<PAGE>
As filed with the Securities and Exchange Commission on March 10, 2000
Registration No. 333-________
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
UNDER THE
SECURITIES ACT OF 1933
THE PMI GROUP, INC.
(Exact name of issuer as specified in its charter)
Delaware 94-3199675
(State or jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
601 Montgomery Street, San Francisco, CA 94111
(Address of Principal Executive Offices)
THE PMI GROUP, INC. OFFICER DEFERRED COMPENSATION PLAN
THE PMI GROUP, INC. DIRECTORS' DEFERRED COMPENSATION PLAN
(Full Title of the Plan)
Victor J. Bacigalupi
Executive Vice President, General Counsel and Secretary
The PMI Group, Inc.
601 Montgomery Street
San Francisco, CA 94111
(Name and address of agent for service)
Telephone number, including area code, of agent for service:
(415) 788-7878
Copies to:
John E. Aguirre Dwight D. Smith, Senior Counsel
Wilson Sonsini Goodrich & Rosati, PC The PMI Group, Inc.
650 Page Mill Road 601 Montgomery Street
Palo Alto, CA 94304-1050 San Francisco, CA 94111
CALCULATION OF REGISTRATION FEE
========================================================================
Title of Amount to Proposed Proposed Amount of
securities to be registered maximum maximum fee
registered offering aggregate
price per offering
share* price*
- ------------------------------------------------------------------------
Common Stock 100,000 shares $33.97 $3,397,000 $ 897
Deferred
Compensation
Obligations** $6,000,000 100% $6,000,000 $ 1,584
========================================================================
* Estimated on the basis of $33.97, the average of the high and low prices of
shares on the New York Stock Exchange on March 8, 2000.
** The Obligations are unsecured obligations of The PMI Group, Inc. to pay
deferred compensation in the future in accordance with the terms of The PMI
Group, Inc. Officer Deferred Compensation Plan and The PMI Group, Inc.
Directors' Deferred Compensation Plan.
<PAGE>
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents are incorporated by reference in this registration
statement: (i) the latest annual report of The PMI Group, Inc. (the "Company"),
filed pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934,
as amended (the "Exchange Act"); (ii) all other reports filed by the Company
pursuant to Section 13(a) or 15(d) of the Exchange Act since the end of the
fiscal year covered by the Annual Reports referred to in clause (i) above; and
(iii) the description of the Company's Common Stock filed pursuant to the
Exchange Act, including any amendment or report filed for the purpose of
updating such description. All documents filed by the Company or the Plan after
the date of this registration statement pursuant to Sections 13(a), 13(c), 14,
and 15(d) of the Exchange Act, prior to the filing of a post-effective amendment
(that indicates all securities offered have been sold or deregisters all
securities then remaining unsold), shall be deemed to be incorporated by
reference in this registration statement and to be a part hereof from the date
of filing of such documents.
ITEM 4. DESCRIPTION OF SECURITIES
Common Stock: Inapplicable.
Deferred
Compensation
Obligations:
The securities being registered represent obligations (the "Obligations") of the
Company to pay deferred compensation in the future in accordance with the terms
of The PMI Group, Inc., Officer Deferred Compensation Plan (the "Officer Plan")
and The PMI Group, Inc. Directors' Deferred Compensation Plan (the "Directors'
Plan") (collectively, the "Plans"), which are filed as Exhibits 4.1 and 4.2 to
this Registration Statement.
The Obligations are general unsecured obligations of the Company to pay deferred
compensation in the future according to the Plans from the general assets of the
Company, and rank equally with other unsecured and unsubordinated indebtedness
of the Company.
The amount of compensation to be deferred by each participant is determined in
accordance with the Plans based on elections by the participant. Amounts
credited to a participant's account are credited with deemed investment returns
equal to the experience of selected investment funds offered under the Plans and
elected by the Participant. The Obligations are payable upon a date or dates
selected by the participant in accordance with the terms of the Plans (which may
include the occurrence of a certain event such as termination of service with
the Company), subject to exceptions for in-service withdrawals, death,
disability, change of control or termination of service distributions, which
shall occur on January 15 of the second calendar year following termination of
service with the Company. The Obligations are payable in the form of a lump-sum
distribution or in installments, at the election of the participant made in
accordance with the terms of the Plans. Company matching contributions made
under the Officer Plan are paid in Company Common Stock.
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Participants or beneficiaries may not sell, transfer, anticipate, assign,
hypothecate or otherwise dispose of any right or interest in the Plans. A
participant may designate one or more beneficiaries to receive any portion of
Obligations payable in the event of death.
The Company may pay all or a part of a participant's vested Obligations as an
in-service withdrawal. If an in-service withdrawal is paid, the Company will
suspend a participant's deferral election prospectively for a period of 12
months. The Company also reserves the right to amend or terminate the Plans at
any time and for any reason including an amendment that would accelerate the
payment of Obligations or Company Common Stock.
The Obligations are not convertible into any other security of the Company. The
Obligations will not have the benefit of a negative pledge or any other
affirmative or negative covenant on the part of the Company. No trustee has
been appointed to take action with respect to the Obligations and each
participant in the Plans will be responsible for enforcing his or her own rights
with respect to the Obligations.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL
Inapplicable.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Section 145 of the Delaware General Corporation Law, inter alia, empowers a
Delaware corporation to indemnify any person who was or is a party or is
threatened to be made a party to any threatened, pending or completed action,
suit or proceeding (other than an action by or in the right of the corporation)
by reason of the fact that such person is or was a director, officer, employee
or agent of the corporation or is or was serving at the request of the
corporation as a director, officer, employee or agent of another corporation or
other enterprise, against expenses (including attorneys' fees), judgments, fines
and amounts paid in settlement actually and reasonably incurred by him or her in
connection with such action, suit or proceeding if he or she acted in good faith
and in a manner he or she reasonably believed to be in or not opposed to the
best interests of the corporation, and, with respect to any criminal action or
proceeding, had no reasonable cause to believe his or her conduct was unlawful.
Similar indemnity is authorized for such person against expenses (including
attorneys' fees) actually and reasonably incurred in connection with the defense
or settlement of any such threatened, pending or completed action or suit if
such person acted in good faith and in a manner he or she reasonably believed to
be in or not opposed to the best interests of the corporation, and provided
further that (unless a court of competent jurisdiction otherwise provides) such
person shall not have been adjudged liable to the corporation. Any such
indemnification may be made only as authorized in each specific case upon a
determination by the stockholders or disinterested directors or, if there are no
disinterested directors, or if such disinterested directors so direct, by
independent legal counsel in a written opinion that indemnification is proper
because the indemnitee has met the applicable standard of conduct.
Section 145 further authorizes a corporation to purchase and maintain insurance
on behalf of any
4
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person who is or was a director, officer, employee or agent of the corporation,
or is or was serving at the request of the corporation as a director, officer,
employee or agent of another corporation or enterprise, against any liability
asserted against him and incurred by him in any such capacity, or arising out of
his status as such, whether or not the corporation would otherwise have the
power to indemnify him under Section 145. The Company maintains policies
insuring its and its subsidiaries' officers and directors against certain
liabilities for actions taken in such capacities, including liabilities under
the Securities Act of 1933.
Article V of the By-laws of the Company provides for indemnification of the
directors and officers of the Company to the fullest extent permitted by law, as
now in effect or later amended. In addition, the By-laws provide for
indemnification against expenses incurred by a director or officer to be paid by
the Company in advance of the final disposition of such action, suit or
proceeding; provided, however, that if required by the Delaware General
Corporation Law, an advancement of expenses will be made only upon receipt of an
undertaking by or on behalf of the director or officer to repay such amount if
it shall be ultimately determined that he is not entitled to be indemnified by
the Company. The By-laws further provide for a contractual cause of action on
the part of directors and officers of the Company with respect to
indemnification claims which have not been paid by the Company.
The Company also has provided liability insurance for each director and officer
for certain losses arising from claims or charges made against them while acting
in their capacities as directors or officers of the Company.
The Company has entered into indemnification agreements with its directors and
executive officers that require the Company to indemnify such persons against
all expenses (including attorneys' fees and amounts paid in settlement),
judgments, fines and penalties which are actually incurred in connection with
any threatened, pending or completed action, suit or other proceeding (including
an action by or in the right of the Company) to which such person is, was or is
threatened to be made a party, by reason of the fact that such person is or was
a director or officer of the Company, or is or was serving at the request of the
Company as a director, officer, employee or other agent of another corporation,
partnership, joint venture, trust, employee benefit plan or other enterprise, to
the fullest extent permitted by applicable law and the Company's Restated
Certificate of Incorporation and By-laws. The indemnification agreements also
set forth certain procedures that will apply in the event of a claim for
indemnification thereunder.
Article Nine of the Company's Restated Certificate of Incorporation limits to
the fullest extent permitted by the Delaware General Corporation Law, as the
same exists or may have been amended, the personal liability of the Company's
directors to the Company or its stockholders for monetary damages for a breach
of their fiduciary duty as directors. Section 102(b)(7) of the Delaware General
Corporation Law currently provides that such provisions do not eliminate or
limit the liability of a director (i) for a breach of the director's duty of
loyalty to the Company or its stockholders, (ii) for acts or omissions not in
good faith or which involve intentional misconduct or a knowing violation of
law, (iii) under Section 174 of the Delaware General Corporation Law (relating
to the declaration of dividends and purchase or redemption of shares in
violation of the Delaware General Corporation Law), or (iv) for any transaction
from which the director derived an improper personal benefit.
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ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED
Inapplicable.
ITEM 8. EXHIBITS
4.1 The PMI Group, Inc. Officer Deferred Compensation Plan, as amended.
4.2 The PMI Group, Inc. Directors' Deferred Compensation Plan, as amended.
5.1 Opinion of Wilson Sonsini Goodrich and Rosati, P.C.
23.1 Consent of Deloitte & Touche LLP, Independent Auditors.
23.2 Consent of Wilson Sonsini Goodrich and Rosati, PC is included in Exhibit
5.1 to this Registration Statement.
24.1 Power of Attorney of Directors (contained on the signature pages of this
Registration Statement).
ITEM 9. UNDERTAKINGS
(a) The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement:
(i) To include any prospectus required by section 10(a)(3) of
the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising
after the effective date of the registration statement (or the most recent post-
effective amendment thereof) which, individually or in the aggregate, represent
a fundamental change in the information set forth in the registration statement;
(iii) To include any material information with respect to the
plan of distribution not previously disclosed in the registration statement or
any material change to such information in the registration statement;
Provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not
apply if the registration statement is on Form S-3 or Form S-8 and the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed by the registrant pursuant to
section 13 or section 15(d) of the Securities Exchange Act of 1934 that are
incorporated by reference in the registration statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed to be
a new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
6
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(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the termination of
the offering.
(b) The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933 each filing of the
registrant's annual report pursuant to section 13(a) or section 15(d) of the
Securities Exchange Act of 1934 (and, where applicable, each filing of the
Plan's annual report pursuant to section 15(d) of the Securities Exchange Act of
1934) that is incorporated by reference in the registration statement shall be
deemed to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and controlling
persons of the registrant pursuant to the foregoing provisions, or otherwise,
the registrant has been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as expressed
in the Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
registrant of expenses incurred or paid by a director, officer or controlling
person of the registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the registrant will, unless in
the opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Act and will
be governed by the final adjudication of such issue .
7
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Signatures
THE REGISTRANT
Pursuant to the requirements of the Securities Act of 1933, the registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-8 and has duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of San Francisco, State of California on the 29th day
of February, 2000.
THE PMI GROUP, INC.
(Registrant)
/s/ W. Roger Haughton
- -----------------------------------------------------
W. Roger Haughton
Chairman of the Board and Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, this registration
statement has been signed by the following persons in the capacities and on the
dates indicated.
<TABLE>
<CAPTION>
Signature Title Date
<S> <C> <C>
Principal Executive Officer:
/s/ W. Roger Haughton
- ------------------------------
W. Roger Haughton Chief Executive Officer February 29, 2000
Principal Financial Officer:
/s/ John M. Lorenzen
- ------------------------------
John M. Lorenzen, Jr. Executive Vice February 29, 2000
President and Chief
Financial Officer
Principal Accounting Officer:
/s/ William A. Seymore
- -------------------------------
William A. Seymore Vice President February 29, 2000
and Controller
</TABLE>
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POWER OF ATTORNEY OF DIRECTORS
KNOW BY ALL PERSONS BY THESE PRESENTS:
Each of the undersigned hereby constitutes and appoints Victor J.
