#1JLG United Rentals JLG LIFT Fourth Quarter - Full Year 2019 Investor Presentation Managing Key Value Drivers to Maximize Full Cycle Returns United Rentals United Rentals, Inc., 100 First Stamford Place, Stamford, CT 06902. 2020 United Rentals, Inc. All rights reserved. United Rentals 800S 10242440 ✪ → fin#2Introductory Information Unless otherwise specified, the information in this presentation, including forward-looking statements related to our outlook, is as of our most recent earnings call held on January 30, 2020. We make no commitment to update any such information contained in this presentation. Certain statements in this presentation are forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995, known as the PSLRA. These statements can generally be identified by the use of forward-looking terminology such as "believe," "expect," "may," "will," "should," "seek," "on-track," "plan," "project," "forecast," "intend," "anticipate" or "target," or the negative thereof or comparable terminology, or by discussions of vision, strategy, outlook or guidance. These statements are based on current plans, estimates and projections, and, therefore, you should not place undue reliance on them. No forward-looking statement can be guaranteed, and actual results may differ materially from those projected. Factors that could cause actual results to differ materially from those projected include, but are not limited to, the following: (1) the possibility that companies that we have acquired or may acquire, including BakerCorp and BlueLine, could have undiscovered liabilities or involve other unexpected costs, may strain our management capabilities or may be difficult to integrate; (2) the cyclical nature of our business, which is highly sensitive to North American construction and industrial activities; if construction or industrial activity decline, our revenues and, because many of our costs are fixed, our profitability may be adversely affected; (3) our significant indebtedness, which 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; (4) the inability to refinance our indebtedness on terms that are favorable to us, or at all; (5) the incurrence of additional debt, which could exacerbate the risks associated with our current level of indebtedness; (6) noncompliance with financial or other covenants in our debt agreements, which could result in our lenders terminating the agreements and requiring us to repay outstanding borrowings; (7) restrictive covenants and amount of borrowings permitted in our debt instruments, which can limit our financial and operational flexibility; (8) overcapacity of fleet in the equipment rental industry; (9) inability to benefit from government spending, including spending associated with infrastructure projects; (10) fluctuations in the price of our common stock and inability to complete stock repurchases in the time frame and/or on the terms anticipated; (11) rates we charge and time utilization we achieve being less than anticipated; (12) inability to manage credit risk adequately or to collect on contracts with a large number of customers; (13) inability to access the capital that our businesses or growth plans may require; (14) the incurrence of impairment charges; (15) trends in oil and natural gas could adversely affect the demand for our services and products; (16) the fact that our holding company structure requires us to depend in part on distributions from subsidiaries and such distributions could be limited by contractual or legal restrictions; (17) increases in our loss reserves to address business operations or other claims and any claims that exceed our established levels of reserves; (18) incurrence of additional expenses (including indemnification obligations) and other costs in connection with litigation, regulatory and investigatory matters; (19) the outcome or other potential consequences of regulatory matters and commercial litigation; (20) shortfalls in our insurance coverage; (21) our charter provisions as well as provisions of certain debt agreements and our significant indebtedness may have the effect of making more difficult or otherwise discouraging, delaying or deterring a takeover or other change of control of us; (22) turnover in our management team and inability to attract and retain key personnel; (23) costs we incur being more than anticipated and the inability to realize expected savings in the amounts or time frames planned; (24) our dependence on key suppliers to obtain equipment and other supplies for our business on acceptable terms; (25) inability to sell our new or used fleet in the amounts, or at the prices, we expect; (26) competition from existing and new competitors; (27) risks related to security breaches, cybersecurity attacks, failure to protect personal information, compliance with data protection laws and other significant disruptions in our information technology systems; (28) the costs of complying with environmental, safety and foreign law and regulations, as well as other risks associated with non-U.S. operations, including currency exchange risk (including as a result of Brexit), and tariffs; (29) labor disputes, work stoppages or other labor difficulties, which may impact our productivity, and potential enactment of new legislation or other changes in law affecting our labor relations and operations generally; (30) increases in our maintenance and replacement costs and/or decreases in the residual value of our equipment; and (31) the effect of changes in tax law. For a more complete description of these and other possible risks and uncertainties, please refer to our Annual Report on Form 10-K for the year ended December 31, 2019, as well as to our subsequent filings with the SEC. The forward-looking statements contained herein speak only as of the date hereof, and we make no commitment to update or publicly release any revisions to forward- looking statements in order to reflect new information or subsequent events, circumstances or changes in expectations. Note: This presentation provides information about free cash flow, EBITDA, adjusted EBITDA and adjusted EPS, which are non-GAAP financial measures. This presentation includes a reconciliation between free cash flow and GAAP cash from operations, as-reported and pro forma reconciliations between both adjusted EBITDA and EBITDA, on the one hand, and GAAP net income, on the other hand, a reconciliation between both adjusted EBITDA and EBITDA, on the one hand, and GAAP cash from operations, on the other hand, a reconciliation between adjusted EPS and GAAP EPS and a reconciliation between forward-looking free cash flow and forward-looking GAAP cash from operations. Information reconciling forward-looking adjusted EBITDA to GAAP financial measures is unavailable to the company without unreasonable effort. The company is not able to provide reconciliations of forward looking adjusted EBITDA to GAAP financial measures because certain items required for such reconciliations are outside of the company's control and/or cannot be reasonably predicted, such as the provision for income taxes. Preparation of such reconciliations would require a forward-looking balance sheet, statement of income and statement of cash flow, prepared in accordance with GAAP, and such forward-looking financial statements are unavailable to the company without unreasonable effort. The company provides a range for its adjusted EBITDA forecast that it believes will be achieved, however it cannot accurately predict all the components of the adjusted EBITDA calculation. United Rentals® United Rentals, Inc., 100 First Stamford Place, Stamford, CT 06902. 2020 United Rentals, Inc. All rights reserved. 2#3United Rentals 800-UR-RENTS Contents 1. Introduction 2. End-Market Overview 3. Company Overview 4. Summary of Key Financial Data 5. Appendix United Rentals® 3 United Rentals, Inc., 100 First Stamford Place, Stamford, CT 06902. © 2018 United Rentals, Inc. All rights reserved.#41 Introduction United Rentals WARNING United Rentals United Rentals, Inc., 100 First Stamford Place, Stamford, CT 06902. 2018 United Rentals, Inc. All rights reserved. ✪ o fin#5United Rentals GEHL Maximizing value creation across the cycle by balancing growth, margins and free cash flow to drive returns JLG Aggressive management of key value drivers within our control KAS 512 6-2386 LOA 5#6Company overview Other 77% United Rentals 13% Sunbelt 7% HRI 3% #1 Market Share (1) • 2019 total revenue $9.35 billion (+16.2% Y/Y) ⚫ 2019 adjusted EBITDA (2) $4.36 billion (+12.7% Y/Y; 46.6% margin) • 1,164 locations across North America(3) • 1,024 branches in the U.S.; locations in 49 of 50 states • 140 branches in Canada; locations in all 10 provinces ⚫ 11 European branches in France, Germany, the United Kingdom and the Netherlands $14.6B of fleet comprised of ~665,000 units (4) Highly diversified product and end-market mix Team of approximately 19,100 employees (5) United Rentals is the North American equipment rental leader (1) North American market share is based on 2019 rental revenues and ARA industry estimates (2) Adjusted EBITDA is a non-GAAP measure. See the tables provided elsewhere in this presentation for reconciliations to the most comparable GAAP measures. (3) As of December 31, 2019. Excludes 11 European branches in France, Germany, the United Kingdom and the Netherlands. Total branch count 1,175. (4) As of December 31, 2019. Average fleet age 49.5 months. (5) As of December 31, 2019. United Rentals® United Rentals, Inc., 100 First Stamford Place, Stamford, CT 06902. 2020 United Rentals, Inc. All rights reserved. 6#7Our customers and the benefits of renting vs. owning Residential construction Multi-Family Customer Mix* 5% • Why Customers Rent Instead of Buy • Industrial • Downstream Chemical . • Oil & gas . Power • 47% Verticals • Non-residential 48% construction Private non-res Public non-res Infrastructure Construction & MRO Manufacturing Food & beverage Control expenses and inventory The right equipment for any job • 24/7 customer care / support • · No need for maintenance Save on storage/warehousing Reliability/reduce downtime Save on disposable costs Equipment tracking • Conserve capital • Pulp & paper • Disaster response • Manage risk Despite diverse needs, customers derive many benefits from renting *Note: Based on 2019 rental revenue. United Rentals® United Rentals, Inc., 100 First Stamford Place, Stamford, CT 06902. 2020 United Rentals, Inc. All rights reserved. 