exv10w1






Exhibit 10.1




ELECTRO RENT CORPORATION




SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN




 









 





TABLE OF CONTENTS




	 	 	 	 	 
	 
	 	 	Page	 
	 
	 	 	 	 
	I. PLAN HISTORY AND FEATURES
	 	 	1	 
	 
	 	 	 	 
	II. DEFINITIONS
	 	 	2	 
	2.1 Board of directors
	 	 	2	 
	2.2 Code
	 	 	2	 
	2.3 Deferral
	 	 	2	 
	2.4 Employee
	 	 	2	 
	2.5 Employer
	 	 	3	 
	2.6 Employment
	 	 	3	 
	2.7 ERISA
	 	 	3	 
	2.8 Participant
	 	 	3	 
	2.9 Plan
	 	 	3	 
	2.10 Plan Administrator
	 	 	3	 
	2.11 Trust or Trust Fund
	 	 	3	 
	2.12 Trust Agreement
	 	 	4	 
	 
	 	 	 	 
	III. PARTICIPATION
	 	 	5	 
	3.1 Requirements for Participation
	 	 	5	 
	3.2 Termination of Participation
	 	 	5	 
	 
	 	 	 	 
	IV. BENEFITS
	 	 	6	 
	4.1 Supplement to the Savings Plan
	 	 	6	 
	4.2 Accounts
	 	 	7	 
	4.3 Payment of Benefits
	 	 	7	 
	4.4 Hardship Withdrawals
	 	 	8	 






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	 	 	Page	 
	 
	 	 	 	 
	V . SECURITY FOR PROMISED BENEFITS
	 	 	9	 
	 
	 	 	 	 
	VI. ADMINISTRATION OF THE PLAN
	 	 	11	 
	6.1 Duties of the Plan Administrator
	 	 	11	 
	6.2 Delegation of Administrative Responsibility
	 	 	11	 
	6.3 Claims Procedure
	 	 	11	 
	6.4 Effect of Plan Administrator Action
	 	 	13	 
	 
	 	 	 	 
	VII. AMENDMENT AND TERMINATION OF THE PLAN
	 	 	15	 
	 
	 	 	 	 
	VIII. MISCELLANEOUS PROVISIONS
	 	 	16	 
	8.1 Alienation
	 	 	16	 
	8.2 Duty to Provide Data
	 	 	16	 
	8.3 Limitation on Rights of Employees
	 	 	17	 
	8.4 Service of Process
	 	 	18	 
	8.5 Governing Law
	 	 	18	 
	8.6 Plurals
	 	 	18	 
	8.7 Titles
	 	 	18	 
	8.8 References
	 	 	19	 






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ELECTRO RENT CORPORATION SUPPLEMENTAL EXECUTIVE




RETIREMENT PLAN




ARTICLE I




PLAN HISTORY AND FEATURES




     Electro Rent Corporation has adopted this Plan for the benefit of certain of its employees.
The Plan is effective January 1, 1987.



     The Plan is a non-qualified deferred compensation program which is a “pension benefit plan”
subject to the Employee Retirement Income Security Act of 1974. Although benefits under the Plan
are unfunded contractual obligations of the Employer, the Employer may transfer money or other
property to one or more “rabbi” trusts and direct that benefits under the Plan be paid out of such
assets.



     The purpose of the Plan is to provide benefits that cannot be provided under qualified
retirement programs of the Employer because of limitations imposed by federal law, including
Internal Revenue Code Section 415 limitations on allowable benefits, Code Section 401(k)
limitations on cash or deferred plan deferrals, and Code Section 401(a)(4) limitations on the
granting of benefits based on non-qualified deferred compensation and on discrimination in
contributions or benefits.



 









 





ARTICLE II




DEFINITIONS




     The following terms, when capitalized, shall have the meaning specified below unless the
context clearly indicates to the contrary.



     2.1 Board of Directors: The Board of Directors of Electro Rent Corporation.



     2.2 Code: The Internal Revenue Code of 1986, as amended from time to time.



     2.3 Deferral: An amount contributed to this Plan by the Employer in lieu of being paid
to a Participant as salary or wages. Deferrals shall be made under salary reduction arrangements
between each Participant and the Employer. Article IV contains the provisions under which Deferrals
may be made. Deferrals may only be withheld from amounts earned after execution of the salary
reduction arrangement pursuant to which the Deferral is being made.