Bacigalupi, Stephen Smith, Charles F. Broom, John M. Lorenzen, Jr., Claude J.
Seaman, and William A. Seymore and each of them with power to act alone, his or
her true and lawful attorney-in-fact and agent, with full power of substitution
and resubstitution, for him or her and in his or her name, place and stead, in
any and all capacities, to sign a Registration Statement or Registration
Statements on Form S-8 or other appropriate form, under the Securities Act of
1933, as amended, with respect to 100,000 shares of Common Stock of the Company
issuable under the Company's Officer Deferred Compensation Plan and $6,000,000
of Deferred Compensation Obligations payable pursuant to the Company's Officer
Deferred Compensation Plan and the Company's Directors' Deferred Compensation
Plan, and any and all amendments of such Registration Statements, including
post-effective amendments, and to file the same, together with exhibits thereto,
and other documents in connection therewith, with the Securities and Exchange
Commission, granting unto such attorney-in-fact full power and authority to do
and perform each and every act and thing requisite and necessary to be done in
and about the premises hereof, as fully to all intents and purposes as he or she
might do or could do in person, thereby ratifying and confirming all that said
attorney-in-fact or his or her substitutes may lawfully do or cause to be done
by virtue hereof.
/s/ James C. Castle February 29, 2000
- ---------------------------------
James C. Castle
/s/ Donald C. Clark February 29, 2000
- ---------------------------------
Donald C. Clark
/s/ W. Roger Haughton February 29, 2000
- ---------------------------------
W. Roger Haughton
/s/ Wayne E. Hedien February 29, 2000
- ---------------------------------
Wayne E. Hedien
/s/ Raymond L. Ocampo Jr. February 29, 2000
- ---------------------------------
Raymond L. Ocampo Jr.
/s/ John D. Roach February 29, 2000
- ---------------------------------
John D. Roach
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/s/ Kenneth T. Rosen February 29, 2000
- ---------------------------------
Kenneth T. Rosen
/s/ Richard L. Thomas February 29, 2000
- ---------------------------------
Richard L. Thomas
/s/ Mary Lee Widener February 29, 2000
- ---------------------------------
Mary Lee Widener
/s/ Ronald H. Zech February 29, 2000
- ---------------------------------
Ronald H. Zech
A majority of the members of the Board of Directors.
10
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EXHIBIT INDEX
4.1 The PMI Group, Inc. Officer Deferred Compensation Plan, as amended.
4.2 The PMI Group, Inc. Directors' Deferred Compensation Plan, as amended.
5.1 Opinion of Wilson Sonsini Goodrich and Rosati, PC.
23.1 Consent of Deloitte & Touche LLP, Independent Auditors.
23.2 Consent of Wilson Sonsini Goodrich and Rosati, PC is included in Exhibit
5.1 to this Registration Statement.
24.1 Power of Attorney of Directors (contained on the signature pages of this
Registration Statement).
<PAGE>
THE PMI GROUP, INC.
OFFICER DEFERRED COMPENSATION PLAN
(Effective July 1, 1997)
(Amended and Restated as of September 16, 1999)
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TABLE OF CONTENTS
<TABLE>
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Page
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<S> <C>
SECTION 1 DEFINITIONS.............................................................. 1
1.1 "Affiliate".............................................................. 1
1.2 "Beneficiary"............................................................ 1
1.3 "Board of Directors"..................................................... 1
1.4 "Change of Control"...................................................... 1
1.5 "Code"................................................................... 3
1.6 "Committee".............................................................. 3
1.7 "Company Contributions".................................................. 3
1.8 "Company"................................................................ 3
1.9 "Compensation"........................................................... 4
1.10 "Compensation Deferrals"................................................. 4
1.11 "Disability" or "Disabled"............................................... 4
1.12 "Eligible Employee"...................................................... 4
1.13 "Employers".............................................................. 4
1.14 "ERISA".................................................................. 4
1.15 "Financial Hardship"..................................................... 4
1.16 "Participant"............................................................ 4
1.17 "Participant's Account" or "Account"..................................... 5
1.18 "Plan"................................................................... 5
1.19 "Plan Year".............................................................. 5
1.20 "Qualified Institutional Investor"....................................... 5
1.21 "1934 Act"............................................................... 5
SECTION 2 PARTICIPATION............................................................ 5
2.1 Participation............................................................ 5
2.2 Suspension of Compensation Deferrals..................................... 6
2.3 Termination of Participation............................................. 6
SECTION 3 COMPENSATION DEFERRAL ELECTIONS.......................................... 7
3.1 Compensation Deferrals................................................... 7
3.2 Crediting of Compensation Deferrals...................................... 7
3.3 Company Contributions.................................................... 7
3.4 Deemed Investment Return on Accounts..................................... 7
3.5 Form of Payment.......................................................... 8
3.6 Term of Deferral......................................................... 8
3.7 Changes in Elections as to Term and Form for Payment..................... 8
SECTION 4 ACCOUNTING............................................................... 9
4.1 Participants' Accounts................................................... 9
</TABLE>
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TABLE OF CONTENTS
(continued)
<TABLE>
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Page
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<S> <C>
4.2 Participants Remain Unsecured Creditors.................................. 9
4.3 Accounting Methods....................................................... 9
4.4 Reports.................................................................. 9
SECTION 5 DISTRIBUTIONS............................................................ 9
5.1 Normal Time for Distribution............................................. 9
5.2 Change of Control........................................................ 10
5.3 Special Rule for Death or Disability..................................... 10
5.4 Special Rule re Deductibility............................................ 10
5.5 Latest Permissible Distribution Date..................................... 10
5.6 Beneficiary Designations................................................. 10
5.7 Financial Hardship....................................................... 11
5.8 Payments to Incompetents................................................. 11
5.9 Undistributable Accounts................................................. 11
5.10 Committee Discretion..................................................... 12
SECTION 6 PARTICIPANT'S INTEREST IN ACCOUNT........................................ 12
6.1 Compensation Deferral Contributions...................................... 12
6.2 Vesting in Company Contributions......................................... 12
SECTION 7 ADMINISTRATION OF THE PLAN............................................... 13
7.1 Plan Administrator....................................................... 13
7.2 Committee................................................................ 13
7.3 Actions by Committee..................................................... 13
7.4 Powers of Committee...................................................... 13
7.5 Decisions of Committee................................................... 14
7.6 Administrative Expenses.................................................. 14
7.7 Eligibility to Participate............................................... 14
7.8 Indemnification.......................................................... 15
SECTION 8 FUNDING.................................................................. 15
8.1 Unfunded Plan............................................................ 15
SECTION 9 MODIFICATION OR TERMINATION OF PLAN...................................... 15
9.1 Employers' Obligations Limited........................................... 15
9.2 Right to Amend or Terminate.............................................. 15
9.3 Effect of Termination.................................................... 15
</TABLE>
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TABLE OF CONTENTS
(continued)
<TABLE>
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Page
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<S> <C>
SECTION 10 GENERAL................................................................. 16
10.1 Participation by Affiliates.............................................. 16
10.2 Inalienability........................................................... 16
10.3 Rights and Duties........................................................ 16
10.4 No Enlargement of Employment Rights...................................... 16
10.5 Apportionment of Costs and Duties........................................ 16
10.6 Compensation Deferrals Not Counted Under Other Employee Benefit Plans.... 16
10.7 Applicable Law........................................................... 17
10.8 Severability............................................................. 17
10.9 Captions................................................................. 17
</TABLE>
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THE PMI GROUP, INC.
OFFICER DEFERRED COMPENSATION PLAN
(Effective July 1, 1997)
THE PMI GROUP, INC., a Delaware corporation, hereby establishes The PMI
Group, Inc. Officer Deferred Compensation Plan, effective July 1, 1997, for the
benefit of a select group of management and highly compensated employees of the
Company and its participating Affiliates, in order to provide such employees
with certain deferred compensation benefits. The Plan is an unfunded deferred
compensation plan that is intended to qualify for the exemptions provided in
sections 201, 301, and 401 of ERISA.
SECTION 1
DEFINITIONS
The following words and phrases shall have the following meanings unless a
different meaning is plainly required by the context:
1.1 "Affiliate" shall mean (a) the Company, and (b) each corporation,
trade or business which is, together with any Employer, a member of a controlled
group of corporations or an affiliated service group or under common control
(within the meaning of section 414(b), (c) or (m) of the Code), but only for the
period during which such other entity is so affiliated with any Employer.
1.2 "Beneficiary" shall mean the person or persons entitled to receive the
balance credited to a Participant's Account under the Plan upon the death of a
Participant, as provided in Section 5.4.
1.3 "Board of Directors" shall mean the Board of Directors of the Company,
as constituted from time to time.
1.4 "Change of Control" shall mean:
(a) The acquisition by any individual, entity or group (within
the meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of
1934, as amended (the "Exchange Act")) (a "Person") of beneficial ownership
(within the meaning of Rule 13d-3 promulgated under the Exchange Act) of 20% or
more of either (i) the then outstanding shares of common stock of the Company
(the "Outstanding Company Common Stock") or (ii) the combined voting power of
the then outstanding voting securities of the Company entitled to vote generally
in the election of directors (the "Outstanding Company Voting Securities");
provided, however, that for purposes of
<PAGE>
this subsection (a), the following shall not constitute a Change of Control: (i)
any acquisition directly from the Company, (ii) any acquisition by the Company,
(iii) any acquisition by any employee benefit plan (or related trust) sponsored
or maintained by the Company or any corporation controlled by the Company, (iv)
any beneficial ownership maintained by (but not additional acquisitions by), The
Allstate Corporation and its subsidiaries, and their respective successors
("Allstate"), pending such time that Allstate distributes or transfers its
current ownership interest in the Outstanding Company Common Stock and
Outstanding Company Voting Securities as contemplated by the Prospectus dated
April 10, 1995, relating to the initial public offering of the common stock of
the Company, or (v) any acquisition pursuant to a transaction which complies
with clauses (i), (ii) and (iii) of subsection (c) of this Section 1.4.
Notwithstanding the foregoing, in its sole discretion, the Board may increase
the 20% threshold set forth above in this subsection (a) prior to any
acquisition of 20% or more beneficial ownership of the Outstanding Company
Common Stock or the Outstanding Company Voting Securities; provided, that (i)
such increased threshold shall apply only to the acquisition and maintenance of
beneficial ownership by any Person eligible to report such beneficial ownership
at the time of such acquisition on Schedule 13G under the Exchange Act, and (ii)
in the event that any Person initially eligible to so report on Schedule 13G
thereafter ceases to be eligible to so report on Schedule 13G, the occurrence of
the event causing such Person no longer to be eligible to so report shall be
deemed an acquisition by such Person of all of the Outstanding Company Common
Stock and Outstanding Company Voting Securities beneficially owned by such
Person immediately prior to such occurrence; or
(b) Individuals who, as of the date hereof, constitute the Board (the
"Incumbent Board") cease for any reason to constitute at least a majority of the
Board; provided, however, that any individual becoming a director subsequent to
the date hereof whose election, or nomination for election by the Company's
shareholders, was approved by a vote of at least a majority of the directors
then comprising the Incumbent Board shall be considered as though such
individual were a member of the Incumbent Board, but excluding, for this
purpose, any such individual whose initial assumption of office occurs as a
result of an actual or threatened election contest with respect to the election
or removal of directors or other actual or threatened solicitation of proxies or
consents by or on behalf of a Person other than the Board; or
(c) Consummation by the Company of a reorganization, merger or
consolidation or sale or other disposition of all or substantially all of the
assets of the Company or the acquisition of assets of another entity (a
"Business Combination"), in each case, unless, following such Business
Combination, (i) all or substantially all of the individuals and entities who
were the beneficial owners, respectively, of the Outstanding Company Common
Stock and Outstanding Company Voting Securities immediately prior to such
Business Combination beneficially own, directly or indirectly, more than 60% of,
respectively, the then outstanding shares of common stock and the combined
voting power of the then outstanding voting securities entitled to vote
generally in the election of directors, as the case may be, of the corporation
resulting from such Business Combination (including, without limitation, a
corporation which as a result of such transaction owns the Company or all or
substantially all of the Company's assets either directly or
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<PAGE>
through one or more subsidiaries) in substantially the same proportions as their
ownership, immediately prior to such Business Combination of the Outstanding
Company Common Stock and Outstanding Company Voting Securities, as the case may
be, (ii) no Person (excluding any employee benefit plan (or related trust) of
the Company or such corporation resulting from such Business Combination)
beneficially owns, directly or indirectly, 20% or more of, respectively, the
then outstanding shares of common stock of the corporation resulting from such
Business Combination or the combined voting power of the then outstanding voting
securities of such corporation except to the extent that such ownership existed
prior to the Business Combination and (iii) at least a majority of the members
of the board of directors of the corporation resulting from such Business
Combination were members of the Incumbent Board at the time of the execution of
the initial agreement, or of the action of the Board, providing for such
Business Combination; or
(d) Approval by the shareholders of the Company of a complete
liquidation or dissolution of the Company.