7#8Branch locations NT YT BC Canada MT OR ID W NV UT SK MMB NM 0 SD NE MN ed States Hudson Bay ON Gulf of Mexico Mexico QC North American branch count 1,164(1) • General Rentals: 816 locations Specialty: 348 locations (2) Largest U.S. states by number of locations (1) • Texas: 152 • California: 111 Florida: 66 • Louisiana: 47 Georgia: 44 Largest and broadest footprint in North America (1) As of December 31, 2019, 1,164 locations in North America and 11 in Europe, for total branch count of 1,175. (2) Specialty includes Tools and Reliable Onsite Services locations that are part of our General Rentals reporting segment. Total branch count of 359, including 11 European locations. United Rentals® United Rentals, Inc., 100 First Stamford Place, Stamford, CT 06902. 2020 United Rentals, Inc. All rights reserved. 8#9Diverse end-market exposure Residential Construction Food Processing Mining Airports Solar Hospitals Commercial Construction Government Facilites Distribution Centers T Power Generation Emergency Response Bridges & Highways Industrial Manufacturing Shipping Upstream Wind Oil & Gas Oil & Gas Transmission ECS Sports & Entertainment Downstream Oil & Gas Utilities Colleges Shopping Data Centers Power Transmission 2019 Revenue by Vertical Infrastructure ■ Non-Res Construction ■ Residential ■Downstream O&G ■ Upstream O&G ■ Mid-stream O&G ■Chemical Processing ■Consumer-related Industrial Manufacturing ■Metals & Minerals ■ Power ■ Pulp, Paper & Wood ■ All Other *Note: Based on 2019 rental revenue. Broad customer base helps reduce full-cycle volatility United Rentals® United Rentals, Inc., 100 First Stamford Place, Stamford, CT 06902. 2020 United Rentals, Inc. All rights reserved. 9#10A decade of continued financial improvement... Total Revenue Adjusted EBITDA(1) Adjusted EPS(1) $10,000M $5,000M $25 $9,000M CAGR $4,500M CAGR $8,000M 14.8% $4,000M 21.4% $20 CAGR (2) 18.7% $7,000M $3,500M $6,000M $3,000M $15 $5,000M $2,500M $4,000M $2,000M $10 $3,000M $1,500M $2,000M $1,000M $5 $1,000M $0 $500M $0 $0 2009 2014 2019 2009 2014 2019 2008 Strong revenue growth Trailing 5-year CAGR: +10.5% Trailing 10-year CAGR: +14.8% Improved diversification Increased industrial exposure • Increased non-cyclical specialty exposure Notes: 2014 2019 Powerful EBITDA growth Trailing 5-year CAGR: +9.9% Trailing 10-year CAGR: +21.4% Sharply higher margins Adj. EBITDA margins up ~1,400 bps vs. 2008 (3) Meaningful EPS growth Trailing 5-year CAGR: +23.1% vs. +7.2% for the S&P 500 over the same period Trailing 11-year CAGR (2,3): +18.7% vs. +11.6% for the S&P 500 over the same period Adj. EBITDA margins up ~2,000 bps vs 2009 (4) Ongoing transformation of the company's financial performance (1) Adjusted EBITDA and Adjusted EPS are non-GAAP measures. See the tables provided elsewhere in this presentation for reconciliations to the most comparable GAAP measures. (2) 10-year CAGR excluded, as Adjusted EPS for 2009 was ($0.76). (3) Reflects change/ improvement since peak of the last cycle relative to 2019. (4) Reflects change/ improvement since trough of the last cycle relative to 2019. United Rentals® United Rentals, Inc., 100 First Stamford Place, Stamford, CT 06902. 2020 United Rentals, Inc. All rights reserved. 10#11...that has ultimately been reflected in free cash flow 2011-2019 Free Cash Flow Conversion: 107% (2) Adjusted Free Cash Flow ($M) $1,800 $1,300 $800 FCF/EBITDA(1) 20.4% $300 FCF/EBITDA(1) 27.9% اااا -$200 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 Durable Free Cash Flow generated throughout the cycle (1) Free Cash Flow (FCF) and EBITDA are non-GAAP financial measures. See the Appendix for reconciliations to the most comparable GAAP measures for 2009-2019. (2) Reflects average annual free cash flow, excluding the impact of merger and restructuring payments, relative to reported net income with 2017 net income adjusted to exclude tax reform benefits. United Rentals® United Rentals, Inc., 100 First Stamford Place, Stamford, CT 06902. 2020 United Rentals, Inc. All rights reserved. 2017 2018 2019 11#12Driving and extending our competitive advantages Company transformed to be considerably more profitable and efficient Operations, technology and culture differentiate us, and make us far more agile Diversified end-market exposure across customers, verticals and geographies • Strong balance sheet and robust cash generation with disciplined approach to smart capital allocation provide powerful optionality Focused on balancing growth, margins, returns and FCF to maximize long-term value creation for our shareholders $ Leverage powerful cash flow; deliver industry leading returns 1 Maximize revenue potential with current & new customers Leverage growth through efficiency and productivity initiatives Operating model supports self-reinforcing growth, margins, returns and cash generation United Rentals 8 United Rentals, Inc., 100 First Stamford Place, Stamford, CT 06902. 2020 United Rentals, Inc. All rights reserved. 12#132 End-market overview United Rentals United Rentals, Inc., 100 First Stamford Place, Stamford, CT 06902. 2018 United Rentals, Inc. All rights reserved. → → fin#14$60B $50B $40B $30B $20B $10B $OB U.S. equipment rental industry overview Combined U.S. General Rental and Construction & Industrial Equipment Rental Market Size ($bn) The U.S. equipment rental market has outgrown its underlying market by over 50% in the last 20 years 400% -Indexed Growth: US Equipment Rental Market -Indexed Growth: Total US Construction Spending United Rentals® 300% CAGR 20-year CAGR 5.3% since 2009 200% 6.6% 100% 0% 2012 2013 2014 2015 2016 2017 2018 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 Largest players capturing a growing share of the U.S. equipment rental market Top 10 U.S. Rental Companies as % of Total Industry Revenues Equipment rental value proposition continues to drive secular penetration Sources: Company reports, ARA, RER, and U.S. Census Bureau (based on most current data available as of January 2020). United Rentals, Inc., 100 First Stamford Place, Stamford, CT 06902. 2020 United Rentals, Inc. All rights reserved. 35% 32% 30% 30% 27% 27% 26% 23% 24% 25% 22% 20% 20% 15% 10% 2010 2011 2012 2013 2014 2015 2016 2017 2018 14#15$6,000 $5,500 $5,000 $4,500 $4,000 $3,500 $3,000 $2,500 1964 1965 1966 United Rentals® Real total U.S. construction spending climbing... Real total U.S. construction spend per capita -10-year avg -20-year avg 30-year avg 40-year avg 1967 1968 1969 1970 1971 1972 1973 1974 1975 1976 1977 Sources: U.S. Census Bureau. Reflects most recent data available as of January 2020. 1978 1979 1980 1981 1982 1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 ... Yet U.S. construction investment remains below long-term average United Rentals, Inc., 100 First Stamford Place, Stamford, CT 06902. 2020 United Rentals, Inc. All rights reserved. 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 15#16Consensus forecast for U.S. construction put-in-place Percent Change Commercial Total Office Retail and Other Commercial Lodging/Hotel Industrial Total Institutional Total Healthcare Education Non-Residential Total Consensus High Consensus Low Year-over-Year 2020 2021 +0.6% -0.2% +3.0% +0.5% -1.3% -0.9% -0.7% -1.0% +0.3% +0.5% +2.9% +2.0% +3.4% +3.5% +3.9% +3.3% +1.5% +0.9% +3.4% +5.4% -0.6% -5.9% Growth expected through at least 2021 Source: American Institute of Architects (most recent forecast as of January 27, 2020). Note: Includes Dodge, IHS Economics, Moody's Economy, FMI, CMD, Associated Builders & Contractors, Wells Fargo Securities, and Markstein Advisors. United Rentals® United Rentals, Inc., 100 First Stamford Place, Stamford, CT 06902. 2020 United Rentals, Inc. All rights reserved. 16#1731 LL Company overview DEW THE RIGHT TOOLS, RIGHT NOW. Power up your productivity with an on-site Mobile Tool Room. UnitedRentals.com 800.URRENTS United O'Rentals 7001 SOLUTIONS 5595 United Rentals United Rentals, Inc., 100 First Stamford Place, Stamford, CT 06902. 2018 United Rentals, Inc. All rights reserved. United Rentals 1-800-UR-RENTS USDOT 899748 → → fin#18Strategic evolution over 20+ years 1997-2008 Become a market leader URI 1997: Founded / IPO United Rentals, Inc. ✓ 1998-2001: Becomes the largest equipment rental company in North America through ~250 acquisitions 2009-2013 Optimize scale, diversify, and drive profitable growth United Rentals 2009: Increased focus on customer service and improving returns through financial and operating discipline 2009-2011: Introduction of Operation United; focused on process improvements to streamline branch operations & logistics RSC 2012-2013: Acquisition and integration of RSC 2002-2008: Strong organic growth in powerful up cycle Equipment Rental 2014-present Building on and transforming the Core Rentals NEFF BlueLine Rental Continued build-up of GenRent platform Increased focus on Specialty business to increase returns Cand reduce volatility through BAKER.DEP United Academy' O CAMBIUM cross-selling Development of services businesses and solutions to increase customer relevance and competitive differentiation Launch of digital capabilities to better serve customers and support internal efficiency United Rentals® United Rentals, Inc., 100 First Stamford Place, Stamford, CT 06902. 2020 United Rentals, Inc. All rights reserved. 18#19Growth and margin opportunities Revenue Related Capitalize on ongoing secular shift towards rental over ownership Leverage cross-selling to capture more wallet share and maximize cyclical growth Evolve sales strategies and asset base to better serve customers and capture secular opportunities (infrastructure, digital, etc.) Differentiate services through new technologies and accelerated innovation Smart M&A Cost and Margin Related Further leveraging of LEAN • • Optimization of operating costs Continual improvement of labor productivity Fixed cost leverage via organic and M&A growth Mix shift as Specialty outpaces total growth Product and customer mix Further leveraging of technology and systems. Optimizing growth and margins to maximize value creation United Rentals® United Rentals, Inc., 100 First Stamford Place, Stamford, CT 06902. 2020 United Rentals, Inc. All rights reserved. 