PLM INTERNATIONAL, INC.
MANDATORY MANAGEMENT STOCK BONUS PLAN
1. Purpose
This plan's purpose is to compensate senior management for their
contributions to the growth and profits of the Company and its Subsidiaries and
increase their investment in the common stock of the Company, thereby enhancing
their incentive to build shareholder value, while conserving Company liquidity.
2. Definitions
For purposes of this Plan, the following terms will have the
definitions set forth below:
(a) "Allocation Ratio." A percentage determined by the Board not to
exceed 50 percent.
(b) "Company." PLM International, Inc.
(c) "Subsidiary" or "Subsidiaries". A corporation or corporations of
which the Company owns, directly or indirectly, shares having a
majority of the ordinary voting power for the election of directors.
(d) "Board." The Company's Board of Directors.
(e) "Bonus Compensation Plan." This phrase shall have the meaning
supplied by Section 4(a), below.
(f) "Bonus Share." The shares of common stock of the Company reserved
pursuant to Section 3 hereof and issued to a Recipient pursuant to this
Plan.
(g) "Cause." For purposes of this Plan, "cause" shall mean:
(i) the willful and continued failure by Recipient to perform
his or her employment duties (other than any failure resulting from
Recipient's incapacity due to physical or mental illness) after demand
for substantial performance is delivered by the Company or its
Subsidiary which demand specifically identifies the manner in which
Recipient has not substantially performed his or her duties;
(ii) the willfull and intentional act by the Recipient that
is, in the reasonable determination of the Company or its Subsidiary,
materially injurious to the Company, monetarily or otherwise;
(iii) the breach by the Recipient of any material covenant of
Recipient's employment agreement, if any, with the Company; or
(iv) the conviction of the Recipient of a crime involving an
act of moral turpitude or which is a felony resulting in or intended to
result, directly or indirectly, in gain or personal enrichment of the
Recipient, relations of the Recipient, or their affiliates at the
expense of the Company or its Subsidiary.
For purposes of this definition, no act or failure to act on
Recipient's part shall be considered willful unless done or omitted to
be done, by him or her not in good faith and without the reasonable
belief that his or her action(s) or omission(s) was in the best
interests of the Company or its Subsidiary.
(h) "Committee." The Compensation Committee as appointed from time to
time by the Board. No member of the Committee shall be eligible for
selection as a person to whom shares may be allocated pursuant to this
Plan or to whom stock options may be granted to employees of the
Company pursuant to any other plan of the Company or any of its
affiliates, at any time while he or she is serving on the Committee.
(i) "Date of Issuance." This term shall mean the date Bonus Shares are
allocated and granted to a Recipient pursuant to Board resolution.
(j) "Fair Value of a Bonus Share." The quoted closing price of the
Company's common stock on the Date of Issuance.
(k) "Plan." The PLM International, Inc. Mandatory Management Stock
Bonus Plan.
(l) "Recipient." An employee of the Company or a Subsidiary to whom
shares are allocated under this Plan, or such individual's designated
beneficiary, surviving spouse, estate, or legal representative. For
this purpose, however, any such beneficiary, spouse, estate, or legal
representative shall be considered as one person with the employee.
(m) "Restricted Period." This phrase shall have the meaning supplied by
Section 7(c), below.
3. Bonus Share Reserve
(a) Bonus Share Reserve. The Company will establish a Bonus Share
reserve to which will be credited 500,000 shares of the common stock of
the Company, par value $0.01 per share. Should the shares of the
Company's common stock, due to a stock split or stock dividend or
combination of shares or any other change, or exchange for other
securities, by reclassification, reorganization, merger, consolidation,
recapitalization or otherwise, be increased or decreased or changed
into, or exchanged for, a different number or kind of shares of stock
or other securities of the Company or of another corporation, the
number of shares then remaining in the Bonus Share reserve shall be
appropriately adjusted to reflect such action. If any such adjustment
results in a fractional share, the fraction shall be disregarded.
(b) Adjustments to Reserve. Upon the allocation of shares hereunder,
the reserve will be reduced by the number of Bonus Shares so allocated
and, upon the repurchase thereof pursuant to Section 7(d) or the
forfeiture thereof pursuant to Section 7(e), the reserve shall be
increased by such number of such shares, and such Bonus Shares may
again be the subject of allocations hereunder.
(c) Distributions of Bonus Shares. Distributions of Bonus Shares, as
the Board shall in its sole discretion determine, may be made from
authorized but unissued shares or from treasury shares. All shares
issued as Bonus Shares in accordance with the Plan shall be fully paid
and non-assessable and free from preemptive rights. All distributions
of Bonus Shares under this Plan shall be in compliance with ss.711 of
the American Stock Exchange Company Guide or such other equivalent
guideline.