Notwithstanding the foregoing, a Change of Control shall not be deemed to
occur solely because any Person acquires beneficial ownership of 20% or more of
the Outstanding Company Voting Securities or Outstanding Company Common Stock as
a result of the acquisition of such securities or stock by the Company, which
acquisition reduces the number of the Outstanding Company Voting Securities or
Outstanding Company Common Stock; provided, that if after such acquisition by
the Company such Person (while such Person remains the beneficial owner of 20%
or more of the Outstanding Company Voting Securities or Outstanding Company
Common Stock) becomes the beneficial owner of additional shares of such
Outstanding Company Voting Securities or Outstanding Company Common Stock (as
the case may be), a Change of Control shall then occur. Capitalized terms used
in this Section 1.4, not otherwise defined, shall have the meaning set forth in
the form of change of control employment agreement approved at the February 12,
1998 meeting of the Board of Directors.
1.5 "Code" shall mean the Internal Revenue Code of 1986, as amended.
Reference to a specific section of the Code shall include such section, any
valid regulation promulgated thereunder, and any comparable provision of any
future legislation amending, supplementing or superseding such section.
1.6 "Committee" shall mean the committee appointed by (and serving at the
pleasure of) the Chief Executive Officer of the Company (the "CEO") to
administer the Plan. As of the effective date of the Plan, the members of the
Committee shall be the CEO and the Company's senior human resources officer.
1.7 "Company Contributions" shall mean the amounts credited to
Participants' Accounts under the Plan by the Company, in accordance with Section
3.3.
1.8 "Company" shall mean The PMI Group, Inc., a Delaware corporation.
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1.9 "Compensation" shall mean the base salary and bonuses (if any) of a
Participant. The Committee, in its discretion, shall from time to time designate
the types of bonuses which shall be eligible for deferral under the Plan. A
Participant's Compensation shall not include any other type of remuneration.
1.10 "Compensation Deferrals" shall mean the amounts credited to
Participants' Accounts under the Plan pursuant to their deferral elections made
in accordance with Section 2.1.
1.11 "Disability" or "Disabled" shall mean the mental or physical inability
of a Participant to perform the regularly assigned duties of his or her
employment, provided that such inability (a) has continued or is expected to
continue for a period of at least 6 months and (b) is evidenced by the
certificate of a physician satisfactory to the Committee stating that such
inability exists and is likely to be permanent.
1.12 "Eligible Employee" shall mean an employee of an Employer who holds
office at the level of Vice President or above, including any Assistant Vice
President or Field Vice President. Notwithstanding the preceding, the Board of
Directors, in its sole discretion, may (a) change the required title for
purposes of determining eligibility for the Plan, and (b) determine that one or
more otherwise eligible employees of an Employer shall not be Eligible
Employees.
1.13 "Employers" shall mean the Company and each of its Affiliates that
adopts the Plan with the approval of the Board of Directors. With respect to an
individual Participant, "Employer" shall mean the Company or its Affiliate that
(a) directly employs such Participant, and (b) has adopted the Plan (with the
approval of the Board of Directors).
1.14 "ERISA" shall mean the Employee Retirement Income Security Act of
1974, as amended. Reference to a specific section of ERISA shall include such
section, any valid regulation promulgated thereunder, and any comparable
provision of any future legislation amending, supplementing or superseding such
section.
1.15 "Financial Hardship" shall mean a severe financial emergency which is
caused by a sudden and unexpected accident, illness or other event beyond the
control of the Participant which, absent a suspension of deferrals under Section
2.2 or accelerated distribution under Section 5.5, would result in severe
financial burden to the Participant or a member of his or her immediate family.
A Financial Hardship does not exist to the extent that the hardship may be
relieved by (a) reimbursement or compensation by insurance, (b) by liquidation
of the Participant's other assets (to the extent such liquidation would not
itself cause severe financial hardship), or (c) any loan available to the
Participant (to the extent the payments on such loan would not themselves cause
severe financial hardship.
1.16 "Participant" shall mean an Eligible Employee who (a) has become a
Participant in the Plan pursuant to Section 2.1 and (b) has not ceased to be a
Participant pursuant to Section 2.3.
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1.17 "Participant's Account" or "Account"shall mean, as to any Participant,
the separate account maintained on the books of the Company in order to reflect
his or her interest under the Plan.
1.18 "Plan" shall mean The PMI Group, Inc. Officer Deferred Compensation
Plan, as set forth in this instrument and as hereafter amended from time to
time.
1.19 "Plan Year" shall mean the calendar year. Notwithstanding the
preceding, the 1997 Plan Year shall be the period July 1, 1997 (the effective
date of the Plan), through December 31, 1997.
1.20 "Qualified Institutional Investor" shall mean as of any time of
determination any Person (as defined in Section 1.4): (a) that is eligible to
file a Schedule 13G with respect to all securities of the Company beneficially
owned by such Person pursuant to Rule 13d-1(b)(1) promulgated under the 1934 Act
(as such Rule is in effect on the date hereof), (b) that is not required to file
a Schedule 13D under the 1934 Act (or any successor or comparable report) with
respect to any securities of the Company, and (c) that beneficially owns less
than 15% of the common stock of the Company, par value $.01 per share,
outstanding at the time of determination.
1.21 "1934 Act" means the Securities and Exchange Act of 1934, as amended.
SECTION 2
PARTICIPATION
2.1 Participation. Each Eligible Employee's decision to become a
Participant shall be entirely voluntary.
2.1.1 Initial Elections by Current Employees. An Eligible Employee
may elect to become a Participant in the Plan by electing, no later than July
30, 1997, to make Compensation Deferrals under the Plan. An election under this
Section 2.1.1 to make Compensation Deferrals shall be effective only for the
remainder of the 1997 Plan Year.
2.1.2 Initial Elections by Other Employees. Each individual who
becomes an Eligible Employee after July 1, 1997 (whether by hire or promotion)
may elect to become a Participant in the Plan by electing, within thirty days of
the date of his or her hire or promotion (as the case may be), to make
Compensation Deferrals under the Plan. An election under this Section 2.1.2 to
make Compensation Deferrals shall be effective only for the remainder of the
Plan Year with respect to which the election is made.
2.1.3 Elections for Subsequent Plan Years. An Eligible Employee
may elect to become a Participant (or to continue or reinstate his or her active
participation) in the Plan for any subsequent Plan Year by electing, no later
than December 31 of the preceding Plan Year, to make
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Compensation Deferrals under the Plan. An election under this Section 2.1.3 to
make Compensation Deferrals shall be effective only for the Plan Year with
respect to which the election is made.
2.1.4 Separate Election to Defer Bonuses. Each Eligible Employee
shall make a separate Compensation Deferral election with respect to the bonus
portion(s) (if any) of his or her Compensation. An Eligible Employee's
Compensation Deferral election with respect to his or her bonus(es) shall be
made no later than the deadline specified by the Committee for the particular
Plan Year during which the Eligible Employee will perform the services for which
a bonus may be paid, except to the limited extent provided in Section 2.1.2.
2.1.5 No Election Changes During Plan Year. After the beginning
of a Plan Year, a Participant shall not be permitted to change or revoke his or
her deferral election for such Plan Year, except to the limited extent provided
in Section 2.2.
2.1.6 Specific Timing and Method of Election. Notwithstanding any
contrary provision of this Section 2.1, the Committee, in its sole discretion,
shall determine the manner and deadlines for Participants to make Compensation
Deferral elections. The deadlines prescribed by the Committee may be earlier
than the deadlines specified in this Section 2.1, but shall not be later than
such specified deadlines.
2.2 Suspension of Compensation Deferrals.
2.2.1 Automatic Suspension. In the event that a Participant
receives a financial hardship withdrawal from The PMI Group, Inc. Savings and
Profit-Sharing Plan or any other plan (maintained by an Employer) which contains
a qualified cash or deferred arrangement under section 401(k) of the Code
(collectively, the "401(k) Plans"), the Participant's Compensation Deferrals
under the Plan (if any) shall be suspended for a period of twelve (12) months
from the date that the Participant received such hardship withdrawal.
Notwithstanding the preceding, the Participant's Compensation Deferrals shall be
not be so suspended if the Committee determines that such suspension is not
required in order to preserve the tax-qualification of the 401(k) Plans.
2.2.2 Permissible Suspension. In the event that a Participant
incurs a Financial Hardship, the Committee, in its sole discretion, may suspend
the Participant's Compensation Deferrals for the remainder of the Plan Year.
However, an election to make Compensation Deferrals under Section 2.1 shall be
irrevocable as to amounts deferred as of the effective date of any suspension in
accordance with this Section 2.2.2.
2.3 Termination of Participation. An Eligible Employee who has become a
Participant shall remain a Participant until his or her entire vested Account
balance is distributed. However, an Eligible Employee who has become a
Participant may or may not be an active Participant making Compensation
Deferrals for a particular Plan Year, depending upon whether he or she has
elected to make Compensation Deferrals for such Plan Year.
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SECTION 3
COMPENSATION DEFERRAL ELECTIONS
3.1 Compensation Deferrals. At the times and in the manner prescribed in
Section 2.1, each Eligible Employee may elect to defer portions of his or her
Compensation and to have the amounts of such deferrals credited to his or her
Account. For each Plan Year, an Eligible Employee may elect to defer an amount
equal to any percentage or any specific dollar amount of his or her
Compensation, provided that the percentage or dollar amount elected by the
Participant shall result in an expected deferral at least the lesser of (a)
$5,000, or (b) 5% of his or her Compensation. Notwithstanding any contrary
provision of the Plan, the Committee may reduce a Participant's Compensation
Deferrals to the extent necessary to satisfy any required deductions for welfare
plans or any deductions required by law.
3.2 Crediting of Compensation Deferrals. The amounts deferred pursuant to
Section 3.1 shall reduce the Participant's Compensation for the Plan Year and
shall be credited to the Participant's Account as of the last day of the month
in which the amounts (but for the deferral) would have been paid to the
Participant. For each Plan Year, the exact dollar amount to be deferred from
each Compensation payment shall be determined by the Committee under such
formulae as it shall adopt from time to time.
3.3 Company Contributions. A Company Contribution equal to 25% of the
amount a Participant elects to have deemed invested in the Company's Stock Fund
shall be credited to a Participant's Account, on such terms and conditions as
the Committee may specify in its sole discretion. The Company Contribution (if
any) made on behalf of a Participant shall be credited to the Participant's
Account as of the date specified by the Company.
3.4 Deemed Investment Return on Accounts. Although no assets will be
segregated or otherwise set aside with respect to a Participant's Account, the
amount that is ultimately payable to the Participant with respect to his or her
Account shall be determined as if such Account had been invested in such manner
as the Committee, in its discretion, may specify from time to time (including,
but not limited to, the equity return method. The Committee, in its sole
discretion, shall adopt (and may modify from time to time) such rules and
procedures as it deems necessary or appropriate to implement the deemed
investment of the Participants' Accounts. Such procedures shall (a) provide that
a Participant shall be entitled to make deemed investment elections as to the
deemed investment of his or her Account, and (b) permit a Participant to elect
(not less than once per calendar quarter) to have part or all of his or her
Account deemed to be invested in common stock of the Company (including
reinvestment of any deemed dividends). However, such procedures may differ among
Participants or classes of Participants, as determined by the Committee in its
discretion. Notwithstanding the foregoing, if any Company Contribution is
credited to a Participant's Account, such Contribution shall be deemed invested
in the Company Stock Fund.
