EMPLOYMENT AGREEMENT


         THIS  EMPLOYMENT  AGREEMENT  ("Agreement")  is made and entered into on
this 18th day of December, 1992, by
and between PLM INTERNATIONAL, INC.("Employer") and Stephen M. Bess("Employee").

         WHEREAS,  the Executive Committee of the Board of Directors deems it in
the best interest of the  shareholders  of the Employer to maintain a continuity
of management, and retain an experienced, successful and proven management team;
and

         WHEREAS,  Stephen M. Bess has accepted the  appointment of the Board of
Directors to the position(s) of President, PLM Investment Management, Inc.;

                               W I T N E S S E T H

         That in  consideration of the covenants,  duties,  terms and conditions
hereinafter set forth, the parties hereto agree as follows:

         1. Services. Employer hereby engages the exclusive services of Employee
as President,  PLM Investment  Management,  Inc.,  with his powers and duties in
that capacity to be determined  by Employer's  Board of Directors,  and Employee
hereby  agrees to  perform  such  services  on the terms and  conditions  herein
contained  and to abide by all  rules and  regulations  for the  conduct  of the
Employee that are now or may hereafter be established by Employer. In connection
with this Agreement,  Employee shall be based at the principal executive offices
of Employer or at such  location as may be  designated  from time to time by the
Board of  Directors  of  Employer,  except  for  required  travel on  Employer's
business to an extent  substantially  consistent  with present  business  travel
obligations.

         2.  Employment  Term. The term of this Agreement  shall commence on the
date hereof (the "Commencement  Date"), and shall continue for three (3) year(s)
(the "Original  Term") unless  terminated  pursuant to Sections 10 or 11 of this
Agreement.  One year from the Commencement Date and each anniversary thereafter,
the term of this Agreement  shall be  automatically  extended one (1) additional
year unless prior to such  anniversary  of the  Commencement  Date, the Employer
shall have delivered to the Employee notice of a determination  made pursuant to
Section  10.1(C) of this  Agreement,  or Employee  shall have  delivered  to the
Employer written notice that the term of this Agreement shall not be extended.


         3.       Compensation.

                  3.1 Employer  shall pay to Employee as full  compensation  for
all  services  performed,  the  sum  of  one  hundred  twenty  thousand  dollars
($120,000)  per year (or such higher  amount as may be agreed to by Employer and
Employee  from time to  time)(the  original  amount or the adjusted  amount,  if
applicable, being the "Base Salary") payable in equal semi-monthly installments.
Employee's  compensation  may be adjusted  from time to time,  but it may not be
reduced below the Base Salary without the Employee's prior written consent.

                  3.2 Employer  may deduct and withhold  from all payments to be
made to Employee  hereunder the amounts  required or permitted to be deducted or
withheld  pursuant to any provisions of any present or future  applicable law or
regulation,  together with the right and authority to pay any such deductions or
withholdings  over to any party  entitled to the same pursuant to the provisions
of any such law or regulation.

         4. Bonus. The Employee shall be eligible to participate in any bonus or
incentive  compensation  plan for which  Employee or other senior  executives of
Employer may  reasonably  expect to  participate  (the  "Incentive  Compensation
Plan").  To the  extent  not  otherwise  determined  pursuant  to the  Incentive
Compensation  Plan,  the Board of Directors  shall have the sole  discretion  to
determine the amount of such bonus, or incentive compensation, if any.