19#20· · People & culture as differentiating assets Highly engaged, committed and diverse workforce • • Very strong engagement across all categories inline or better-than Towers Watson US High Performing Company Benchmark Industry leading low-turnover rate, which helps drive better customer experience via continuity, consistency, and lower costs Multiple internal communications platforms ensure active 2-way dialogue (town-halls, social media platform, all-employee calls, branch visits, etc.) Diversity embraced top to bottom with measurable goals and achievement across key groups including Women United, Together United and Veteran's United Strong commitment to supporting each other • High participation in employee-managed 501(c)(3) United Compassion Fund which provides financial assistance to those in need · Over $2.45 million already allocated to United Rentals' employees and families in need Strong supporter of Veteran Groups • Over 9.4% of workforce is made up of U.S. and Canadian veterans • • Nationally recognized military friendly employer • • . #7 ranked company on G.I. Jobs list for top 100 Military Friendly Employers & Military Friendly Spouse Employers HIREVets Medallion Award - Platinum award US Veterans Magazine recognized on their Best of the Best Top Veteran-Friendly Companies and Top Supplier Diversity Programs Excellent employee-generated ratings via independent assessments • Peer-best ratings on Glassdoor across key categories including Overall Rating, Recommend to a Friend, CEO Approval, Career Opportunities, etc. Named to Forbes 2018 global list of "World's Best Employers" Strong, diverse and committed team of ~19,100 employees United Rentals® United Rentals, Inc., 100 First Stamford Place, Stamford, CT 06902. 2020 United Rentals, Inc. All rights reserved. 20#21Competitive positioning aided by structural advantages Size, Breadth and Diversity of Fleet ㅈㄱ Benefits of Scale, Scope & Diversification XX Investments in Technology © Strong Balance Sheet + Cash Flow Strong Culture Focused on Customers & Shareholders Proven Management Team Focus on driving and extending our leadership position United Rentals® United Rentals, Inc., 100 First Stamford Place, Stamford, CT 06902. 2020 United Rentals, Inc. All rights reserved. 21#22Online digital strategy and results Customer Acquisition and Engagement + Customer Retention and Growth + . • United Rentals Equipment Branches Solutions Services Your Job Starts Here Q Search equipment solutions 9 Enter a location (required) My Equipment Popular Equipment Types CB Awareness and interest New customer acquisition Creating & nurturing demand United Rentals My Branches North Kansas City, M United Rentals wable Ligte Toni with k 4200 Extend Service offerings Performance to Peers Performance to Peers 78% Utilization Performance Transaction Summary Improvement Opportunity 40% . Enhance the customer experience • Streamline transactions • • Build trust by adding transparency . Deliver more value-add through digital capabilities Search impressions increased +190% YOY Digital marketing drives 12% of all UR calls United Rentals® Digital accounts growing at 2x company average Self-serve transactions via UR.com up +66% YOY United Rentals, Inc., 100 First Stamford Place, Stamford, CT 06902. 2020 United Rentals, Inc. All rights reserved. 772 Transactions Aerial Forklifts Best In-Class 2:49 Dirt Good 36% Compaction Drive customer productivity via Telematics and data Extract maximum value from your fleet with Customer Equipment Services • Training More than 2000 consumption benchmarking sessions 295,000+ courses delivered via United Academy 22 22#23Total Control®: Adoption Continues to Grow and Deepen TC Feature Highlights User Adoption 2019 "Calls for Pick Up" $2.3 billion via TC and Digital Solutions +4% YoY 13,000 • Rental Fleet Management Find My Fleet Invoices and bill pay Reporting and KPI metrics Customer Growth 2019 TC CUSTOMERS Revenue Total Accounts • • • Advanced Project Tracking REVENUE GROWTH Reservations Placed +21% YoY GPS Alerts Technology integrations, e.g., SAP® TC Customers Same Customers 24% Digitally via TC 14% Providing tangible value for customers and building loyalty to United Rentals United Rentals® United Rentals, Inc., 100 First Stamford Place, Stamford, CT 06902. 2020 United Rentals, Inc. All rights reserved. 23 23#24Telematics & FAST Telematics & Related Technologies ■Internal Benefits: - Performance monitoring and service alerts More efficient location and pick-up capabilities Overtime and revenue recovery ■ Customer Benefits: Field Automation Systems & Technologies (FAST) ■ Internal Benefits: - Increased driver and dispatcher productivity - Improved fleet efficiency - Reduced fuel consumption - Safety benefits - Environmental benefits Visibility into equipment utilization Ability to more easily locate equipment Billing and Account access Fuel alerts Using technology to drive greater efficiencies and improve customer experience United Rentals® United Rentals, Inc., 100 First Stamford Place, Stamford, CT 06902. 2020 United Rentals, Inc. All rights reserved. 24#25Investing in Specialty services O United Rentals O THE RIGHT TOOLS A NO 0% Trench Safety • Excavation support solutions, confined space entry equipment and customer training Used for construction, utility installs, manhole work, and other underground applications Power & HVAC Complete solutions for mobile power and air flow Used for disaster response, plant shut downs, commercial renovations, and seasonal climate control Fluid Solutions Full range of equipment to contain, transfer, and treat fluids • Used by municipalities, industrial plants, and mining, construction, municipal and agri- business customers Tool Solutions • Tool trailers stocked with hoisting, torqueing, pipe fitting, and air tools • Used during refinery and other industrial shutdowns, and also at large construction sites Onsite Services . • Plastic port-a-potties, luxury restroom trailers, sinks, and showers Core rental item used across all types of special events, construction sites, and industrial projects Aggressive growth in Specialty improves returns with reduced volatility United Rentals® United Rentals, Inc., 100 First Stamford Place, Stamford, CT 06902. 2020 United Rentals, Inc. All rights reserved. 25#26Specialty provides strong growth opportunities (1) +33% $1,254M $1,021M $931M $823M $471M $297M $2,168M $1,719M 2012 2013 2014 2015 2016 2017 2018 2019 Specialty as a % 7.2% 9.5% 14.5% 16.0% 17.7% 18.9% 21.4% 23.2% Total Revenues Specialty represented -23% of total revenue in 2019 with over $2 billion in Revenues (1) Tool Solutions was added in 2013 and Fluid Solutions was added in April 2014. Note: Data includes 1) Fluid Solutions, Trench Safety and Power & HVAC and 2) Reliable Onsite Services and Tools revenues, which are included in our General Rentals reporting segment. ● United Rentals® United Rentals, Inc., 100 First Stamford Place, Stamford, CT 06902. 2020 United Rentals, Inc. All rights reserved. 26#27Capital allocation strategy Manage Leverage Invest in Growth • Target leverage range over the cycle of 2.0x-3.0x. Net leverage (1) of 2.6x at December 31, 2019. ⚫ Credit ratings: S&P: BB • Moody's: Ba2 Organic • Continued organic investments to support growth and boost productivity. • Opened 34 specialty branches in 2019, following 30 opened in 2018. • • M&A Balance sheet strategy creates flexibility to pursue strategic assets as opportunities arise. Acquisition of National Pump in 2014 and BakerCorp in 2018 expanded specialty. Acquisitions of NES and Neff in 2017 and BlueLine in 2018 to support our 'grow the core' strategy. Return Excess Cash to Investors • $1.25 billion repurchase program . commenced in July 2018 and was completed in December 2019. $500 million share repurchase program authorized in first quarter 2020 to be completed over 12 months. Since 2012, United Rentals has returned $3.7 billion to shareholders, representing 35% of total issued shares. ⚫ $1 billion of discretionary free cash flow earmarked for debt reduction in 2020 Disciplined, prudent, efficient, and opportunistic approach to capital allocation (1) Leverage ratio calculated as total debt, net of cash, excluding original issuance discounts, premiums, and deferred financing, divided by adjusted EBITDA. United Rentals® United Rentals, Inc., 100 First Stamford Place, Stamford, CT 06902. 2020 United Rentals, Inc. All rights reserved. 27#28M&A strategy: Disciplined and opportunistic Strategic Proactively supports growth in attractive markets Difficult to replicate organically Financial • Invest capital at attractive returns over cycle • • Revenue growth Margin opportunities Cultural Safety Talent Ethics and integrity • Access to new customers • Manage leverage . Management philosophy . • Enhance cross-selling Internal Rate of Return • Customer focus • Best practice adoption • ROIC . Geographic coverage Community • Volatility · Diversification Proven integration capabilities are a key advantage in realizing greater value from M&A United Rentals® United Rentals, Inc., 100 First Stamford Place, Stamford, CT 06902. 2020 United Rentals, Inc. All rights reserved. 28#29Record of value creation through M&A • • RSC (2012) Size: $4.2B transaction value (cash and stock) Type: 'Grow-the- core' gen rent acquisition Rationale: Positions • URI as leader in North American rental industry Value: Targeted $200M cost savings from branch consolidation and overhead • rationalization Exceeded initial cost savings estimates - Raised target to $230M $250M • National Pump (2014) Size: $780M transaction value (cash) Type: Specialty adjacency in the pump rental sector Rationale: Expand offerings in higher margin / return assets Value: Delivered on growth thesis by capitalizing on cross-selling opportunity • Secured foothold in energy-related end markets • Strongly diversified into core construction and industrial NES (2017) Size: $965M transaction value (cash) Type: 'Grow-the- core' gen rent acquisition Rationale: Strengthened aerial capabilities and added two-way cross-selling opportunities Value: Targeted $40M cost savings and $35M of revenue cross-sell opportunity • Neff Rentals (2017) Size: $1.3B transaction value (cash) Type: 'Grow-the- core' gen rent acquisition Rationale: Introduced new dirt capabilities and expertise in infrastructure; provided two-way cross-selling opportunities Value: Targeted $35M cost savings and $15M of revenue cross-sell opportunity • BakerCorp (2018) Size: $720M transaction value (cash) Type: Specialty adjacency in the fluid control sector Rationale: Expand offerings in higher return and lower volatility assets Value: Targeted $19M cost savings and $60M of cross- sell revenue opportunity • BlueLine (2018) Size: $2.1B transaction value (cash) Type: 'Grow-the- core' gen rent acquisition Rationale: Bolstered URI's position as a leader in the North American rental industry while also adding to presence with local and mid- sized customer segment Value: Targeted $45M cost savings and $35M of cross- sell revenue opportunity With 20 years of execution experience for 275+ transactions, team has successfully integrated assets in different environments and across the spectrum from bolt-ons to transformational United Rentals® United Rentals, Inc., 100 First Stamford Place, Stamford, CT 06902. 