SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934
Filed by the Registrant [x]
Filed by a Party other than the Registrant: [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, or Use of the Commission Only
(as permitted by Rule 14a-6(e)(2))
[x] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Sec. 240.14a-11(c) or Sec. 240.14a-12
...............................................................................
PLM International, Inc.
(Name of Registrant as Specified in its Charter)
...............................................................................
Payment of Filing Fee (Check the appropriate box):
[x] No fee required.
[ ] Fee computed on table below per Exchange Act Rule 14a-6(i)(1) and 0-11.
1) Title of each class of securities to which transaction applies:
2) Aggregate number of securities to which transaction applies:
3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing fee
is calculated and state how it was determined):
4) Proposed maximum aggregate value of transaction:
5) Total fee paid:
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by the Exchange Act
Rule 0-11 (a) (2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number, or
the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
2) Form, Schedule or Registration Statement No.:
3) Filing Party:
4) Date Filed:
April 15, 1999
Dear Stockholder:
It is with great pleasure that the directors and I invite you to attend
the Annual Meeting of Stockholders of PLM International, Inc. (the "Company")
which will be held at 1:00 p.m. (Pacific Time) on Thursday, May 27, 1999 at the
A.P. Giannini Auditorium, Concourse Level, 555 California Street, San Francisco,
California.
At the meeting, the stockholders will elect two directors. The Notice
of Annual Meeting of Stockholders and Proxy Statement accompanying this letter
describe the business to be transacted at the meeting.
WHETHER YOU PLAN TO ATTEND THE MEETING OR NOT, WE URGE YOU TO SIGN,
DATE AND RETURN THE ENCLOSED PROXY CARD IN THE ENCLOSED POSTAGE-PAID ENVELOPE IN
ORDER THAT AS MANY SHARES AS POSSIBLE MAY BE REPRESENTED AT THE MEETING. The
vote of every stockholder is important and your cooperation in promptly
returning your executed proxy will be appreciated. Each proxy is revocable and
will not affect your right to vote in person in the event that you attend the
meeting. Thank you for your continued support.
Very truly yours,
/s/ ROBERT N. TIDBALL
-------------------------------
ROBERT N. TIDBALL
President, Chief Executive Officer
and Chairman of the Board
PLM INTERNATIONAL, INC.
One Market
Steuart Street Tower, Suite 800
San Francisco, California 94105
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
The Annual Meeting of Stockholders of PLM International, Inc. (the
"Company") will be held on Thursday, May 27, 1999 at 1:00 p.m. (Pacific Time) in
the A.P. Giannini Auditorium, Concourse Level, 555 California Street, San
Francisco, California for the following purposes:
1. Elect two Class III directors of PLM International, Inc. (Proxy Item
No. 1), and
2. Transact such other business as may properly come before the meeting
or any adjournments or postponements thereof.
Stockholders of record on April 9, 1999 shall be entitled to notice of, and to
vote at, the Annual Meeting of Stockholders.
By Order of the Board of Directors,
/S/ SUSAN C. SANTO
-----------------------------
SUSAN C. SANTO
Vice President, Secretary, and General Counsel
April 15, 1999
San Francisco, California
YOUR VOTE IS IMPORTANT. WHETHER OR NOT YOU EXPECT TO ATTEND THE ANNUAL
MEETING OF STOCKHOLDERS, WE URGE YOU TO SIGN, DATE, AND MAIL THE ENCLOSED PROXY
CARD IN THE ENCLOSED POSTAGE-PAID ENVELOPE. IF YOU ATTEND THE MEETING, YOU MAY
VOTE YOUR SHARES IN PERSON BY COMPLETING A BALLOT OR PROXY CARD AT THE MEETING.
YOU MAY REVOKE YOUR PROXY AT ANY TIME BEFORE IT IS VOTED AT THE ANNUAL MEETING
OF STOCKHOLDERS.
PLM INTERNATIONAL, INC.
PROXY STATEMENT
ANNUAL MEETING OF STOCKHOLDERS
May 27, 1999
This Proxy Statement is furnished in connection with the solicitation
by the Board of Directors (the "Board") of PLM International, Inc. ("PLM
International" or the "Company") of proxies to be voted at the Annual Meeting of
Stockholders to be held at 1:00 p.m. (Pacific Time) on Thursday, May 27, 1999,
at the A.P. Giannini Auditorium, Concourse Level, 555 California Street, San
Francisco, California, or any adjournments or postponements thereof (the "Annual
Meeting").
The Notice of Annual Meeting, this Proxy Statement and the accompanying
proxy card are being mailed to stockholders on or about April 15, 1999. The
costs of this proxy solicitation will be borne by the Company. Proxies may be
solicited by mail, personal interview, telephone, facsimile, e-mail and
advertisements. Proxies are expected to be solicited by directors, officers and
regular employees of the Company. The directors, officers and employees who
assist in the solicitation will not receive any additional compensation for such
services and will perform such services in addition to their usual duties. The
Company has retained MacKenzie Partners, Inc. ("MacKenzie") to assist in the
solicitation of proxies from brokers, nominees and individuals. MacKenzie's
estimated fee for this service is $7,500, plus reimbursement of out-of-pocket
expenses. The Company will also request brokers and other nominees who hold
stock of the Company to forward solicitation materials to the beneficial owners
of the common stock held of record by them and will reimburse them for their
reasonable out-of-pocket expenses in forwarding such solicitation materials.
VOTING OF PROXIES
All properly executed proxy cards delivered pursuant to this
solicitation and not revoked will be voted at the Annual Meeting as specified in
such proxy card. If no choice is indicated, the shares represented by a signed
proxy card will be voted in favor of Proxy Item No. 1. The affirmative vote of
the majority of shares present and entitled to vote at the Annual Meeting will
be required for approval of Proxy Item No. 1.
Votes at the Annual Meeting will be tabulated by one or more
independent inspectors of election appointed by the Company. Abstentions and
votes withheld by brokers in the absence of instructions from streetname holders
(broker nonvotes) will be included in the determination of shares present at the
Annual Meeting for purposes of determining a quorum. Abstentions will be counted
towards the tabulation of votes cast on proxy items submitted to stockholders,
whereas broker nonvotes are not counted for purposes of determining whether a
proxy item has been approved.
A stockholder submitting a proxy card may revoke it at any time before
it is voted at the Annual Meeting by notifying the Secretary of the Company in
writing of such revocation, by properly executing a later-dated proxy card, or
by voting in person at the Annual Meeting.
OUTSTANDING VOTING SECURITIES
Stockholders of record on April 9, 1999, or their proxies, are entitled
to vote at the Annual Meeting. On such date, the outstanding voting stock of the
Company consisted of 8,158,751 shares of common stock. Each share of common
stock will be entitled to one vote per share on each matter to be voted at the
Annual Meeting. There is no provision in the Certificate of Incorporation of the
Company permitting cumulative voting.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth certain information known to the Company
with respect to beneficial ownership of the common stock by (a) each stockholder
known by the Company to be the beneficial owner of more than 5% of the common
stock, (b) each of its directors and the named executive officers identified in
the Summary Compensation Table below, and (c) all directors and executive
officers of the Company as a group.
NUMBER OF SHARES OF COMMON PERCENT OF COMMON STOCK<F1>
NAME AND ADDRESS OF BENEFICIAL OWNER STOCK<F1>
- ---------------------------------------------------------- ------------------------------ ----------------------------
Steel Partners II, L.P............................... 1,337,300 16.39%
750 Lexington Avenue, 27th Floor
New York, New York 10022
Dimensional Fund Advisors, Inc 469,800 5.76%
1299 Ocean Avenue, 11th Floor
Santa Monica, California 90401<F2>.............
Oak Forest Investment Management, Inc. 458,000 5.61%
6701 Democracy Blvd., Ste. 402
Bethesda, Maryland 20817<F3>.....................
J. Michael Allgood<F4>................................ 100,780 1.22%
Stephen M. Bess<F5>.................................. 46,688 *
Randall L-W. Caudill<F6>............................. 5,333 *
Douglas P. Goodrich<F7>.............................. 168,810 2%
Warren G. Lichtenstein<F8>........................... 1,337,300 16.39%
Howard M. Lorber..................................... -- --
Susan C. Santo<F9>................................... 15,833 *
Harold R. Somerset<F10>.............................. 36,000 *
Robert N. Tidball<F11>............................... 8,333 *
All directors and executive officers as a group (12
people)<F13>......................................... 2,118,602 24.63%
- ------------------
* Represents less than 1% of the outstanding shares.
