SEVERANCE AGREEMENT

         This  Severance  Agreement (the  "Agreement"),  dated as of December 2,
1996, is entered into by and between PLM Financial  Services,  Inc. ("PLM",  the
"Employer" or the "Company") and Stephen M. Bess ("Employee"),  who hereby state
as follows:

         WHEREAS,  Employee  presently  holds the  position of  President at PLM
Investment Management, Inc., a wholly-owned subsidiary of PLM;

         WHEREAS,  PLM deems it to be in the best  interest  of the  Company  to
provide  incentives to keep Employee fully  dedicated to Employee's  position at
PLM; and

         WHEREAS,  PLM and Employee believe the best way of assuring  Employee's
continued  dedication to the Company is to provide  Employee certain benefits in
the event his/her  employment is terminated by the Company,  which  benefits are
greater  than he/she would  otherwise be entitled to,  pursuant to the terms and
conditions described herein.

         NOW,  THEREFORE,  IN  CONSIDERATION  OF THE PROVISIONS  HEREINABOVE AND
HEREINAFTER SET FORTH, PLM AND EMPLOYEE DO HEREBY AGREE AS FOLLOWS:

         1. The Company will pay to Employee Severance Pay (as defined below) if
the following conditions are met:

          (A) Employee is terminated  from  employment  with the Company for any
          reason other than the reasons set forth in Section 3 below, and

          (B) Employee  enters into a Release (the "Release")  substantially  in
          the  form  attached   hereto  as  Exhibit  A,  with  all  blank  lines
          appropriately completed.

         2. Severance Pay and Other Post Employment Benefits.

         2.1  "Severance  Pay" shall be defined as  twenty-four  (24)  months of
Employee's  base salary at his/her current rate per month at the time of his/her
termination,  less customary payroll  deductions.  Severance Pay will be paid to
Employee or Employee's heirs, successors, or permitted assigns on a semi-monthly
basis, pursuant to the Company's normal payroll schedule, with the first payment
being made  following the "Effective  Date" as defined in the Release.  The term
"Severance  Pay" shall  also  include  Employee's  continued  enrollment  at the
Company's  expense for  twenty-four  (24) months in the Company's group medical,
dental and vision insurance plans,  disability insurance plan and life insurance
plan (together,  the "Benefit Plans"),  all at the same level as provided during
the period immediately preceding Employee's termination of employment, provided,
however,  "Severance  Pay" shall not include  enrollment in any Company  Benefit
Plan to the extent the  insurer or  underwriter  of such  Benefit  Plan will not
cover Employee  under or include same level benefit  coverage for Employee after
termination of Employee's  employment at a comparable premium.  Employee's right
to  continued  group  benefits  after any period  covered by the Company will be
determined in accordance  with federal and state law.  Employee will continue to
be  obligated  to pay  the  same  employee's  portion  of any  premium  and  any
deductible and/or co-payments  associated with such benefits, as other similarly
situated employees of the Company.

         2.2 In addition to the Severance Pay specified in Section 2.1, Employee
will be entitled to outplacement  counseling at Employer's expense in accordance
with Employer's  customary practice,  if any, with respect to an employee having
Employee's base salary level.

         3.  Employee  shall not be entitled to the Severance Pay if Employee is
separated from the Company for any of the following reasons:

          (A)  Resignation.  Employee  voluntarily  quits his  position  for any
          reason.

          (B) Cause. The Company terminates Employee's employment for Cause. For
          purposes of this Agreement "Cause" shall mean:

               (i) the  failure by  Employee  to perform  his duties in a manner
               consistent  with  Employee's  historic  performance  levels after
               demand for such performance is delivered by Employer which demand
               identifies  the manner in which  Employee  has not  continued  to
               perform  his  duties  in  accordance  with  Employee's   historic
               performance levels;

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

               (iii)the  failure,  for any reason,  of Employee to maintain  all
               professional  licenses and memberships  required by his position;
               or

               (iv) the  conviction of the Employee of a crime  involving an act
               of moral turpitude or which is a felony.

          (C) Death. Employee's employment is terminated due to his death.