2020 United Rentals, Inc. All rights reserved. 29 29#304 Summary of key financial data United AUST CANC SKAY 512-3 6-2386 United Rentals United Rentals, Inc., 100 First Stamford Place, Stamford, CT 06902. 2018 United Rentals, Inc. All rights reserved. ✪ o fin#31Key financial results snapshot Total Revenue ($M) Adjusted EBITDA(1) ($M) 2019 5-Year CAGR: 2020 Implied Growth: +10.5% +2.7% (3) 2019 5-Year CAGR: +9.9% 2020 Implied Growth: +2.2% (3) Adjusted Earnings per Share (EPS)(1,2) 2019 5-Year CAGR: 23.1% $10,000 $5,000 $20 $4,500 $8,000 $4,000 $15 $3,500 $6,000 $3,000 $2,500 $10 $4,000 $2,000 $1,500 $5 $2,000 $1,000 $500 $0 $0 $0 2014 2015 2016 2017 2018 2019 2020F(3) 2014 2015 2016 2017 2018 2019 2020F (3) 2014 2015 2016 2017 2018 2019 Robust growth and increased profitability across the current cycle Notes: (1) Adjusted EBITDA and Adjusted EPS are non-GAAP measures. See the tables provided elsewhere in this presentation for reconciliations to the most comparable GAAP measures. (2) 2017 EPS excludes a one-time benefit from the Tax Act of $8.05. 2018 and 2019 reflect a reduction in the U.S. federal corporate statutory rate from 35% to 21% as a result of the Tax Act. United Rentals® United Rentals, Inc., 100 First Stamford Place, Stamford, CT 06902. 2020 United Rentals, Inc. All rights reserved. 31#32Structural changes are key to increased margins Adjusted EBITDA Margin (%) Adjusted EBITDA margins +1,380 bps above prior peak 60% 50% 40% 30% 20% 10% 0% 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020F Note: 2020F reflects mid-point of guidance. · · Key Drivers of Margin Gains Strong fixed-cost absorption • Cyclical leverage (e.g., SG&A as % of sales) M&A cost synergies (e.g., RSC, NES, Neff) Operational efficiency gains ⚫ Process improvements (e.g., LEAN, 5S, etc.) Technology (e.g., logistics, CORE, telematics) Improved mix Shift towards higher margin Specialty • Improved segment/end-market mix ⚫ De-emphasis of low margin/return businesses. Improved used equipment sales strategies Dramatic cycle-over-cycle margin improvement United Rentals 8 United Rentals, Inc., 100 First Stamford Place, Stamford, CT 06902. 2020 United Rentals, Inc. All rights reserved. 32#33Consistent free cash flow generation $1,700 $1,500 $1,300 $1,100 $900 $700 Free Cash Flow($M) --10-Yr Average -5-Yr Average $924 $1,195 $983 $1,334 $1,700 $1,592 $500 $574 $421 $367 $335 $300 $227 $100 $23 $(73) -$100 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020F -$300 $6.0B of free cash flow generated over last 5 years, with a strong outlook (2) Notes: (1) Free cash flow is a non-GAAP measure. See tables provided elsewhere in this presentation for reconciliations to the most comparable GAAP measure. Merger and restructuring related payments were first reported for 2012. The information required to determine the amount of merger and restructuring related payments for periods prior to 2012 is unavailable without unreasonable effort. Free cash flow for 2012 and subsequent periods above excludes merger and restructuring related payments. (2) Reflects 5 year period from 2015 to 2019, excluding merger and restructuring related payments. (3) 2020F reflects mid-point of guidance United Rentals® United Rentals, Inc., 100 First Stamford Place, Stamford, CT 06902. 2020 United Rentals, Inc. All rights reserved.#344Q Results Total Revenue Adjusted EBITDA** Net Rental Capital Expenditures (YTD) Net Cash Provided by Operating Activities (YTD) Free Cash Flow** (YTD) $2.456 billion (6.5% Y/Y as reported; +3.7% Y/Y pro forma*) $1.154 billion (47.0% margin; -140 bps Y/Y as reported; -130 bps Y/Y pro forma*) $1.301 billion, after gross purchases of $2.132 billion $3.024 billion $1.592 billion*** *Pro forma reflects the combination of United Rentals and BlueLine for 2018. **Adjusted EBITDA and Free Cash Flow are non-GAAP measures. See the tables provided elsewhere in this presentation for reconciliations to the most comparable GAAP measures. ***Excludes aggregate merger and restructuring related payments of $26M. United Rentals® United Rentals, Inc., 100 First Stamford Place, Stamford, CT 06902. 2020 United Rentals, Inc. All rights reserved. 34#352020 Financial outlook Total Revenue Adjusted EBITDA* Net Rental Capital Expenditures Net Cash Provided by Operating Activities Free Cash Flow* $9.4 billion to $9.8 billion $4.35 billion to $4.55 billion $1.05 billion to $1.35 billion, after gross purchases of $1.9 billion to $2.2 billion $2.85 billion to $3.35 billion $1.6 billion to $1.8 billion** *Adjusted EBITDA and Free Cash Flow are non-GAAP measures. See the table provided elsewhere in this presentation for a reconciliation of forecasted Free Cash Flow to the most comparable GAAP measure. Information reconciling forecasted adjusted EBITDA to the most comparable GAAP financial measures is unavailable to the company without unreasonable effort, as discussed in the "Introductory Information" slide. **Excludes merger and restructuring related payments. FCF outlook assumptions include 2020 cash taxes of -$285M and cash interest of -$530M. United Rentals® United Rentals, Inc., 100 First Stamford Place, Stamford, CT 06902. 2020 United Rentals, Inc. All rights reserved. 35#36Fleet productivity: overview Fleet Productivity provides greater insight into the interplay and combined impact of key decisions made by managers every day across (a) rental rates, (b) time utilization, and (c) changes in mix on our Owned Equipment Rental Revenue (i.e., the revenue we generate with our owned rental assets). Mix includes impact of changes in customer mix, fleet mix, geographic mix and business mix (i.e., Specialty). Fleet Productivity is a metric that better explains how the combined changes in rental rates, time utilization, and mix come together to produce revenue and how management flexes the combination of these factors to drive efficient growth and benefits returns. Fleet Productivity is a comprehensive measure that combines the impact of the change in rental rates plus the impact of changes in time utilization plus the revenue impact from changes in mix in one metric. Fleet Productivity provides better insight into the decisions made to optimize growth and returns United Rentals® United Rentals, Inc., 100 First Stamford Place, Stamford, CT 06902. 2020 United Rentals, Inc. All rights reserved. 36#37Fleet productivity: historical results() As Reported Historical Results Fleet Productivity(2) Contribution from Ancillary and Re-Rent Reported YoY Change in Rental Revenue Actual YoY Change in Average OEC Assumed YoY Impact of OEC Inflation on Rent Rev 1Q 2016 2.8% (1.5%) (2.3%) 0.3% (0.7%) 2Q 2016 1.6% (1.5%) (1.7%) 0.3% (1.3%) 3Q 2016 1.7% (1.5%) (1.1%) 0.5% (0.3%) 4Q 2016 2.6% (1.5%) 0.8% (0.3%) 1.6% 1Q 2017 3.9% (1.5%) 1.4% 0.6% 4.4% 2Q 2017(3) 14.3% (1.5%) 0.7% * (NES) 0.1% 13.5% 3Q 2017 15.7% (1.5%) 4Q 2017(3) 27.5% (1.5%) 1Q 2018 27.7% (1.5%) 1.7% 0.5% (0.8%) 0.3% 16.2% * (Neff) 0.3% 26.8% (0.3%) 25.1% 2Q 2018 16.2% (1.5%) 4.5% 0.1% 19.3% 3Q 2018(3) 19.5% (1.5%) 2.3% (BakerCorp) 0.8% 21.2% 4Q 2018(3) 18.8% (1.5%) * 1.5% (BlueLine) 2.0% 20.8% 1Q 2019 23.7% (1.5%) (1.3%) 2.1% 23.0% 2Q 2019 23.2% (1.5%) (3.1%) 1.6% 20.2% 3Q 2019 18.1% (1.5%) (1.3%) 0.1% 15.4% 4Q 2019 7.6% (1.5%) (2.4%) 0.0% 3.7% 4Q 2019 PF(4) 4.0% (1.5%) (1.8%) 0.1% 0.8% (1) (2) Provided on an As Reported basis, except as otherwise noted. Fleet Productivity reflects the combined impact of changes in rental rates, time utilization, and mix that contribute to Owned Equipment Rental revenue (OER). United Rentals (3) Denotes quarter in which URI closed a material acquisition (NES = 2Q17; Neff = 4Q17; BakerCorp = 3Q18; BlueLine = 4Q18). (4) Provided on a Pro Forma basis, as if BlueLine had been acquired January 1, 2018. United Rentals, Inc., 100 First Stamford Place, Stamford, CT 06902. 2020 United Rentals, Inc. All rights reserved. 37#38Balance sheet strength continues to improve Leverage Ratio Actual Forecast 3.6x 3.0x(2) 3.1x (4) 2.9x 2.9x 2.8x 2.7x 2.6x (5) ~2.3x 2012 2013 2014 2.0x - 2015 2016 2017 2018 2019 2020F 3.0x targeted leverage range across the cycle; $1 billion of free cash flow earmarked for debt reduction in 2020 (1) Leverage Ratio calculated as total debt and QUIPS, net of cash, excluding original issuance discounts, premiums, and deferred financing divided by adjusted EBITDA. (2) Pro Forma assumes RSC acquisition occurred on January 1, 2012. (3) Reflects leverage as reported, which includes borrowings related to the acquisitions of both NES and Neff without full-year benefits of EBITDA contribution. (4) Reflects leverage as reported, which includes borrowings related to the acquisitions of both Baker and BlueLine without full-year benefits of EBITDA contribution. (5) Assumes midpoint of adjusted EBITDA guidance of $4.450B and $1B of net debt reduction United Rentals 8 United Rentals, Inc., 100 First Stamford Place, Stamford, CT 06902. 2020 United Rentals, Inc. All rights reserved. 38 88#39No maturities of long-term debt until 2025 ($M) Total Liquidity of $2.143B*** Fixed vs. Floating Ratio: 69%/31% 5000 4500 4000 $3,750 3500 3000 2500 $2,045 Unused ABL Facility $2,538 2000 $988 Term Loan B $2,100 1500 $750 4.625% Senior $1,100 6.5% Senior Unsecured $1,750 $1,673 Notes 1000 $1,705* Unsecured $46 A/R Unused Used ABL Notes $1,000 $929 Facility $800 5.875% 500 A/R Securitization Used 5.5% Senior Unsecured Notes Senior Unsecured Notes $750 3.875% Secured Notes $1,000 5.5% Senior Unsecured Notes 4.875%** Senior Unsecured Notes 0 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 Long-term debt maturities extend well into the next decade Note: as of December 31, 2019. *Includes $56M in Letters of Credit. **Comprised of two separate 4.875% notes, a note with $1.669M principal amount and a note with $4M principal amount. ***Includes total cash, cash equivalents and availability under ABL and AR facilities. United Rentals® United Rentals, Inc., 100 First Stamford Place, Stamford, CT 06902. 2020 United Rentals, Inc. All rights reserved. $750 5.25% Senior Unsecured Notes 2030 39#405 Appendix United AUST CANC SKAY 512-3 6-2386 United Rentals United Rentals, Inc., 100 First Stamford Place, Stamford, CT 06902. 