<FN>
<F1> Computed on the basis of 8,158,751 shares of common stock outstanding
(excluding treasury stock) as of April 9, 1999. Beneficial ownership as
reported in the above table has been determined in accordance with Rule
13d-3 under the Securities Exchange Act of 1934, as amended.
<F2> Includes 469,800 shares held by Dimensional Fund Advisors Inc.
("Dimensional") as investment advisor and investment manager on behalf
of four investment companies registered under the Investment Company
Act of 1940 and other investment vehicles, including commingled group
trusts. In its role as investment advisor and investment manager,
Dimensional possesses both voting and investment power over the shares,
and Dimensional disclaims beneficial ownership of all such shares.
<F3> Includes 458,000 shares held by Oak Forest Investment Management, Inc.
as an investment advisor registered under the Investment Company Act of
1940. In its role as investment advisor, Oak Forest Investment
Management, Inc., possesses both the power to vote and to dispose or
direct the disposition of all such shares.
<F4> Includes 68,333 shares of common stock issuable to Mr. Allgood pursuant
to options exercisable within 60 days of April 9, 1999.
<F5> Includes 16,666 shares of common stock issuable to Mr. Bess pursuant to
options exercisable within 60 days of April 9, 1999.
<F6> Includes 3,333 shares of common stock issuable to Mr. Caudill pursuant
to options exercisable within 60 days of April 9, 1999.
<F7> Includes 78,333 shares of common stock issuable to Mr. Goodrich
pursuant to options exercisable within 60 days of April 9, 1999.
<F8> Includes 1,337,300 shares held by Steel Partners II, L.P. The general
partner of Steel Partners II, L.P. is Steel Partners L.L.C., of which
Mr. Lichtenstein is the chief executive officer. Mr. Lichtenstein may
be deemed to be the beneficial owner of all of such shares by virtue of
his power to vote and dispose of such shares.
<F9> Includes 13,333 shares of common stock issuable to Ms. Santo pursuant
to options exercisable within 60 days of April 9, 1999.
<F10> Includes 29,999 shares of common stock issuable to Mr. Somerset
pursuant to options exercisable within 60 days of April 9, 1999.
<F11> Includes 179,999 shares of common stock issuable to Mr. Tidball
pursuant to options exercisable within 60 days of April 9, 1999.
<F12> Includes 3,333 shares of common stock issuable to Mr. Witt pursuant to
options exercisable within 60 days of April 9, 1999.
<F13> Includes 443,328 shares of common stock issuable to members of the
Board of Directors and executive officers pursuant to options
exercisable within 60 days of April 9, 1999.
</FN>
IDENTIFICATION OF DIRECTORS AND EXECUTIVE OFFICERS
As of the date of this report, the directors and executive officers of PLM
International (and key executive officers of its subsidiaries) are as follows:
NAME AGE POSITION
- ---------------------------------------- ------------------ -------------------------------------------------------
Robert N. Tidball 60 Chairman of the Board, Director, President, and Chief
Executive Officer, PLM International, Inc.
Randall L-W. Caudill 52 Director, PLM International, Inc.
Douglas P. Goodrich 52 Director and Senior Vice President, PLM
International, Inc.
Warren G. Lichtenstein 33 Director, PLM International, Inc.
Howard M. Lorber 50 Director, PLM International, Inc.
Harold R. Somerset 63 Director, PLM International, Inc.
Robert L. Witt 59 Director, PLM International, Inc.
J. Michael Allgood 50 Vice President and Chief Financial Officer, PLM
International, Inc.
Stephen M. Bess 52 President, PLM Investment Management, Inc.; Vice
President and Director, PLM Financial Services, Inc.
Richard K Brock 36 Vice President and Corporate Controller, PLM
International, Inc.
Donald R. Dugan, Jr. 38 President, American Finance Group, Inc.
Susan C. Santo 36 Vice President, Secretary, and General Counsel, PLM
International, Inc.
Robert N. Tidball was appointed Chairman of the Board in August 1997 and
President and Chief Executive Officer of PLM International in March 1989. At the
time of his appointment as President and Chief Executive Officer, he was
Executive Vice President of PLM International. Mr. Tidball became a director of
PLM International in April 1989. Between 1987 and 1989, Mr. Tidball held various
executive positions with subsidiaries of PLM International.
Randall L-W. Caudill was elected to the Board of Directors in September 1997. He
is President of Dunsford Hill Capital Partners, a San Francisco-based financial
consulting firm serving emerging growth companies. Prior to founding Dunsford
Hill Capital Partners in 1997, Mr. Caudill held senior investment banking
positions at Prudential Securities from 1987 to 1997, and before that at Morgan
Grenfell Inc. and The First Boston Corporation. Mr. Caudill also serves as a
director of SBE, Inc., a publicly-held company, and various other companies.
Douglas P. Goodrich was elected to the Board of Directors in July 1996, and
appointed Senior Vice President of PLM International in March 1994. Prior to
1994, Mr. Goodrich served as an executive officer of the Company and various of
its subsidiaries since joining the Company in 1987.
Warren G. Lichtenstein was elected to the Board of Directors in December 1998.
Mr. Lichtenstein is the Chief Executive Officer of Steel Partners L.L.C., the
general partner of Steel Partners II, L.P., which is PLM International's largest
shareholder. Additionally, Mr. Lichtenstein is Chairman of the Board of
Directors for each of Aydin Corporation, a New York Stock Exchange-listed
defense electronics concern, and Gateway Industries, Inc., and serves on the
boards of directors of Rose's Holdings, Inc. and Saratoga Beverage Group, Inc.,
each a publicly-held company.
Howard M. Lorber was elected to the Board of Directors in January 1999. Mr.
Lorber is President and Chief Operating Officer of New Valley Corporation, an
investment banking and real estate concern. He is also Chairman of the Board and
Chief Executive Officer of Nathan's Famous, Inc., a fast food company.
Additionally, Mr. Lorber is a director of United Capital Corporation and Prime
Hospitality Corporation, and serves on the boards of several community service
organizations.
Harold R. Somerset was elected to the Board of Directors of PLM International in
July 1994. From February 1988 to December 1993, Mr. Somerset was President and
Chief Executive Officer of California & Hawaiian Sugar Corporation (C&H Sugar),
a subsidiary of Alexander & Baldwin, Inc. Mr. Somerset also serves on the boards
of directors for various other companies and organizations, including Longs Drug
Stores, Inc., a publicly-held company.
Robert L. Witt was elected to the Board of Directors in June 1997. Since 1993,
Mr. Witt has been a principal with WWS Associates, a consulting and investment
group specializing in start-up situations and private organizations about to go
public. Prior to that, he was Chief Executive Officer and Chairman of the Board
of Hexcel Corporation, an international advanced materials company with sales
primarily in the aerospace, transportation and general industrial markets. Mr.
Witt also serves on the boards of directors for various other companies and
organizations.
J. Michael Allgood has served as Vice President and Chief Financial Officer of
PLM International since October 1992. During that time, he has also served as an
executive officer of certain of PLM International's subsidiaries.
Stephen M. Bess was appointed a Director of PLM Financial Services, Inc., a
subsidiary of PLM International, in July 1997. Mr. Bess has served as President
of PLM Investment Management, Inc., an indirect wholly-owned subsidiary of PLM
International, since August 1989, and as an executive officer of certain other
of PLM International's subsidiaries or affiliates since 1982.
Richard K Brock was appointed Vice President and Corporate Controller of PLM
International in June 1997, having served the Company as an accounting manager
beginning in September 1991 and as Director of Planning and General Accounting
beginning in February 1994.
Donald R. Dugan, Jr. was appointed President of American Finance Group, Inc., a
subsidiary of PLM International, in January 1996. Prior to the Company
organizing American Finance Group, Inc., Mr. Dugan served in various capacities
with American Finance Group, a Massachusetts general partnership, including Vice
President, Treasurer from 1989 to 1995, and was appointed Vice President and
National Sales Manager in mid-1995.