          (D) Family or Medical Leave.  Employee shall have been absent from his
          duties for any reason which is covered by the  California  Family Care
          and Medical  Leave Act ("FCML") or the Family and Medical Leave Act of
          1993  ("FMLA")  for longer  than the  period for which the  Company is
          required to provide to Employee  unpaid leave  pursuant to the FCML or
          the FMLA. Nothing contained in this Agreement shall be deemed to waive
          Employee's rights under the FCML or the FMLA.

         4. The  Employee  shall not be required  to mitigate  the amount of any
payment provided for in this Agreement by seeking other employment or otherwise.
Employee  acknowledges  that the Severance Pay provided in this  Agreement is in
excess of the amount  that the  Employee  would have  customarily  received as a
terminated  employee under Company policy and that these additional benefits are
expressly  given as  consideration  for the execution of this  Agreement and the
agreement to execute the Release attached hereto as Exhibit A.

         5. Confidentiality.

         5.1 Employee agrees that he/she shall keep and hold the contents, terms
and  provisions of this  Agreement in the strictest  confidence  and that he/she
shall not  discuss,  disclose,  disseminate,  produce,  publish,  comment  upon,
reference  or reveal the  existence of this  Agreement  or any of the  contents,
terms and provisions of this Agreement to any person or any entity without first
securing  the prior  written  consent of the Company,  except (1) to  Employee's
personal  representatives or as required in a judicial proceeding to enforce the
terms of this  Agreement,  or (2) as otherwise  required by law (in which latter
instance,  the  Employee,  upon  becoming  aware of any such legal  duty,  shall
promptly give notice  thereof to the Company and shall,  to the greatest  extent
possible,  cooperate  with the  request of the  Company  to keep this  Agreement
confidential).  This paragraph  does not apply to the reporting,  completing and
filing  of state  and  federal  income  tax  returns  or any and all  subsequent
proceedings  relating  thereto.  The  Employee  agrees  that any  breach of this
paragraph  will  cause  irreparable  harm and loss to the  Company  and that the
Company  shall be entitled to have and secure  against the  Employee  injunctive
relief against any future or further violations of this paragraph.

         5.2 Employee,  in consideration of the Severance Pay and other benefits
to be  received  by  him/her  under  this  Agreement,  shall  not,  directly  or
indirectly, solicit any of PLM's customers or employees exisiting as of the date
of Employee's  termination of employment.  If Employee  violates this Paragraph,
and  continues  to do so  after  the  Company  has  notified  Employee  of  such
violation,  Company shall have the right to seek and secure equitable  restraint
of Employee from such  activities  in  contravention  of the  provisions of this
Agreement,  including obtaining a temporary  restraining order and/or injunction
against Employee.

         5.3  It  is  specifically  understood  and  agreed  that  some  of  the
Employer's (and Employer's  affiliates) business activities are secret in nature
and  constitute  trade  secrets,  including but not limited to  Employer's  (and
Employer's  affiliates)  "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  (and  Employer's  affiliates)  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,  such  information  is in  the  public  domain  or
authorized  by a contract or  agreement  to which the  Employer is a party or by
which it is  bound.  Violation  of this or any of the  other  covenants  of this
Agreement  will entitle the Employer to,  among other  remedies,  terminate  all
future Severance Pay.

         6. This  Agreement  (including  the  attached  Exhibit A) contains  the
entire and  exclusive  understanding  among the  parties  regarding  the subject
matter  hereof and  supersedes  and  replaces all prior  negotiations,  proposed
agreements and agreements,  written and oral, and may not be modified or amended
in any respect  whatsoever,  except by a writing  signed by all parties  hereto.
This Agreement is not intended to conflict with, or reduce or increase any right
Employee may have pursuant to the PLM International,  Inc. 1988 Management Stock
Compensation Plan, the PLM International,  Inc. Mandatory Management Stock Bonus
Plan, or the PLM International, Inc. Executive Deferred Compensation Plan.

         7. This  Agreement  shall be governed and construed in accordance  with
the laws of the State of California. Venue of any action to enforce the terms of
this Agreement  shall lie in San Francisco  County,  California.  Except for the
injunctive relief as set forth in Paragraph 5, any dispute, claim or controversy
arising out of or related to this  Agreement  shall be  resolved by  arbitration
under the Employment  Dispute  Resolution  Arbitration Rules and auspices of the
American Arbitration Association, San Francisco, California Regional Office (the
"Association").  Any  such  arbitration  shall  be  conducted  by an  arbitrator
selected by mutual agreement of the parties, and such arbitration decision shall
be final. The party prevailing in the arbitration  shall be awarded its share of
the fees  and  expenses  of the  arbitration  (including,  but not  limited  to,
arbitrator's  fees),  in  addition to  attorneys'  fees.  Employee  specifically
consents to such arbitration and hereby represents such consent is willfully and
voluntarily given without  influence by coercion or threatening  statements from
Employer.