         5. Other  Benefits.  Employer  shall maintain in full force and effect,
and Employee shall be entitled to continue to participate  in, all of Employer's
employee  benefit plans and  arrangements  in effect on the date hereof in which
Employee  participates;  or such other plans or arrangements  that would provide
Employee with substantially  equivalent benefits  thereunder  (including without
limitation  each  pension  and  retirement  plan and  arrangement,  supplemental
pension and retirement plan and  arrangement,  stock option plan, life insurance
plan  and  arrangement,   health-and-accident  plan  and  arrangement,   medical
insurance plan and arrangement, disability plan and arrangement, survivor income
plan and arrangement,  relocation plan and vacation plan) (the "Employee Benefit
Plans");  provided,  however,  that  this  Section  5 shall  not apply to any of
Employer's Incentive  Compensation Plan(s).  Employer shall not make any changes
in such plans or arrangements  which would adversely affect Employee's rights or
benefits thereunder,  unless such change occurs pursuant to a program applicable
to all  employees  or  executives  of the  Employer  and  does not  result  in a
proportionately  greater  reduction in the rights of or benefits to the Employee
as compared with any other employee or executive of the Employer. Employee shall
be entitled to  participate in and receive  benefits under any Employee  Benefit
Plan or  arrangement  made available by Employer in the future to its employees,
executives or key  management  employees,  subject to and on a basis  consistent
with  the  terms,  conditions  and  overall  administration  of such  plans  and
arrangements.  Nothing  paid to the  Employee  under  any  plan  or  arrangement
presently  in effect or made  available  in the future  shall be deemed to be in
lieu of the salary  payable to the  Employee  pursuant  to Section 3.1 hereof or
pursuant to an Incentive  Compensation Plan as provided in Section 4 hereof. Any
payments or  benefits  payable to the  Employee  hereunder  with  respect to any
calendar  year during  which  Employee is employed by Employer for less than the
entire such year shall,  unless  otherwise  provided in the  applicable  plan or
arrangement,  be prorated in accordance with the number of days in such calendar
year  during  which he is  employed;  provided,  however,  benefits  or payments
payable   to   Employee   under  any  life   insurance   plan  or   arrangement,
health-and-accident  plan or arrangement or disability plan or arrangement shall
be  payable on behalf of  Employee  by  Employer  for a period of six (6) months
after termination of employment hereunder.

         6. Other Interests. Employee shall devote his time and attention solely
to the business and interest of Employer,  and Employer shall be entitled to all
the  benefits  arising  from or  incident  to  Employee's  services.  During the
employment term,  Employee shall not, without Employer's  written consent,  have
any interest in any business which conflicts  either directly or indirectly with
Employer's  business,  except that  Employee may hold an interest not  exceeding
five percent (5%) in any corporation whose stock is publicly traded.

          7. Confidentiality. It is specifically understood and agreed that some
of the Employer's  business activities are secret in nature and constitute trade
secrets,  including  but  not  limited  to  Employer's  "know-how",  methods  of
production  and  manufacturing,  ideas and results of research and  development,
specifications of equipment and materials, profit margins, planning information,
projections,  customer and supplier information,  reports, analyses, agreements,
as well as  financial  data  and  reports.  All  Employer's  trade  secrets  and
proprietary  information are and shall be the property of Employer,  for its own
exclusive  use and benefit,  and  Employee  agrees that he will hold the same in
strictest  confidence  and will not at any  time,  either  during  or after  his
employment  by the  Employer,  use or  permit  the use of the  same  for his own
benefit  or  for  the  benefit  of  others  unless  authorized  to do so by  the
Employer's  written  consent or by a contract or agreement to which the Employer
is a party or by which it is bound.

          8. Services Furnished.  During the term of Employee's  employment with
Employer,  Employer  shall  furnish  Employee  with  office  space,  secretarial
assistance  and such  other  facilities  and  service  as have  heretofore  been
furnished to Employee.

          9.  Other  Positions.  Employee  agrees  to serve  without  additional
compensation  (other than  compensation  accruing to any other person serving in
such capacity), if elected or appointed a director of the Employer or any of its
subsidiaries,  provided that Employee is indemnified  for serving in any and all
such  capacities on a basis no less favorable  than is currently  provided other
directors.

         10.  Termination by Employer.  Employee's  employment  hereunder may be
terminated  by  Employer  without  any breach of this  Agreement  only under the
following circumstances:

                   10.1  If   occurring   prior  to  a  Change  in  Control  (as
hereinafter defined):

                           (A)  Death.  Employee's  employment  hereunder  shall
terminate upon his death.

                           (B)  Disability.   If,  as  a  result  of  Employee's
incapacity due to physical or
mental illness, Employee shall have been absent or substantially absent from his
duties hereunder for the entire period of six (6) consecutive months, and within
thirty (30) days after written  notice of  termination is given (which may occur
before or after the end of such six month period) shall not have returned to the
performance of his duties hereunder on a full time basis, Employer may terminate
Employee's employment hereunder.  Employee's absence or substantial absence from
his duties  will be treated as  resulting  from  incapacity  due to  physical or
mental illness if Employee is "totally disabled from his own occupation."  Total
disability  from  Employee's  own  occupation  will exist  where (1)  because of
sickness  or  injury,  Employee  cannot  perform  the  important  duties  of his
occupation,  (2) Employee is either  receiving  Doctor's  Care or has  furnished
written proof  acceptable to Employer that further  Doctor's Care would be of no
benefit,  and (3) Employee does not work at all. Doctor's Care means the regular
and personal care of a Doctor which, under the prevailing medical standards,  is
appropriate for the condition causing the disability.

