‡](http://www.sec.gov/Archives/edgar/data/1047166/000119312506164103/dex10f.htm)] |
| 10 | | (b) | [removed: United] [added: [United] Rentals, Inc. Deferred Compensation Plan, as amended and restated, effective December 16, 2008 (incorporated by reference to Exhibit 10.1 of the United Rentals, Inc. Report on Form 8-K, Commission File No. 001-14387, filed on December 19, [removed: 2008)‡] [added: 2008)‡](http://www.sec.gov/Archives/edgar/data/1047166/000101905608001457/ex10_1.htm)] |
| 10 | | (c) | [removed: United] [added: [United] Rentals, Inc. Deferred Compensation Plan for Directors, as amended and restated, effective January 1, 2013 (incorporated by reference to Exhibit 10(f) of the United Rentals, Inc. Report on Form 10-K for year ended December 31, [removed: 2012)‡] [added: 2012)‡](http://www.sec.gov/Archives/edgar/data/1047166/000106770113000004/uri-2012123110kex10f.htm)] |
| 10 | | (d) | [removed: United] [added: [United] Rentals, Inc. Deferred Compensation Plan for Directors, as amended and restated, effective December 16, 2008 (incorporated by reference to Exhibit 10.2 of the United Rentals, Inc. Report on Form 8-K, Commission File No. 001-14387, filed on December 19, [removed: 2008)‡] [added: 2008)‡](http://www.sec.gov/Archives/edgar/data/1047166/000101905608001457/ex10_2.htm)] |
| 10 | | (e) | [removed: Amendment] [added: [Amendment] Number One to the United Rentals, Inc. Deferred Compensation Plan for Directors, as amended and restated, effective December 16, 2008 (incorporated by reference to Exhibit 10(h) of the United Rentals, Inc. Annual Report on Form 10-K for the year ended December 31, [removed: 2010)‡] [added: 2010)‡](http://www.sec.gov/Archives/edgar/data/1047166/000119312511020326/dex10h.htm)] |
| 10 | | (f) | [removed: United] [added: [United] Rentals, Inc. 2014 Annual Incentive Compensation Plan, (incorporated by reference to Appendix B of the United Rentals, Inc. Proxy Statement on Schedule 14A filed on March 26, [removed: 2014)‡] [added: 2014)‡](http://www.sec.gov/Archives/edgar/data/1067701/000119312514116572/d667430ddef14a.htm)] |
| 10 | | (g) | [removed: United] [added: [United] Rentals, Inc. Long-Term Incentive Plan, as amended and restated, effective December 16, 2008 (incorporated by reference to Exhibit 10.5 of the United Rentals, Inc. Report on Form 8-K, Commission File No. 001-14387, filed on December 19, [removed: 2008)‡] [added: 2008)‡](http://www.sec.gov/Archives/edgar/data/1047166/000101905608001457/ex10_5.htm)] |
| 10 | | (h) | [removed: United] [added: [United] Rentals, Inc. Second Amended and Restated 2010 Long Term Incentive Plan (incorporated by reference to Appendix C of the United Rentals, Inc. Proxy Statement on Schedule 14A filed on March 26, [removed: 2014)‡] [added: 2014)‡](http://www.sec.gov/Archives/edgar/data/1067701/000119312514116572/d667430ddef14a.htm)] |
| 10 | | (i) | [removed: Form] [added: [Form] of United Rentals, Inc. Restricted Stock Unit Agreement for Senior Management; effective for grants of awards beginning in 2015 (incorporated by reference to Exhibit 10(h) on Form 10-Q for the quarter ended March 31, [removed: 2015)‡] [added: 2015)‡](http://www.sec.gov/Archives/edgar/data/1047166/000106770115000012/uri-3312015xex10h.htm)] |
| 10 | | (j) | [removed: Form] [added: [Form] of United Rentals, Inc. 2015 Performance-Based Restricted Stock Unit Agreement for Senior Management (incorporated by reference to Exhibit 10(i) on Form 10-Q for the quarter ended March 31, [removed: 2015)‡] [added: 2015)‡](http://www.sec.gov/Archives/edgar/data/1047166/000106770115000012/uri-3312015xex10i.htm)] |
| 10 | | (k) | [removed: Form] [added: [Form] of United Rentals, Inc. 2010 Long-Term Incentive Plan Director Restricted Stock Unit Agreement (incorporated by reference to Exhibit 10(b) of the United Rentals, Inc. Report on Form 10-Q for the quarter ended June 30, [removed: 2010)‡] [added: 2010)‡](http://www.sec.gov/Archives/edgar/data/1047166/000119312510161856/dex10b.htm)] |
| 10 | | (l) | [removed: Form] [added: [Form] of United Rentals, Inc. 2010 Long Term Incentive Plan Restricted Stock Unit Agreement (Performance-Based) (incorporated by reference to Exhibit 10(a) of the United Rentals, Inc. Report on Form 10-Q for the quarter ended March 31, [removed: 2011)‡] [added: 2011)‡](http://www.sec.gov/Archives/edgar/data/1047166/000119312511102380/dex10a.htm)] |