Susan C. Santo became Vice President, Secretary, and General Counsel of PLM
International in November 1997. She has worked as an attorney for PLM
International since 1990 and served as its Senior Attorney from 1994 until her
appointment as General Counsel.
ELECTION OF DIRECTORS (PROXY ITEM NO. 1)
At the Annual Meeting, two Class III directors will be elected for a
term of three years. The terms of the current Class III directors expire at the
Annual Meeting, and the terms of the Class I and Class II directors will expire
at the annual meetings of stockholders convened in 2000 and 2001, respectively.
The Company's nominees for Class III directors are Warren G. Lichtenstein and
Howard M. Lorber. Messrs. Lichtenstein and Lorber presently serve as Class III
directors of the Company. The Company's nominees have consented to be nominated
and to serve if elected. If the nominee(s) become unavailable for election, the
proxy will be voted for such other person(s), if any, as the Board of Directors
may designate.
INFORMATION CONCERNING DIRECTORS
The Board of Directors currently consists of seven directors and is
divided into three classes, designated Class I, Class II and Class III. Each
director is elected to a three-year term. The current Class I directors are
Messrs. Tidball and Witt. The current Class II directors are Messrs. Caudill,
Goodrich and Somerset. The current Class III directors are Messrs. Lichtenstein
and Lorber.
The current size and configuration of the classes of the Board of
Directors is a result of the expansion and reconfiguration of the Board of
Directors in December 1998, and again in January 1999, in connection with an
April 30, 1998 agreement between the Board of Directors and Mr. Lichtenstein to
nominate Mr. Lichtenstein and his nominee for election to the Board of Directors
at the Company's 1999 shareholder meeting. In December 1998 and January 1999 the
Board of Directors determined it was in the Company's interest to obtain the
advice and counsel of Mr. Lichtenstein and his nominee, Mr. Lorber, as members
of the Board of Directors prior to the 1999 annual meeting of the Company's
shareholders. Accordingly, in December the Board of Directors voted to expand
the Board of Directors from five to six seats and to elect Mr. Lichtenstein to
the Board of Directors as a Class III Director and determined that he would be
one of the Company's nominees for election to the Board of Directors at the 1999
annual meeting of the Company's shareholders, as had been agreed to. In order to
keep the classes of directors as even as possible in accordance with the
Company's bylaws, Mr. Goodrich resigned as a Class III director and was
immediately re-appointed as a Class II director. Further, in January the Board
of Directors voted to expand the Board of Directors from six to seven seats and
to elect Mr. Lorber to the Board of Directors as a Class III Director and
determined that he would be the Company's second nominee for election to the
Board of Directors at the 1999 annual meeting of the Company's shareholders. Mr.
Somerset resigned as a Class III director and was immediately re-appointed as a
Class II director.
The Company's Board of Directors held seven meetings in 1998 and, to
date, has held three meetings in 1999. Since joining the Board of Directors,
each of the directors serving on the Board of Directors has attended 100% of (a)
the total number of meetings of the Board of Directors held in 1998 and (b) the
total number of meetings held by all committees of the Board of Directors on
which such director served.
Among the committees of the Board of Directors are an Executive
Committee, an Audit Committee, a Compensation Committee and a Nominating
Committee.
The Executive Committee consists of Mr. Tidball - Chairman, Mr.
Caudill, Mr. Somerset and Mr. Witt. The Executive Committee, which was formed in
October 1988, may exercise all the powers and authority of the Board of
Directors in the management of the business and affairs of the Company, subject
to the limitations prescribed by the Board of Directors, the bylaws of the
Company and Delaware law. The Executive Committee did not meet in 1998.
The Audit Committee consists of Mr. Caudill - Chairman, Mr. Somerset
and Mr. Witt. The Audit Committee was formed in February 1988 to recommend the
appointment and compensation of the independent auditors, approve professional
services provided by the auditors, review the scope of the annual audit and
auditors' report to management, and review financial statements and internal
accounting controls. The Audit Committee met once in 1998.
The Compensation Committee consists of Mr. Somerset - Chairman, Mr.
Witt and Mr. Caudill. The Compensation Committee was formed in February 1988 to
review all compensation programs, policies and practices, including salaries,
incentives, stock options, stock grants and stock purchase programs, and to make
recommendations to the Board of Directors regarding the salary of all corporate
officers and certain key employees. The Compensation Committee met once in 1998.
The Nominating Committee was established in September 1990 to
investigate and make recommendations to the Board of Directors for nominees to
the Board of Directors and its committees. The Nominating Committee consists of
Mr. Tidball - Chairman, Mr. Somerset and Mr. Witt. The Nominating Committee did
not meet in 1998. The Nominating Committee will consider nominees to the Board
of Directors recommended by security holders upon submission of the names of
such nominees and such other information as requested by the Nominating
Committee in accordance with the Company's bylaws.
CORPORATE GOVERNANCE STANDARDS
In 1998, the Board of Directors undertook a process of reviewing its
informal policies and practices regarding corporate governance, and agreed that
it was appropriate to formally adopt certain "core" corporate governance
principals that it believed were central to the Board's role in directing the
future of the Company. The core principals addressed by the Board relate to the
independence of the Board and its committees, its leadership role, and its
ability to evaluate management's performance. Although the Board is comprised of
a majority of independent directors, the Board determined that the independent
directors should have a more structured framework within which to communicate
and meet (without the other Board members) as often as they felt necessary in
order to discuss matters of importance to the Company. To that end, the Board of
Directors created the position of Lead Independent Director.
The Lead Independent Director has the authority to: act in a lead
capacity to coordinate and communicate with the other independent directors as
he deems advisable or appropriate; determine when the independent directors
should meet without the other directors and determine the agenda for any such
meeting; and report to the full Board regarding any matters or recommendations
which the independent directors deem advisable or appropriate. The position of
Lead Independent Director is filled for a term of one year by one of the
Company's independent directors whose term as a director expires at the coming
year's annual meeting, as determined by the independent directors. Mr. Somerset
has served as the Company's Lead Independent Director since August 1998, and his
term as Lead Independent Director expires at the Annual Meeting. Mr. Witt will
serve as Lead Independent Director for a one-year term following the Annual
Meeting.
The Board also adopted a policy that independent directors are to meet
at least once a year, alone, without the CEO or other directors; that only
independent directors are to participate as members of the Compensation
Committee of the Board; and that no director may also serve as a consultant or
service provider to the Company.
The Board defined an "independent director" as any director who is a
non-management director, free of any material business or professional
relationship with the Company or its management. A director is not considered to
be independent if, among other things, he has been employed as an executive by
the Company during the past five years, is affiliated with a significant
customer, lessee or supplier of the Company, owns or controls a legal or
beneficial interest of 10% or more of the Company's common stock, has an ongoing
business relationship with the Company that involves continued dealings with
management, or has a relationship which, in the Board's reasonable opinion,
would interfere with the exercise of independent judgment in carrying out the
responsibilities of a director. Four of the Board's current seven members are
considered to be independent as defined by the Board. Two of the remaining
members are executive officers of the Company, and the remaining director may be
considered the beneficial owner of greater than 10% of the Company's common
stock.
COMPENSATION OF DIRECTORS
Each non-employee director of the Company (Messrs. Caudill,
Lichtenstein, Lorber, Somerset, and Witt) receives a monthly retainer of $2,000
and a per-meeting fee of $1,000 for meetings of the Board of Directors and the
Executive Committee attended in person ($250 for meetings attended by
telephone). A fee of $250 per meeting is paid to all nonemployee directors for
meetings of all other committees of the Board of Directors.
Each non-employee director of the Company was granted options to
purchase 10,000 shares of common stock of the Company as of February 1, 1999,
pursuant to the Directors' 1995 Nonqualified Stock Option Plan (the "1995
Directors' Plan"), which was adopted by the Board of Directors on January 25,
1995. According to the terms of the 1995 Directors' Plan, Directors who are not
employees of the Company receive annual options to purchase 10,000 shares of
common stock of the Company. Option grants to each non-employee director were
made as of February 1 of each of the years 1995, 1996, 1997, 1998, and 1999. The
exercise price of the options is the closing price of the Company's common stock
on the date of grant. The exercise price of options granted in each of 1995,
1996, 1997, 1998 and 1999 is $2.625, $3.50, $3.31, $5.25 and $5.875 per share of
common stock, respectively.