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3.5 Form of Payment. Each Participant shall indicate on his or her
deferral election (made pursuant to Section 3.1) the form of payment for the
Compensation Deferrals made pursuant to such election. A Participant may elect
(a) a lump sum payment, or (b) a fixed number of annual installment payments
(not to exceed ten). A Participant's election as to the form of payment shall
apply to all amounts credited to the Participant's Account for the Plan Year
with respect to which the election is made, and except to the limited extent
provided in Section 3.7, shall be irrevocable. Any Company Contributions
credited to a Participant's Account shall be paid in the form of shares of
Company common stock, payable after the end of the term(s) of deferral elected
by the Participant for his or her Compensation Deferral with respect to which
such Company Contribution was made, provided that if the Participant receives
installment payments, the shares shall be paid with the first such installment.
3.6 Term of Deferral. Each Participant shall indicate on his or her
deferral election made pursuant to Section 3.1 the time for payment for
Compensation Deferrals (and deemed investment returns, gains and losses thereon)
made pursuant to such election. A Participant may elect a term of deferral equal
to any whole number (not less than one) of calendar years specified in his or
her deferral election. In addition, pursuant to such procedures as the Committee
(in its discretion) may adopt from time to time, a Participant may elect a term
of deferral which ends upon the later (or earlier) of the expiration of a
specified period or the occurrence of a specific event (for example, the later
of ten years or termination of employment with the Company and all Affiliates).
A Participant's election as to the term of deferral shall apply to all amounts
credited to the Participant's Account for the Plan Year with respect to which
the election is made, and except to the limited extent provided in Section 3.7,
shall be irrevocable.
3.7 Changes in Elections as to Term and Form for Payment. A Participant
may change his or her election under Section 3.5 and/or Section 3.6 for amounts
credited to the Participant's Account for any Plan Year, provided that any such
election will be effective only if (a) such election is made at least twelve
months and one day prior to the date payment of such amounts is scheduled to
commence (without giving effect to such election), (b) the newly elected
scheduled payment commencement date is not earlier than the second Plan Year
after the Plan Year in which such election is made, and (c) payment of such
amounts has not actually commenced. For example, if a Participant initially
elected to receive his or her 1999 Plan Year deferrals in a lump sum to be paid
during on July 1, 2003, the Participant instead may elect to receive payment in
the form of ten annual installments commencing during the 2004 Plan Year,
provided that such election is made on or before June 30, 2002. (i.e., not less
----
twelve months and one day prior to the date which payment of such amounts
previously was scheduled to commence, and with a newly elected scheduled payment
commencement date which is not earlier than the second Plan Year after the Plan
Year in which such election is made).
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SECTION 4
ACCOUNTING
4.1 Participants' Accounts. For each Plan Year, at the direction of the
Committee, there shall be established and maintained on the books of the
Company, a separate Account or Accounts for each Participant to which shall be
credited all Compensation Deferrals made by the Participant during such Plan
Year, all Company Contributions made by the Company on behalf of the Participant
during the Plan Year, and deemed investment returns, gains and losses on such
Compensation Deferrals and Company Contributions.
4.2 Participants Remain Unsecured Creditors. All amounts credited to a
Participant's Account under the Plan shall continue for all purposes to be a
part of the general assets of the Company. Each Participant's interest in the
Plan shall make him or her only a general, unsecured creditor of the Company.
4.3 Accounting Methods. The accounting methods or formulae to be used
under the Plan for the purpose of maintaining the Participants' Accounts,
including the calculation and crediting (or debiting) of deemed returns, gains
and losses, shall be determined by the Committee, in its sole discretion. The
accounting methods or formulae selected by the Committee may be revised from
time to time.
4.4 Reports. Each Participant shall be furnished with periodic statements
of his or her Account, reflecting the status of his or her interest in the Plan,
at least annually.
SECTION 5
DISTRIBUTIONS
5.1 Normal Time for Distribution. Subject to Sections 5.2 through 5.5
and Section 5.10, distribution of the balance credited to a Participant's
Account shall commence as soon as administratively practicable after the end of
the term(s) of deferral elected by the Participant under Section 3.6, in
accordance with the following rules. If, pursuant to Section 3.5, the
Participant elected to receive annual installment payments, his or her first
installment shall be equal to the balance then credited to his or her Account,
divided by the number of installments to be made. Each subsequent annual
installment shall be paid to the Participant as near as administratively
practicable to each anniversary of the first installment payment. The amount of
each subsequent installment shall be equal to the balance then credited to the
Participant's Account, divided by the number of installments remaining to be
made. While a Participant's Account is in installment payout status, the unpaid
balance credited to the Participant's Account shall continue to be credited (or
debited) with deemed investment returns, gains and losses under Section 3.4.
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5.2 Change of Control. If there is a Change of Control, the balance then
credited to a Participant's Account shall be distributed to him or her in a lump
sum as soon as administratively practicable after the date of the Change of
Control. Deemed investment returns, gains and losses shall be credited (or
debited) prior to any such accelerated distribution in accordance with Section
3.4. The amount of any such accelerated lump sum distribution shall also include
any amount that the Participant deferred but which has not yet been credited to
his or her Account.
5.3 Special Rule for Death or Disability. If a Participant dies or
becomes Disabled, the balance then credited to his or her Account shall be
distributed to the Participant (or his or her Beneficiary) at the time and in
the form elected by the Participant pursuant to Sections 3.5 and 3.6; provided,
however, that the Committee, in its sole discretion, may elect to distribute
such amount in a lump sum as soon as administratively practicable after the date
of death or Disability. In accordance with Section 3.4, deemed investment
returns, gains and losses shall be credited (or debited) prior to any such
accelerated distribution.
5.4 Special Rule re Deductibility. Notwithstanding any contrary provision
of Section 5.1, any payment scheduled for a particular Plan Year shall not be
made in such Plan Year to the extent necessary to avoid application of the
deductibility limitation of section 162(m) of the Code. (For this purpose,
deductibility shall be determined by adding such payment to all other
compensation paid by the Company and its Affiliates to the Participant during
the Plan Year.) If, pursuant to the foregoing sentences, any amounts are not
paid when originally scheduled, such amounts shall be paid in the first
subsequent taxable year in which such payments would not be subject to the
deductibility limitation of section 162(m) of the Code. During any such delay in
payment, unpaid amounts shall continue to be credited (or debited) with deemed
investment returns, gains and losses under Section 3.4. Notwithstanding the
foregoing, distribution of a Participant's Account shall be made without regard
to the deductibility limitation of section 162(m) of the Code if the time for
distribution is accelerated pursuant to Section 5.2 or Section 5.3.
5.5 Latest Permissible Distribution Date. Notwithstanding any contrary
provision of this Section 5, any amount which is credited to a Participant's
Account on January 15 of the second calendar year following the year in which
the Participant terminates employment with the Company and all of its Affiliates
shall be distributed to the Participant (or his or her Beneficiary) in a single
lump sum as soon as administratively practicable after such January 15. Any such
amount shall continue to be credited (or debited) with deemed investment
returns, gains and losses until the date of payment. For example, if a
Participant terminates employment with the Company and all of its Affiliates
during July 2000, and an amount remains credited to his or her Account on
January 15, 2002 (after application of the other provisions of Section 5), then
such amount (as increased or decreased by deemed investment returns, gains and
losses) shall be distributed to the Participant (or his or her Beneficiary) in a
lump sum as soon as administratively practicable after January 15, 2002.
5.6 Beneficiary Designations. Each Participant may, pursuant to such
procedures as the Committee may specify, designate one or more Beneficiaries.
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5.6.1 Spousal Consent. If a Participant designates a person other
than or in addition to his or her spouse as a primary Beneficiary, the
designation shall be ineffective unless the Participant's spouse consents to the
designation. Any spousal consent required under this Section 5.6 shall be
ineffective unless it (a) is set forth in writing in a form specified in the
discretion of the Committee, (b) acknowledges the effect of the Participant's
designation of another person as his or her Beneficiary under the Plan, and (c)
is signed by the spouse and witnessed by an authorized agent of the Committee or
a notary public. Notwithstanding this consent requirement, if the Participant
establishes to the satisfaction of the Committee that written spousal consent
may not be obtained because the spouse cannot be located, his or her designation
shall be effective without a spousal consent. Any spousal consent required
under this Section 5.6 shall be valid only with respect to the spouse who signs
the consent. A Participant may revoke his or her Beneficiary designation at any
time, provided that such revocation is in writing.
5.6.2 Changes and Failed Designations. A Participant may designate
different Beneficiaries (or may revoke a prior Beneficiary designation) at any
time by delivering a new designation (or revocation of a prior designation) in
accordance with Section 5.6.1. Any designation or revocation shall be effective
only if it is received by the Committee. However, when so received, the
designation or revocation shall be effective as of the date the notice is
executed (whether or not the Participant still is living), but without prejudice
to the Committee on account of any payment made before the change is recorded.
The last effective designation received by the Committee shall supersede all
prior designations. If a Participant dies without having effectively designated
a Beneficiary, or if no Beneficiary survives the Participant, the Participant's
Account shall be payable to his or her surviving spouse, or, if the Participant
is not survived by his or her spouse, the Account shall be paid to his or her
estate.
5.7 Financial Hardship. In the event that a Participant incurs a
Financial Hardship, the Committee, in its sole discretion and notwithstanding
any contrary provision of the Plan, may determine that all or part of the
Participant's Account shall be paid to him or her immediately; provided,
however, that the amount paid to the Participant pursuant to this Section 5.7
shall be limited to the amount reasonably necessary to alleviate the
Participant's Financial Hardship. Also, payment under this Section 5.7 may not
be made to the extent that the hardship may be relieved by suspension of the
Participant's Compensation Deferrals in accordance with Section 2.2.
5.8 Payments to Incompetents. If any individual to whom a benefit is
payable under the Plan is a minor or legally incompetent, the Committee shall
determine whether payment shall be made directly to the individual, any person
acting as his or her custodian or legal guardian under the California Uniform
Transfers to Minors Act, his or her legal representative or a near relative, or
directly for his or her support, maintenance or education.
5.9 Undistributable Accounts. Each Participant and (in the event of death)
his or her Beneficiary shall keep the Committee advised of his or her current
address. If the Committee is unable to locate the Participant or Beneficiary to
whom a Participant's Account is payable under this Section 5, the Participant's
Account shall continue to be credited (or debited) with deemed
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investment returns, gains and losses in accordance with Section 3.3. Accounts
that, in accordance with the preceding sentence, have been undistributable for a
period of thirty-five months shall be forfeited as of the end of the thirty-
fifth month. If a Participant whose Account was forfeited under this Section 5.9
(or his or her Beneficiary) files a claim for distribution of the Account after
the date on which it was forfeited, and if the Committee determines that such
claim is valid, then the forfeited balance shall be paid by the Employer in a
lump sum cash payment as soon as practicable thereafter (without interest or any
deemed investment returns, gains or losses after the date of forfeiture).
5.10 Committee Discretion. Within the specific time periods described in
this Section 5, the Committee shall have sole discretion to determine the
specific timing of the payment of any Account balance under the Plan. In
addition and notwithstanding any contrary provision of the Plan, the Committee,
in its sole discretion, may cause the balance credited to a Participant's
Account to be paid to him or her in a lump sum at any time following the
Participant's termination of employment with all Employers and Affiliates.
SECTION 6
PARTICIPANT'S INTEREST IN ACCOUNT
6.1 Compensation Deferral Contributions. Subject to Sections 8.1 (relating
to creditor status) and 9.2 (relating to amendment and/or termination of the
Plan), a Participant's interest in the balance credited to his or her Account at
all times shall be 100% vested and nonforfeitable.
6.2 Vesting in Company Contributions. Except as provided in the following
sentence, a Participant's interest in his or her Company Contribution (if any)
shall become 100% vested and nonforfeitable on the earlier of (a) the date that
is three years after the date as of which such Company Contribution was made
(but only if the Participant does not terminate employment prior to the end of
such three year period), (b) the date on which a Change of Control occurs, or
(c) the date on which the Participant terminates employment due to death or
Disability. If a Participant transfers any Compensation Deferral out of the
Company Stock Fund prior to any Company Contribution associated with such
Compensation Deferral becoming vested in accordance with the preceding sentence,
such Company Contribution shall be immediately forfeited. For example, if a
Participant elects to have $10,000 of his or her Compensation Deferral deemed
invested in the Company Stock Fund and transfers 50% of such Compensation
Deferral (as adjusted for earnings or losses) out of the Company Stock Fund
prior to the Company Contribution on that Compensation Deferral becoming vested,
50% of the Company Contribution (i.e., $1,250, as adjusted for earnings of
losses) shall be immediately forfeited. The vested portion of a Participant's
Account shall be distributable to him or her in the manner and at the time set
forth in Section 5, and any unvested portion of such Account shall be
permanently forfeited.