2018 United Rentals, Inc. All rights reserved. fin ✪ o#41Adjusted Earnings Per Share GAAP Reconciliation We define "earnings per share - adjusted" as the sum of earnings per share - GAAP, as reported plus the impact of the following special items: merger related costs, merger related intangible asset amortization, impact on depreciation related to acquired fleet and property and equipment, impact of the fair value mark-up of acquired fleet, restructuring charge, asset impairment charge and loss on repurchase/redemption of debt securities and amendment of ABL facility. Management believes that earnings per share - adjusted provides useful information concerning future profitability. However, earnings per share - adjusted is not a measure of financial performance under GAAP. Accordingly, earnings per share - adjusted should not be considered an alternative to GAAP earnings per share. The table below provides a reconciliation between earnings per share - GAAP, as reported, and earnings per share - adjusted. $ Millions Earnings per share - GAAP, as reported After-tax impact of: Merger related costs (2) Three Months Ended December 31, Year Ended December 31, 2019 2018 2019 2018 $ 4.49 $ 3.80 $ 15.11 $ 13.12 0.21 0.01 0.32 Merger related intangible asset amortization (3) 0.60 0.58 2.48 1.76 Impact on depreciation related to acquired fleet and property and equipment (4) Impact of the fair value mark-up of acquired fleet (5) 0.05 0.39 0.19 0.16 0.11 0.72 0.59 Restructuring charge (6) 0.03 0.15 0.18 0.28 Asset impairment charge (7) (0.01) 0.05 Loss on repurchase/redemption of debt securities and amendment of ABL facility Earnings per share - adjusted 0.28 0.58 $ Tax rate applied to above adjustments (1) 5.60 $ 4.85 25.1% 25.7% $ 19.52 $ 25.3% 16.26 25.5% อล (1) (2) (3) The tax rates applied to the adjustments reflect the statutory rates in the applicable entities. Reflects transaction costs associated with the BakerCorp and BlueLine acquisitions discussed above. We have made a number of acquisitions in the past and may continue to make acquisitions in the future. Merger related costs only include costs associated with major acquisitions that significantly impact our operations. The historic acquisitions that have included merger related costs are RSC, which had annual revenues of approximately $1.5 billion prior to the acquisition, and National Pump, which had annual revenues of over $200 million prior to the acquisition. NES had annual revenues of approximately $369 million, Neff had annual revenues of approximately $413 million, BakerCorp had annual revenues of approximately $295 million and BlueLine had annual revenues of approximately $786 million. Reflects the amortization of the intangible assets acquired in the RSC, National Pump, NES, Neff, BakerCorp and BlueLine acquisitions. United Rentals® (4) (5) (6) Reflects the impact of extending the useful lives of equipment acquired in the RSC, NES, Neff, BakerCorp and BlueLine acquisitions, net of the impact of additional depreciation associated with the fair value mark-up of such equipment. 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, Neff and BlueLine acquisitions and subsequently sold. Primarily reflects severance and branch closure charges associated with our closed restructuring programs and our current restructuring program. We only include such costs that are part of a restructuring program as restructuring charges. Since the first such restructuring program was initiated in 2008, we have completed four restructuring programs. We have cumulatively incurred total restructuring charges of $333 million under our restructuring programs. (7) Reflects write-offs of leasehold improvements and other fixed assets. United Rentals, Inc., 100 First Stamford Place, Stamford, CT 06902. 2020 United Rentals, Inc. All rights reserved. 41#42EBITDA and Adjusted EBITDA GAAP Reconciliations EBITDA represents the sum of net income, provision for income taxes, interest expense, net, depreciation of rental equipment, and non-rental depreciation and amortization. Adjusted EBITDA represents EBITDA plus the sum of the merger related costs, restructuring charge, stock compensation expense, net, and the impact of the fair value mark-up of acquired fleet. These items are excluded from adjusted EBITDA internally when evaluating our operating performance and for strategic planning and forecasting purposes, and allow investors to make a more meaningful comparison between our core business operating results over different periods of time, as well as with those of other similar companies. The EBITDA and adjusted EBITDA margins represent EBITDA or adjusted EBITDA divided by total revenue. Management believes that EBITDA and adjusted EBITDA, when viewed with the Company's results under GAAP and the accompanying reconciliation, provide useful information about operating performance and period-over-period growth, and provide additional information that is useful for evaluating the operating performance of our core business without regard to potential distortions. Additionally, management believes that EBITDA and adjusted EBITDA help investors gain an understanding of the factors and trends affecting our ongoing cash earnings, from which capital investments are made and debt is serviced. However, EBITDA and adjusted EBITDA are not measures of financial performance or liquidity under GAAP and, accordingly, should not be considered as alternatives to net income or cash flow from operating activities as indicators of operating performance or liquidity. The table below provides a reconciliation between net income and EBITDA and adjusted EBITDA. The table below provides a reconciliation between net income and EBITDA and adjusted EBITDA. $ Millions Net income Provision for income taxes Interest expense, net Depreciation of rental equipment Non-rental depreciation and amortization Three Months Ended Year Ended December 31, December 31, 2019 2018 2019 2018 $ 338 $ 310 $ 1,174 $ 1,096 95 115 340 380 170 142 648 481 420 375 1,631 1,363 96 95 407 308 $ 1,119 $ 1,037 $ 4,200 $ 3,628 22 1 36 2 16 18 31 Stock compensation expense, net (3) Impact of the fair value mark-up of acquired fleet (4) 16 29 61 102 17 13 75 66 Adjusted EBITDA (B) $ 1,154 $ 1,117 $ 4,355 $ 3,863 (A) Our EBITDA margin was 45.6% and 45.0% for the three months ended December 31, 2019 and 2018, respectively, and 44.9% and 45.1% for the years ended December 31, 2019 and 2018, respectively. (B) EBITDA (A) Merger related costs (1) Restructuring charge (2) (1) Our adjusted EBITDA margin was 47.0% and 48.4% for the three months ended December 31, 2019 and 2018, respectively, and 46.6% and 48.0% for the years ended December 31, 2019 and 2018, respectively. Reflects transaction costs associated with the BakerCorp and BlueLine acquisitions discussed above. We have made a number of acquisitions in the past and may continue to make acquisitions in the future. Merger related costs only include costs associated with major acquisitions that significantly impact our operations. The historic acquisitions that have included merger related costs are RSC, which had annual revenues of approximately $1.5 billion prior to the acquisition, and National Pump, which had annual revenues of over $200 million prior to the acquisition. NES had annual revenues of approximately $369 million, Neff had annual revenues of approximately $413 million, BakerCorp had annual revenues of approximately $295 million and BlueLine had annual revenues of approximately $786 million. United Rentals® (2) (3) (4) Primarily reflects severance and branch closure charges associated with our closed restructuring programs and our current restructuring program. We only include such costs that are part of a restructuring program as restructuring charges. Since the first such restructuring program was initiated in 2008, we have completed four restructuring programs. We have cumulatively incurred total restructuring charges of $333 million under our restructuring programs. Represents non-cash, share-based payments associated with the granting of equity instruments. 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, Neff and BlueLine acquisitions and subsequently sold. United Rentals, Inc., 100 First Stamford Place, Stamford, CT 06902. 2020 United Rentals, Inc. All rights reserved. 42#43Reconciliation of Net Cash Provided by Operating Activities to EBITDA and Adjusted EBITDA The table below provides a reconciliation between net cash provided by operating activities and EBITDA and adjusted EBITDA. $ Millions Three Months Ended December 31, (1) 2019 2018 2019 Net cash provided by operating activities $ 442 $ Year Ended December 31, 2018 730 $ 3,024 $ 2,853 Adjustments for items included in net cash provided by operating activities but excluded from the calculation of EBITDA: Amortization of deferred financing costs and original issue discounts Gain on sales of rental equipment Gain on sales of non-rental equipment Gain on insurance proceeds from damaged equipment Merger related costs (1) Restructuring charge (2) Stock compensation expense, net (3) (16) ཕྱེgཝཟླ ེསྐྱས<88 ཙg༠༠།སེ༅ (15) (12) 313 278 6 22 (22) (1) (36) (16) (18) (31) (29) (61) (102) Loss on repurchase/redemption of debt securities and amendment of ABL facility (29) (61) Changes in assets and liabilities 387 192 170 124 Cash paid for interest 101 76 581 455 Cash paid for income taxes, net 142 21 238 71 EBITDA Add back: $ 1,119 $ 1,037 $ 4,200 $ 3,628 Merger related costs (1) Restructuring charge (2) Stock compensation expense, net (3) Impact of the fair value mark-up of acquired fleet (4) Adjusted EBITDA 22 2 16 16 29 22 1 36 18 31 61 102 17 13 75 $ 1,154 $ 1,117 $ 4,355 $ 66 3,863 Reflects transaction costs associated with the BakerCorp and BlueLine acquisitions discussed above. We have made a number of acquisitions in the past and may continue to make acquisitions in the future. Merger related costs only include costs associated with major acquisitions that significantly impact our operations. The historic acquisitions that have included merger related costs are RSC, which had annual revenues of approximately $1.5 billion prior to the acquisition, and National Pump, which had annual revenues of over $200 million prior to the acquisition. NES had annual revenues of approximately $369 million, Neff had annual revenues of approximately $413 million, BakerCorp had annual revenues of approximately $295 million and BlueLine had annual revenues of approximately $786 million. (2) (3) (4) Primarily reflects severance and branch closure charges associated with our closed restructuring programs and our current restructuring program. We only include such costs that are part of a restructuring program as restructuring charges. Since the first such restructuring program was initiated in 2008, we have completed four restructuring programs. We have cumulatively incurred total restructuring charges of $333 million under our restructuring programs. Represents non-cash, share-based payments associated with the granting of equity instruments. 