     2.4 Employee: An individual who renders services to the Employer as a common law
employee or officer (i.e., a person whose wages from the Employer are subject to federal
income tax withholding). A person rendering services to the Employer purportedly as an independent
contractor shall not be treated as an Employee before the Employer has acknowledged that it must
withhold federal income taxes from his or her pay.





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     2.5 Employer: Electro Rent Corporation and any other company which adopts the Plan,
and any successor entity which continues the Plan or such companies collectively. In contexts in
which actions are required or permitted to be taken or notice is to be given, the Employer shall
mean Electro Rent Corporation or any successor company.



     2.6 Employment: The period during which an individual is an Employee. Employment shall
commence on the day the individual first performs services for the Employer as an Employee and
shall terminate on the day the Employee resigns, dies, retires or is discharged or permanently laid
off.



     2.7 ERISA: The Employee Retirement Income Security Act of 1974.



     2.8 Participant: Any Employee who is included in the Plan pursuant to Article III.



     2.9 Plan: This document and any Trust Agreement.



     2.10 Plan Administrator: Electro Rent Corporation, acting through its chief executive
officer or such other person as the Employer shall designate. The Plan Administrator is the Plan’s
“named fiduciary” within the meaning of Section 402(a)(2) of ERISA.



     2.11 Trust or Trust Fund: The fund established under one or more Trust
Agreements pursuant to the Plan.



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     2.12 Trust Agreement: Any agreement between a trustee and the Employer entered into
for the purpose of investing and administering the Trust Fund. Each Trust Agreement constitutes a
part of this Plan.



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ARTICLE III




PARTICIPATION




     3.1 Requirements for Participation



          A person may participate in the Plan if: (1) the Plan Administrator determines that the
limitations of Code Sections 415 or 401(k) would preclude the individual from making Deferrals to
the maximum amount permitted under the Electro Rent Corporation Employee Stock Ownership and
Savings Plan (the “Savings Plan”). In addition, any individuals selected by the Employer may
participate in the Plan. A person shall become a Participant on the date he or she is notified by
the Plan Administrator in writing that he or she has become a Participant.




     3.2 Termination of Participation



          An individual who has become a Participant shall cease to be a Participant upon termination
of Employment.




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ARTICLE IV




BENEFITS




     4.1 Supplement to the Savings Plan



          (a) To the extent that a Participant cannot contribute the maximum amount permitted under the
Savings Plan because of Code Section 415 or 401(k) limitations applicable to the Savings Plan, the
amount that cannot be contributed to the Savings Plan shall automatically be treated as a Deferral
under this Plan in accordance with contribution elections which have been made under the Savings
Plan, except as otherwise permitted by the Plan Administrator. A Participant may make “catch-up”
Deferrals to this Plan retroactive to January 1, 1987 but starting at a later date during 1987. Any
Deferral to be made under this Plan shall be deducted from the Participant’s paycheck on the same
date the amount would have been deducted under the Savings Plan but for legal limitations, or at
such other time as the Plan Administrator specifies, and shall be credited to the Participant’s
account in accordance with Section 4.3.




          (b) The Employer makes matching contributions under the Savings Plan. Matching contributions
which cannot be provided under the Savings Plan due to Code Section 415 or applicable
anti-discrimination requirements shall be provided under this Plan to the extent they are “earned”
by the Participant by making contributions to the Savings Plan or Deferrals to this Plan. Employer
matching contributions made to this Plan shall be subject to the same vesting provisions as the
Savings Plan.




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     4.2 Accounts



          Deferrals or Employer matching contributions for a Participant under Section 4.1 shall be
credited to a separate unfunded account on the books of the Employer as soon as reasonably possible
after such amounts have been ascertained. These accounts shall be credited with interest at a rate
to be determined by the Plan Administrator. To the extent an account is funded through the Trust
Fund, it shall be credited instead with the approximate actual earnings (or losses) on the portion
of the Trust Fund being held for the Participant’s benefit as authorized by the Plan Administrator.