| 10 | | (m) | [removed: United] [added: [United] Rentals, Inc. Restricted Stock Unit Deferral Plan, as amended and restated, effective December 16, 2008 (incorporated by reference to Exhibit 10.3 of the United Rentals, Inc. Report on Form 8-K, Commission File No. 001-14387, filed on December 19, [removed: 2008)‡] [added: 2008)‡](http://www.sec.gov/Archives/edgar/data/1047166/000101905608001457/ex10_3.htm)] |
| 10 | | (n) | [removed: Amendment] [added: [Amendment] Number One to the United Rentals, Inc. Restricted Stock Unit Deferral Plan, as amended and restated, effective December 16, 2008 (incorporated by reference to Exhibit 10(p) of the United Rentals, Inc. Annual Report on Form 10-K for the year ended December 31, [removed: 2010)‡] [added: 2010)‡](http://www.sec.gov/Archives/edgar/data/1047166/000119312511020326/dex10p.htm)] |
| 10 | | (o) | [removed: Form] [added: [Form] of United Rentals, Inc. Restricted Stock Unit Agreement for Senior Management (incorporated by reference to Exhibit 10(b) of the United Rentals, Inc. Report on Form 10-Q for the quarter ended June 30, 2006, Commission File No. [removed: 001-14387)‡] [added: 001-14387)‡](http://www.sec.gov/Archives/edgar/data/1047166/000119312506164103/dex10b.htm)] |
| 10 | | (p) | [removed: Form] [added: [Form] of United Rentals, Inc., Restricted Stock Unit Agreement for Senior Management, effective for grants of awards beginning in 2010 (incorporated by reference to Exhibit 10(e) of the United Rentals, Inc. Report on Form 10-Q for the quarter ended March 31, [removed: 2010)‡] [added: 2010)‡](http://www.sec.gov/Archives/edgar/data/1047166/000119312510088964/dex10e.htm)] |
| 10 | | (q) | [removed: Form] [added: [Form] of United Rentals, Inc. Restricted Stock Unit Agreement for Non-Employee Directors (incorporated by reference to Exhibit 10(c) of the United Rentals, Inc. Report on Form 10-Q for the quarter ended June 30, 2006, Commission File No. [removed: 001-14387)‡] [added: 001-14387)‡](http://www.sec.gov/Archives/edgar/data/1047166/000119312506164103/dex10c.htm)] |
| 10 | | [removed: (r)] [added: (s)] | [removed: Form] [added: [Form] of United Rentals, Inc. Stock Option Agreement for Senior Management (incorporated by reference to Exhibit 10.4 of the United Rentals, Inc. Report on Form 10-Q for the quarter ended June 30, [removed: 2009)‡] [added: 2009)‡](http://www.sec.gov/Archives/edgar/data/1047166/000119312509158282/dex104.htm)] |
| 10 | | [removed: (s)] [added: (t)] | [removed: Form] [added: [Form] of United Rentals, Inc. Stock Option Agreement for Senior Management, effective for grants of awards beginning in 2010 (incorporated by reference to Exhibit 10(d) of the United Rentals, Inc. Report on Form 10-Q for the quarter ended March 31, [removed: 2010)‡] [added: 2010)‡](http://www.sec.gov/Archives/edgar/data/1047166/000119312510088964/dex10d.htm)] |
| 10 | | [removed: (t)] [added: (u)] | [removed: Form] [added: [Form] of Directors Option Agreement of United Rentals, Inc. (incorporated by reference to Exhibit 99.1 of the United Rentals, Inc. Report on Form 8-K, Commission File No. 001-14387, filed on March 8, [removed: 2005)‡] [added: 2005)‡](#s155734C83E5D5B7BABC347C3B4D9DD8F)] |
| 2 | | (d) | [Agreement and Plan of Merger, dated as of January 25, 2017, by and among United Rentals (North America), Inc., UR Merger Sub II Corporation, NES Rentals Holdings II, Inc. and Diamond Castle Holdings, LLC, solely in its capacity as the Stockholder Representative (incorporated by reference to Exhibit 2.1 of the United Rentals, Inc. and United Rentals (North America), Inc. Current Report on Form 8-K filed on January 27, 2017)](http://www.sec.gov/Archives/edgar/data/1047166/000110465917004553/a17-3341_1ex2d1.htm) |
| 2 | | (e) | [Agreement and Plan of Merger, dated as of August 16, 2017, by and among United Rentals (North America), Inc., UR Merger Sub III Corporation and Neff Corporation (incorporated herein by reference to Exhibit 2.1 of the United Rentals, Inc. and United Rentals (North America), Inc. Current Report on Form 8-K filed on August 17, 2017](http://www.sec.gov/Archives/edgar/data/1047166/000110465917052469/a17-20313_2ex2d1.htm) |
| 3 | | (b) | [Amended and Restated By-laws of United Rentals, Inc., amended as of May 4, 2017 (incorporated by reference to Exhibit 3.4 of the United Rentals, Inc. and United Rentals (North America), Inc. Current Report on Form 8-K filed on May 4, 2017)](http://www.sec.gov/Archives/edgar/data/1047166/000110465917029910/a17-12287_1ex3d4.htm) |