                           (C) This  Agreement may be terminated  without cause,
in the sole, absolute and unreviewable discretion of Employer, by written notice
made by the President of Employer. Such notice shall state that the President of
Employer has determined  that it is in the best interests of the Employer or its
shareholders   to  terminate  this  Agreement  and  the  Employee's   employment
hereunder.

                   10.2 If occurring subsequent to or resulting from a Change in
Control (as hereinafter defined):

                           (A)  Death.  Employee's  employment  hereunder  shall
terminate upon his death.

                           (B)   Disability.  If,  as  a  result  of  Employee's
incapacity due to physical or mental illness  Employee shall have been absent or
substantially  absent from his duties hereunder for the entire period of six (6)
consecutive  months,  and  within  thirty  (30)  days  after  written  notice of
termination  is given (which may occur before or after the end of such six-month
period) shall not have returned to the performance of his duties  hereunder on a
full  time  basis,  Employer  may  terminate  Employee's  employment  hereunder.
Incapacity  due to physical or mental  illness will be determined as provided in
Section 10.1(B); or

                           (C)  Cause.   Employer  may   terminate   Employee's
employment  hereunder for Cause.  For purposes of this Agreement,  "Cause" shall
mean:

                                     (i) the  willful and  continued  failure by
Employee to perform his duties hereunder (other than any failure  resulting from
Employee's  incapacity  due to  physical  or mental  illness)  after  demand for
substantial  performance  is delivered by  Employer,  which demand  specifically
identifies  the manner in which  Employee has not  substantially  performed  his
duties;

                                     (ii) the willful and intentional act by the
Employee that is, in the reasonable  determination  of the Employer,  materially
injurious to the Employer, monetarily or otherwise;

                                     (iii)  the  breach by the  Employee  of any
material covenant of this Agreement; or

                                     (iv) the  conviction  of the  Employee 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 Employee,  relations of the Employee,  or their affiliates at the expense of
the Employer.

                  For purposes of this Section 10, no act, or failure to act, on
Employee's part shall be considered  willful unless done, or omitted to be done,
by him not in good faith and without the reasonable belief that his action(s) or
omission(s)  was  in  the  best  interests  of  the  Employer.  Furthermore,  no
termination  of  Employee's  employment  shall  be  effective  until  Notice  of
Termination is given to Employee by Employer.

         11.  Termination  by Employee.  Employee may terminate  his  employment
hereunder upon thirty (30) days' written  notice to Employer for any reason.  If
Employee terminates his employment  hereunder  subsequent to a Change in Control
(as  hereinafter  defined) and such  termination  is made for any of the reasons
listed below,  then such termination  shall be deemed to have been done for good
reason ("Good Reason").

                  Reasons constituting Good Reason shall be limited to:

                            (A) any breach by Employer of any material provision
of this  Agreement  which has not been cured within ten (10) days after  written
notice of such non-compliance is given by Employee to Employer;

                            (B) any demonstrable and material  diminution of the
compensation, duties, responsibilities,  authority or powers of Employee as such
relate to any  positions or offices held by Employee  immediately  prior to such
Change in Control;  provided that Employee provides a reasonable  description of
any such  diminution(s) and a statement that Employee finds, in good faith, that
the  acts  or   omissions   to  act   causing   such   diminution   in   duties,
responsibilities,  authority or powers to be a material  diminution and that, as
such, he elects to terminate his employment hereunder for Good Reason;

                            (C) the taking of, or failure to take, any action by
Employer which would deprive  Employee of any material fringe benefit enjoyed at
the time of such  Change in  Control  or the  failure  of  Employer  to  include
Employee in any Employee Benefit Plan or Incentive  Compensation  Plan for which
Employee is properly eligible  including the failure to pay Employee the amount,
if any,  determined in good faith to be due and owing  Employee  pursuant to any
such Employee Benefit Plan or Incentive Compensation Plan; or

                            (D) any  requirement  by the Employer  that Employee
relocate his primary business office to a geographical  area greater than twenty
(20) miles from Employer's  principal executive offices as existing  immediately
prior to the applicable  Change in Control or, if Employee is based in an office
other than Employer's  principal  executive office, the office of Employer where
Employee is based immediately prior to the most recent Change in Control.