     4.3 Payment of Benefits



          Benefits under this Section shall be paid to the Participant upon termination of Employment.
A Participant’s benefit under the Plan shall consist of his or her Account balance as of the date
distribution is made or commences. Payment shall be made in a cash lump sum if the Participant’s
benefit under the Plan is less than $40,000. For benefits from $40,000 to $200,000, payment shall
be made in no more than five annual installments. The amount of each installment shall be
calculated as follows; however, no installment shall be less than $20,000 except to the extent
that the unpaid account balance is less than $20,000, in which case the installment shall be equal
to the entire unpaid account balance: the first installment shall be one-fifth of the total
benefit, the second installment shall be one-fourth of the remaining benefit, the third
installment, one-third, etc. For benefits exceeding $200,000, payment shall be made in ten annual
installments, each payment being one-tenth of the unpaid amount of the benefit. By written
agreement between the Plan Administrator and the Participant executed at the time the individual
first becomes




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a Participant hereunder, the Plan Administrator in its sole discretion may authorize a different
form of payment. Payments shall commence as of the first day of the month coincident with or next
following termination of Employment. Upon a Participant’s death, the balance payable to the
Participant shall be paid to the Participant’s surviving beneficiary in installments as described
above or as a continuation of installments if the Participant’s benefit was already in pay status
at the time of the Participant’s death. The Participant shall designate a beneficiary in the manner
and form prescribed by the Plan Administrator. If the Participant has no surviving beneficiary, the
Participant’s benefit shall be paid in a lump sum to the Participant’s estate.




     4.4. Hardship Withdrawals



          The Plan Administrator in its sole discretion may permit a Participant to withdraw all or a
part of his or her Account because of the existence of a hardship.





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ARTICLE V




SECURITY FOR PROMISED BENEFITS




     This Plan constitutes an unfunded, unsecured promise of the Employer to pay amounts to each
Participant (or his or her beneficiary) out of the Employer’s general assets. Nevertheless, subject
to the following terms, the Employer is hereby authorized in its discretion to transfer money or
other property to one or more Trust Funds and direct the trustee(s) (which may be any individual or
group of individuals, including a Participant, or a corporate fiduciary) to pay Plan benefits to a
Participant out of such assets.



          (a) The funding of such Trust Fund shall be at the discretion of any of the Employer’s
officers, but the Trust (including additions to it and earnings) shall be irrevocable.




          (b) The Employer shall remain the owner of all assets in the Trust and the assets shall only
be subject to the claims of Employer creditors if the Employer ever goes into bankruptcy, or
becomes insolvent. The term “insolvent,” as used herein shall mean the Employer’s inability to pay,
within a reasonable time, its liabilities as they become due. The Employer shall have the duty to
inform the trustee(s), within a reasonable time, if the Employer becomes insolvent or goes into
bankruptcy. When so informed, the trustee(s) shall suspend payments to the Participants and hold
the assets for the benefit of the Employer’s general creditors. If the trustee(s) receives a
written allegation that the Employer is bankrupt or insolvent, the trustee(s) shall suspend
payments to the Participants and hold the assets for the benefit of the Employer’s general
creditors, and shall determine within thirty days of receipt of such notice whether the Employer is
bankrupt or insolvent.



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If the trustee(s) determines that the Employer is not bankrupt or insolvent, the trustee(s) shall
resume payments to the Participants.




          (c) Except as provided in subsection (b), Participants’ interest in the Trust shall be the
same as, but in no event better than, the rights of general unsecured creditors of the Employer.




          (d) The Employer may retain the right to direct how the Trust Fund is to be invested and shall
have the power to substitute assets of like value for cash or assets in the Trust.




          (e) To the extent the Trust Fund has sufficient assets, benefits under the Plan may be paid by
the trustee(s). To the extent the trustee(s) does not or cannot pay benefits out of the Trust, the
benefits shall be paid by the Employer.




          (f) The Employer may reduce the amount of payment to be made under this Plan to a Participant
or his or her beneficiary by the amount of any taxes on the payment which the Employer is required
to withhold pursuant to applicable law.