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SECTION 7
ADMINISTRATION OF THE PLAN
7.1 Plan Administrator. The Company is hereby designated as the
administrator of the Plan (within the meaning of section 3(16)(A) of ERISA).
7.2 Committee. The Plan shall be administered by the Committee. The
Committee shall have the authority to control and manage the operation and
administration of the Plan. Any member of the Committee may resign at any time
by notice in writing mailed or delivered to the Secretary of the Company.
7.3 Actions by Committee. Each decision of a majority of the members of
the Committee then in office shall constitute the final and binding act of the
Committee. The Committee may act with or without a meeting being called or held
and shall keep minutes of all meetings held and a record of all actions taken by
written consent.
7.4 Powers of Committee. The Committee shall have all powers and
discretion necessary or appropriate to supervise the administration of the Plan
and to control its operation in accordance with its terms, including, but not by
way of limitation, the following powers:
(a) To interpret and determine the meaning and validity of the
provisions of the Plan and to determine any question arising under, or in
connection with, the administration, operation or validity of the Plan or any
amendment thereto;
(b) To determine the types of bonuses which shall be eligible for
deferral under the Plan;
(c) To determine any and all considerations affecting the
eligibility of any employee to become a Participant or remain a Participant in
the Plan;
(d) To cause one or more separate Accounts to be maintained for
each Participant;
(e) To cause Compensation Deferrals and deemed returns, gains and
losses to be credited to Participants' Accounts;
(f) To establish and revise a method or procedure for the deemed
investment of Participants' Accounts, as provided in Section 3.3;
(g) To establish and revise an accounting method or formula for
the Plan, as provided in Section 4.3;
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(h) To determine the manner and form in which any distribution is
to be made under the Plan;
(i) To determine the manner and form for making elections under
the Plan;
(j) To determine the status and rights of Participants and their
spouses, Beneficiaries or estates;
(k) To employ such counsel, agents and advisers, and to obtain
such legal, clerical and other services, as it may deem necessary or appropriate
in carrying out the provisions of the Plan;
(l) To establish, from time to time, rules for the performance of
its powers and duties and for the administration of the Plan;
(m) To arrange for annual distribution to each Participant of a
statement of benefits accrued under the Plan;
(n) To publish a claims and appeal procedure satisfying the
minimum standards of section 503 of ERISA pursuant to which individuals or
estates may claim Plan benefits and appeal denials of such claims;
(o) To delegate to any one or more of its members or to any other
person, severally or jointly, the authority to perform for and on behalf of the
Committee one or more of the functions of the Committee under the Plan;
(p) To decide all issues regarding the conversion of
Participants' Accounts into stock options, the use of such Accounts to exercise
stock options or any related matter; and
(q) To decide all issues and questions regarding Account
balances, and the time, form, manner and amount of distributions to
Participants.
7.5 Decisions of Committee. All actions, interpretations, and decisions
of the Committee shall be conclusive and binding on all persons, and shall be
given the maximum possible deference allowed by law.
7.6 Administrative Expenses. All expenses incurred in the administration
of the Plan by the Committee, or otherwise, including legal fees and expenses,
shall be paid and borne by the Employers.
7.7 Eligibility to Participate. No member of the Committee who is also an
employee of an Employer shall be excluded from participating in the Plan if
otherwise eligible, but he or she shall
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not be entitled, as a member of the Committee, to act or pass upon any matters
pertaining specifically to his or her own Account under the Plan.
7.8 Indemnification. Each of the Employers shall, and hereby does,
indemnify and hold harmless the members of the Committee, from and against any
and all losses, claims, damages or liabilities (including attorneys' fees and
amounts paid, with the approval of the Board of Directors, in settlement of any
claim) arising out of or resulting from the implementation of a duty, act or
decision with respect to the Plan, so long as such duty, act or decision does
not involve gross negligence or willful misconduct on the part of any such
individual.
SECTION 8
FUNDING
8.1 Unfunded Plan. All amounts credited to a Participant's Account under
the Plan shall continue for all purposes to be a part of the general assets of
the Company. The interest of the Participant in his or her Account, including
his or her right to distribution thereof, shall be an unsecured claim against
the general assets of the Company. Nothing contained in the Plan shall (a) give
any Participant or beneficiary any interest in or claim against any specific
assets of the Company, nor (b) prevent the Company (with the consent of its
board of directors) from establishing a grantor trust (within the meaning of
subpart E, part I, subchapter J, chapter 1, subtitle A of the Code) to assist
the Company in fulfilling its obligations under the Plan.
SECTION 9
MODIFICATION OR TERMINATION OF PLAN
9.1 Employers' Obligations Limited. The Employers intend to continue the
Plan indefinitely, and to maintain each Participant's Account until it is
scheduled to be paid to him or her in accordance with the provisions of the
Plan. However, the Plan is voluntary on the part of the Employers, and the
Employers do not guarantee to continue the Plan. The Company at any time may, by
amendment of the Plan, suspend Compensation Deferrals or may discontinue
Compensation Deferrals, with or without cause. Complete discontinuance of all
Compensation Deferrals shall be deemed a termination of the Plan.
9.2 Right to Amend or Terminate. The Board of Directors, in its sole
discretion, may amend or terminate the Plan, or any part thereof, at any time
and for any reason, provided that no amendment or termination of the Plan shall,
without the consent of the Participant, reduce the balance then credited to the
Participant's Account.
9.3 Effect of Termination. If the Plan is terminated pursuant to this
Section 9, the balances credited to the Accounts of the affected Participants
shall be distributed to them at the time
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and in the manner set forth in Section 5; provided, however, that the Committee,
in its sole discretion, may authorize accelerated distribution of Participants'
Accounts as of any earlier date.
SECTION 10
GENERAL
10.1 Participation by Affiliates. One or more Affiliates of the Company
may become participating Employers by adopting the Plan and obtaining approval
for such adoption from the Board of Directors. By adopting the Plan, an
Affiliate is deemed to agree to all of its terms, including (but not limited to)
the provisions granting exclusive authority to the Board of Directors to amend
the Plan and the provisions granting exclusive authority to the Committee to
administer and interpret the Plan. Any Affiliate may terminate its participation
in the Plan at any time. A list of participating Employers, and the effective
dates of their participation, is attached hereto as Appendix A.
10.2 Inalienability. In no event may any Participant, Beneficiary, spouse
or estate sell, transfer, anticipate, assign, hypothecate, or otherwise dispose
of any right or interest under the Plan; and such rights and interests shall not
at any time be subject to the claims of creditors nor be liable to attachment,
execution or other legal process. Accordingly, for example, a Participant's
interest in the Plan is not transferable pursuant to a domestic relations order.
10.3 Rights and Duties. Neither the Employers nor the Committee shall be
subject to any liability or duty under the Plan except as expressly provided in
the Plan, or for any action taken, omitted or suffered in good faith.
10.4 No Enlargement of Employment Rights. Neither the establishment or
maintenance of the Plan, the making of any Compensation Deferrals nor any action
of any Employer or the Committee, shall be held or construed to confer upon any
individual any right to be continued as an employee of the Employer nor, upon
dismissal, any right or interest in any specific assets of the Employers other
than as provided in the Plan. Each Employer expressly reserves the right to
discharge any employee at any time.
10.5 Apportionment of Costs and Duties. All acts required of the Employers
under the Plan may be performed by the Company for itself and its Affiliates,
and the costs of the Plan shall be equitably apportioned by the Committee among
the Company and the other Employers. Whenever an Employer is permitted or
required under the terms of the Plan to do or perform any act, matter or thing,
it shall be done and performed by any officer or employee of the Employer who is
thereunto duly authorized by the board of directors of the Employer.
10.6 Compensation Deferrals Not Counted Under Other Employee Benefit
Plans. Compensation Deferrals under the Plan will not be considered for purposes
of contributions or
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benefits under any other employee benefit plan sponsored by the Employers,
except to the extent specifically provided in any such plan.
10.7 Applicable Law. The provisions of the Plan shall be construed,
administered and enforced in accordance with ERISA, and to the extent not
preempted by ERISA, with the laws of the State of California (other than its
conflict of laws provisions).
10.8 Severability. If any provision of the Plan is held invalid or
unenforceable, its invalidity or unenforceability shall not affect any other
provisions of the Plan, and in lieu of each provision which is held invalid or
unenforceable, there shall be added as part of the Plan a provision that shall
be as similar in terms to such invalid or unenforceable provision as may be
possible and be valid, legal, and enforceable.
10.9 Captions. The captions contained in and the table of contents
prefixed to the Plan are inserted only as a matter of convenience and for
reference and in no way define, limit, enlarge or describe the scope or intent
of the Plan nor in any way shall affect the construction of any provision of the
Plan.
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<PAGE>
EXECUTION
IN WITNESS WHEREOF, The PMI Group, Inc., by its duly authorized officer, has
executed this Plan on the date indicated below.
THE PMI GROUP, INC.
________________________________________
Dated: September ___1999 By:
Title:
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<PAGE>
APPENDIX A
LIST OF PARTICIPATING EMPLOYERS
Employer Effective Date of Participation
1. The PMI Group, Inc. July 1, 1997
2. PMI Mortgage Insurance Co. July 1, 1997
3. Residential Guaranty Co. July 1, 1997
4. PMI Mortgage Guaranty Co. July 1, 1997
5. PMI Mortgage Services Inc. July 1, 1997
6. PMI Securities Co. July 1, 1997
7. American Pioneer Title Insurance Company July 1, 1997
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<PAGE>
THE PMI GROUP, INC.
DIRECTORS' DEFERRED COMPENSATION PLAN
(Amended and Restated as of July 21, 1999)
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
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<S> <C>
SECTION 1 DEFINITIONS............................................................. 1
1.1 "Affiliate"............................................................. 1
1.2 "Beneficiary"........................................................... 1
1.3 "Board of Directors".................................................... 1
1.4 "Change of Control"..................................................... 1
1.5 "Code".................................................................. 3
1.6 "Committee"............................................................. 3
1.7 "Company"............................................................... 3
1.8 "Compensation".......................................................... 4
1.9 "Compensation Deferrals"................................................ 4
1.10 "Disability" or "Disabled".............................................. 4
1.11 "Financial Hardship".................................................... 4
1.12 "Participant"........................................................... 4
1.13 "Participant's Account" or "Account".................................... 4
1.14 "Plan".................................................................. 4
1.15 "Plan Year"............................................................. 4
1.16 "Nonemployee Director".................................................. 4
SECTION 2 PARTICIPATION........................................................... 5
2.1 Participation........................................................... 5
2.2 Suspension of Compensation Deferrals.................................... 5
2.3 Termination of Participation............................................ 6
SECTION 3 COMPENSATION DEFERRAL ELECTIONS......................................... 6
3.1 Compensation Deferrals.................................................. 6
3.2 Crediting of Compensation Deferrals..................................... 6
3.3 Deemed Investment Return on Accounts.................................... 6
3.4 Form of Payment......................................................... 7
3.5 Term of Deferral........................................................ 7
3.6 Changes in Elections as to Term and Form for Payment.................... 7
SECTION 4 ACCOUNTING.............................................................. 7
4.1 Participants' Accounts.................................................. 7
4.2 Participants Remain Unsecured Creditors................................. 8
4.3 Accounting Methods...................................................... 8
4.4 Reports................................................................. 8
</TABLE>
-i-
<PAGE>
TABLE OF CONTENTS
(continued)
<TABLE>
<CAPTION>
Page
----
<S> <C>
SECTION 5 DISTRIBUTIONS........................................................... 8
5.1 Normal Time for Distribution............................................ 8
5.2 Change of Control....................................................... 8
5.3 Special Rule for Death or Disability.................................... 8
5.4 Special Rule re Deductibility........................................... 9
5.5 Latest Permissible Distribution Date.................................... 9
5.6 Beneficiary Designations................................................ 9
5.7 Financial Hardship...................................................... 10
5.8 Payments to Incompetents................................................ 10
5.9 Undistributable Accounts................................................ 10
5.10 Committee Discretion.................................................... 10
SECTION 6 PARTICIPANT'S INTEREST IN ACCOUNT....................................... 11
6.1 Compensation Deferral Contributions..................................... 11
SECTION 7 ADMINISTRATION OF THE PLAN.............................................. 11
7.1 Committee............................................................... 11
7.2 Actions by Committee.................................................... 11
7.3 Powers of Committee..................................................... 11
7.4 Decisions of Committee.................................................. 12
7.5 Administrative Expenses................................................. 12
7.6 Eligibility to Participate.............................................. 12
7.7 Indemnification......................................................... 12
SECTION 8 FUNDING................................................................. 13
8.1 Unfunded Plan........................................................... 13
SECTION 9 MODIFICATION OR TERMINATION OF PLAN..................................... 13
9.1 Company's Obligation is Limited......................................... 13
9.2 Right to Amend or Terminate............................................. 13
9.3 Effect of Termination................................................... 13
SECTION 10 GENERAL PROVISIONS..................................................... 13
10.1 Inalienability.......................................................... 13
10.2 Rights and Duties....................................................... 14
10.3 No Enlargement of Rights................................................ 14
</TABLE>
-ii-
<PAGE>
TABLE OF CONTENTS
(continued)
<TABLE>
<CAPTION>
Page
----
<S> <C>
10.4 Compliance with Rule 16b-3.............................................. 14
10.5 Compensation Deferrals Not Counted Under Other Employee Benefit Plans... 14
10.6 Applicable Law.......................................................... 14
10.7 Severability............................................................ 14
10.8 Captions................................................................ 14
</TABLE>
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<PAGE>
THE PMI GROUP, INC.