                  For purposes of this  Agreement,  a "Change in Control"  shall
mean an event or series of events  which  would be  required  to be  reported in
response to Item 6(e) of Schedule 14A of Regulation  14A  promulgated  under the
Securities Exchange Act of 1934 (the "Exchange Act"), as amended;  provided that
the  following  events  shall be  deemed  a Change  in  Control  whether  or not
reportable  as a Change in Control  pursuant to  Regulation  14A of the Exchange
Act:

                                         (i) any  "person" (as such term is used
in Sections 13(d) and 14(d) of the Exchange Act, as in effect on the date hereof
(a "Person")) acquiring  "beneficial  ownership" (as defined in Rule 13D-3 under
the Exchange Act, as in effect on the date hereof  ("Beneficial  Ownership")) of
securities of the Employer representing 36% or more of the combined voting power
of the Employer's then outstanding securities;

                                         (ii)  any  Person,  who  does  not have
Beneficial  Ownership of securities of the Employer  representing  5% or more of
the combined voting power of the  outstanding  securities of the Employer on the
date  hereof,  acquiring  Beneficial  Ownership of more than 15% of the combined
voting power of the securities of the Employer then outstanding; or

                                         (iii)  a   change   in  the   Board  of
Directors,  which  change  is the  result  of a proxy  solicitation(s)  or other
action(s) to influence  voting at a shareholders'  meeting of the Company (other
than by  voting  one's  own  stock)  by a Person  or group  of  Persons  who has
Beneficial  Ownership  of 5% or  more  of  the  combined  voting  power  of  the
securities of the Employer and which causes the Continuing Directors to cease to
be a majority of the Board of Directors of the Employer; provided, however, that
none of the  foregoing  events  shall be deemed to be a Change in Control if the
event(s)  or   election(s)   causing  such  change  shall  have  been   approved
specifically  for purposes of this Agreement by the affirmative vote of at least
a majority of the members of the Continuing Directors.

                  For purposes of this Agreement,  "Continuing  Directors" shall
mean a member  of the  Board of  Directors  who (i) is a member  of the Board of
Directors on the date hereof,  or (ii) who subsequently  becomes a member of the
Board of Directors and who either (x) is appointed or  recommended  for election
with the affirmative  vote of a majority of the Directors then in office who are
Directors on the date hereof,  or (y) is appointed or  recommended  for election
with the affirmative  vote of a majority of the Directors then in office who are
described in subsections (i) and (ii)(x) above, as applicable.

         12.      Compensation Upon Termination or During Disability.

                  12.1  During any period  that  Employee  fails to perform  his
duties  hereunder as a result of incapacity  due to physical or mental  illness,
Employee  shall  continue  to receive  his full Base  Salary at the rate then in
effect for such period until his employment is terminated pursuant to Section 10
hereof.

                  12.2 If  Employee's  employment  is  terminated  by his death,
Employer shall pay to Employee's spouse, or if Employee leaves no spouse, to his
estate,  commencing  on the  next  succeeding  day  which is the last day of the
month,  and monthly  thereafter on the last day of each month,  until a total of
three payments have been made, an amount equal to one twelfth of the Base Salary
in effect immediately prior to such termination.

                  12.3 If Employee's  employment  shall be terminated for Cause,
the Employer  shall pay  Employee his full Base Salary  through the date of such
termination at the rate in effect at the time Notice of Termination is given and
the  Employer  shall  have no further  obligations  to the  Employee  under this
Agreement.