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, Neff and BlueLine acquisitions and subsequently sold. United Rentals 9 United Rentals, Inc., 100 First Stamford Place, Stamford, CT 06902. 2020 United Rentals, Inc. All rights reserved. 43#44Pro Forma EBITDA and Adjusted EBITDA GAAP Reconciliations The pro forma information below for 2018 reflects the combination of United Rentals, BakerCorp and BlueLine. BakerCorp was acquired in July 2018 and was fully included in United Rentals' results for the three months ended December 31, 2018. Prior to our acquisitions of BakerCorp and BlueLine, BakerCorp and BlueLine management used different EBITDA and adjusted EBITDA definitions than those used by United Rentals. The information below reflects BakerCorp and BlueLine historical information presented in accordance with United Rentals' definitions of EBITDA and adjusted EBITDA. The management of BakerCorp and BlueLine historically did not view EBITDA and adjusted EBITDA as liquidity measures, and accordingly the information required to reconcile these measures to the statement of cash flows is unavailable to the company. The tables below provide calculations of as-reported and pro forma net income and EBITDA and adjusted EBITDA for the three months and years ended December 31, 2019 and 2018. $ Millions Net income (loss) Provision for income taxes Interest expense, net Depreciation of rental equipment Non-rental depreciation and amortization EBITDA (A) Merger related costs (1) Restructuring charge (2) Stock compensation expense, net (3) Impact of the fair value mark-up of acquired fleet (4) Other (5) Adjusted EBITDA (B) A) Three Months Ended December 31, 2019 As- reported 2018 As- reported 2018 Three Months Ended December 31, 2018 BlueLine $338 $310 $(139) Pro forma $171 95 115 115 170 142 11 153 420 375 17 392 96 95 95 $1,119 $1,037 $(111) $926 16 17 | 207 29 262 22 138 160 16 16 29 13 13 1 1 $1,154 $1,117 $28 $1,145 (1) B) Our as-reported EBITDA margin was 45.6% and 45.0% for the three months ended December 31, 2019 and 2018, respectively, and pro forma EBITDA margin was 39.1% for the three months ended December 31, 2018. Our as-reported EBITDA margin was 44.9% and 45.1% for the years ended December 31, 2019 and 2018, respectively, and pro forma EBITDA margin was 41.8% for the year ended December 31, 2018. Our as-reported adjusted EBITDA margin was 47.0% and 48.4% for the three months ended December 31, 2019 and 2018, respectively, and pro forma adjusted EBITDA margin was 48.3% for the three months ended December 31, 2018. Our as-reported adjusted EBITDA margin was 46.6% and 48.0% for the years ended December 31, 2019 and 2018, respectively, and pro forma adjusted EBITDA margin was 46.9% for the year ended December 31, 2018. Reflects transaction costs associated with the BakerCorp and BlueLine acquisitions discussed above. We have made a number of acquisitions in the past and may continue to make acquisitions in the future. Merger related costs only include costs associated with major acquisitions that significantly impact our operations. The historic acquisitions that have included merger related costs are RSC, which had annual revenues of approximately $1.5 billion prior to the acquisition, and National Pump, which had annual revenues of over $200 million prior to the acquisition. NES had annual revenues of approximately $369 million, Neff had annual revenues of approximately $413 million, BakerCorp had annual revenues of approximately $295 million and BlueLine had annual revenues of approximately $786 million. The BlueLine merger costs reflect merger related costs recognized by BlueLine prior to the acquisition. United Rentals® (2) Primarily reflects severance and branch closure charges associated with our closed restructuring programs and our current restructuring program. We only include such costs that are part of a restructuring program as restructuring charges. Since the first such restructuring program was initiated in 2008, we have completed four restructuring programs. We have cumulatively incurred total restructuring charges of $333 million under our restructuring programs. (3) Represents non-cash, share-based payments associated with the granting of equity instruments. (4) 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, Neff and BlueLine acquisitions and subsequently sold. (5) Includes various adjustments reflected in historic adjusted EBITDA for BlueLine. United Rentals, Inc., 100 First Stamford Place, Stamford, CT 06902. 2020 United Rentals, Inc. All rights reserved. 44#45Pro Forma EBITDA and Adjusted EBITDA GAAP Reconciliations (Cont'd) The pro forma information below for 2018 reflects the combination of United Rentals, BakerCorp and BlueLine. BakerCorp was acquired in July 2018 and was fully included in United Rentals' results for the three months ended December 31, 2018. Prior to our acquisitions of BakerCorp and BlueLine, BakerCorp and BlueLine management used different EBITDA and adjusted EBITDA definitions than those used by United Rentals. The information below reflects BakerCorp and BlueLine historical information presented in accordance with United Rentals' definitions of EBITDA and adjusted EBITDA. The management of BakerCorp and BlueLine historically did not view EBITDA and adjusted EBITDA as liquidity measures, and accordingly the information required to reconcile these measures to the statement of cash flows is unavailable to the company. The tables below provide calculations of as-reported and pro forma net income and EBITDA and adjusted EBITDA for the three months and years ended December 31, 2019 and 2018. $ Millions Year Ended December 31, 2019 Net income (loss) As- reported $1,174 2018 As- reported $1,096 2018 Year Ended December 31, 2018 2018 BakerCorp $(46) BlueLine $(169) Pro forma $881 Provision (benefit) for income taxes 340 380 (38) 342 Interest expense, net 648 481 30 106 617 Depreciation of rental equipment Non-rental depreciation and amortization EBITDA (A) Merger related costs (1) Restructuring charge (2) Stock compensation expense, net (3) 1,631 1,363 21 167 1,551 407 308 14 6 328 $4,200 $3,628 $(19) $110 $3,719 1 36 57 142 235 18 31 31 61 102 102 Impact of the fair value mark-up of acquired fleet (4) Other (5) Adjusted EBITDA (B) 75 66 66 $4,355 $3,863 7 $45 12 $264 19 $4,172 (1) A) B) Our as-reported EBITDA margin was 45.6% and 45.0% for the three months ended December 31, 2019 and 2018, respectively, and pro forma EBITDA margin was 39.1% for the three months ended December 31, 2018. Our as-reported EBITDA margin was 44.9% and 45.1% for the years ended December 31, 2019 and 2018, respectively, and pro forma EBITDA margin was 41.8% for the year ended December 31, 2018. Our as-reported adjusted EBITDA margin was 47.0% and 48.4% for the three months ended December 31, 2019 and 2018, respectively, and pro forma adjusted EBITDA margin was 48.3% for the three months ended December 31, 2018. Our as-reported adjusted EBITDA margin was 46.6% and 48.0% for the years ended December 31, 2019 and 2018, respectively, and pro forma adjusted EBITDA margin was 46.9% for the year ended December 31, 2018. Reflects transaction costs associated with the BakerCorp and BlueLine acquisitions discussed above. We have made a number of acquisitions in the past and may continue to make acquisitions in the future. Merger related costs only include costs associated with major acquisitions that significantly impact our operations. The historic acquisitions that have included merger related costs are RSC, which had annual revenues of approximately $1.5 billion prior to the acquisition, and National Pump, which had annual revenues of over $200 million prior to the acquisition. NES had annual revenues of approximately $369 million, Neff had annual revenues of approximately $413 million, BakerCorp had annual revenues of approximately $295 million and BlueLine had annual revenues of approximately $786 million. The BlueLine merger costs reflect merger related costs recognized by BlueLine prior to the acquisition. United Rentals® Represents non-cash, share-based payments associated with the granting of equity instruments. (2) Primarily reflects severance and branch closure charges associated with our closed restructuring programs and our current restructuring program. We only include such costs that are part of a restructuring program as restructuring charges. Since the first such restructuring program was initiated in 2008, we have completed four restructuring programs. We have cumulatively incurred total restructuring charges of $333 million under our restructuring programs. (3) (4) 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, Neff and BlueLine acquisitions and subsequently sold. (5) Includes various adjustments reflected in historic adjusted EBITDA for BlueLine. United Rentals, Inc., 100 First Stamford Place, Stamford, CT 06902. 2020 United Rentals, Inc. All rights reserved.#46Free Cash Flow GAAP Reconciliation We define "free cash flow" as net cash provided by operating activities less purchases of, and plus proceeds from, equipment. The equipment purchases and proceeds are included in cash flows from investing activities. Management believes that free cash flow provides useful additional information concerning cash flow available to meet future debt service obligations and working capital requirements. However, free cash flow is not a measure of financial performance or liquidity under GAAP. Accordingly, free cash flow should not be considered an alternative to net income or cash flow from operating activities as an indicator of operating performance or liquidity. The table below provides a reconciliation between net cash provided by operating activities and free cash flow. $ Millions Net cash provided by operating activities Purchases of rental equipment Purchases of non-rental equipment Three Months Ended December 31, Year Ended December 31, 2019 2018 2019 2018 $ 442 $ 730 $ (158) (144) 3,024 $ 2,853 (2,132) (2,106) (61) (51) (218) (185) Proceeds from sales of rental equipment 244 186 831 664 Proceeds from sales of non-rental equipment 11 10 37 23 Insurance proceeds from damaged equipment Free cash flow (1) 6 4 24 22 $ 484 735 $ 1,566 $ 1,271 (1) Free cash flow included aggregate merger and restructuring related payments of $4 million and $31 million for the three months ended December 31, 2019 and 2018, respectively, and $26 million and $63 million for the years ended December 31, 2019 and 2018, respectively. The table below provides a reconciliation between 2020 forecasted net cash provided by operating activities and free cash flow. $ Millions Net cash provided by operating activities Purchases of rental equipment Proceeds from sales of rental equipment Purchases of non-rental equipment, net of proceeds from sales Free cash flow (excluding the impact of merger and restructuring related payments) United Rentals® United Rentals, Inc., 100 First Stamford Place, Stamford, CT 06902. 