          (g) After all accrued benefits due under this Plan have been paid, or with the consent of all
Participants entitled to payment of benefits under the Trust, the Trust Agreement shall terminate
and any remaining assets shall be transferred to the Employer.




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ARTICLE VI




ADMINISTRATION OF THE PLAN




     6.1 Duties of the Plan Administrator



          The Plan Administrator shall be responsible for the general administration and management of
the Plan and shall administer the Plan in accordance with its terms.




     6.2 Delegation of Administrative Responsibility



          (a) The Plan Administrator may delegate all or any portion of its administrative
responsibilities with respect to the Plan to any other person pursuant to this Section.




          (b) A delegation under this Section shall be accomplished by a written instrument executed by
the Plan Administrator specifying responsibilities delegated and the fiduciary responsibilities
allocated to such delegate. A delegation of such responsibility shall be effective upon the date
specified in the delegation, subject to written acceptance by the delegate.




     6.3 Claims Procedure



          (a) Normally, a Participant or beneficiary need not present a formal claim for benefits in
order to qualify for rights or benefits under this Plan. However, if any person is not granted the
rights or benefits to which the person believes himself or herself to be entitled, a formal claim
for benefits must be filed in accordance with this Section. A claim by any person shall be
presented to the claims official appointed by the Plan Administrator in writing within the maximum
time permitted



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by law or under regulations promulgated by the Secretary of Labor or his or her delegate
pertaining to claims procedures. The claims official shall, within a reasonable time, consider the
claim and shall issue his or her determination thereon in writing. If the claim is granted, the
appropriate distribution or payment shall be made under the Plan.




          (b) If the claim is wholly or partially denied, the claims official shall, within ninety days
(or such longer period as may be reasonably necessary) provide the claimant with written notice of
the denial, setting forth, in a manner calculated to be understood by the claimant:





               (i) the specific reason or reasons for the denial,




               (ii) specific references to pertinent Plan provisions on which the
denial is based,




               (iii) a description of any additional material or information necessary for the claimant to
perfect the claim and an explanation of why the material or information is necessary, and




               (iv) an explanation of the Plan’s claim review procedure.



          (c) Each claimant shall have the opportunity to appeal in writing the claims official’s denial
of a claim to a review official designated by the Plan Administrator for a full and fair review.
The claimant or his or her duly authorized representative:





               (i) may request a review by filing a written application with the review official,




               (ii) may review pertinent documents, and




               (iii) may submit issues and comments in writing.



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          (d) The Plan Administrator may establish time limits within which a claimant may request
review of a denied claim which are reasonable in relation to the nature of the benefit which is the
subject of the claim and other attendant circumstances, but which shall not be less than sixty days
after receipt by the claimant of written notice of denial of his or her claim.




          (e) The decision by the review official upon review of a claim shall be made not later than
sixty days after his or her receipt of the request for review, unless special circumstances require
an extension of time for processing, in which case a decision shall be rendered as soon as
possible, but not later than one hundred twenty days after receipt of the request for review.




          (f) The decision on review shall be in writing and shall include specific reasons for the
decision written in a manner calculated to be understood by the claimant, with specific references
to the pertinent Plan provisions on which the decision is based.




          (g) To the extent permitted by law, the decision of the claims official (if no review is
properly requested) or the decision of the review official, as the case may be, shall be final and
binding on all parties. No legal action for benefits under the Plan shall be brought unless and
until the claimant has exhausted his or her remedies under this Section.




     6.4 Effect of Plan Administrator Action



          (a) All actions taken and all determinations made by the Plan Administrator in good faith
shall be final and binding upon all Participants and any person interested in the Plan. To the
extent the Plan Administrator has been granted discretionary authority under the Plan, its prior
exercise of such authority shall not obligate the Plan Administrator to exercise its authority in
a like fashion thereafter.