         8.  Each  signatory  hereto  represents  that  he,  she or it is  fully
authorized to execute this Agreement.

         9. The parties agree that if any provision of this Agreement is held to
be invalid,  void or unenforceable,  the remaining  provisions shall continue in
full force and effect.

         10. With  respect to the  Company,  this  Agreement  shall inure to the
benefit of and be binding upon any successors or assigns of PLM. 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.

         11. Nothing  contained in this Agreement  shall be deemed to change the
"at-will"  nature  of  the  employment  relationship  between  the  Company  and
Employee.  The  Company  and the  Employee  hereby  acknowledge  and agree  that
Employee's  employment may be terminated at will, with or without cause, for any
reason, subject to the obligations created by this Agreement.  Nothing contained
in this Agreement shall be deemed to provide  Employee any right to (i) regular,
irregular or special salary  increases of any kind,  (ii)  participation  in any
Company  bonus  plan or  other  benefit  plan  not  otherwise  available  to all
employees of the Company or (iii) payment of any bonus compensation of any kind.
This  Agreement  shall not in any way bind or  create  any  obligations  for PLM
International, Inc. or any of its subsidiaries other than Employer.

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

PLM FINANCIAL SERVICES, INC.                EMPLOYEE


By:  /s/ Stephen Peary                      /s/ Stephen M. Bess

Its: Senior Vice President














<PAGE>


                                    EXHIBIT A

                     SEPARATION AGREEMENT AND MUTUAL RELEASE

         This   Separation   Agreement  and  Mutual  Release  (the   "Separation
Agreement"),  dated  as of  ____________________,  19__ is  entered  into by and
between PLM Financial Services,  Inc., and  _________________  ("Employee"),  an
individual, who hereby state as follows:

         WHEREAS, Employee has been employed by PLM Financial Services, Inc. and
its  wholly-owned  affiliates and parent,  PLM  International,  Inc.  (together,
"PLM") since ___________,  and has most recently held the position of President,
PLM Investment Management, Inc.

         WHEREAS, Employee's employment with PLM has been terminated effective
 ___________________________;

         WHEREAS,  PLM and  Employee  each desire to resolve any and all matters
arising out of Employee's employment with or termination from PLM.

         NOW, THEREFORE, PLM AND EMPLOYEE DO HEREBY AGREE AS FOLLOWS:

         1. In consideration  of the provisions  hereinabove and hereinafter set
forth,   PLM  and   Employee   and   each  of  their   affiliates,   successors,
administrators,  assigns,  agents,  attorneys,  and any other persons  acting on
their   behalf   (collectively   "Releasors"),   do   hereby   irrevocably   and
unconditionally  release,  relieve, waive, relinquish and discharge one another,
and   all   heirs,   predecessors,   successors,   representatives,   assignees,
subsidiaries,  affiliates,  parents,  spouses,  partners,  officers,  directors,
stockholders, agents, employees, insurers, attorneys, and all persons acting by,
through,  under or in concert with any of them (collectively,  "Releasees"),  of
and from any and all manner of liabilities,  claims, demands, actions, causes of
action,  damages,  obligations,  all  theories of fault or  wrongdoing  (whether
statutory,  common  law,  tort  or  otherwise),   debts,  expenses,  costs,  and
attorneys' fees, of every kind, known or unknown  (hereinafter  referred to as a
"Claim" or the "Claims"),  arising out of, or in any way related to,  Employee's
employment with or termination from PLM.

         These Claims  include,  but are not limited to,  Claims  arising  under
federal, state and local statutory or common law, such as the Age Discrimination
in Employment Act, Title VII of the Civil Rights Act, as amended,  including the
amendments of the Civil Rights Act of 1991, and the Americans With  Disabilities
Act, and the law of contract and tort.