DIRECTORS' DEFERRED COMPENSATION PLAN
(Amended and Restated as of July 21, 1999)
THE PMI GROUP, INC., a Delaware corporation, having established The PMI Group,
Inc. Directors' Deferred Compensation Plan, hereby amends and restates the Plan
effective as of July 23, 1998, for the benefit of members of the Board of
Directors who are employees of neither the Company nor its Affiliates, in order
to provide such directors with certain deferred compensation benefits. The Plan
is an unfunded deferred compensation plan which is exempt from the provisions of
the Employee Retirement Income Security Act of 1974, as amended.
SECTION 1
DEFINITIONS
The following words and phrases shall have the following meanings unless a
different meaning is plainly required by the context:
1.1 "Affiliate" shall mean (a) the Company, and (b) each corporation, trade
or business which is, together with the Company, a member of a controlled group
of corporations or an affiliated service group or under common control (within
the meaning of Section 414(b), (c) or (m) of the Code), but only for the period
during which such other entity is so affiliated with the Company.
1.2 "Beneficiary" shall mean the person or persons entitled to receive the
balance credited to a Participant's Account under the Plan upon the death of a
Participant, as provided in Section 5.4.
1.3 "Board of Directors" shall mean the Board of Directors of the Company, as
constituted from time to time.
1.4 "Change of Control" means the occurrence of any of the following:
(a) The acquisition by any individual, entity or group (within the
meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of
1934, as amended (the "Exchange Act")) (a "Person") of beneficial
ownership (within the meaning of Rule 13d-3 promulgated under the
Exchange Act) of 20% or more of either (i) the then outstanding shares of
common stock of the Company (the "Outstanding Company Common Stock") or
(ii) the combined voting power of the then outstanding voting securities
of the Company entitled to vote generally in the election of directors
(the "Outstanding Company Voting Securities"); provided, however, that
for purposes of this subsection (a), the following shall not constitute a
Change of Control: (i) any acquisition directly from the Company, (ii)
any acquisition by the Company, (iii) any acquisition by any employee
benefit plan
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(or related trust) sponsored or maintained by the Company or any
corporation controlled by the Company, (iv) any beneficial ownership
maintained by (but not additional acquisitions by), The Allstate
Corporation and its subsidiaries, and their respective successors
("Allstate"), pending such time that Allstate distributes or transfers
its current ownership interest in the Outstanding Company Common Stock
and Outstanding Company Voting Securities as contemplated by the
Prospectus dated April 10, 1995, relating to the initial public offering
of the common stock of the Company, or (v) any acquisition pursuant to a
transaction which complies with clauses (i), (ii) and (iii) of subsection
(c) of this Section 1.4. Notwithstanding the foregoing, in its sole
discretion, the Board may increase the 20% threshold set forth above in
this subsection (a) prior to any acquisition of 20% or more beneficial
ownership of the Outstanding Company Common Stock or the Outstanding
Company Voting Securities; provided, that (i) such increased threshold
shall apply only to the acquisition and maintenance of beneficial
ownership by any Person eligible to report such beneficial ownership at
the time of such acquisition on Schedule 13G under the Exchange Act, and
(ii) in the event that any Person initially eligible to so report on
Schedule 13G thereafter ceases to be eligible to so report on Schedule
13G, the occurrence of the event causing such Person no longer to be
eligible to so report shall be deemed an acquisition by such Person of
all of the Outstanding Company Common Stock and Outstanding Company
Voting Securities beneficially owned by such Person immediately prior to
such occurrence; or
(b) Individuals who, as of the date hereof, constitute the Board (the
"Incumbent Board") cease for any reason to constitute at least a majority
of the Board; provided, however, that any individual becoming a director
subsequent to the date hereof whose election, or nomination for election
by the Company's shareholders, was approved by a vote of at least a
majority of the directors then comprising the Incumbent Board shall be
considered as though such individual were a member of the Incumbent
Board, but excluding, for this purpose, any such individual whose initial
assumption of office occurs as a result of an actual or threatened
election contest with respect to the election or removal of directors or
other actual or threatened solicitation of proxies or consents by or on
behalf of a Person other than the Board; or
(c) Consummation by the Company of a reorganization, merger or
consolidation or sale or other disposition of all or substantially all of
the assets of the Company or the acquisition of assets of another entity
(a "Business Combination"), in each case, unless, following such Business
Combination, (i) all or substantially all of the individuals and entities
who were the beneficial owners, respectively, of the Outstanding Company
Common Stock and Outstanding Company Voting Securities immediately prior
to such Business Combination beneficially own, directly or indirectly,
more than 60% of, respectively, the then outstanding shares of common
stock and the combined voting power of the then outstanding voting
securities entitled to vote generally in the election of directors,
2
<PAGE>
as the case may be, of the corporation resulting from such Business
Combination (including, without limitation, a corporation which as a
result of such transaction owns the Company or all or substantially all
of the Company's assets either directly or through one or more
subsidiaries) in substantially the same proportions as their ownership,
immediately prior to such Business Combination of the Outstanding Company
Common Stock and Outstanding Company Voting Securities, as the case may
be, (ii) no Person (excluding any employee benefit plan (or related
trust) of the Company or such corporation resulting from such Business
Combination) beneficially owns, directly or indirectly, 20% or more of,
respectively, the then outstanding shares of common stock of the
corporation resulting from such Business Combination or the combined
voting power of the then outstanding voting securities of such
corporation except to the extent that such ownership existed prior to the
Business Combination and (iii) at least a majority of the members of the
board of directors of the corporation resulting from such Business
Combination were members of the Incumbent Board at the time of the
execution of the initial agreement, or of the action of the Board,
providing for such Business Combination; or
(d) Approval by the shareholders of the Company of a complete liquidation
or dissolution of the Company.
Notwithstanding the foregoing, a Change of Control shall not be deemed to occur
solely because any Person acquires beneficial ownership of 20% or more of the
Outstanding Company Voting Securities or Outstanding Company Common Stock as a
result of the acquisition of such securities or stock by the Company, which
acquisition reduces the number of the Outstanding Company Voting Securities or
Outstanding Company Common Stock; provided, that if after such acquisition by
the Company such Person (while such Person remains the beneficial owner of 20%
or more of the Outstanding Company Voting Securities or Outstanding Company
Common Stock) becomes the beneficial owner of additional shares of such
Outstanding Company Voting Securities or Outstanding Company Common Stock (as
the case may be), a Change of Control shall then occur. Capitalized terms used
in this Section 1.4, not otherwise defined, shall have the meaning set forth in
the form of change of control employment agreement approved at the February 12,
1998 meeting of the Board of Directors.
1.5 "Code" shall mean the Internal Revenue Code of 1986, as amended.
Reference to a specific section of the Code shall include such section, any
valid regulation promulgated thereunder, and any comparable provision of any
future legislation amending, supplementing or superseding such section.
1.6 "Committee" shall mean the committee appointed by (and serving at the
pleasure of) the Board of Directors to administer the Plan. As of the effective
date of the Plan, the members of the Committee shall be the Compensation
Committee of the Board of Directors.
1.7 "Company" shall mean The PMI Group, Inc., a Delaware corporation.
3
<PAGE>
1.8 "Compensation" shall mean the annual cash retainer, retainer for serving
as a committee chairperson (if any), and meeting fees (if any) of a Participant.
A Participant's Compensation shall not include any other type of remuneration.
1.9 "Compensation Deferrals" shall mean the amounts credited to Participants'
Accounts under the Plan pursuant to their deferral elections made in accordance
with Section 2.1.
1.10 "Disability" or "Disabled" shall mean the mental or physical inability of
a Participant to perform the regularly assigned duties of a member of the Board
of Directors, provided that such inability (a) has continued or is expected to
continue for a period of at least six months and (b) is evidenced by the
certificate of a physician satisfactory to the Committee stating that such
inability exists and is likely to be permanent.
1.11 "Financial Hardship" shall mean a severe financial emergency which is
caused by a sudden and unexpected accident, illness or other event beyond the
control of the Participant which, absent a suspension of deferrals under Section
2.2 or accelerated distribution under Section 5.5, would result in severe
financial burden to the Participant or a member of his or her immediate family.
A Financial Hardship does not exist to the extent that the hardship may be
relieved by (a) reimbursement or compensation by insurance, (b) by liquidation
of the Participant's other assets (to the extent such liquidation would not
itself cause severe financial hardship), or (c) any loan available to the
Participant (to the extent the payments on such loan would not themselves cause
severe financial hardship.
1.12 "Participant" shall mean a Nonemployee Director who (a) has become a
Participant in the Plan pursuant to Section 2.1 and (b) has not ceased to be a
Participant pursuant to Section 2.3.
1.13 "Participant's Account" or "Account" shall mean, as to any Participant,
the separate account maintained on the books of the Company in order to reflect
his or her interest under the Plan.
1.14 "Plan" shall mean The PMI Group, Inc. Directors' Deferred Compensation
Plan, as set forth in this instrument and as hereafter amended from time to
time.
1.15 "Plan Year" shall mean the twelve month period beginning June 1 and
ending May 31.
1.16 "Nonemployee Director" means a member of the Board of Directors who is an
employee of neither the Company nor of any Affiliate.
4
<PAGE>
SECTION 2
PARTICIPATION
2.1 Participation. Each Nonemployee Director's decision to become a
Participant shall be entirely voluntary.
2.1.1 Current Nonemployee Directors. Each Nonemployee Director who both
(a) is such on July 1, 1997, and (b) previously elected to make Compensation
Deferrals under the Plan for the 1997 Plan Year, shall have his or her
Compensation Deferral election continue in effect for the remainder of the 1997
Plan Year only (and subject to the other provisions of the Plan).
2.1.2 Initial Elections by New Nonemployee Directors. Each individual
who first becomes a Nonemployee Director after July 1, 1997 may elect to become
a Participant in the Plan by electing, within thirty days of the date of his or
her hire or promotion (as the case may be), to make Compensation Deferrals under
the Plan. An election under this Section 2.1.2 to make Compensation Deferrals
shall be effective only for the remainder of the Plan Year with respect to which
the election is made.
2.1.3 Elections for Subsequent Plan Years. A Nonemployee Director may
elect to become a Participant (or to continue or reinstate his or her active
participation) in the Plan for any subsequent Plan Year by electing, no later
than January 30 of the preceding Plan Year, to make Compensation Deferrals under
the Plan. An election under this Section 2.1.3 to make Compensation Deferrals
shall be effective only for the Plan Year with respect to which the election is
made.
2.1.4 No Election Changes During Plan Year. After the beginning of a
Plan Year, a Participant shall not be permitted to change or revoke his or her
deferral election for such Plan Year, except to the limited extent provided in
Section 2.2.
2.1.5 Specific Timing and Method of Election. Notwithstanding any
contrary provision of this Section 2.1, the Committee, in its sole discretion,
shall determine the manner and deadlines for Participants to make Compensation
Deferral elections. The deadlines prescribed by the Committee may be earlier
than the deadlines specified in this Section 2.1, but shall not be later than
such specified deadlines.