                  12.4 If (A) Employer shall terminate the Employee's employment
hereunder other than as permitted hereby or (B) the Employee shall terminate his
employment  for Good  Reason,  then  Employer  shall pay  Employee in cash or by
cashier's check within five (5) business days of such  termination as Employee's
sole remedy for such  termination  the sum of (1) Employee's  Base Salary or, if
greater,  the  base  compensation  rate  in  effect  immediately  prior  to such
termination, multiplied by a number equal to the number of years in the Original
Term,  (2) an amount  equal to the greater of the amount paid and/or  payable to
Employee or accrued by the  Employer  for  Employee  pursuant to all  applicable
Incentive  Compensation  Plans (i) for the fiscal year of the Employer  prior to
the fiscal year of any Change in Control or (ii) for the  immediately  preceding
fiscal year of the  Employer  (even  though in either (i) or (ii) payable in the
next succeeding fiscal year(s) of Employer), multiplied by a number equal to the
number of years in the Original  Term,  and (3) all cash amounts due pursuant to
Section 5 hereof.  The receipt of such payments shall constitute the sole remedy
of  Employee  for  such  termination  and  the  making  of such  payments  shall
constitute  full  performance by Employer under this  Agreement.  For purpose of
this Section 12.4 only, the Original Term, if greater than 2.99 years,  shall be
2.99 years.

                  12.5 If the Employee shall  terminate his employment  pursuant
to Section 11 hereof for any reason other than Good Reason,  Employer  shall pay
Employee his full Base Salary  through the date of such  termination at the rate
in effect at the time Notice of Termination is given.

                  12.6 If Employee's  employment shall be terminated pursuant to
Section  10.1 (C) then  Employer  shall pay  Employee  and  provide  benefits to
Employee pursuant to the standard policy of Employer.

                  12.7 The Employee shall not be required to mitigate the amount
of any payment  provided for in this  Agreement by seeking  other  employment or
otherwise.

         13. Stock Options. In the event Employee's  employment with Employer is
terminated  pursuant  to  Section  11 for Good  Reason,  any and all  options to
purchase  stock (common or otherwise)  in the Employer  granted  pursuant to any
plan or otherwise,  or any equivalent or similar rights which appreciate or tend
to appreciate as the value of the  Employer's  stock  appreciates,  shall become
immediately accelerated and fully vested and any restrictions on such options or
equivalent or similar rights shall, to the extent  permissible  under applicable
securities laws, fully lapse.  Employer shall endeavor to cause any restrictions
on such options or equivalent or similar  rights not lapsed by operation of this
Section 13 to so lapse.

         14.  Covenant  not  to  Compete.  Employee,  in  consideration  of  the
compensation  and  other  benefits  to be  received  by  him  pursuant  to  this
Agreement,  expressly  agrees  that he will not,  within a radius of fifty  (50)
miles from any place of business of the Employer, engage directly or indirectly,
as employee,  principal,  agent, partner,  director or independent contractor or
otherwise in any  business  which is  competitive  to that of the Employer for a
period  equal  to the  Original  Term  after he  ceases  to be  employed  by the
Employer.

         15.  Non-solicitation.  Except in the case of a termination pursuant to
Section 11 for Good Reason,  for a period equal to the Original  Term  following
termination of this Agreement, Employee shall not directly or indirectly solicit
any of Employer's customers existing as of the date of termination.  If Employee
violates  this  Section  15,  Section 14 or the  confidentiality  provisions  of
Section 7, and continues to do so after  Employer has notified  Employee of such
violation, Employer shall have the right to seek equitable restraint of Employee
from such  activities in  contravention  of the  provisions  of this  Agreement,
including seeking and obtaining a temporary  restraining order and/or injunction
against   Employee;   provided  that  Employer   demonstrates   that  Employee's
solicitations result in direct financial detriment to Employer.

         16. Arbitration.  Except as provided in Section 15, if a dispute arises
between  Employer and Employee  concerning  termination of this Agreement  under
Section 10 or 11 above or otherwise,  the disputed  matter shall be submitted to
arbitration.

