On July 16, 2009, the Compensation Committee of the Board of Directors of Electro Rent Corporation (the "Company") approved and granted restricted stock units (the "Units") under the Company's 2005 Equity Incentive Plan to certain non-director senior executives of the Company. The grants included (i) annual grants based on an amount to bring the total compensation of the executives for fiscal 2009 to slightly less than those of a benchmark group and (ii) a one-time retention grant to take into account the lack of equity grants by the Company in recent years. The Company's named executive officers received the following grants:

Named Executive Officer                         Annual Unit Retention   Total Units
                                                Grant       Unit Grant  Granted
Steven Markheim                                 16,720      23,280      40,000
President and Chief Operating Officer
Craig R. Jones                                  11,188      15,812      27,000
Vice President and Chief Financial Officer

The grants of Units are represented by an Stock Unit Award Agreement (the "Agreement") between the Company and the executive, a form of which is filed as Exhibit 10.1 to this Form 8-K and is incorporated herein by reference. The terms of the Units are summarized below, and the summary is qualified in its entirety by reference to the form of the Agreement filed herewith. The Company will issue one share of its Common Stock for each vested Unit on the earliest of the following: (i) January 1, 2015; (ii) a change of control; and (iii) the date of the executive's termination of employment. The Units will vest in three equal installments on each of July 16, 2010, 2011 and 2012, or earlier on a change of control or the executive's death or disability. Any Units not vested on or before the date of issuance of the Common Stock will be forfeited. An amount per vested Unit equal to any dividend (less any applicable withholding) paid on the underlying Common Stock since the date of grant will be paid within 10 days after vesting on all vested Units.