2.2 Suspension of Compensation Deferrals.
2.2.1 Automatic Suspension. In the event that a Participant receives a
financial hardship withdrawal from The PMI Group, Inc. Savings and Profit-
Sharing Plan or any other plan (maintained by the Company or an Affiliate) which
contains a qualified cash or deferred arrangement under section 401(k) of the
Internal Revenue Code of 1986, as amended (collectively, the "401(k) Plans"),
the Participant's Compensation Deferrals under the Plan (if any) shall be
suspended for a period of twelve (12) months from the date that the Participant
5
<PAGE>
received such hardship withdrawal. Notwithstanding the preceding, the
Participant's Compensation Deferrals shall be not be so suspended if the
Committee determines that such suspension is not required in order to preserve
the tax-qualification of the 401(k) Plans.
2.2.2 Permissible Suspension. In the event that a Participant incurs a
Financial Hardship, the Committee, in its sole discretion, may suspend the
Participant's Compensation Deferrals for the remainder of the Plan Year.
However, an election to make Compensation Deferrals under Section 2.1 shall be
irrevocable as to amounts deferred as of the effective date of any suspension in
accordance with this Section 2.2.2.
2.3 Termination of Participation. A Nonemployee Director who has become a
Participant shall remain a Participant until his or her entire vested Account
balance is distributed. However, a Nonemployee Director who has become a
Participant may or may not be an active Participant making Compensation
Deferrals for a particular Plan Year, depending upon whether he or she has
elected to make Compensation Deferrals for such Plan Year.
SECTION 3
COMPENSATION DEFERRAL ELECTIONS
3.1 Compensation Deferrals. At the times and in the manner prescribed in
Section 2.1, each Nonemployee Director may elect to defer portions of his or her
Compensation and to have the amounts of such deferrals credited to his or her
Account. For each Plan Year, a Nonemployee Director may elect to defer an amount
equal to any percentage or any specific dollar amount of his or her
Compensation, provided that the percentage or dollar amount elected by the
Participant shall result in an expected deferral of not less than $5,000 of his
or her Compensation. Notwithstanding any contrary provision of the Plan, the
Committee may reduce a Participant's Compensation Deferrals to the extent
necessary to satisfy any deductions required by law.
3.2 Crediting of Compensation Deferrals. The amounts deferred pursuant to
Section 3.1 shall reduce the Participant's Compensation for the Plan Year and
shall be credited to the Participant's Account as of the date on which the
amounts (but for the deferral) otherwise would have been paid to the
Participant. For each Plan Year, the exact dollar amount to be deferred from
each Compensation payment shall be determined by the Committee under such
formulae as it shall adopt from time to time.
3.3 Deemed Investment Return on Accounts. Although no assets will be
segregated or otherwise set aside with respect to a Participant's Account, the
amount that is ultimately payable to the Participant with respect to his or her
Account shall be determined as if such Account had been invested in common stock
of the Company (including reinvestment of any deemed dividends). The Committee,
in its sole discretion, shall adopt (and may modify from time to time) such
rules and procedures as it deems necessary or appropriate to implement the
deemed investment of the Participants' Accounts. However, such procedures may
differ among Participants or classes of Participants, as determined by the
Committee in its discretion.
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3.4 Form of Payment. Each Participant shall indicate on his or her deferral
election (made pursuant to Section 3.1) the form of payment for the Compensation
Deferrals made pursuant to such election. A Participant may elect (a) a lump sum
payment, or (b) a fixed number of annual installment payments (not to exceed
ten). A Participant's election as to the form of payment shall apply to all
amounts credited to the Participant's Account for the Plan Year with respect to
which the election is made, and except to the limited extent provided in Section
3.6, shall be irrevocable.
3.5 Term of Deferral. Each Participant shall indicate on his or her deferral
election made pursuant to Section 3.1 the time for payment for Compensation
Deferrals (and deemed investment returns, gains and losses thereon) made
pursuant to such election. A Participant may elect a term of deferral equal to
any whole number (not less than one) of calendar years specified in his or her
deferral election. In addition, pursuant to such procedures as the Committee (in
its discretion) may adopt from time to time, a Participant may elect a term of
deferral which ends upon the later (or earlier) of the expiration of a specified
period or the occurrence of a specific event (for example, the later of ten
years or termination of service on the Board of Directors). A Participant's
election as to the term of deferral shall apply to all amounts credited to the
Participant's Account for the Plan Year with respect to which the election is
made, and except to the limited extent provided in Section 3.6, shall be
irrevocable.
3.6 Changes in Elections as to Term and Form for Payment. A Participant may
change his or her election under Section 3.4 and/or Section 3.5 for amounts
credited to the Participant's Account for any Plan Year, provided that any such
election will be effective only if (a) such election is made at least two Plan
Years prior to the Plan Year in which payment of such amounts is scheduled to
commence (without giving effect to such election), (b) the newly elected
scheduled payment commencement date is not earlier than the second Plan Year
after the Plan Year in which such election is made, and (c) payment of such
amounts has not actually commenced. For example, if a Participant initially
elected to receive his or 1999 Plan Year deferrals in a lump sum to be paid
during the 2003 Plan Year, the Participant instead may elect to receive payment
in the form of ten annual installments commencing during the 2004 Plan Year,
provided that such election is made on or before December 31, 2001. (i.e., not
----
less than two Plan Years prior to the Plan Year in which payment of such amounts
previously was scheduled to commence, and with a newly elected scheduled payment
commencement date which is not earlier than the second Plan Year after the Plan
Year in which such election is made).
SECTION 4
ACCOUNTING
4.1 Participants' Accounts. For each Plan Year, at the direction of the
Committee, there shall be established and maintained on the books of the
Company, a separate Account or Accounts for each Participant to which shall be
credited all Compensation Deferrals made by the Participant during such Plan
Year, and deemed investment returns, gains and losses on such Compensation
Deferrals.
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4.2 Participants Remain Unsecured Creditors. All amounts credited to a
Participant's Account under the Plan shall continue for all purposes to be a
part of the general assets of the Company. Each Participant's interest in the
Plan shall make him or her only a general, unsecured creditor of the Company.
4.3 Accounting Methods. The accounting methods or formulae to be used under
the Plan for the purpose of maintaining the Participants' Accounts, including
the calculation and crediting (or debiting) of deemed returns, gains and losses,
shall be determined by the Committee, in its sole discretion. The accounting
methods or formulae selected by the Committee may be revised from time to time.
4.4 Reports. Each Participant shall be furnished with periodic statements of
his or her Account, reflecting the status of his or her interest in the Plan, at
least annually.
SECTION 5
DISTRIBUTIONS
5.1 Normal Time for Distribution. Subject to Sections 5.2 through 5.5 and
Section 5.10, distribution of the balance credited to a Participant's Account
shall commence as soon as administratively practicable after the end of the
term(s) of deferral elected by the Participant under Section 3.5, in accordance
with the following rules. If, pursuant to Section 3.4, the Participant elected
to receive annual installment payments, his or her first installment shall be
equal to the balance then credited to his or her Account, divided by the number
of installments to be made. Each subsequent annual installment shall be paid to
the Participant as near as administratively practicable to each anniversary of
the first installment payment. The amount of each subsequent installment shall
be equal to the balance then credited to the Participant's Account, divided by
the number of installments remaining to be made. While a Participant's Account
is in installment payout status, the unpaid balance credited to the
Participant's Account shall continue to be credited (or debited) with deemed
investment returns, gains and losses under Section 3.3.
5.2 Change of Control. If there is a Change of Control, the balance then
credited to a Participant's Account shall be distributed to him or her in a lump
sum as soon as administratively practicable after the date of the Change of
Control. Deemed investment returns, gains and losses shall be credited (or
debited) prior to any such accelerated distribution in accordance with Section
3.3. The amount of any such accelerated lump sum distribution shall also include
any amount that the Participant deferred but which has not yet been credited to
his or her Account.
5.3 Special Rule for Death or Disability. If a Participant dies or becomes
Disabled, the balance then credited to his or her Account shall be distributed
to the Participant (or his or her Beneficiary) at the time and in the form
elected by the Participant pursuant to Sections 3.4 and 3.5; provided, however,
that the Committee, in its sole discretion, may elect to distribute such amount
in a lump sum as soon as administratively practicable after the date of death or
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Disability. In accordance with Section 3.3, deemed investment returns, gains and
losses shall be credited (or debited) prior to any such accelerated
distribution.
5.4 Special Rule re Deductibility. Notwithstanding any contrary provision of
Section 5.1, any payment scheduled for a particular Plan Year shall not be made
in such Plan Year to the extent necessary to avoid application of the
deductibility limitation of section 162(m) of the Code. (For this purpose,
deductibility shall be determined by adding such payment to all other
compensation paid by the Company and its Affiliates to the Participant during
the Plan Year.) If, pursuant to the foregoing sentences, any amounts are not
paid when originally scheduled, such amounts shall be paid in the first
subsequent taxable year in which such payments would not be subject to the
deductibility limitation of section 162(m) of the Code. During any such delay in
payment, unpaid amounts shall continue to be credited (or debited) with deemed
investment returns, gains and losses under Section 3.3. Notwithstanding the
foregoing, distribution of a Participant's Account shall be made without regard
to the deductibility limitation of section 162(m) of the Code if the time for
distribution is accelerated pursuant to Section 5.2 or Section 5.3.
5.5 Latest Permissible Distribution Date. Notwithstanding any contrary
provision of this Section 5, any amount which is credited to a Participant's
Account on January 15 of the second calendar year following the year in which
the Participant terminates service on the Board of Directors shall be
distributed to the Participant (or his or her Beneficiary) in a single lump sum
as soon as administratively practicable after such January 15. Any such amount
shall continue to be credited (or debited) with deemed investment returns, gains
and losses until the date of payment. For example, if a Participant terminates
service on the Board of Directors during July 2000, and an amount remains
credited to his or her Account on January 15, 2002 (after application of the
other provisions of Section 5), then such amount (as increased or decreased by
deemed investment returns, gains and losses) shall be distributed to the
Participant (or his or her Beneficiary) in a lump sum as soon as
administratively practicable after January 15, 2002.
5.6 Beneficiary Designations. Each Participant may, pursuant to such
procedures as the Committee may specify, designate one or more Beneficiaries.
5.6.1 Spousal Consent. If a Participant designates a person other than
or in addition to his or her spouse as a primary Beneficiary, the designation
shall be ineffective unless the Participant's spouse consents to the
designation. Any spousal consent required under this Section 5.6 shall be
ineffective unless it (a) is set forth in writing in a form specified in the
discretion of the Committee, (b) acknowledges the effect of the Participant's
designation of another person as his or her Beneficiary under the Plan, and (c)
is signed by the spouse and witnessed by an authorized agent of the Committee or
a notary public. Notwithstanding this consent requirement, if the Participant
establishes to the satisfaction of the Committee that written spousal consent
may not be obtained because the spouse cannot be located, his or her designation
shall be effective without a spousal consent. Any spousal consent required under
this Section 5.6 shall be valid only with respect to the spouse who signs the
consent. A Participant may revoke his or her Beneficiary designation at any
time, provided that such revocation is in writing.
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5.6.2 Changes and Failed Designations. A Participant may designate
different Beneficiaries (or may revoke a prior Beneficiary designation) at any
time by delivering a new designation (or revocation of a prior designation) in
accordance with Section 5.6.1. Any designation or revocation shall be effective
only if it is received by the Committee. However, when so received, the
designation or revocation shall be effective as of the date the notice is
executed (whether or not the Participant still is living), but without prejudice
to the Committee on account of any payment made before the change is recorded.
The last effective designation received by the Committee shall supersede all
prior designations. If a Participant dies without having effectively designated
a Beneficiary, or if no Beneficiary survives the Participant, the Participant's
Account shall be payable to his or her surviving spouse, or, if the Participant
is not survived by his or her spouse, the Account shall be paid to his or her
estate.
5.7 Financial Hardship. In the event that a Participant incurs a Financial
Hardship, the Committee, in its sole discretion and notwithstanding any contrary
provision of the Plan, may determine that all or part of the Participant's
Account shall be paid to him or her immediately; provided, however, that the
amount paid to the Participant pursuant to this Section 5.7 shall be limited to
the amount reasonably necessary to alleviate the Participant's Financial
Hardship. Also, payment under this Section 5.7 may not be made to the extent
that the hardship may be relieved by suspension of the Participant's
Compensation Deferrals in accordance with Section 2.2.