4. Eligibility and Making of Allocations
(a) Eligible Employees. Any salaried executive employee of the Company
or any Subsidiary (including officers and directors, except for persons
serving as directors only) who participate in the Company's Executive
Management Bonus Pool or any other executive management bonus
compensation plan (together, "Bonus Compensation Plans") shall be
eligible to receive an allocation of Bonus Shares pursuant to this
Plan. Bonus shares allocated pursuant to this Plan are made in
substitution of cash compensation that would otherwise be earned by the
Recipient under a Bonus Compensation Plan. Bonus Shares are restricted
and subject to forfeiture pursuant to Section 7 of this Plan.
(b) Selection by the Committee. From those employees for whom a cash
bonus has been recommended under a Bonus Compensation Plan, the
Committee may from time to time select (i) those employees to whom it
recommends that the Board make allocations of Bonus Shares, and (ii)
the Allocation Ratio that should be applied to each such employee. In
selecting those employees whom it wishes to recommend for allocations
and in determining the Allocation Ratio it wishes to recommend, the
Committee shall consider the position and responsibilities of the
eligible employees, the value of their services to the Company and its
Subsidiaries and such other factors as the Committee deems pertinent.
(c) Review by Board of Committee's Recommendations. As promptly as
practicable after the Committee makes its recommendations pursuant to
(b), above, the Board will review the Committee's recommendations and,
in the Board's discretion, (i) determine from the list of employees
recommended by the Committee which employees should be allocated Bonus
Shares under this plan, and (ii) the Allocation Ratio that should be
applied to each such employee, provided, however, the Board may, in its
sole discretion, increase or decrease the Allocation Ratio to the
extent permitted under this Plan.
(d) Formula for Number of Bonus Shares. The number of Bonus Shares
allocable and granted to a Recipient shall be determined as follows:
amount of cash bonus due an employee under a Bonus Compensation Plan,
multiplied by the Allocation Ratio applicable to such Employee,
multiplied by 1.3334 (to compensate employees for the restricted nature
of the Bonus Shares and the risk of forfeiture) divided by the Fair
Value of a Bonus Share. No fractional shares may be issued under the
Plan. Cash bonuses due under a Bonus Compensation Plan will be reduced
by an amount equal to the amount of such cash bonus multiplied by the
Allocation Ratio applicable to a Recipient being granted Bonus Shares
under this Plan.
(e) Example. For example, a Recipient is to receive a cash bonus under
a Bonus Compensation Plan equal to $30,000. The Board has set the
Allocation Ratio at 50 percent. The Fair Value of a Bonus Share is
$5.00. The Recipient will be allocated 4,000 Bonus Shares computed as
follows: $30,000 x .50 x 1.3334 / 5.00. The Recipient's cash bonus
payable under the Bonus Compensation Plan will be $15,000 computed as
follows: $30,000 - [$30,000 x .50].
(f) Participation in Other Stock Option Plans. A person who has
received options to purchase stock under any stock option plan of the
Company or a Subsidiary may exercise the same in accordance with their
terms, and will not by reason thereof be ineligible to received Bonus
Shares under this Plan. A person who has received Bonus Shares
hereunder shall be eligible to, and may, be granted any option or other
rights to purchase stock pursuant to any stock option plan or stock
purchase plan of the Company presently in effect or hereafter adopted,
and he or she shall be eligible to receive additional allocations of
Bonus Shares under this Plan or under any other similar plan of the
Company.
(g) Limited on Number of Allocable Shares. The total number of Bonus
Shares which may allocated pursuant to this Plan will not exceed the
amount available in the Bonus Share reserve.
5. Form of Allocations
(a) Number Specified. Each grant shall specify the number of Bonus
Shares allocated as well as the Allocation Ratio and the Fair Value of
Bonus Shares.
(b) Notice. When a grant is made, the Board shall advise the Recipient
and the Company thereof by delivery of written notice in the form of
Exhibit A hereto annexed.
(c) Registration and Listing. All Bonus Shares granted pursuant to this
Plan shall be properly registered with the Securities and Exchange
Commission under the Securities Act of 1933. The Company shall take
such action as shall be necessary to cause any and all Bonus Shares
issued pursuant to this Plan and not previously listed to be promptly
listed on the American Stock Exchange and/or such other exchange(s) on
which shares of the same class as the Bonus Shares are then listed.
6. No Payment Required of Recipients
(a) No Payment Required. Recipients shall not be required to pay any
amounts to the Company upon allocation, grant, transfer or sale of the
Bonus Shares. The Company shall be entitled to make appropriate
withholding for income or employment taxes or other similar items.