The total number of shares of common stock for which options may be
granted under the 1995 Directors' Plan is 120,000 shares. Options granted under
the 1995 Directors' Plan vest pro rata over a three-year period. Generally,
vested options held by a non-employee director who ceases to be a director of
the Company may be exercised within six months after ceasing to be a director.
In connection with the resignations of three non-employee directors in 1997,
50,000 vested options granted under the 1995 Directors' Plan were redeemed by
the Company, and no shares with respect to such options were issued.
Additionally, 40,000 non-vested options held by such non-employee directors were
forfeited. Accordingly, the number of outstanding options granted under the 1995
Directors' Plan totals 110,000, for which no shares have been issued. As of the
date of this Proxy Statement, 36,663 options were exercisable under the 1995
Directors' Plan.
COMPENSATION OF EXECUTIVE OFFICERS
The following table sets forth for the fiscal years ended December 31,
1998, 1997, and 1996, a summary of compensation awarded to, earned by or paid to
the Company's Chief Executive Officer and each of its four other most highly
compensated executive officers (together, the "named executive officers") at
December 31, 1998:
SUMMARY COMPENSATION TABLE
ANNUAL COMPENSATION LONG-TERM COMPENSATION
------------------------------------ -----------------------------
SECURITIES
NAME AND RESTRICTED UNDERLYING
PRINCIPAL STOCK OPTIONS/ ALL OTHER
POSITION YEAR SALARY(1) BONUS(2) AWARDS(3) SARS (4) COMPENSATION(5)
($) ($) ($) (#) ($)
---------------------------------------------------------------------------------------------------------------------
ROBERT N. TIDBALL 1998 311,000 180,000 80,000 110,000 5,971
----
President, Chief 1997 300,000 172,500 76,670 -- 6,682
----
Executive Officer 1996 300,000 135,000 60,000 20,000 5,897
----
DOUGLAS P. GOODRICH 1998 197,733 80,000 106,672 85,000 5,971
----
Senior Vice President 1997 190,000 75,000 100,000 -- 6,682
----
1996 190,000 189,625 -- 45,000 5,897
----
J. MICHAEL ALLGOOD 1998 181,417 97,500 43,335 85,000 5,971
----
Chief Financial Officer 1997 175,000 97,500 43,335 -- 6,682
----
and Vice President 1996 175,000 52,500 23,334 30,000 5,897
----
STEPHEN M. BESS 1998 176,417 52,500 23,334 20,000 5,971
----
President, PLM Investment 1997 170,000 52,500 23,334 -- 6,682
----
Management, Inc. 1996 165,000 45,000 -- -- 5,897
----
SUSAN C. SANTO 1998 170,000 80,000 -- 40,000 5,971
----
Vice President, General 1997 115,167 25,000 -- -- 6,682
----
Counsel and Secretary 1996 -- -- -- -- --
----
(1) Amounts shown do not include the cost to the Company of personal
benefits, the value of which did not exceed the lesser of $50,000 or
10% of the aggregate salary and bonus compensation for each named
executive officer.
(2) Bonus compensation reflects the amount earned in the designated year,
but paid in the immediate subsequent year. For 1996, as Senior Vice
President of the Company's equipment acquisition subsidiary, PLM
Transportation Equipment Corporation, Mr. Goodrich's bonus compensation
was structured to include a commission incentive plan based on the
amount of equipment transactions closed during each fiscal quarter. In
1996, Mr. Goodrich received commission compensation equal to $159,625.
(3) Restricted stock (also referred to in this Proxy Statement as "Bonus
Shares") was awarded pursuant to the 1996 PLM International, Inc.
Mandatory Management Stock Bonus Plan. Bonus Shares were granted in
substitution of cash bonus compensation earned in the designated year,
though shares were actually granted effective January 18, 1999, January
15, 1998, and January 8, 1997. The number of Bonus Shares granted
equals the amount of cash bonus awarded by the Board of Directors to a
designated recipient, multiplied by an allocation ratio applicable to
such recipient, multiplied by 1.334 (to compensate recipients for the
restricted nature of the shares and risk of forfeiture) divided by the
fair market value of the Company's common stock on the effective date
of grant. The fair market value is equal to the closing price of the
Company's common stock on the effective date of grant or the
immediately preceding trading day if the grant day was a non-trading
day. Cash bonus compensation earned in a designated year is reduced by
an amount equal to the amount of cash bonus earned in the designated
year multiplied by the allocation ratio applicable to the recipient.
Bonus Shares granted pursuant to this plan generally vest ratably over
three years. Non-vested Bonus Shares are subject to forfeiture in the
event the recipient voluntarily terminates his or her employment with
the Company. The allocation ratio for the Bonus Shares granted in
substitution of cash bonus earned in 1998, 1997 and 1996, the resulting
awards of Bonus Shares, and the reduction in cash bonus are as follows
for each of the named executive officers:
ALLOCATION
NAME RATIO BONUS SHARES AWARDED REDUCTION IN CASH BONUS
---- ----- -------------------- -----------------------
1998 1997 1996 1998 1997 1996
---- ---- ---- ---- ---- ----
Robert N. Tidball 25% 13,606 14,960 20,001 $60,000 $57,500 $45,000
Douglas P. Goodrich 50% 18,141 19,513 -- 80,000 75,000 --
J. Michael Allgood 25% 7,370 8,456 7,778 32,500 32,500 17,500
Stephen M. Bess 25% 3,968 4,553 -- 17,500 17,500 --
(4) Includes options granted effective August 21, 1996, pursuant to the
Company's stockholder-approved 1988 Management Stock Compensation Plan,
and options granted effective May 12, 1998, pursuant to the Company's
1998 Management Stock Compensation Plan, which was approved by the
Board of Directors on May 12, 1998. The options granted in 1996 have an
exercise price of $3.25 per share, and the options granted in 1998 have
an exercise price of $6.813 per share. All options vest ratably over
three years. One half of the options granted in 1996 held by each named
executive officer expire August 21, 2001, and one half expire August
21, 2002. The options granted in 1998 expire on May 12, 2008.
(5) Includes for 1998, contributions made by the Company pursuant to the
PLM International, Inc. Profit Sharing and 401(k) Plan to each of the
named executive officer's accounts as follows: $4,000 in 401(k)
matching contributions and $1,372 in profit-sharing contributions (an
equal amount of profit-sharing contributions were made to the
retirement accounts of each of the Company's eligible employees). Also
includes for each named executive officer Company-paid premiums in the
amount of $599 for term life insurance.
STOCK OPTION GRANTS AND EXERCISES
In 1998, the Company granted options to acquire 340,000 shares of
common stock to the named executive officers pursuant to the PLM International,
Inc. 1998 Management Stock Compensation Plan, approved by the Board of Directors
on May 12, 1998. Mr. Tidball received 110,000 options, Mr. Goodrich received
85,000 options, Mr. Allgood received 85,000 options, Mr. Bess received 20,000
options, and Ms. Santo received 40,000 options. All options were granted
effective May 12, 1998. See "1998 Management Stock Compensation Plan."
The following table sets forth certain information concerning stock
options granted to the named executive officers during the fiscal year ended
December 31, 1998, including hypothetical gains based on assumed rates of annual
compound stock price appreciation:
STOCK OPTION GRANTS IN 1998
POTENTIAL REALIZABLE VALUE AT
ASSUMED ANNUAL RATES OF
STOCK PRICE APPRECIATION FOR
INDIVIDUAL OPTIONS OPTION TERM<F4>
- -------------------------------------------------------------------------------------------- -------------------------------------
MARKET
COMMON % OF TOTAL PRICE PER
STOCK OPTIONS SHARE
OPTIONS GRANTED TO EXERCISE ON
GRANTED EMPLOYEES PRICE PER GRANT EXPIRATION
NAME (#)<F1> IN 1998 SHARE<F2> DATE DATE<F3> 0% 5% 10%
----------- ------------- ----------- ----------- ---------------- ----------- ----------- -------------
Robert N. Tidball 110,000 22 $6.813 $7.75 May 12, 2008 $103,070 $640,145 $1,458,545
Douglas P. Goodrich 85,000 17 6.813 7.75 May 12, 2008 79,645 494,658 1,127,058
J. Michael Allgood 85,000 17 6.813 7.75 May 12, 2008 79,645 494,658 1,127,058
Stephen M. Bess 20,000 4 6.813 7.75 May 12, 2008 18,740 116,390 265,190
Susan C. Santo 40,000 8 6.813 7.75 May 12, 2008 37,480 232,780 530,380
<FN>
<F1> Granted effective May 12, 1998, pursuant to the Company's 1998
Management Stock Compensation Plan. Such options vest ratably over a
three-year period beginning on the effective date of grant, subject to
acceleration in certain circumstances following a "change in control,"
as defined in the plan. See "1998 Management Stock Compensation Plan."