| 10 | | (r) | [Form of United Rentals, Inc. Restricted Stock Unit Agreement for Non-Employee Directors (incorporated by reference to United Rentals, Inc. Report on Form 10-Q for the quarter ended June 30, 2017)](http://www.sec.gov/Archives/edgar/data/1047166/000106770117000022/uri-6302017xex10a.htm) |
| 10 | | (jjj) | [Assignment and Acceptance Agreement and Amendment No. 6 to Third Amended and Restated Receivables Purchase Agreement and Amendment No. 4 to Third Amended and Restated Purchase and Contribution Agreement, dated as of August 29, 2017, by and among United Rentals (North America), Inc., United Rentals Receivables LLC II, United Rentals, Inc., Liberty Street Funding LLC, Gotham Funding Corporation, Fairway Finance Company, LLC, The Bank of Nova Scotia, PNC Bank, National Association, SunTrust Bank, The Bank of Tokyo-Mitsubishi UFJ, Ltd., New York Branch, Bank of Montreal and The Toronto-Dominion Bank (incorporated by reference to Exhibit 10.1 of the United Rentals, Inc. Report on Form 8-K filed on August 29, 2017)](http://www.sec.gov/Archives/edgar/data/1047166/000110465917054302/a17-21007_1ex10d1.htm) |
| 10 | | (kkk) | [Amendment No. 7 to Third Amended and Restated Receivables Purchase Agreement dated as of December 1, 2017, by and among United Rentals (North America), Inc., United Rentals Receivables LLC II, United Rentals, Inc., Liberty Street Funding LLC, Gotham Funding Corporation, Fairway Finance Company, LLC, The Bank of Nova Scotia, PNC Bank, National Association, SunTrust Bank, The Bank of Tokyo-Mitsubishi UFJ, Ltd., Bank of Montreal and The Toronto-Dominion Bank)(incorporated by reference to Exhibit 10.1 of the United Rentals, Inc. Report on Form 8-K filed on December 1, 2017)](http://www.sec.gov/Archives/edgar/data/1047166/000110465917071450/a17-27858_1ex10d1.htm) |
| 12 | | * | [Computation of Ratio of Earnings to Fixed Charges](https://www.sec.gov/Archives/edgar/data/1067701/000106770118000006/uri-2017123110kex12.htm) |
| 21 | | * | [Subsidiaries of United Rentals, Inc.](https://www.sec.gov/Archives/edgar/data/1067701/000106770118000006/uri-2017123110kex21.htm) |
| 23 | | * | [Consent of Ernst & Young LLP](https://www.sec.gov/Archives/edgar/data/1067701/000106770118000006/uri-2017123110kex23.htm) |
| | | | |
| /S/ GRACIA MARTORE | | Director | | January 22, 2018 |
| Gracia Martore | | | | |
| /S/ SHIV SINGH | | Director | | January 22, 2018 |
| Shiv Singh | | | | |
| 3 | | (b) | By-laws of United Rentals, Inc., amended as of September 8, 2016 (incorporated by reference to Exhibit 3.1 of the United Rentals, Inc. Report on Form 8-K filed on September 14, 2016) |
| 10 | | (nn) | Employment Agreement, dated as of March 12, 2010, between United Rentals, Inc. and Matthew Flannery (incorporated by reference to Exhibit 10(b) of the United Rentals, Inc. Report on Form 10-Q for the quarter ended March 31, 2010)‡ |
| 10 | | (oo) | First Amendment, effective as of March 12, 2010, to the Employment Agreement between United Rentals, Inc. and Matthew Flannery (incorporated by reference to Exhibit 10(rr) of the United Rentals, Inc. Annual Report on Form 10-K for the year ended December 31, 2010)‡ |
| 10 | | (pp) | First Amendment, dated April 28, 2008, to the Employment Agreement between United Rentals, Inc. and Dale Asplund (incorporated by reference to Exhibit 10(b) of the United Rentals, Inc. Report on Form 10-Q for the quarter ended March 31, 2011) ‡ |
| 10 | | (qq) | Second Amendment, effective as of April 3, 2013, to the Employment Agreement between United Rentals, Inc. and Dale Asplund (incorporated by reference to Exhibit 10(b) of the United Rentals, Inc. Report on Form 10-Q for the quarter ended March 31, 2013) ‡ |
| 12 | | * | Computation of Ratio of Earnings to Fixed Charges |
| 21 | | * | Subsidiaries of United Rentals, Inc. |
| 23 | | * | Consent of Ernst & Young LLP |
| | | | | |
| /S/ BRIAN D. MCAULEY | | Director | | January 25, 2017 |
| Brian D. McAuley | | | | |
| /S/ JOHN S. MCKINNEY | | Director | | January 25, 2017 |
| John S. McKinney | | | | |
| /S/ L. “KEITH” WIMBUSH | | Director | | January 25, 2017 |
| L. “Keith” Wimbush | | | | |
An excerpt. Shown here: 40 of 100 rewritten, all 14 added and all 15 removed. The counts are complete. For every sentence, read Item 15. Exhibits and Financial Statement Schedules in the FY2017 filing and the FY2016 filing.