(b) Investment Purpose. The Company may require that, in acquiring any
Bonus Shares, the Recipient agree with, and represent to, the Company
that the Recipient is acquiring such Bonus Shares for the purpose of
investment and with no present intent to transfer, sell, or otherwise
dispose of such shares as set forth in Exhibit B, below.
7. Restrictions
(a) Transfer/Issuance. Bonus Shares will be promptly transferred or
issued after the Date of Issuance and a certificate or certificates for
such shares shall be issued in the Recipient's name. The Recipient
shall thereupon be a shareholder of all the shares represented by the
certificate or certificates. As such, the Recipient will have all the
rights of a shareholder with respect to such shares, including the
right to vote such shares and to receive all dividends and other
distributions (subject to Section 7(b)) paid with respect to such
shares, provided, however, that the shares shall be subject to the
restrictions in Sections 7(d) and 7(e). Stock certificates representing
Bonus Shares will be imprinted with a legend stating that the shares
represented thereby may not be sold, exchanged, transferred, pledged,
hypothecated, or otherwise disposed of except in accordance with this
Plan's terms, and each transfer agent for the Common Stock shall be
instructed to like effect in respect of such shares. In aid of such
restrictions, the Recipient shall, immediately upon receipt of the
certificate(s) deposit such certificate(s) together with a stock power
or other instrument of transfer, appropriately endorsed in blank, with
an escrow agent designated by the Committee, under a deposit agreement
containing such terms and conditions as the Committee shall approve,
the expenses of such escrow to be borne by the Company.
(b) Stock Splits, Dividends, etc. If, due to a stock split, stock
dividend, combination of shares, or any other change or exchange for
other securities by reclassification, reorganization, merger,
consolidation, recapitalization or otherwise, the Recipient, as the
owner of Bonus Shares subject to restrictions hereunder, shall be
entitled to new, additional, or different shares of stock or
securities, the certificate or certificates for, or other evidences of,
such new, additional, or different shares or securities, together with
a stock power or other instrument of transfer appropriately endorsed,
also shall be imprinted with a legend as provided in Section 7(a) and
deposited by the Recipient with the escrow agent. If any of the
event(s) described in the preceding sentence occur, all Plan provisions
relating to restrictions and lapse of restrictions will apply to such
new, additional, or different shares or securities to the same extent
applicable to the Bonus Shares with respect to which they were
distributed, provided, however, that if the Recipient shall receive
rights, warrants or fractional interest in respect of any of such Bonus
Shares, such rights or warrants may be held, exercised, sold or
otherwise disposed of, and such fractional interests may be settled, by
the Recipient free and clear of the restrictions hereafter set forth.
(c) Restricted Period. The term "Restricted Period" with respect to
restricted Bonus Shares (after which restrictions shall lapse) means,
subject to Section 7(f) below, a period starting on the Date of
Issuance of such shares to the Recipient and ending on the date three
(3) years after the Date of Issuance, or as the Committee may otherwise
establish at the time of allocation of shares hereunder.
(d) Restrictions on Transfer of Bonus Shares. During the Restricted
Period applicable to Bonus Shares and except as otherwise specifically
provided in the Plan, none of such shares shall be sold, exchanged,
transferred, pledged, hypothecated, or otherwise disposed of unless the
Company shall offer to repurchase such shares for the then fair market
value of such shares, with appropriate adjustment for any change in the
Bonus Shares of the nature described in Section 7(b). Unless such
repurchase is otherwise prohibited by the laws of the State of
California or other applicable state or federal law currently in effect
at the time of an offer of Bonus Shares by the Company for repurchase
pursuant to the terms of this Plan, the Company shall repurchase said
shares and make payment in full therefor fifteen (15) days following
such offer. Fair market value of such shares shall be the quoted
closing price of the Company's common stock two days before payment for
such shares is made by the Company.
(e) During the Restricted Period, in the event a Recipient voluntarily
terminates his or her employment with the Company or any Subsidiary or
is terminated for Cause, any and all Bonus Shares for which
restrictions have not lapsed pursuant to Section 7(f) shall be
immediately forfeited by such Recipient and such Recipient shall no
longer have any rights, title or interests in such Bonus Shares,
related shares issued pursuant to Section 7(b) or any dividends or
distributions derived therefrom. Such Bonus Shares and related shares
will be surrendered to the Company by the escrow agent, will be placed
in the treasury of the Company, and will no longer be considered
outstanding.
(f) Lapse of Restricted Period. The restrictions and risks of
forfeiture set forth in Sections 7(d) and 7(e) hereof will lapse as
follows:
(i) as to 33.33% of Bonus Shares on the first anniversary of the
Date of Issuance, or
(ii) an additional 33.33% of Bonus Shares on the second
anniversary of the Date of Issuance, or
(iii) all remaining Bonus Shares on the third anniversary of the
Date of Issuance, or
(iv) upon the Recipient's death, or
(v) upon acceptance by the Board of an offer to acquire all or
substantially all of the Company's common stock or assets, or
(vi) upon announcement of an offer tendering for all or more
than 50 percent of the Company's outstanding common stock, or
(vii) upon resolution of the Board, or
(viii) upon termination of this Plan.