                  Any  disputed  matter shall be settled by  arbitration  in the
City of San Francisco,  California in accordance with the commercial arbitration
rules of the American  Arbitration  Association ("AAA Rules"). Any judgment upon
the award  rendered  by the  arbitrators  may be  entered  in any  court  having
jurisdiction  thereof.  The  arbitrators  shall have the  authority to grant any
equitable and legal remedies that would be available in any judicial  proceeding
instituted to resolve the disputed matter.  The arbitrators  shall apply the law
of  the  State  of   California   in   making   any   determination   hereunder.
Notwithstanding anything to the contrary which may now or hereafter be contained
in the AAA Rules,  the parties  agree any such  arbitration  shall be  conducted
before a panel of three  arbitrators who shall be compensated for their services
at a rate to be determined by the American Arbitration  Association in the event
the  parties are not able to agree upon their rate of  compensation.  Each party
shall have the right to appoint one  arbitrator  (to be appointed  within twenty
days of the notice of a dispute to be resolved by arbitration hereunder) and the
two  arbitrators so chosen shall mutually agree upon the selection of the third,
impartial arbitrator. The majority decision of the arbitrators will be final and
conclusive upon the parties hereto.

         17. Taxes.  Notwithstanding  anything herein to the contrary,  Employer
shall not be  obligated  to pay any portion of any amount  otherwise  payable to
Employee  hereunder  if Employer is not  reasonably  able to deduct such portion
(the  "Excess  Amount")  solely by  operation  of  Section  280G (or such  other
provision(s) as may from time to time be enacted  governing the deductibility of
so- called "Golden Parachute Payments") of the Internal Revenue Code of 1986, as
amended (the "Code").  Employer  shall be deemed able to reasonably  deduct such
Excess Amount; and all amounts accruing hereunder,  including the Excess Amount,
shall be paid Employee in the event Employee  delivers to Employer an opinion of
an attorney that is reasonably acceptable to Employer stating such Excess Amount
is reasonably deductible by Employer by operation of Section 280G (or such other
provisions as may from time to time be enacted  governing the  deductibility  of
so-called "Golden Parachute Payments") of the Code.

         18.      Miscellaneous.

                  18.1 Written notices  required by this Agreement shall be sent
to Employer or Employee by certified mail, with a return receipt  requested,  to
Employer's registered address and to Employee's last shown address on Employer's
records,  respectively.  Such notice  shall be deemed to be  delivered  two days
after mailing.

                  18.2   This   Agreement   contains   the  full  and   complete
understanding of the parties and supersedes all prior representations, promises,
agreements, and warranties, whether oral or written.

                  18.3  This  Agreement  shall be  governed  by and  interpreted
according to the laws of the State of California.

                  18.4 With respect to Employer,  this Agreement  shall inure to
the benefit of and be binding upon any  successors or assigns of Employer.  With
respect to Employee, this Agreement shall not be assignable,  but shall inure to
the benefit of and be binding  upon the heirs,  executors,  administrators,  and
successors of Employee.

                  18.5 The  captions of the various  sections of this  Agreement
are inserted only for convenience and shall not be considered in construing this
Agreement.

                  18.6 This  Agreement  can be  modified,  amended or any of its
terms waived only by a writing signed by both parties.

                  18.7 If any provision of this Agreement shall be held invalid,
illegal or unenforceable, the remaining provisions of the Agreement shall remain
in full force and effect and the  invalid,  illegal or  unenforceable  provision
shall be  limited or  eliminated  only to the extent  necessary  to remove  such
invalidity, illegality or unenforceability in accordance with the applicable law
at that time.

                  18.8 Without  limiting the provisions of Section 16, if either
party institutes arbitration  proceedings pursuant to Section 16 or an action to
enforce the terms of this Agreement,  the prevailing party in such proceeding or
action  shall be  entitled  to recover  reasonable  attorneys'  fees,  costs and
expenses.

                  18.9  No  remedy  made  available  to  Employer  by any of the
provisions  of this  Agreement is intended to be exclusive of any other  remedy.
Each and every  remedy  shall be  cumulative  and shall be in  addition to every
other  remedy  given  hereunder  as well as those  remedies  existing at law, in
equity, by statute or otherwise.

                  18.10 This Agreement supercedes any prior Employment Agreement
which  may be in  effect  between  Employer  and  Employee,  and any such  prior
agreement is hereby terminated.

                  IN WITNESS  WHEREOF,  this  Agreement has been executed on the
day and year specified above.


                                  EMPLOYER:

                                  PLM INTERNATIONAL, INC.


                                  By:  /s/ Robert N. Tidball

                                  Its: President

ATTEST:
/s/ Kim Rayfield


                                  EMPLOYEE:

                                  /s/ Stephen M. Bess

ATTEST:
/s/ Kim Rayfield