2020 United Rentals, Inc. All rights reserved. $2,850-$3,350 $(1,900)-$(2,200) $800-$900 $(150)-$(250) $1,600-$1,800 45#47Historical Adjusted Earnings Per Share GAAP Reconciliation Adjusted EPS (earnings per share) is a non-GAAP measure that reflects diluted earnings (loss) per share from continuing operations excluding the impact of the special items described below. Management believes that adjusted EPS provides useful information concerning future profitability. However, adjusted EPS is not a measure of financial performance under GAAP. Accordingly, adjusted EPS should not be considered an alternative to GAAP earnings per share. The table below provides a reconciliation between diluted earnings (loss) per share and adjusted EPS. 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 Diluted earnings (loss) per share (EPS) from continuing operations $ (12.62) $ (0.98) $ (0.38) $ 1.38 $ 0.79 $ 3.64 $ 5.15 $ 6.07 $ 6.45 $ 15.73 $ 13.12 $ 15.11 EPS adjustments (after-tax): Merger related costs (1) Merger related intangible asset amortization (2) Impact on depreciation related to acquired fleet and property and equipment (3) Impact of the fair value mark-up of acquired fleet (4) 0.25 0.72 0.74 0.05 0.94 (0.03) (0.04) 0.06 (0.17) 1.10 (0.03) (0.02) 0.36 0.32 0.01 1.15 1.12 1.15 1.76 2.48 0.05 0.19 0.39 0.24 0.25 0.21 0.19 0.25 0.59 0.59 0.72 0.19 Pre-close RSC merger related interest expense (5) Impact on interest expense related to fair value adjustment of acquired RSC indebtedness (6) (0.03) (0.04) (0.03) (0.02) (0.01) I Restructuring charge (7) 0.17 0.29 0.34 0.16 0.64 0.07 (0.01) 0.04 0.11 0.36 Asset impairment charge (8) 0.06 0.12 0.09 0.04 0.10 0.02 0.03 0.01 (Gain) loss on extinguishment of debt securities, including subordinated convertible debentures, and amendments of debt facilities (9) (0.32) (0.19) 0.28 0.04 0.45 0.02 0.46 0.78 0.70 0.39 Gain on sale of software subsidiary (10) (0.05) Goodwill impairment charge (11) 12.19 0.19 3.19 | | | | | Charge related to settlement of SEC inquiry (12) Preferred stock redemption charge (13) Foreign tax credit valuation allowance and other (14) Total EPS adjustments Adjusted EPS 2017 Tax Act impact (15) Total revenues ($M) (16) United Rentals® 0.28 0.18 0.05 0.58 | | | | 0.10 $ 15.58 $ 0.22 $ 0.71 $ 0.49 $ $ 2.96 $ (0.76) $ 0.33 $ 1.87 $ 2.97 $ 3.76 $ 1.27 $ 4.91 $ 1.76 $ 1.95 $ 6.91 $ 8.02 $ 2.20 $ 2.91 $ 8.65 $ 18.64 $ 3.14 $ 4.41 16.26 $ 19.52 $ 8.05 $ $ 3,267 $ 2,358 $ 2,237 $ 2,611 $ 4,117 $ 4,955 $ 5,685 $ 5,817 $ 5,762 $ 6,641 $ 8,047 $ 9,351 United Rentals, Inc., 100 First Stamford Place, Stamford, CT 06902. 2020 United Rentals, Inc. All rights reserved. 46#48Historical Adjusted Earnings Per Share GAAP Reconciliation (cont'd) (1) We have made a number of acquisitions in the past and may continue to make acquisitions in the future. Merger related costs only include costs associated with major acquisitions that significantly impact our operations. The acquisitions that have included merger related costs are 1) RSC, which had annual revenues of approximately $1.5 billion prior to the acquisition, 2) National Pump, which had annual revenues of over $200 million prior to the acquisition, 3) NES, which had annual revenues of approximately $369 million prior to the acquisition, 4) Neff, which had annual revenues of approximately $413 million prior to the acquisition, 5) BakerCorp, which had annual revenues of approximately $295 million prior to the acquisition and 6) BlueLine, which had annual revenues of approximately $786 million prior to the acquisition. (2) Reflects the amortization of the intangible assets acquired in the RSC, National Pump, NES, Neff, BakerCorp and BlueLine acquisitions. (3) Reflects the impact of extending the useful lives of equipment acquired in the RSC, NES, Neff, BakerCorp and BlueLine acquisitions, net of the impact of additional depreciation associated with the fair value mark-up of such equipment. (4) 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, Neff and BlueLine acquisitions and subsequently sold. (5) In March 2012, we issued $2.825 billion of debt in connection with the RSC acquisition. The pre-close RSC merger related interest expense reflects the interest expense recorded on this debt prior to the acquisition of RSC on April 30, 2012. (6) Reflects a reduction of interest expense associated with the fair value mark-up of debt acquired in the RSC acquisition. (7) Primarily reflects severance and branch closure charges associated with our closed restructuring programs and our current restructuring program. We only include such costs that are part of a restructuring program as restructuring charges. Since the first such restructuring program was initiated in 2008, we have completed four restructuring programs. We have cumulatively incurred total restructuring charges of $333 million under our restructuring programs. (8) Primarily reflects write-offs of leasehold improvements and other fixed assets. (9) Reflects gains/losses on the extinguishment of certain debt securities, including subordinated convertible debentures, and write-offs of debt issuance costs associated with amendments to our debt facilities. In 2013, we retired all outstanding subordinated convertible debentures. (10) Reflects a gain recognized upon the sale of a former subsidiary that developed and marketed software. (11) We recognized a goodwill impairment charge in the fourth quarter of 2008 that reflected the challenges of the construction cycle, as well as the broader economic and credit environment. Substantially all of the impairment charge related to goodwill arising out of acquisitions made between 1997 and 2000. (12) In the third quarter of 2008 we settled, without admitting or denying the allegations in the SEC's complaint, to the entry of a judgment requiring us to pay a civil penalty of $14 million associated with an SEC inquiry into our historical accounting practices. (13) Reflects a preferred stock redemption charge associated with the June 2008 repurchase of our Series C and D preferred stock. (14) Primarily relates to the establishment of a valuation allowance related to certain foreign tax credits that, as a result of the preferred stock redemption discussed above, were no longer expected to be realized. (15) The Tax Cuts and Jobs Act (the "Tax Act"), which was enacted in December 2017, reduced the U.S. federal corporate statutory tax rate from 35% to 21%. The benefit in 2017 reflects an aggregate benefit of $689 million, or $8.05 per diluted share, reflecting 1) a one-time non-cash tax benefit reflecting the revaluation of our net deferred tax liability using a U.S. federal corporate statutory tax rate of 21% and 2) a one-time transition tax on our unremitted foreign earnings and profits. Periods subsequent to 2017 reflect the lower 21% U. S. federal corporate statutory tax rate. (16) Total revenue is provided for context. United Rentals® United Rentals, Inc., 100 First Stamford Place, Stamford, CT 06902. 2020 United Rentals, Inc. All rights reserved. 47#49Historical EBITDA and Adjusted EBITDA GAAP Reconciliations ($M) EBITDA represents the sum of net income (loss), loss on discontinued operations, net of tax, provision (benefit) for income taxes, interest expense, subordinated convertible debentures, net, depreciation of rental equipment, and non-rental depreciation and amortization. Adjusted EBITDA represents EBITDA plus the adjusting items (determined at the time of the historic reporting) discussed below. These items are excluded from adjusted EBITDA internally when evaluating our operating performance and for strategic planning and forecasting purposes, and allow investors to make a more meaningful comparison between our core business operating results over different periods of time, as well as with those of other similar companies. The EBITDA and adjusted EBITDA margins represent EBITDA or adjusted EBITDA divided by total revenue. Management believes that EBITDA and adjusted EBITDA, when viewed with the Company's results under GAAP and the accompanying reconciliations, provide useful information about operating performance and period-over-period growth, and provide additional information that is useful for evaluating the operating performance of our core business without regard to potential distortions. Additionally, management believes that EBITDA and adjusted EBITDA help investors gain an understanding of the factors and trends affecting our ongoing cash earnings, from which capital investments are made and debt is serviced. The tables below provide 1) a reconciliation between net income and EBITDA and adjusted EBITDA and 2) a reconciliation between net cash provided by operating activities and EBITDA and adjusted EBITDA. 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 Net income (loss) $ (704) $ (62) $ (26) $ 101 $ 75 $ 387 $ 540 $ 585 $ 566 $ 1,346 $ 1,096 $ 1,174 Loss on discontinued operations, net of tax Provision (benefit) for income taxes 2 4 (109) (47) (41) 63 13 218 310 378 343 (298) 380 340 Interest expense, net 174 226 255 228 512 475 555 567 511 464 481 648 Interest expense-subordinated convertible debentures, net (1) Depreciation of rental equipment 55565 9 (4) 8 7 4 3 455 417 389 423 699 852 921 976 990 1,124 1,363 1,631 Non-rental depreciation and amortization 58 57 60 57 198 246 273 268 255 259 308 407 EBITDA (117) 589 649 879 1,501 2,181 2,599 2,774 2,665 2,895 3,628 4,200 EBITDA Margin (3.6)% 25.0% 29.0% 33.7% 36.5% 44.0% 45.7% 47.7% 46.3% 43.6% 45.1% 44.9% Merger related costs (2) 19 111 9 11 (26) 50 36 1 Restructuring charge (3) 20 31 34 19 99 12 (1) 6 14 50 31 18 Charge related to settlement of SEC inquiry (4) 14 Goodwill impairment charge (5) 1,147 || | | | | 1 | | | | | Impact of the fair value mark-up of acquired fleet (6) 37 44 35 29 35 82 66 75 (Gain) loss on sale of software subsidiary (7) (8) 1 Stock compensation expense, net (8) 6 8 8 12 32 46 74 49 45 87 102 61 Adjusted EBITDA $ 1,070 $ 628 $ 691 $ 929 $ 1,772 $ 2,293 $ 2,718 $ 2,832 Adjusted EBITDA Margin 32.8% 26.6% 30.9% 35.6% 43.0% 46.3% 47.8% 48.7% 47.9% $ 2,759 $ 3,164 47.6% $ 3,863 $ 4,355 48.0% 46.6% United Rentals® United Rentals, Inc., 100 First Stamford Place, Stamford, CT 06902. 