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          (b) The Plan shall be interpreted by the Plan Administrator in accordance with its terms and
their intended meaning. If, due to errors in drafting, a provision does not accurately reflect its
intended meaning, as demonstrated by consistent interpretations by the Plan Administrator or other
evidence of intention, the provision shall be considered ambiguous and shall be interpreted by the
Plan Administrator in a fashion consistent with its intent. The Plan Administrator, without the
need for Board approval, shall amend the Plan retroactively to cure any such ambiguity. This
subsection may not be invoked by a Participant, beneficiary or any other person to require the Plan
to be interpreted in a manner which is inconsistent with its interpretation by the Plan
Administrator.




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ARTICLE VII




AMENDMENT AND TERMINATION OF THE PLAN




     The Employer reserves the right at any time to amend or to restructure the Plan prospectively
or retroactively. No amendment or other change shall reduce the present value of a Participant’s
benefit (ignoring income tax consequences) without the Participant’s consent. This Plan may not be
terminated by the Employer until all benefits due under the Plan have been paid.



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ARTICLE VIII




MISCELLANEOUS PROVISIONS




     8.1 Alienation



          The rights of a Participant or beneficiary under the Plan shall not be subject to any claim of any
creditor of the Participant or beneficiary nor to attachment or garnishment or other legal process
by any creditor of the Participant or beneficiary. A Participant or beneficiary shall not have the
right to alienate, anticipate, commute, pledge, encumber or assign any of the benefits or payments
or proceeds which the individual may expect to receive, contingently or otherwise, under the Plan.




     8.2 Duty to Provide Data



          (a) Every person with an interest in the Plan or claiming benefits under the Plan shall
furnish the Plan Administrator on a timely and accurate basis with such documents, evidence or
information as it considers necessary or desirable for the purpose of administering the Plan. The
Plan Administrator may postpone payment of benefits until such information and such documents have
been furnished.




          (b) Every person claiming a benefit under this Plan shall give written notice to the Plan
Administrator of his or her post office address and each change of post office address. Any
communication, statement or notice addressed to such a person at his or her latest post office
address as filed with the Plan Administrator will, on deposit in the United States mail with
postage prepaid, be as binding upon such person for all purposes of the Plan as if it had been
received, whether actually received or not. If a person fails to give notice of his or her correct
address, the



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Plan Administrator, the Employer and the trustee shall not be obliged to search for, or to
ascertain, his or her whereabouts.




          (c) If benefits which are otherwise currently payable cannot be paid to the person entitled to
the benefits because the individual has failed to comply with this Section or other Plan provisions
relating to claims for benefits, any unpaid amounts shall be forfeited.




     8.3 Limitation on Rights of Employees



          The Plan is strictly a voluntary undertaking on the part of the Employer and shall not
constitute a contract between the Employer and any Employee, or consideration for, or an
inducement or condition of, the employment of an Employee. Except as otherwise required by statute
or an express, written employment contract, nothing contained in the Plan shall give any Employee
the right to be retained in the service of the Employer or to interfere with or restrict the right
of the Employer, which is hereby expressly reserved, to discharge or retire any Employee at any
time, with or without cause. Except as otherwise required by statute, inclusion under the Plan
will not give any Employee any right or claim to any benefit hereunder except to the extent such
right has specifically become fixed under the terms of the Plan. The doctrine of substantial
performance shall have no application to Employees, Participants or their beneficiaries. Each
condition and provision, including numerical items, has been carefully considered and constitutes
the minimum limit on performance which will give rise to the applicable right.




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     8.4 Service of Process



          The Secretary of Electro Rent Corporation is hereby designated as agent for the service of
legal process on the Plan.




     8.5 Governing Law



          The Plan and Trust shall be interpreted, administered and enforced in accordance with ERISA,
and the rights of Participants, former Participants, beneficiaries and all other persons shall be
determined in accordance with that law. ERISA does not require that this Plan be “funded.” Under
ERISA this Plan would be considered “unfunded” even if one or more Trust Funds are established
since the assets in such Trust Funds are subject to the claims of the Employer’s creditors under
Article V. To the extent that state law is applicable, the laws of the State of California shall
apply.




     8.6 Plurals



          Where the context so indicates, the singular shall include the plural and vice versa.




     8.7 Titles



          Titles are provided herein for convenience only and are not to serve as a basis for
interpretation or construction of the Plan.





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