(g) Transfers Upon Death of Recipient. Nothing in this Plan will
preclude the transfer of Bonus Shares, on the Recipient's death, to the
Recipient's legal representatives or estate, nor preclude such
representatives from transferring any of such shares to the person(s)
entitled thereto by will or the laws of descent and distribution.
(h) Delivery of Written Notice. All notices in writing required
pursuant to Sections 5 or 7 will be sufficient only if actually
delivered or if sent via registered or certified mail, postage prepaid
to Recipient's home address, and will be conclusively deemed given on
the date of delivery, if delivered or on the second business day
following the date of such mailing, if mailed.
8. Finality of Determination
The Committee will administer this Plan and construe its provisions.
Any determination by the Committee (except insofar as it will make
recommendations only) in carrying out, administering, or construing this Plan
will be final and binding for all purposes and upon all interested persons and
their heirs, successors, and personal representatives.
9. Limitations
(a) No Right to Allocation. No person will at any time have any right
to receive an allocation or grant of Bonus Shares hereunder and no
person will have authority to enter into an agreement for the making of
an allocation or grant or to make any representation or warranty with
respect thereto.
(b) Rights of Recipients. Recipients of allocations will have no rights
in respect thereof other than those set forth in the Plan. Except as
provided in Section 7(g), such rights may not be assigned or
transferred except by will or by the laws of descent and distribution.
Any attempt to sell, exchange, transfer, pledge, hypothecate, or
otherwise dispose of any Bonus Shares held by the Recipient under
restrictions which have not yet lapsed, will be deemed null and void.
Before issuance of Bonus Shares, no such shares will be earmarked for
the Recipients' accounts nor will such Recipients have any rights as
stockholders with respect to such shares.
(c) No Right to Continued Employment. Neither the Company's action in
establishing the Plan, nor any action taken by it or by the Board or
the Committee under the Plan, nor any provision of the Plan, will be
construed as giving to any person the right to be retained in the
employ of the Company or any Subsidiary.
10. Amendment, Suspension or Termination of Plan
The Board may amend, suspend or terminate the Plan in whole or in part
at any time; provided that such amendment, suspension or termination will not
affect adversely rights or obligations with respect to allocations previously
made.
11. Governing Law.
The Plan will be governed by the laws of the State of California.
12. Expenses of Administration.
All costs and expenses incurred in the operation and administration of
this Plan will be borne by the Company.
EXHIBIT "A" -- PLM INTERNATIONAL, INC.
MANDATORY MANAGEMENT STOCK OPTION PLAN
To: 1. ____________________, Recipient, and
2. Chief Financial Officer, PLM International, Inc.
This is to advise you that PLM International, Inc.'s Board of Directors
has on the date of this notice allocated to the Recipient above named a total of
___________ Bonus Shares under and pursuant to the Mandatory Management Stock
Bonus Plan. The applicable Allocation Ratio is _____ percent. The Fair Value of
Bonus Shares is $______/share. The cash compensation under your Bonus
Compensation Plan has been reduced by $15,000.
------------------------------
For the Board
Douglas P. Goodrich
Date: ___________________________
EXHIBIT "B" -- PLM INTERNATIONAL, INC.
MANDATORY MANAGEMENT STOCK BONUS PLAN
To: Chief Financial Officer, PLM International, Inc.
I represent that the 7,778 Bonus Shares allocated to me pursuant to the
Company's Mandatory Management Stock Bonus Plan, upon receipt of these Bonus
Shares, will be deposited, together with a stock power duly endorsed in blank,
with an escrow agent appointed pursuant to Section 7(a) of the Plan, I represent
and agree that I am acquiring these Bonus Shares for investment and that I have
no present intention to transfer, sell or otherwise dispose of such shares,
except as permitted pursuant to the Plan and in compliance with applicable
securities laws. I acknowledge that these Bonus Shares are subject to
restrictions on transfer and subject to forfeiture as set forth in the Plan. I
agree further that I am acquiring these shares in accordance with, and subject
to, the terms, provisions and conditions of said Plan, to all of which I hereby
expressly assent. These agreements will bind and inure to the benefit of my
heirs, legal representatives, successors and assigns.
My address of record is:
My Social Security Number is:
Receipt of the above, together with the payment referred to, is hereby
acknowledged.
- -----------------------------------
Recipient:
PLM International, Inc.
By:
Date:
f:\userdata\plmleg\cd\stephen\96sp0919.doc