2020 United Rentals, Inc. All rights reserved. 48#50Historical EBITDA and Adjusted EBITDA GAAP Reconciliations ($M) (cont'd) 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 Net cash provided by operating activities (9) Adjustments for items included in net cash provided by operating activities but excluded from the calculation of EBITDA: Loss from discontinued operation, net of taxes Amortization of deferred financing costs and original issue discounts Gain on sales of rental equipment (Loss) gain on sales of non-rental equipment Gain on insurance proceeds on damaged equipment (10) Gain (loss) on sale of software subsidiary (7) Merger related costs (2) Restructuring charge (3) Stock compensation expense, net (8) Gain (loss) on extinguishment of debt securities, and amendments of debt facilities Loss on retirement of subordinated convertible debentures (1) Excess tax benefits from share-based payment arrangements (11) Changes in assets and liabilities Cash paid for interest, including subordinated convertible debentures (1) Cash paid (received) for income taxes, net EBITDA $ 438 $ 452 $ 612 $ 721 $1,551 $ 1,801 $1,987 $ 1,941 $ 2,209 $ 2,853 $ 3,024 4 (17) (22) (23) (21) (17) (10) (9 (12) (15) 66 125 176 229 227 204 220 278 313 2 2 6 11 8 4 6 6 8 12 21 22 24 ®ཕྱེ། ། |རྒྱབྱེ॰ N | | € 1. GINA སྗེསྨྱུ☁8 |སྐྱེ I (1) 26 (50) (36) (6) (14) (50) (31) (18) 8 (19) (111) (9) (31) (34) (19) (99) (12) 1 (8) (8) (12) (32) (46) (74) (49) (45) (87) (102) (61 (3) (72) (1) (80) (123) (101) (54) (61) (2) (2) 7 13 (58) 234 3 589 སྐྱེ¥ ། | | |སྐྱེ༅ 8། |88ཊྛི 5ཕྲུགྲྭ། |བྱེ ༄༅།⌘༄༄ ༄། ཁཆྱེ༅ | <རྨ།ཆེ $ | |8aཤྩ 5 58 49 571 31 182 194 101 129 124 170 203 371 461 457 447 415 357 455 581 24 40 48 100 60 99 205 71 238 879 1,501 2,181 2,599 2,774 2,665 2,895 3,628 4,200 Add back: Merger related costs (2) Restructuring charge (3) Stock compensation expense, net (8) Impact of the fair value mark-up of acquired fleet (6) (Gain) loss on sale of software subsidiary (7) Adjusted EBITDA | $ ྋ 8 | ∞ | 31 19 111 9 34 19 99 12 == 11 (26) (1) 6 14 550 36 1 31 18 8 12 IN 32 46 74 49 45 87 102 61 37 44 35 29 35 82 66 75 $ 628 $ 691 $ | 「ཱ - (8) 1 - - - 929 $1,772 $2,293 $2,718 $2,832 $2,759 $3,164 $ 3,863 $ 4,355 United Rentals® United Rentals, Inc., 100 First Stamford Place, Stamford, CT 06902. 2020 United Rentals, Inc. All rights reserved. 49 49#51Historical EBITDA and Adjusted EBITDA GAAP Reconciliations ($M) (cont'd) (1) In 2013, we retired all outstanding subordinated convertible debentures. (2) We have made a number of acquisitions in the past and may continue to make acquisitions in the future. Merger related costs only include costs associated with major acquisitions that significantly impact our operations. The acquisitions that have included merger related costs are 1) RSC, which had annual revenues of approximately $1.5 billion prior to the acquisition, 2) National Pump, which had annual revenues of over $200 million prior to the acquisition, 3) NES, which had annual revenues of approximately $369 million prior to the acquisition, 4) Neff, which had annual revenues of approximately $413 million prior to the acquisition, 5) BakerCorp, which had annual revenues of approximately $295 million prior to the acquisition and 6) BlueLine, which had annual revenues of approximately $786 million prior to the acquisition. (3) Primarily reflects severance and branch closure charges associated with our closed restructuring programs and our current restructuring program. We only include such costs that are part of a restructuring program as restructuring charges. Since the first such restructuring program was initiated in 2008, we have completed four restructuring programs. We have cumulatively incurred total restructuring charges of $333 million under our restructuring programs. (4) In the third quarter of 2008 we settled, without admitting or denying the allegations in the SEC's complaint, to the entry of a judgment requiring us to pay a civil penalty of $14 million associated with an SEC inquiry into our historical accounting practices. (5) We recognized a goodwill impairment charge in the fourth quarter of 2008 that reflected the challenges of the construction cycle, as well as the broader economic and credit environment. Substantially all of the impairment charge related to goodwill arising out of acquisitions made between 1997 and 2000. (6) 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, Neff and BlueLine acquisitions and subsequently sold. (7) Reflects a gain recognized upon the sale of a former subsidiary that developed and marketed software. (8) Represents non-cash, share-based payments associated with the granting of equity instruments. (9) We first reported the reconciliation between net cash provided by operating activities and EBITDA and adjusted EBITDA in 2011, and 2009 is the earliest reported period with such a reconciliation. The presentation of our statement of cash flows for periods prior to 2009 differs from the presentation used in 2011, on account of which the information required to prepare the reconciliation between net cash provided by operating activities and EBITDA and adjusted EBITDA for periods prior to 2009 is unavailable without unreasonable effort. (10) In 2018, we adopted accounting guidance that addressed the cash flow presentation for proceeds from the settlement of insurance claims. Adoption of this guidance decreased net cash provided by operating activities, relative to previously reported amounts, but did not change EBITDA or adjusted EBITDA for 2017, 2016 and 2015 in the table above. The information required to determine the amount of insurance proceeds for periods prior to 2015 is unavailable without unreasonable effort. The insurance proceeds do not impact EBITDA or adjusted EBITDA. (11) The excess tax benefits from share-based payment arrangements result from stock-based compensation windfall deductions in excess of the amounts reported for financial reporting purposes. We adopted accounting guidance in 2017 that changed the cash flow presentation of excess tax benefits from share-based payment arrangements. In the table above, the excess tax benefits from share-based payment arrangements for periods after 2016 are presented as a component of net cash provided by operating activities, while, for 2015 and 2016, they are presented as a separate line item. United Rentals® United Rentals, Inc., 100 First Stamford Place, Stamford, CT 06902. 2020 United Rentals, Inc. All rights reserved. 50 50#52Historical Free Cash Flow GAAP Reconciliation ($M) We define "free cash flow" as net cash provided by operating activities less purchases of, and plus proceeds from, equipment, and plus excess tax benefits from share-based payment arrangements. The equipment purchases and proceeds are included in cash flows from investing activities. Management believes that free cash flow provides useful additional information concerning cash flow available to meet future debt service obligations and working capital requirements. However, free cash flow is not a measure of financial performance or liquidity under GAAP. Accordingly, free cash flow should not be considered an alternative to net income or cash flow from operating activities as an indicator of operating performance or liquidity. The table below provides a reconciliation between net cash provided by operating activities and free cash flow. 2008 Net cash provided by operating activities $ Purchases of rental equipment 2009 2010 2011 764 $ 438 $ 452 $ 612 $ (624) (260) (346) (774) 2012 2013 2014 2015 2016 2017 2018 2019 721 $ 1,551 $ 1,801 $ 1,987 $ 1,941 $ 2,209 $ 2,853 $ 3,024 (1,272) (1,580) (1,701) (1,534) (1,246) (1,769) (2,106) (2,132) Purchases of non-rental equipment (80) (51) (28) (36) (97) (104) (120) (102) (93) (120) (185) (218) Proceeds from sales of rental equipment 264 229 144 208 399 490 544 538 496 550 664 831 Proceeds from sales of non-rental equipment Insurance proceeds from damaged equipment (1) Excess tax benefits from share-based payment arrangements (2) Free cash flow 11 13 7 13 31 26 33 17 14 16 23 37 8 12 21 22 24 (2) (2) 5 58 $ 335 $ 367 $ 227 $ 23 $ (223) $ 383 $ 557 $ 919 $ 1,182 $ 907 $ 1,271 $ 1,566 Merger and restructuring related payments included in free cash flow (3) 150 38 17 5 13 76 63 26 Free cash flow excluding merger and restructuring related payments (3) $ (73) $ 421 $ 574 $ 924 $ 1,195 $ 983 $ 1,334 $ 1,592 (1) In 2018, we adopted accounting guidance that addressed the cash flow presentation for proceeds from the settlement of insurance claims. Adoption of this guidance decreased net cash provided by operating activities, relative to previously reported amounts, but did not change free cash flow, for 2017, 2016 and 2015 in the table above. The information required to determine the amount of insurance proceeds for periods prior to 2015 is unavailable without unreasonable effort. The adoption of this accounting guidance did not impact free cash flow, as the reduction to net cash provided by operating activities was offset by the increase in insurance proceeds from damaged equipment. (2) The excess tax benefits from share-based payment arrangements result from stock-based compensation windfall deductions in excess of the amounts reported for financial reporting purposes. We adopted accounting guidance in 2017 that changed the cash flow presentation of excess tax benefits from share-based payment arrangements. In the table above, the excess tax benefits from share-based payment arrangements for periods after 2016 are presented as a component of net cash provided by operating activities, while, for 2016 and prior, they are presented as a separate line item. Because we historically included the excess tax benefits from share based payment arrangements in the free cash flow calculation, the adoption of this guidance did not change the calculation of free cash flow. (3) Merger and restructuring related payments were first reported for 2012. The information required to determine the amount of merger and restructuring related payments for periods prior to 2012 is unavailable without unreasonable effort. United Rentals® United Rentals, Inc., 100 First Stamford Place, Stamford, CT 06902. 2020 United Rentals, Inc. All rights reserved. 51