<F2> The 1998 Management Stock Compensation Plan provides that the exercise
price of options equal 110% of the average daily closing price of the
common stock on the American Stock Exchange for the ten trading days
immediately preceding the effective grant date. The closing price of
the common stock for the ten trading days immediately preceding May 12,
1998 ranged from a low of $5.81 to a high of $7.06, with the average
daily closing price being $6.194.
<F3> Subject to earlier termination in certain events related to termination
of employment.
<F4> Represents assumed rates of stock price appreciation in accordance with
rules promulgated by the Securities and Exchange Commission. Actual
gains, if any, on stock option exercises are dependent on the future
market price of the Company's common stock. Computation based on actual
10-year option term and annual compounding, computed as the product of
(a) the difference between: (i) the product of the per share market
price at the effective date of grant ($7.75) and the sum of 1 plus the
adjusted stock price appreciation rate (5% - 63%, 10% - 159%) and (ii)
the per share exercise price of the option ($6.813) and (b) the number
of securities underlying the grant at fiscal year end.
</FN>
The following table sets forth information concerning the exercise of
stock options during the last fiscal year by each of the named executive
officers and the December 31, 1998 value of unexercised options held by each of
the named executive officers as of such date:
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR-END OPTION VALUES
- ------------------------------- ----------------- ---------------- ----------------------------- -----------------------------
NUMBER OF SECURITIES VALUE OF UNEXERCISED
NUMBER OF UNDERLYING UNEXERCISED IN-THE-MONEY OPTIONS AT
SHARES OPTIONS AT DECEMBER 31, 1998 DECEMBER 31, 1998
ACQUIRED ON EXERCISABLE/ EXERCISABLE/
EXERCISE<F1> VALUE REALIZED UNEXERCISABLE UNEXERCISABLE<F2>
NAME
- ------------------------------- ----------------- ---------------- ----------------------------- -----------------------------
Robert N. Tidball <F3> 20,000 $73,120 143,333/116,687 $646,249/22,501
Douglas P. Goodrich<F4> 10,000 38,800 50,000/100,000 193,750/50,625
J. Michael Allgood<F5> 10,000 35,700 40,000/95,000 160,000/33,750
Stephen M. Bess<F6> 2,500 9,692 10,000/20,000 46,250/--
Susan C. Santo<F7> 2,500 8,750 0/40,000 --/--
- -----------------
<FN>
<F1> All of the options exercised were granted in 1994 and had an exercise
price of $3.06.
<F2> Options granted in 1992 have an exercise price of $2.00. Options
granted in 1996 have an exercise price of $3.25. Options granted in
1998 have an exercise price of $6.813. The closing price of the
Company's common stock on the American Stock Exchange on December 31,
1998 was $6.625 per share.
<F3> Mr. Tidball was granted options to purchase 130,000 shares of common
stock in 1992, options to purchase 20,000 shares of common stock in
1996 and options to purchase 110,000 shares of common stock in 1998.
<F4> Mr. Goodrich was granted options to purchase 20,000 shares of common
stock in 1992, options to purchase 45,000 shares of common stock in
1996 and options to purchase 85,000 shares of common stock in 1998.
<F5> Mr. Allgood was granted options to purchase 20,000 shares of common
stock in 1992, options to purchase 30,000 shares of common stock in
1996 and options to purchase 85,000 shares of common stock in 1998.
<F6> Mr. Bess holds options to purchase 10,000 shares of common stock
pursuant to options granted in 1992 and was granted options to purchase
20,000 shares of common stock in 1998.
<F7> Ms. Santo was granted options to purchase 40,000 shares of common stock
in 1998.
</FN>
1998 MANAGEMENT STOCK COMPENSATION PLAN
On May 12, 1998 the Board of Directors approved the PLM International,
Inc. 1998 Management Stock Compensation Plan (the "1998 Plan"). The purpose of
the 1998 Plan is to obtain for the Company and its shareholders the commitment
and motivation inherent in stock ownership by those individuals upon whose
judgment, initiative, creativity and efforts the Company is substantially
dependent for the successful operation of its business. The 1998 Plan has been
designed to permit the Company to use equity-based compensation in a flexible
manner that will permit the Company to obtain the maximum possible benefits by
providing for a variety of possible types and structures of stock and stock
option awards. Thus, under the 1998 Plan, the Company will be able to adjust the
types of awards to changing tax and accounting rules as well as to the
individual circumstances of specific groups of employees to whom the Company
desires to target incentives. To these ends, the 1998 Plan authorizes the Board
of Directors to grant (a) incentive stock options under Section 422 of the
Internal Revenue Code of 1986, as amended (the "Code") ("Incentive Options"),
(b) non-qualified stock options ("Non-qualified Options"), and (c) shares of the
Company's common stock. The Company has reserved up to 800,000 shares of common
stock for issuance for awards made under the 1998 Plan, subject to adjustment
for certain corporate events such as stock splits, stock dividends or
reclassification, which shares will be registered with the Securities and
Exchange Commission. This represents approximately 9.81% of the Company's
currently outstanding common stock. The 1998 Plan terminates on May 12, 2008
unless terminated earlier by the Board of Directors.
The 1998 Plan is administered by the Board of Directors, which has the
authority, taking into consideration the recommendation of management, to select
employees to whom shares or options will be granted, structure the types of
awards that will be granted, determine whether an option should be a
Non-qualified Option or an Incentive Option, determine the number of shares that
will be awarded or subject to any options awarded, the time and manner in which
awards of options can be exercisable, the restrictions to be placed on any
shares, and the time or times at which any such restrictions will lapse.
Management employees and other key employees (including employees who are
directors) of the Company or its subsidiaries are eligible to participate in the
1998 Plan. The determination to grant shares or options under the 1998 Plan to
employees who are directors can only be made by a committee of the Board of
Directors consisting of two or more directors who are "disinterested persons"
and who are "outside directors." The Board of Directors has designated the
Compensation Committee (the "Committee") to administer the 1998 Plan.
Participation in the 1998 Plan does not preclude participation in any other
stock or non-stock compensation plans of the Company.
Under the 1998 Plan, the exercise price of any Non-qualified Option or
Incentive Option is, unless otherwise decided by the Board, equal to 110% of the
average daily closing price of such shares on the American Stock Exchange for
the ten trading days immediately preceding the date as of which such option is
granted. Options awarded under the 1998 Plan vest ratably over a three-year
period, and following vesting, may be exercised until such options expire. The
exercise price for any shares would generally be payable in cash. The exercise
price may also be paid by (a) delivery to the Company of already-owned shares of
common stock having a fair market value equal to the aggregate exercise price on
the date of exercise, (b) non-cash exercise methods which are permitted by law,
or (c) any combination of cash, already-owned shares or such non-cash exercise
methods having a combined value equal to the aggregate exercise price. The
exercise price might also, with the approval of the Board of Directors, be paid
with a promissory note. The terms and conditions of each promissory note would
be established by the Board of Directors in its discretion. Options and grants
of stock under the 1998 Plan may be made subject for a period of time to a right
of repurchase on the part of the Company at a price equal to the price paid by
the grantee.
No optionee under the 1998 Plan has any rights of a stockholder until
the option is exercised and the corresponding shares have been issued by the
Company. Options are not assignable or transferable other than by will or the
laws of inheritance, and during an optionee's lifetime, the option can be
exercised only by the optionee. In the case of the death of the original
optionee, the options are transferable to (and exercisable within a limited
period of time no greater than one year by) the original optionee's personal
representative, legatees or heirs. In the case of the termination of employment
of any optionee other than on account of his or her death, options held by the
optionee that were exercisable immediately before termination of employment
would continue to be exercisable for three months in the case of Incentive
Options and six months in the case of Non-qualified Options, except that, in the
case of both Incentive Options and Non-qualified Options, the period during
which options would remain exercisable would be one year if the optionee's
termination of employment was due to permanent and total disability. In no event
would any option be exercisable after its expiration date.