5.8 Payments to Incompetents. If any individual to whom a benefit is payable
under the Plan is a minor or legally incompetent, the Committee shall determine
whether payment shall be made directly to the individual, any person acting as
his or her custodian or legal guardian under the California Uniform Transfers to
Minors Act, his or her legal representative or a near relative, or directly for
his or her support, maintenance or education.
5.9 Undistributable Accounts. Each Participant and (in the event of death)
his or her Beneficiary shall keep the Committee advised of his or her current
address. If the Committee is unable to locate the Participant or Beneficiary to
whom a Participant's Account is payable under this Section 5, the Participant's
Account shall continue to be credited (or debited) with deemed investment
returns, gains and losses in accordance with Section 3.3. Accounts that, in
accordance with the preceding sentence, have been undistributable for a period
of thirty-five months shall be forfeited as of the end of the thirty-fifth
month. If a Participant whose Account was forfeited under this Section 5.9 (or
his or her Beneficiary) files a claim for distribution of the Account after the
date on which it was forfeited, and if the Committee determines that such claim
is valid, then the forfeited balance shall be paid by the Company in a lump sum
cash payment as soon as practicable thereafter (without interest or any deemed
investment returns, gains or losses after the date of forfeiture).
5.10 Committee Discretion. Within the specific time periods described in this
Section 5, the Committee shall have sole discretion to determine the specific
timing of the payment of any Account balance under the Plan. In addition and
notwithstanding any contrary provision of the Plan, the Committee, in its sole
discretion, may cause the balance credited to a
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Participant's Account to be paid to him or her in a lump sum at any time
following the Participant's cessation of service on the Board of Directors.
SECTION 6
PARTICIPANT'S INTEREST IN ACCOUNT
6.1 Compensation Deferral Contributions. Subject to Sections 8.1 (relating to
creditor status) and 9.2 (relating to amendment and/or termination of the Plan),
a Participant's interest in the balance credited to his or her Account at all
times shall be 100% vested and nonforfeitable.
SECTION 7
ADMINISTRATION OF THE PLAN
7.1 Committee. The Plan shall be administered by the Committee. The Committee
shall have the authority to control and manage the operation and administration
of the Plan. Any member of the Committee may resign at any time by notice in
writing mailed or delivered to the Secretary of the Company.
7.2 Actions by Committee. Each decision of a majority of the members of the
Committee then in office shall constitute the final and binding act of the
Committee. The Committee may act with or without a meeting being called or held
and shall keep minutes of all meetings held and a record of all actions taken by
written consent.
7.3 Powers of Committee. The Committee shall have all powers and discretion
necessary or appropriate to supervise the administration of the Plan and to
control its operation in accordance with its terms, including, but not by way of
limitation, the following powers:
(a) to interpret and determine the meaning and validity of the provisions
of the Plan and to determine any question arising under, or in connection
with, the administration, operation or validity of the Plan or any
amendment thereto;
(b) to determine any and all considerations affecting the eligibility of
any Nonemployee Director to become a Participant or remain a Participant
in the Plan;
(c) to cause one or more separate Accounts to be maintained for each
Participant;
(d) to cause Compensation Deferrals and deemed investment returns, gains
and losses to be credited to Participants' Accounts;
(e) to establish and revise a method or procedure for the deemed
investment of Participants' Accounts, as provided in Section 3.3;
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(f) to establish and revise an accounting method or formula for the Plan,
as provided in Section 4.3;
(g) to determine the manner and form in which any distribution is to be
made under the Plan;
(h) to determine the manner and form for making elections under the Plan;
(i) to determine the status and rights of Participants and their spouses,
Beneficiaries or estates;
(j) to employ such counsel, agents and advisers, and to obtain such
legal, clerical and other services, as it may deem necessary or
appropriate in carrying out the provisions of the Plan;
(k) to establish, from time to time, rules for the performance of its
powers and duties and for the administration of the Plan;
(l) to arrange for annual distribution to each Participant of a statement
of benefits accrued under the Plan;
(m) to publish a claims and appeal procedure pursuant to which
individuals or estates may claim Plan benefits and appeal denials of such
claims;
(n) to delegate to any one or more of its members or to any other person,
severally or jointly, the authority to perform for and on behalf of the
Committee one or more of the functions of the Committee under the Plan;
and
(o) to decide all issues and questions regarding Account balances, and
the time, form, manner and amount of distributions to Participants.
7.4 Decisions of Committee. All actions, interpretations, and decisions of
the Committee shall be conclusive and binding on all persons, and shall be given
the maximum possible deference allowed by law.
7.5 Administrative Expenses. All expenses incurred in the administration of
the Plan by the Committee, or otherwise, including legal fees and expenses,
shall be paid and borne by the Company.
7.6 Eligibility to Participate. No member of the Committee who is also a
Nonemployee Director shall be excluded from participating in the Plan if
otherwise eligible, but he or she shall not be entitled, as a member of the
Committee, to act or pass upon any matters pertaining specifically to his or her
own Account under the Plan.
7.7 Indemnification. The Company shall, and hereby does, indemnify and hold
harmless the members of the Committee, from and against any and all losses,
claims, damages or liabilities (including attorneys' fees and amounts paid, with
the approval of the Board of
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Directors, in settlement of any claim) arising out of or resulting from the
implementation of a duty, act or decision with respect to the Plan, so long as
such duty, act or decision does not involve gross negligence or willful
misconduct on the part of any such individual.
SECTION 8
FUNDING
8.1 Unfunded Plan. All amounts credited to a Participant's Account under the
Plan shall continue for all purposes to be a part of the general assets of the
Company. The interest of the Participant in his or her Account, including his or
her right to distribution thereof, shall be an unsecured claim against the
general assets of the Company. Nothing contained in the Plan shall give any
Participant or beneficiary any interest in or claim against any specific assets
of the Company.
SECTION 9
MODIFICATION OR TERMINATION OF PLAN
9.1 Company's Obligation is Limited. The Company intends to continue the Plan
indefinitely, and to maintain each Participant's Account until it is scheduled
to be paid to him or her in accordance with the provisions of the Plan. However,
the Plan is voluntary on the part of the Company, and the Company does not
guarantee to continue the Plan. The Company at any time may, by amendment of the
Plan, suspend Compensation Deferrals or may discontinue Compensation Deferrals,
with or without cause. Complete discontinuance of all Compensation Deferrals
shall be deemed a termination of the Plan.
9.2 Right to Amend or Terminate. The Board of Directors, in its sole
discretion, may amend or terminate the Plan, or any part thereof, at any time
and for any reason, provided that no amendment or termination of the Plan shall,
without the consent of the Participant, reduce the balance then credited to the
Participant's Account.
9.3 Effect of Termination. If the Plan is terminated pursuant to this Section
9, the balances credited to the Accounts of the affected Participants shall be
distributed to them at the time and in the manner set forth in Section 5;
provided, however, that the Committee, in its sole discretion, may authorize
accelerated distribution of Participants' Accounts as of any earlier date.
SECTION 10
GENERAL PROVISIONS
10.1 Inalienability. In no event may any Participant, Beneficiary, spouse or
estate sell, transfer, anticipate, assign, hypothecate, or otherwise dispose of
any right or interest under the Plan; and such rights and interests shall not at
any time be subject to the claims of creditors nor be liable to attachment,
execution or other legal process. Accordingly, for example, a Participant's
interest in the Plan is not transferable pursuant to a domestic relations order.
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10.2 Rights and Duties. Neither the Company nor the Committee shall be subject
to any liability or duty under the Plan except as expressly provided in the
Plan, or for any action taken, omitted or suffered in good faith.
10.3 No Enlargement of Rights. Neither the establishment or maintenance of the
Plan, the making of any Compensation Deferrals nor any action of the Company or
the Committee, shall be held or construed to confer upon any individual any
right to be continue as a member of the Board of Directors.
10.4 Compliance with Rule 16b-3. All transactions under the Plan are intended
to be exempt from liability under section 16(b) of the Securities Exchange Act
of 1934, as amended ("section 16(b)"). To the extent deemed necessary or
advisable by the Committee, any election, payment, distribution or other
transaction by or on behalf of any Nonemployee Director may be canceled or
delayed in order to ensure that such payment will not result in any liability
under section 16(b) to such individual.
10.5 Compensation Deferrals Not Counted Under Other Employee Benefit Plans.
Compensation Deferrals under the Plan will not be considered for purposes of
contributions or benefits under any other employee benefit plan sponsored by the
Company or any Affiliate, except to the extent specifically provided in any such
plan.
10.6 Applicable Law. The provisions of the Plan shall be construed,
administered and enforced in accordance with the laws of the State of California
(other than its conflict of laws provisions).
10.7 Severability. If any provision of the Plan is held invalid or
unenforceable, its invalidity or unenforceability shall not affect any other
provisions of the Plan, and in lieu of each provision which is held invalid or
unenforceable, there shall be added as part of the Plan a provision that shall
be as similar in terms to such invalid or unenforceable provision as may be
possible and be valid, legal, and enforceable.
10.8 Captions. The captions contained in and the table of contents prefixed to
the Plan are inserted only as a matter of convenience and for reference and in
no way define, limit, enlarge or describe the scope or intent of the Plan nor in
any way shall affect the construction of any provision of the Plan.
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EXECUTION
IN WITNESS WHEREOF, The PMI Group, Inc., by its duly authorized
officer, has executed this Plan on the date indicated below.
THE PMI GROUP, INC.
Dated: __________, 1999 By _______________________________
Title:
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EXHIBIT 5.1
March 6, 2000
The PMI Group, Inc.
601 Montgomery Street
San Francisco, CA 94111
Re: Registration Statement on Form S-8/The PMI Group, Inc. Officer
Deferred Compensation Plan
Ladies and Gentlemen:
At your request, we are rendering this opinion in connection with the
proposed issuance pursuant to The PMI Group, Inc. Officer Deferred Compensation
Plan, as amended (the "Officer Plan") and The PMI Group, Inc. Directors'
Deferred Compensation Plan, as amended (the "Directors' Plan") (collectively,
the "Plans"), of up to 100,000 shares of common stock, $0.01 par value ("Common
Stock"), of The PMI Group, Inc., a Delaware corporation (the "Company") and
$6,000,000 in aggregate amount of deferred compensation obligations (the
"Obligations").
We have examined instruments, documents, and records which we deemed
relevant and necessary for the basis of our opinion hereinafter expressed. In
such examination, we have assumed the following: (a) the authenticity of
original documents and the genuineness of all signatures; (b) the conformity to
the originals of all documents submitted to us as copies; and (c) the truth,
accuracy and completeness of the information, representations and warranties
contained in the records, documents, instruments and certificates we have
reviewed.
Based on such examination, we are of the opinion that the 100,000
shares of Common Stock to be issued by the Company pursuant to the Officer Plan
are validly authorized shares of Common Stock and, when issued in accordance
with the provisions of the Officer Plan, will be legally issued, fully paid and
nonassessable. In addition, we are of the opinion that the $6,000,000 of the
Obligations to be issued by the Company pursuant to the Plans are binding
obligations of the Company, and, when issued in accordance with the provisions
of the Plan, will be legally issued, fully paid and nonassessable.
We hereby consent to the filing of this opinion as an exhibit to this
Registration Statement on Form S-8 and to the use of our name wherever it
appears in said Registration Statement. In giving such consent, we do not
consider that we are "experts" within the meaning of such term as used in the
Securities Act of 1933, as amended, or the rules and regulations of the
Securities and Exchange Commission issued thereunder, with respect to any part
of the Registration Statement, including this opinion as an exhibit or
otherwise.
Very truly yours,
/s/ Wilson Sonsini Goodrich & Rosati
WILSON SONSINI GOODRICH & ROSATI
a Professional Corporation
<PAGE>
EXHIBIT 23.1
INDEPENDENT AUDITORS CONSENT
We consent to the incorporation by reference in this Registration Statement of
The PMI Group, Inc., on Form S-8 of; (i) our report dated January 20, 1999
incorporated by reference in the Annual Report on Form 10-K of The PMI Group,
Inc., for the year ended December 31, 1998, and (ii) our report dated January
20, 1999 relating to the financial statement schedules appearing in such Form
10-K.
/s/ Deloitte & Touche LLP
March 6, 2000
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