         2. PLM and  Employee  acknowledge  and agree that they are aware of the
facts and  intend  that the  execution  of this  Separation  Agreement  shall be
effective as full and final accord and  satisfaction  and settlement of and as a
bar to each and  every  Claim or Claims  arising  out of the  above  which  PLM,
Employee  or the  Releasors  has,  may have in the future or has had against the
other party or the Releasees, whether such Claims are known or unknown, foreseen
or unforeseen.

         3. PLM AND  EMPLOYEE  EACH  CERTIFY THAT THEY HAVE READ SECTION 1542 OF
THE CIVIL CODE OF THE STATE OF CALIFORNIA, WHICH STATES AS FOLLOWS:

"A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR
SUSPECT TO EXIST IN HIS FAVOR AT THE TIME OF  EXECUTING  THE  RELEASE,  WHICH IF
KNOWN BY HIM MUST HAVE MATERIALLY AFFECTED HIS SETTLEMENT WITH THE DEBTOR."

         4. PLM AND EMPLOYEE HEREBY EXPRESSLY WAIVE  APPLICATION OF SECTION 1542
OF THE CIVIL CODE OF THE STATE OF CALIFORNIA AND ANY AND ALL RIGHTS  THEREUNDER,
AS WELL AS ANY OTHER FEDERAL OR STATE STATUTORY RIGHTS OR RULES OR PRINCIPLES OF
COMMON  LAW OR EQUITY  OR THOSE OF ANY  JURISDICTION  SIMILAR  TO  SECTION  1542
(HEREINAFTER REFERRED TO AS A "SIMILAR  PROVISION").  THUS PLM, EMPLOYEE, OR THE
RELEASORS  MAY NOT INVOKE THE  BENEFITS  OF  SECTION  1542 OR ANY OTHER  SIMILAR
PROVISION  IN ORDER TO  PROSECUTE  OR ASSERT IN ANY  MANNER  ANY CLAIM OR CLAIMS
RELEASED HEREUNDER.

         5. In  addition to the  amounts  which have been paid to  Employee  for
earned  salary and accrued  vacation  pay through , and although the employee is
not otherwise  entitled to it, Employee will be paid  __________________Thousand
Dollars  ($_______),  less customary payroll  deductions,  as separation pay, as
well  as  certain  other  post  employment  benefits  specified  in a  Severance
Agreement dated as of ________. Such separation pay will be paid in semi-monthly
installments for a total of forty-eight (48) installments, starting on the first
regularly  scheduled pay day following  the  Effective  Date of this  Separation
Agreement,  as defined in Paragraph  15 below.  Employee  acknowledges  that the
separation pay and other post  employment  benefits are conferred on Employee as
consideration  for the execution of the Severance  Agreement and this Separation
Agreement.

         6.  In  executing  this  Separation   Agreement,   the  parties  hereby
acknowledge  and agree that Employee is retaining all rights and interests which
have vested through [termination date] in PLM's stock option plan(s), its 401(k)
Plan  (Employees  Profit Sharing and Tax Advantaged  Savings Plan) and any other
plan in which Employee holds a vested interest except as expressly identified as
being released under this Agreement, and it is expressly agreed that Employee is
not releasing or waiving his vested interest in said plans. In  consideration of
the receipt of Severance Pay,  Employee  waives all rights and benefits to which
he may be entitled under the Employment  Agreement  entered  between him and PLM
International, Inc.

         7.  Employee  agrees  to  immediately  return  to PLM  any  information
regarding PLM's practices,  procedures,  trade secrets,  customer lists, product
marketing   and  any  other  PLM   documents  in  any  form  (the   "Proprietary
Information") and Employee remains obligated to maintain the  confidentiality of
such Proprietary Information at all times.

         8.  Nothing  in this  Separation  Agreement  shall be  construed  as an
admission by either party of any unlawful or actionable  conduct by either party
and the parties hereto make no admission of liability of any kind whatsoever.

         9. The  provisions  of this  Separation  Agreement  shall be  deemed to
obligate,  extend to and inure to the  benefit  of,  with  respect  to PLM,  its
agents, servants,  employees,  officers,  directors,  parents,  subsidiaries and
affiliates,   successors  and  assigns,  and,  with  respect  to  Employee,  his
representatives, executors, heirs, administrators, successors and assigns.