Upon the occurrence of certain corporate events described in the 1998
Plan, including a change in corporate control as determined by the Board of
Directors in its discretion specifically for the purposes of the 1998 Plan, the
Board of Directors has the discretion under the plan to take any or all of the
following actions: (a) accelerate the exercisability of any options or the
vesting of any shares of stock granted or sold under the 1998 Plan or issued
pursuant to the exercise of options granted under the 1998 Plan; (b) arrange to
have any surviving corporation grant replacement options or stock to optionees
or grantees; or (c) cancel options or repurchase non-vested shares at a price
determined by the Board of Directors in its discretion to be the fair market
value of the cancelled option or repurchased stock. If the outstanding shares of
the Company's common stock were increased or decreased in number, or changed
into, or exchanged for, a different number of securities of the Company or any
other corporation by reason of a recapitalization, reclassification, stock
split, reverse stock split, combination of shares, stock dividend or other
event, the Board of Directors could adjust the number and kind of securities as
to which outstanding options might be exercised, and/or their exercise price, as
might be appropriate. The Board of Directors could also increase or decrease the
800,000-share limit otherwise placed upon the 1998 Plan to the extent necessary
to prevent what would in substance be a reduction or enlargement of the
800,000-share limit.
The Board of Directors has the power to amend, modify, suspend or
terminate the 1998 Plan in any or all respects whatsoever at any time, except
that stockholder approval is required if and to the extent the Board of
Directors determines that such approval is appropriate for the purpose of
satisfying applicable law. Any termination by the Board of Directors would have
no effect on any shares previously granted or sold under the plan, or on any
outstanding options or agreements placing restrictions on any shares granted or
sold under the plan. The Board of Directors may also amend or modify the terms
of any outstanding award provided that no amendment will, without the consent of
the grantee or optionee, adversely affect the rights of such grantee or optionee
with respect to an outstanding award.
As of the date of this Proxy Statement, 500,000 options to purchase
shares have been granted to the named executive officers and other key employees
of the Company under the 1998 Plan. See "Stock Option Grants in 1998".
EMPLOYMENT AGREEMENTS WITH EXECUTIVE OFFICERS
The Company has entered into Employment Agreements (the "Employment
Agreements") with its Chief Executive Officer, its four other named executive
officers and others (each a "Contract Employee"). The Employment Agreements are
designed to encourage Contract Employees to remain in the employ of the Company
and to reinforce their continued attention and dedication to their duties in the
event of an unsolicited attempt to take over control of the Company. The
Employment Agreements have three-year terms from the date on which they were
entered into (the "Original Term") and are automatically extended for one
additional year on each succeeding anniversary thereof unless earlier terminated
by the Company or the employee. Each Employment Agreement contains provisions
governing salary, bonus and participation in Company benefit plans, and provides
in certain events for payments to the Contract Employee upon termination of his
or her employment with the Company. In addition, each Employment Agreement
includes a covenant not to solicit the Company's customers or otherwise compete
against the Company for a period of time after termination of employment.
If, following a change in control, the Company terminates a Contract
Employee other than for cause or if the employee terminates his or her
employment for good reason (including, without limitation, any demonstrable and
material diminution of the compensation, duties, responsibilities, authority or
powers of the Contract Employee), then the Company is required to pay the
Contract Employee the sum of (a) the employee's annual base compensation rate
then in effect multiplied by the number of years in the Original Term (up to
2.99 years), (b) an amount equal to the greater of the amount paid and/or
payable to or due the Contract Employee under the Company's bonus or incentive
plans (i) for the Company's fiscal year prior to the fiscal year of any change
in control or (ii) for the immediately preceding fiscal year, multiplied by the
number of years in the Original Term (up to 2.99 years) and (c) all other cash
benefits due the Contract Employee.
In addition, if, following a change in control, the Contract Employee
terminates his or her employment for good reason, all options to purchase stock
of the Company granted to such Contract Employee immediately become fully vested
and any restrictions on the exercise of such options lapse.
For purposes of the Employment Agreements, a change in control is
generally defined to include, among other things, (a) any Person acquiring
Beneficial Ownership (as such terms are defined in the Employment Agreements) of
36% or more of the combined voting power of the Company's securities, (b) any
Person, who did not have Beneficial Ownership of 5% or more of the voting power
of the Company's securities on the date the Employment Agreement was entered
into, subsequently acquiring Beneficial Ownership of more than 15% of such
voting power or (c) a change in the Board of Directors of the Company due to
proxy solicitations or other actions to influence voting at a meeting of
stockholders of the Company by a Person who has Beneficial Ownership of 5% or
more of the voting power of the Company, and which causes the Continuing
Directors (as defined below) to cease to be a majority of the Board of
Directors, unless such event(s) have been approved by a majority of the
Continuing Directors.
"Continuing Directors" are those who (a) were directors on the date the
Employment Agreement was entered into, (b) were appointed or recommended for
election by a majority of those who were directors on such date, or (c) were
appointed or recommended by a majority of those directors described in (a) and
(b) above.
The Employment Agreements are structured so that no excess payments
within the meaning of Section 280G of the Code will be made to any Contract
Employee pursuant to the Employment Agreements. If a change in control occurred
on the date hereof and the employment of the Contract Employees was immediately
terminated without cause, based on certain assumptions, the following would be
the amounts of post-employment compensation benefits provided under the
Employment Agreements to the following named executive officers: Mr. Tidball,
$1,686,360; Mr. Goodrich, $1,094,340; Mr. Allgood, $953,810; Mr. Bess, $759,460;
and Ms. Santo, $768,430.
PENSION BENEFITS
The following table sets forth certain information regarding annual
benefits payable in specified compensation and years of service classifications
under the Company's nonqualified supplemental retirement income plan:
AVERAGE ANNUAL COMPENSATION DURING LAST ANNUAL PAYOUT TO BE RECEIVED IN EACH OF
FIVE YEARS OF EMPLOYMENT<F1><F2> FIVE YEARS FOLLOWING LATER OF TERMINATION OF
EMPLOYMENT OR ATTAINMENT OF AGE 60
- ------------------------------------------- --------------------------------------------------------------------------
CREDITED YEARS OF SERVICE<F3>
5 10 15
- -- --
$ 100,000 $ 25,000 $ 50,000 $ 75,000
140,000 35,000 70,000 105,000
180,000 45,000 90,000 135,000
220,000 55,000 110,000 165,000
260,000 65,000 130,000 195,000
300,000 75,000 150,000 225,000
400,000 100,000 200,000 300,000
<FN>
<F1> The Company's nonqualified supplemental retirement income plan provides
that an executive participating in the plan is generally entitled to
receive for a period of 60 months, commencing upon the later of
attainment of age 60 or termination of employment, an amount equal to
the product of (a) 5%, (b) number of years of employment with PLM
International, its affiliates or predecessors (up to a maximum of 15
years) and (c) average monthly base compensation during the most recent
consecutive months of employment (not to exceed 60) preceding
termination of employment. Obligations under the plan are funded by
general corporate funds and insurance policies on the lives of the
participants. For purposes of computing benefits under the plan,
compensation includes only salaries and wages and does not include
bonuses. Benefits payable are not subject to any deduction for social
security or other offset amounts. The annual base compensation 60-month
averages at December 31, 1998 for the named executive officers were as
follows: Mr. Tidball, $295,867: Mr. Goodrich, $187,300; Mr. Allgood,
$166,616; Mr. Bess, $154,617; and Ms. Santo, $111,337.
<F2> Benefits under the plan generally vest over a five-year period. Vesting
is accelerated immediately to 100% in the event of a change in control
of the Company. The Board of Directors has discretion to accelerate the
date for making payments under the plan in the event of a change in
control.
<F3> Years of credited service for the named executive officers are as
follows:
YEARS
-------
Robert N. Tidball 13
Douglas P. Goodrich 11
J. Michael Allgood 6
Stephen M. Bess 16
Susan C. Santo 8
</FN>
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION<F1>
The Compensation Committee of the Board of Directors (the "Committee")
is responsible for advising and recommending to the Board of Directors of the
Company policies governing executive compensation and the Company's incentive
compensation plans, including its 1998 Management Stock Compensation Plan and
the 1996 Mandatory Management Stock Bonus Plan. The Company's executive
compensation programs are designed to attract and retain executives capable of
leading the Company to meet its business objectives and to motivate them to
enhance long-term stockholder value. The Committee is also responsible for
determining the annual compensation levels for the Company's Chief Executive
Officer and other executive officers, subject to review by the disinterested
members of the Board of Directors. The Committee reviews the policies and
specific programs annually to determine if they are meeting the goals of
attracting and retaining qualified executives.
Compensation for the Company's executive officers consists of both
fixed (base salary) and variable (incentive) compensation elements, including
annual cash incentives, stock option grants and stock grants. These elements are
designed to operate on an integrated basis and together comprise total
compensation value. Base compensation for the Chief Executive Officer and other
executive officers is determined at the beginning of each fiscal year based, in
part, on an evaluation of the individual's performance for the prior fiscal
year, as well as reference to compensation data included in a variety of salary
surveys. Incentive compensation for the executive officers for each fiscal year
is determined after the end of the fiscal year, based on the individual's and
the Company's performance as compared to goals set at the beginning of the year.
The disinterested members of the Board of Directors review the Committee's
recommendations regarding the compensation of executive officers.
It is the Committee's belief that none of the Company's executive
officers will be affected by the provisions of Section 162(m) of the Code which
limits the deductibility of certain executive compensation during 1998.
Therefore, the Committee has not adopted a policy as to compliance with the
requirements of Section 162(m) of the Code.
BASE SALARY
Base salary levels of the Company's key executives are largely
determined through comparison with other companies based on certain defined
parameters (as discussed below), and the individual's performance, as reflected
by the appraisal and recommendation of the Chief Executive Officer in the case
of all executives except the Chief Executive Officer, and as evaluated by the
Committee in the case of the Chief Executive Officer. (See "Annual Cash
Incentives," below, for a discussion regarding the performance factors.) For
comparison purposes, the Company performs salary surveys from time to time and
reviews compensation information for companies located in the San Francisco Bay
Area, companies with total revenues of between $100 to $650 million, companies
with a gross leasing portfolio between $500 million and $1 billion, companies in
the transportation leasing and financial services industries, and companies with
fewer than 500 employees. This information is reviewed by reference to public
disclosures and published surveys. In addition, the Committee from time to time
obtains information about comparable salary levels from outside compensation
consultants. The companies included in the salary comparisons are generally not
the same as the companies included in the index to the stock performance graph
included to this Proxy Statement. The Committee believes that the Company's most
direct competitors for executive talent in the San Francisco Bay Area are not
necessarily the same companies to which the Company would be compared for stock
performance purposes.
<F1> The material in this report is not "soliciting material," is not deemed
filed with the Securities and Exchange Commission and is not to be
incorporated by reference in any filing of the Company under the
Securities Act of 1933, as amended, or the Securities Exchange Act of
1934, as amended.
The Company completed its most recent salary survey on executive
positions in December 1997, using data from numerous sources, including
information published by The Employers' Group, Watson Wyatt, William Mercer,
Equipment Leasing Association of America, McLagan Partners Inc., KPMG Peat
Marwick LLP and The Conference Board. The results of this survey were submitted
to the Committee in connection with determining base salaries for executives for
fiscal year 1998. The Committee also considered the individual performance of
each executive. The Summary Compensation Table above shows, under the caption
"Salary," the base compensation for the named executive officers in 1998.
Mr. Tidball's base compensation was set at $312,000, effective February
1, 1998. Mr. Tidball's annual base salary was in part determined based on the
Committee's evaluation of his performance during the prior fiscal year which
included the financial results reflected in the stock performance graph included
in this Proxy Statement and nonfinancial factors, including strategic planning
for the future of the Company. The Committee also took into consideration that
the average compensation of chief executive officers, as reflected in the
December 1997 salary survey, was $396,000.
ANNUAL CASH INCENTIVES
The annual cash incentive is designed to provide short-term (one-year)
incentives to executive officers. Generally, the cash incentive is paid from a
senior management bonus pool established by the Committee at the beginning of
each year based on a targeted level of profitability. The Committee retains the
right to increase or decrease the size of the bonus pool during the year.
Payment of cash incentives is not solely contingent on the Company's meeting the
targeted level of profitability, which level was met during 1998. Profitability,
however, is a factor in determining the size of the bonus pool each year.
Incentive awards for the Company's key executives participating in the
single bonus pool (other than the Chief Executive Officer) are based on the
achievement of predetermined individual performance goals. Specific individual
goals for each executive are established at the beginning of the year by the
Chief Executive Officer and are tied to the functional responsibilities of each
executive. Individual goals may include objective and subjective factors, such
as improving the performance of assets managed by the executive, successful
acquisitions or sales, management of operating expenses, development of
leadership skills, and personal training and education. No specific weights are
assigned to the individual goals. In fiscal 1998, certain of the individual
performance targets were met. The Summary Compensation Table above shows, under
the caption "Bonus," incentive awards for the named executive officers for 1998.
(As discussed above, these performance goals are also used to set, in part, the
executive's base compensation for the next year.)
In establishing the annual cash incentive for the Chief Executive
Officer, the Committee considers the performance of the Company and the Chief
Executive Officer, including his leadership and effectiveness in dealing with
major corporate problems and opportunities. While overall corporate performance,
including stock price performance, is taken into account, the incentive award
for the Chief Executive Officer is primarily determined by a subjective account
of his individual performance. The cash incentive compensation for the Chief
Executive Officer in 1998 was $180,000, and is reflected in the Summary
Compensation Table above under the caption "Bonus."
RESTRICTED STOCK GRANTS
Restricted stock may be awarded pursuant to the 1996 PLM International,
Inc. Mandatory Stock Bonus Plan to compensate senior management for their
contributions to the growth and profits of the Company and its subsidiaries and
to increase their investment in the common stock of the Company, thereby
enhancing their incentive to build stockholder value while conserving Company
liquidity. The Committee recommends to the Board of Directors which executives
will receive restricted stock grants and the portion of their incentive
compensation (between 25% and 50%) that will be reduced in return for such
grants expressed as a percentage of their total bonus (the "Allocation Ratio").
Once determined, the participating executives are granted restricted stock
according to the following formula: amount of cash bonus due an employee as
awarded by the Committee under their incentive compensation plan, multiplied by
the recipient's Allocation Ratio, multiplied by 1.3334 (to compensate employees
for the restricted nature of the Stock Grants and the risk of forfeiture),
divided by the fair market value of a granted share (the quoted closing price of
the Company's common stock on the date of issuance). In selecting those
employees whom it wishes to recommend for restricted stock grants, the Committee
considers 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. Restricted stock grants generally vest ratably
over three years and, until vested, are subject to forfeiture in the event an
executive voluntarily terminates his or her employment with the Company or is
terminated for cause. The Committee believes restricted stock grants provide
long-term incentives and rewards tied to the Company's common stock. Recipients
benefit only when Company stockholders benefit from stock price appreciation.
The Company benefits by paying less cash incentives. In addition, the restricted
nature of the stock grants, including the risk of forfeiture, rewards executives
who maintain long-term employment with the Company.
There were 43,085 shares of common stock granted as restricted stock to
executive officers for 1998, of which 13,606 were granted to the Chief Executive
Officer. The Summary Compensation Table above shows, under the caption
"Restricted Stock Awards," the value of the restricted stock grants at the time
of such grant to the Chief Executive Officer and other named executive officers
for 1998, as well as the number of shares of common stock granted as restricted
stock to the Chief Executive Officer and other named executive officers for
1998.
STOCK OPTIONS
Stock options are designed to provide long-term incentives and rewards
tied to the price of the Company's common stock. Given the fluctuations of the
stock market, stock price performance and financial performance are not always
consistent. The Committee believes that stock options, which provide value to
participants only when the Company's stockholders benefit from stock price
appreciation, are an important component of the Company's annual executive
compensation program. The Company's shareholder-approved 1988 Management Stock
Compensation Plan expired in March 1998. In order to be able to continue to
provide long-term incentives to the Company's key employees and officers, on May
12, 1998, the Committee recommended and the Board of Directors approved the 1998
Management Stock Compensation Plan, which is described above under the section
entitled "1998 Management Stock Compensation Plan."
Based on recommendations of the Committee, the Board of Directors
granted a total of 500,000 options to purchase common stock to executive
officers and key employees, including 110,000 options granted to the Chief
Executive Officer. The table entitled "Stock Option Grants In 1998" shows, under
the caption "Common Stock Options Granted," the number of options granted to the
Chief Executive Officer and other named executive officers at the exercise price
of $6.813 per share. The options generally vest ratably over three years and are
subject to acceleration in certain circumstances following a change in control.
See also "1998 Management Stock Compensation Plan" above.
THE MEMBERS OF THE COMPENSATION COMMITTEE
HAROLD R. SOMERSET, CHAIRMAN
RANDALL L-W. CAUDILL
ROBERT L. WITT
COMPARISON OF FIVE YEAR CUMULATIVE TOTAL RETURN
The following stock performance graph compares the performance of the
Company's common stock to the S&P 500 Index and the Russell 2000 Index, an index
of small market capitalization companies. The graph assumes that the value of
the investment in the Company's common stock and each index was $100 on December
31, 1993, and that all dividends were reinvested. All year references are to
December 31 of the applicable year.
COMPARISON OF 5 YEAR CUMULATIVE TOTAL RETURN*
AMONG PLM INTERNATIONAL, INC., THE S&P 500 INDEX
AND THE RUSSELL 2000 INDEX
December 1993:
PLM INTERNATIONAL, INC.: $100
S & P 500: $100
RUSSELL 2000: $100
December 1994
PLM INTERNATIONAL, INC.: $135
S & P 500: $101
RUSSELL 2000: $98
December 1995
PLM INTERNATIONAL, INC.: $176
S & P 500: $139
RUSSELL 2000: $126
December 1996
PLM INTERNATIONAL, INC.: $159
S & P 500: $171
RUSSELL 2000: $147
December 1997
PLM INTERNATIONAL, INC.: $265
S & P 500: $229
RUSSELL 2000: $180
December 1998
PLM INTERNATIONAL, INC.: $312
S & P 500: $294
RUSSELL 2000: $179
* $100 INVESTED ON 12/31/93 IN STOCK OR INDEX
INCLUDING REINVESTMENT OF DIVIDENDS
(FISCAL YEAR ENDING DECEMBER 31.)
The Company is an equipment leasing company specializing in the
management of equipment on operating and finance leases domestically and
internationally. Its portfolio of owned and managed equipment consists of
diversified transportation equipment and includes marine vessels, aircraft,
trailers/tractors, railcars/locomotives, marine containers, and mobile offshore
drilling units. In addition, the Company's wholly-owned subsidiary, American
Finance Group, Inc., leases numerous nontransportation equipment types on
finance leases, primarily domestically. No issuers are leasing similar
portfolios of diversified transportation equipment on operating leases and
numerous other equipment types on finance leases. Therefore, the Company
believes it cannot reasonably identify a peer group and has used an index
composed of companies with similar market capitalizations.
INDEPENDENT AUDITORS
Representatives of KPMG Peat Marwick LLP, the Company's independent
auditors, are expected to be present at the Annual Meeting. They will be
afforded an opportunity to make a statement, if they so desire, and are expected
to be available to respond to appropriate questions.
STOCKHOLDER PROPOSALS
Proposals from stockholders for the 2000 Annual Meeting must be
received by the Company no later than December 16, 1999 to be considered for
inclusion in the Company's Proxy Statement and proxy card relating to the 2000
Annual Meeting.
In addition, pursuant to the Company's bylaws, a stockholder who
desires to present a proposal at a meeting of stockholders of the Company
without inclusion of such proposal in the Company's proxy materials relating to
the meeting must give timely notice of the proposal in writing to the Secretary
of the Company. To be timely, a stockholder's notice must be delivered to or
mailed and received at the principal executive offices of the company not less
than 50 days nor more than 75 days prior to the meeting; provided, however, that
if less than 65 days' prior notice or prior public disclosure of the date of the
meeting is given or made to stockholders, a stockholder's notice must be so
received not later than the close of business on the fifteenth day following the
day on which notice of the date of the meeting was mailed or public disclosure
was made, whichever occurs first. The Company reserves the right to reject, rule
out of order, or take other appropriate action with respect to any proposal that
does not comply with these and other applicable requirements.
All notices of proposals of stockholders, whether or not to be included
in the Company's proxy materials, should be sent to the attention of the
Secretary, PLM International, Inc., One Market, Steuart Street Tower, Suite 800,
San Francisco, California 94105.
OTHER BUSINESS
The Board of Directors of the Company does not intend to present any
other items of business at the Annual Meeting.
The Board of Directors knows of no other items that are likely to be
brought before the Annual Meeting except those that are set forth in the
foregoing Notice of Annual Meeting of Stockholders. If any other matters
properly come before the Annual Meeting, the persons designated on the enclosed
proxy card will vote in accordance with their judgment on such matters.
By Order of the Board of Directors
/S/ SUSAN C. SANTO
--------------------------------
SUSAN C. SANTO
Vice President, Secretary and General Counsel
San Francisco, California
April 15, 1999
PLM INTERNATIONAL WILL PROVIDE WITHOUT CHARGE TO EACH PERSON FURNISHED
A COPY OF THIS PROXY STATEMENT, A COPY OF ITS ANNUAL REPORT ON FORM 10-K, AS
FILED WITH THE SECURITIES AND EXCHANGE COMMISSION, UPON RECEIPT OF A WRITTEN
REQUEST THEREFOR SENT TO THE SECRETARY OF PLM INTERNATIONAL, INC., ONE MARKET,
STEUART STREET TOWER, SUITE 800, SAN FRANCISCO, CALIFORNIA 94105.
PROXY PLM INTERNATIONAL, INC. PROXY
ONE MARKET, STEUART STREET TOWER, SUITE 800
SAN FRANCISCO, CALIFORNIA 94105-1301
ANNUAL MEETING OF STOCKHOLDERS -- MAY 27, 1999
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby constitutes and appoints Robert N. Tidball and
Douglas P. Goodrich, and each of them, true and lawful agents and proxies to the
undersigned, with full power of substitution, to represent the undersigned and
to vote all shares of stock that the undersigned is entitled to vote at the
Annual Meeting of Stockholders of PLM International, Inc. (the "Company"), to be
held on May 27, 1999, and at any and all adjournments and postponements thereof,
on all matters before such meeting.
THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED IN THE MANNER
DIRECTED HEREIN BY THE UNDERSIGNED STOCKHOLDER. HOWEVER, IF NO VOTE IS
SPECIFIED, THIS PROXY WILL BE VOTED FOR PROXY ITEM NO. 1.
Please mark this Proxy Card, fill in the date, sign on the reverse side
and return promptly in the enclosed envelope. No postage is necessary if mailed
in the United States.
This Proxy grants discretionary authority (1) to vote for a substitute
nominee of the Board of Directors if any nominee for the director listed on the
reverse side is unable to serve, or for good cause will not serve as a director
(unless authority to vote for all nominees or for the particular nominee who has
ceased to be a candidate is withheld), and (2) to vote in accordance with the
best judgment of the named proxies on other matters that may properly come
before the meeting.
(CONTINUED, AND TO BE SIGNED ON THE OTHER SIDE)
[X] Please mark your votes as this
THE BOARD OF DIRECTORS
RECOMMENDS A VOTE FOR
PROXY ITEM NO. 1 BELOW:
1. ELECTION OF DIRECTORS:
NOMINEES: FOR WITHHOLD FOR ALL
Warren G. Lichtenstein [ ] [ ]
Howard M. Lorber
(INSTRUCTION: To withhold authority for any individual nominee,
strike a line through the nominee's name in the list above.)
This Proxy, when properly executed, will be voted in the manner directed by the
undersigned. If no direction is made, this Proxy will be voted "FOR" Proxy Item
No. 1 above.
Signature(s)_____________________ Dated: ___________________, 1999
Please sign this proxy exactly as your name appears hereon. Joint owners should
each sign personally. Trustees and other fiduciaries should indicate the
capacity in which they sign, and where more than one name appears, a majority
should sign. If a corporation, the signature should be that of an authorized
person who should also state his/her title.
PLEASE MARK, SIGN, DATE AND RETURN THIS PROXY CARD PROMPTLY USING THE ENCLOSED
ENVELOPE.