         10. Employee agrees that he/she shall keep and hold the contents, terms
and  provisions of this  Agreement in the strictest  confidence  and that he/she
shall not  discuss,  disclose,  disseminate,  produce,  publish,  comment  upon,
reference  or reveal the  existence of this  Agreement  or any of the  contents,
terms and provisions of this Agreement to any person or any entity without first
securing  the prior  written  consent of the Company,  except (1) to  Employee's
personal  representatives or as required in a judicial proceeding to enforce the
terms of this  Agreement,  or (2) as otherwise  required by law (in which latter
instance,  the  Employee,  upon  becoming  aware of any such legal  duty,  shall
promptly give notice  thereof to the Company and shall,  to the greatest  extent
possible,  cooperate  with the  request of the  Company  to keep this  Agreement
confidential).  This paragraph  does not apply to the reporting,  completing and
filing  of state  and  federal  income  tax  returns  or any and all  subsequent
proceedings  relating  thereto.  The  Employee  agrees  that any  breach of this
paragraph  will  cause  irreparable  harm and loss to the  Company  and that the
Company  shall be entitled to have and secure  against the  Employee  injunctive
relief against any future or further violations of this paragraph.

         11. This Separation  Agreement contains the entire  understanding among
the  parties  and  supersedes  and  replaces  all prior  negotiations,  proposed
agreements  and  agreements  (other than the Severance  Agreement),  written and
oral, and may not be modified or amended in any respect whatsoever,  except by a
writing signed by all parties hereto.

         12. This  Separation  Agreement  shall be  governed  and  construed  in
accordance  with the laws of the  State of  California.  Venue of any  action to
enforce  the  terms of this  Separation  Agreement  shall  lie in San  Francisco
County,  California.  Except as set forth in Paragraph 12, any dispute, claim or
controversy arising out of or related to Separation  Agreement shall be resolved
by arbitration  under the Employment  Dispute  Resolution  Arbitration Rules and
auspices of the American  Arbitration  Association,  San  Francisco,  California
Regional Office (the "Association").  Any such arbitration shall be conducted by
an arbitrator selected by mutual agreement of the parties,  and such arbitration
decision  shall be  final.  The party  prevailing  in the  arbitration  shall be
awarded its share of the fees and expenses of the  arbitration  (including,  but
not limited to,  arbitrator's  fees), in addition to attorneys'  fees.  Employee
specifically  consents to such arbitration and hereby represents such consent is
willfully and  voluntarily  given without  influence by coercion or  threatening
statements from PLM.

         13.  Each  signatory  hereto  represents  that  he,  she or it is fully
authorized to execute this Separation Agreement.

         14.  The  Parties  agree  that  if any  provision  of  this  Separation
Agreement  is held by a court of  competent  jurisdiction  or  arbitrator  to be
invalid, void or unenforceable,  the remaining provisions shall continue in full
force and effect.

          15. The following is required by the Older Workers Benefit  Protection
Act of  1990:  Employee  has up to 21 days  from  the  date  of this  Separation
Agreement to accept the terms of this Separation  Agreement,  although  Employee
may accept it at any time within those 21 days.

         Employee  is  advised  to consult  an  attorney  about this  Separation
Agreement.

         Once Employee accepts this Separation Agreement,  by signing and dating
this Separation Agreement,  Employee will have an additional seven days in which
to revoke his acceptance. To revoke, Employee must send to PLM's General Counsel
a written  statement of  revocation  by facsimile and  registered  mail,  return
receipt requested. If Employee does not revoke, the eighth day after the date of
his acceptance will be the "Effective Date" of the Separation Agreement.

         16. PLM and  Employee  do hereby  acknowledge  and agree that they have
each been represented by independent  counsel of their own choice throughout all
negotiations which preceded the execution of this Separation  Agreement and that
they fully understand and voluntarily accept this Separation  Agreement and have
executed this Separation  Agreement after seeking the advice of said independent
counsel.  Each  party  shall  bear,  and be solely  responsible  for,  their own
respective  costs and expenses  related to the preparation and subject matter of
this Separation Agreement.



<PAGE>


         IN WITNESS  WHEREOF,  the parties have executed this document as of the
date set forth below, at San Francisco, California.

EMPLOYEE                                    PLM FINANCIAL SERVICES, INC.

                                            By:

Dated:                                      Title: