SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934
(X ) Filed by the Registrant
( ) Filed by a Party other than the Registrant
Check the appropriate box:
( ) Preliminary Proxy Statement
( ) Confidential, for Use of the Commission Only (as permitted by
Rule 14a-b(e)(2))
(X ) Definitive Proxy Statement
( ) Definitive Additional Materials
( ) Soliciting Material Pursuant to (section mark)240.14a-11(c) or
(section mark)240.14a-12
PCA International, Inc.
(Name of Registrant as Specified In Its Charter)
(Name of Person(s) Filing Proxy Statement If Other Than Registrant)
PAYMENT OF FILING FEE (Check the appropriate box):
(X ) $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(i)(2).
( ) $500 per each party to the controversy pursuant to Exchange Act
Rule 14a-6(i)(3).
( ) Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
1) Title of each class of securities to which transaction applies:
2) Aggregate number of securities to which transaction applies:
3) Per unit price or other underlying value of transaction
computed pursuant to Exchange Act Rule 0-11: *
4) Proposed maximum aggregate value of transaction:
5) Total fee paid:
(Set forth the amount on which the filing fee is calculated and state how
it was determined)
( ) Fee previously paid with preliminary materials.
( ) Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration
statement number, or the Form or Schedule and the date of its filing.
1) Amount Previously Paid: $
2) Form, Schedule or Registration Statement No.:
3) Filing Party:
4) Date Filed:
<PAGE>
PCA INTERNATIONAL, INC.
NOTICE OF ANNUAL MEETING OF
SHAREHOLDERS TO BE HELD ON MAY 22, 1996
The Annual Meeting of Shareholders of PCA International, Inc. (the
"Company") will be held on May 22, 1996, at 10:00 a.m. at the Company's
principal executive offices located at 815 Matthews-Mint Hill Road, Matthews,
North Carolina, for the following purposes:
(1) To elect eight directors to serve until the 1997 Annual Meeting of
Shareholders and to serve until their successors are elected and
qualified.
(2) To approve the Company's 1996 Omnibus Long-Term Compensation Plan.
(3) To ratify the selection of KPMG Peat Marwick LLP as Independent
Auditors.
(4) To transact such other business as may properly come before the meeting
or any adjournment or postponement thereof.
The Board of Directors has fixed the close of business on March 29, 1996,
as the record date for the meeting. Only shareholders of record at that time are
entitled to notice of and to vote at the meeting.
The enclosed proxy is solicited by the Board of Directors of the Company.
Reference is made to the attached proxy statement for further information with
respect to the business to be transacted at the meeting. Management urges you to
date, sign, and return the enclosed proxy promptly. You are cordially invited to
attend the meeting in person, and the giving of the proxy will not affect your
right to vote in person if you elect to do so at the meeting.
By order of the Board of Directors,
BRUCE A. FISHER
SECRETARY
April 20, 1996
Matthews, North Carolina
<PAGE>
PCA INTERNATIONAL, INC.
815 Matthews-Mint Hill Road
Matthews, North Carolina 28105
PROXY STATEMENT
This proxy statement is furnished to the shareholders of PCA International,
Inc. (the "Company"), in connection with the solicitation of proxies by the
Board of Directors of the Company to be voted at the Annual Meeting of
Shareholders to be held on May 22, 1996 (the "1996 Annual Meeting"), or any
adjournment or postponement thereof, for the purposes set forth in the Notice of
Annual Meeting of Shareholders. The cost of soliciting proxies will be borne by
the Company.
GENERAL
This proxy statement and form of proxy are expected to be mailed to
shareholders on or about April 20, 1996. Only shareholders of record at the
close of business on March 29, 1996, will be entitled to receive notice of, and
vote at, the meeting or any adjournment thereof.
As of the close of business on March 29, 1996, the Company had 7,448,771
outstanding shares of Common Stock, par value $0.20 per share (the "Common
Stock"). Each shareholder of record is entitled to one vote for each share of
Common Stock then held and shall have the right to vote the number of shares so
owned for each proposal and for each director to be elected.
The presence, in person or by proxy, of the holders of a majority of the
shares of Common Stock entitled to vote at the 1996 Annual Meeting of
Shareholders constitutes a quorum for the transaction of business. Any proxy may
be revoked at any time prior to its exercise by notifying the Secretary in
writing, by delivering a duly executed proxy bearing a later date, or by
attending the meeting and voting in person.
If the enclosed proxy is properly executed and returned in time to be voted
at the 1996 Annual Meeting, the shares of Common Stock represented thereby will
be voted in accordance with the instructions marked thereon. Unless instructions
to the contrary are marked thereon, a proxy will be voted "FOR" the matters
listed in the accompanying Notice of Annual Meeting of Shareholders. For
purposes of determining the presence of a quorum for transacting business at the
Meeting, abstentions and broker "non-votes" (that is, proxies from brokers or
nominees indicating that such persons have not received instructions from the
beneficial owner or other persons entitled to vote shares on a particular matter
with respect to which the brokers or nominees do not have discretionary power)
will be treated as shares that are present but which have not been voted.
Directors will be elected by a plurality of the votes cast at the 1996 Annual
Meeting. Provided a quorum is present, abstentions and shares not voted are not
taken into account in determining a plurality. Abstentions and broker
"non-votes" will be voted neither "FOR" nor "AGAINST" the approval of each of
the matters to be voted upon.
<PAGE>
ITEM 1
ELECTION OF DIRECTORS
The Company's directors are elected at each Annual Meeting to serve for a
one-year term, or until their respective successors are elected and qualified.
Eight nominees are to be elected this year to serve until the Annual Meeting in
1997.
In accordance with the Company's Bylaws, the Board of Directors has fixed
the number of directors at eight. Nominees for election to the Board of
Directors are selected by action of the entire Board. Unless contrary
instructions are given, the enclosed proxy will be voted for the eight nominees
named below. Each nominee has consented to be named herein as standing for
election to the Board of Directors and has consented to serve if elected. If any
nominee is unable or unwilling to serve at the time of the election, or is
otherwise unavailable for election, the proxies will have discretionary
authority to vote in accordance with their judgment for any other nominee. The
Board of Directors knows of no reason to anticipate this will occur.
The following table sets forth certain information relating to each nominee
for director to be elected at the 1996 Annual Meeting. All nominees have been
heretofore elected by the shareholders and are standing for re-election as
directors.
<TABLE>
<CAPTION>
NAME, PRINCIPAL
OCCUPATION, BUSINESS EXPERIENCE
DURING LAST FIVE YEARS, POSITIONS AND OFFICES DIRECTOR
OTHER DIRECTORSHIPS AGE WITH THE COMPANY SINCE
<S> <C> <C> <C>
Joseph H. Reich 61 Chairman of the Board 1987
Managing Partner of Centennial Associates, L.P. since April
1989.
John Grosso 49 President, Chief Executive 1987
President and Chief Executive Officer of the Company since 1987. Officer and Director
Stanley Tulchin 69 Director 1987
Mr. Tulchin is, and for at least five years has been, a Director
and Chairman of the Board of Reprise Capital Corporation and
Stanley Tulchin Associates. He has been a Director of the Topps
Company, Inc., since 1987 and Chairman of the Board of STA
Credit Corporation since 1991.
R. Stuart Dickson 66 Director 1983
Chairman of the Executive Committee, Ruddick Corporation;
Chairman of the Board of Ruddick Corporation from 1968 to 1994;
Director of First Union Corporation and Textron, Inc., since
1985 and 1984, respectively, and of United Dominion Industries,
Inc. since 1990, and Dimon Incorporated since 1995.
Peter B. Foreman 60 Director 1994
President of Sirius Corporation since 1994; Founding Partner of
Harris Associates, L.P. from 1976-1993; Director of Eagle Food
Centers, Glacier Water Services, and National Picture and Frame
Company.
George Friedman 61 Director 1994
Chairman and CEO of Parallel Communications, Inc., since 1994.
Chairman and CEO of Gryphon Development Ltd. from 1986 to 1992.
</TABLE>
2
<PAGE>
<TABLE>
<CAPTION>
NAME, PRINCIPAL
OCCUPATION, BUSINESS EXPERIENCE
DURING LAST FIVE YEARS, POSITIONS AND OFFICES DIRECTOR
OTHER DIRECTORSHIPS AGE WITH THE COMPANY SINCE
<S> <C> <C> <C>
Charlotte H. Mason 40 Director 1995
Associate Professor, Kenan-Flagler Business School, The
University of North Carolina since 1985.
Albert F. Sloan 66 Director 1981
Chairman of the Board of Lance, Inc., until 1991; Director of
Bassett Furniture Industries, Inc., and RichFoods, Incorporated
for more than five years; and Cato Corporation since 1994.
</TABLE>
DIRECTORS' REMUNERATION; ATTENDANCE
The Company's policy on director compensation is to pay directors' fees
only to directors who are not employees of the Company. Each nonemployee
director receives a $12,000 flat annual fee, plus $1,000 for serving on one or
more committees plus an additional $1,500 as Chairman for a committee, and the
Chairman of the Board receives $52,000 per annum. Nonemployee directors may
elect yearly to receive payment of all, but not less than all, of their fees for
service as directors in the form of options to purchase the Common Stock of the
Company. Additionally, all directors are reimbursed for expenses incurred in
connection with attending Board and Committee meetings.
During the last fiscal year, there were four regularly scheduled meetings
and two special meetings of the Board of Directors. Each director attended 80%
or more of the total number of meetings of the Board of Directors and meetings
of all Committees on which he or she served.
COMMITTEES OF THE BOARD
AUDIT COMMITTEE. Messrs. Dickson (Chairman), Sloan, and Tulchin served as
members of the Audit Committee during fiscal year 1995. The Audit Committee
makes recommendations to the Board concerning the selection of the independent
accountants of the Company, reviews the scope of the audit, reviews the audit
report, and makes recommendations to the Board concerning accounting principles
and practices, internal controls, financial reporting, and other related
matters. The Audit Committee had one formal meeting during the last fiscal year.
COMPENSATION COMMITTEE. Messrs. Foreman (Chairman), Reich, and Friedman
served as members of the Compensation Committee during fiscal year 1995. The
Compensation Committee has the responsibility for reviewing, monitoring, and
recommending overall compensation plans and policies, including amounts of all
compensation for the Company's directors and officers at or above the level of
Executive Vice President. The Compensation Committee held one formal meeting and
met informally at various times during the last fiscal year.
STOCK OPTION PLAN ADMINISTRATION COMMITTEE. Messrs. Foreman (Chairman),
Reich, and Friedman served as members of the Stock Option Plan Administration
Committee for each of the Company's Stock Option Plans during fiscal year 1995.
The Stock Option Plan Administration Committee, which has the responsibility for
granting options under the Company's Stock Option Plans, met informally at
various times during the last fiscal year to make decisions regarding the grant
of options.
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<PAGE>
STOCK OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
The following table shows the beneficial ownership as of March 29, 1996, of
each person known to the Company to be the beneficial owner of more than 5% of
the outstanding shares of the Company's Common Stock:
<TABLE>
<CAPTION>
AMOUNT
AND
NATURE OF
NAME AND ADDRESS BENEFICIAL PERCENT
TITLE OF CLASS OF BENEFICIAL OWNER OWNERSHIP OF CLASS
<S> <C> <C> <C>
Common Stock, Centennial Associates, L.P. 2,018,957(1) 27.1%
$0.20 par c/o Mr. Joseph H. Reich
value 900 Third Avenue
New York, New York 10022
Common Stock, Mr. Joseph H. Reich 510,350(1) 34.0%(2)
$0.20 par 900 Third Avenue 2,018,957(2)
value New York, New York 10022 2,529,307(1)
Common Stock, Reprise Capital Corporation 633,394(3) 8.3%
$0.20 par c/o Mr. Stanley Tulchin
value 400 Post Avenue
Westbury, New York 11590
Common Stock Furman Selz Incorporated 629,000 8.4%
$0.20 par c/o Ms. Valerie King
value 230 Park Avenue
New York, New York 10169
Common Stock Putnam Investments, Inc. 465,100(4) 6.2%
$0.20 par One Post Office Square
value Boston, Massachusetts 02109
</TABLE>
(1) See Note (4) to the table under "Stock Ownership of Directors and Executive
Officers" below.
(2) Includes Centennial ownership listed above. Joseph H. Reich is deemed the
beneficial owner of shares in Centennial Associates, L.P., due to his
position as Managing Partner of that entity.
(3) Includes certain shares as to which Mr. Tulchin disclaims beneficial
ownership. See Notes (2) and (6) to the table under "Stock Ownership of
Directors and Executive Officers" below.
(4) Certain Putnam investment managers (together with their parent corporations,
Putnam Investments, Inc. and Marsh & McLennan Companies, Inc.), are
considered "beneficial owners" in the aggregate of 465,100 shares, or 6.2%
of shares outstanding, of the Company's voting Common Stock, which shares
were acquired for investment purposes by such investment managers for
certain of their advisory clients.
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<PAGE>
STOCK OWNERSHIP OF DIRECTORS AND EXECUTIVE OFFICERS
The following table shows the beneficial stock ownership as of March 29,
1996 of each of the current directors of the Company and of all directors and
executive officers as a group of the outstanding shares of the Company's Common
Stock, $0.20 par value, which is the only class of voting securities
outstanding. Each of the individuals listed below possesses sole voting and
investment power with respect to the shares listed opposite his or her name,
unless noted otherwise:
<TABLE>
<CAPTION>
AMOUNT AND
NATURE OF
BENEFICIAL PERCENT
NAME OWNERSHIP(1) OF CLASS
<S> <C> <C>
R. Stuart Dickson.............................................. 55,434(2)(3) *
Peter B. Foreman............................................... 271,708(2)(7) 3.6%
George Friedman................................................ 16,700(2) *
John Grosso.................................................... 221,400(2) 2.9%
Charlotte H. Mason............................................. 2,000(2) *
Joseph H. Reich................................................ 2,529,307(4) 34.0%
Albert F. Sloan................................................ 9,650(2)(5) *
Stanley Tulchin................................................ 633,394(2)(6) 8.3%
Jan M. Rivenbark............................................... 58,500(2) *
Eric H. Jeltrup................................................ 109,300(2) 1.5%
Bruce A. Fisher................................................ 72,335(2) 1.0%
R. Michael Spencer............................................. 51,454(2) *
All Executive Officers and Directors as a group
(12 persons listed above).................................... 4,031,182(2) 50.3%
</TABLE>
* Less than 1% of the outstanding shares of Common Stock of the Company.
(1) Pursuant to Rule 13d-3 promulgated under the Securities Exchange Act of
1934, beneficial ownership of a security consists of sole or shared voting
power (including power to vote or direct the vote) and/or sole or shared
investment power (including the power to dispose or direct the disposition)
with respect to the security through any contract, arrangement,
understanding, relationship or otherwise. Unless otherwise indicated,
beneficial ownership disclosed consists of sole voting and investment power.
(2) The numbers and percentages of shares shown in the table above include stock
options covering Common Stock exercisable within 60 days of March 29, 1996
as follows: Mr. Tulchin -- 152,000; Mr. Grosso -- 154,500; Mr.
Rivenbark -- 54,000; Mr. Jeltrup -- 79,000; Mr. Fisher -- 46,500; Mr.
Spencer -- 48,000; Mr. Dickson -- 2,400; Mr. Foreman -- 8,400; Mr.
Friedman -- 7,800; Ms. Mason -- 2,000; and Mr. Sloan -- 7,800; and all
executive officers and directors as a group (including such individuals) --
562,400. Such persons and members of such group disclaim any beneficial
ownership of the shares subject to such options.
(3) Includes (i) 300 shares beneficially owned by Mr. Dickson and (ii) 52,734
shares beneficially owned by a wholly-owned subsidiary of Ruddick
Corporation of which Mr. Dickson is Chairman of the Executive Committee.
(4) Joseph H. Reich, Centennial Associates, L.P., and Carol F. Reich, jointly
reported beneficial ownership of 463,850; 2,018,957; and 46,500 shares,
respectively. It was reported that each of such persons had sole dispositive
power or sole investment power with respect to the shares held individually
by each of them. Such persons have stated that the fact that their
beneficial ownership was reported jointly did not constitute an admission
that each of them should be deemed to be part of a group.
5
<PAGE>
(5) Includes 450 shares beneficially owned by Mr. Sloan's wife as to which he
disclaims beneficial ownership.
(6) Includes (i) 135,591 shares beneficially owned by Mr. Tulchin, (ii) 330,803
shares beneficially owned by Reprise Capital Corporation of which Stanley
Tulchin is Chairman of the Board and he and his brother, Norman Tulchin, are
each 35% equity owners, (iii) 15,000 shares owned by a trust for Jill
Tulchin of which Mr. Tulchin is a trustee and disclaims any beneficial
ownership. His brother, Norman Tulchin, beneficially owns 118,719 shares.
Stanley Tulchin disclaims beneficial ownership of the shares owned by his
brother and by Reprise Capital Corporation.
(7) Mr. Foreman is a limited partner in Centennial Associates, L.P., owning less
than a 5% interest therein. The shares shown exclude any indirect ownership
of the Company's shares which might be attributable to him by reason of his
limited partnership interest.
Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
officers and directors and persons who own more than 10% of the Company's Common
Stock to file reports of ownership and changes in ownership with the Securities
and Exchange Commission ("SEC"). Based on Company records and other information,
the Company believes that all such SEC filing requirements with respect to the
1995 fiscal year were met.
ITEM 2
PROPOSAL TO APPROVE THE
1996 OMNIBUS LONG-TERM COMPENSATION PLAN
On March 6, 1996, the Board of Directors adopted, subject to the approval
of the shareholders, the 1996 PCA International, Inc. Omnibus Long-Term
Compensation Plan (the "Plan"). The Plan is intended to allow the Company
(including its subsidiaries) to attract and retain key employees, to stimulate
the efforts of such employees, and to strengthen their desire to remain with the
Company. In addition, the Plan is intended to aid the Company in attracting
superior individuals to serve as nonemployee directors and in providing
appropriate compensation to such nonemployee directors for their service.
The Plan, if approved, will replace and supersede the Company's 1990
Non-Qualified Stock Option Plan and 1992 Non-Qualified Stock Option Plan, except
with respect to options and shares of Common Stock outstanding under the 1990
and 1992 plans, which will continue to be governed by the terms of such plans.
The maximum amount of shares of Common Stock reserved for issuance under the
Plan is 811,550, the same number of shares as would have been available for
issuance under the 1990 and 1992 plans.
Following is a summary of the material features of the Plan and certain
other information regarding the Plan. A copy of the Plan is available upon
request, at no cost, from the Secretary of the Company at the address set forth
in the accompanying Notice of Annual Meeting. The following discussion does not
purport to be complete and is subject to and qualified in its entirety by
reference to the full text of the Plan.
MATERIAL FEATURES OF THE PLAN
The Plan is designed to give the Board of Directors, acting through a
committee of disinterested, outside directors (the "Committee"), flexibility to
adapt the long-term incentive compensation of key employees to changing business
conditions through a variety of long-term incentive arrangements. Under the
Plan, the Committee may grant Employee Stock Options (including both
non-qualified and "incentive" stock options), Stock Appreciation Rights,
Performance Restricted Stock Awards, Performance Awards and Performance Units
("Awards") to senior level employees of the Company holding positions of
responsibility in managerial,
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<PAGE>
administrative, or professional capacities ("Key Employees"). The Plan also
provides for the grant of options to nonemployee directors upon their election
to the Board and allows the nonemployee directors to elect to take their
remaining compensation as directors in the form of stock options. In addition to
the enumerated incentive compensation Awards, the Committee may establish other
types of Key Employee Awards that it determines are consistent with the Plan's
purposes.
KEY EMPLOYEE STOCK OPTIONS. Under the Plan, the Committee may grant Awards
in the form of non-qualified and incentive stock options to purchase shares of
the Company's Common Stock. The Committee will, for each such stock option,
determine the number of shares subject to the option, the manner and time of the
option's exercise, and the exercise price per share of stock subject to the
option. In no event may the exercise price of a stock option be less than 100%
of the fair-market value of the Company's Common Stock on the date of the grant.
All stock options under the Plan will expire no later than ten years from the
date of the grant, and the exercise price of outstanding options may not be
altered by the Committee. The Plan provides for the grant to Key Employees of
incentive stock options within the meaning of Section 422 of the Internal
Revenue Code, as amended (the "Code").
STOCK APPRECIATION RIGHTS. The Plan authorizes the Committee to grant stock
appreciation rights ("SARs") to Key Employees. An SAR consists of the right to
receive a payment equal to the appreciation in market value of a stated number
of shares of Common Stock from the SAR exercise price to the market value on the
date of its exercise.
The Committee determines the number of shares of the Company's Common Stock
subject to the SARs, the manner and time of the SAR's exercise and exercise
price of the SAR, which exercise price may in no event be less than 100% of the
fair-market value of the Common Stock on the date of grant of the SAR. SARs may
be granted either in tandem with Key Employee stock options or independent of
the grant of such options.
PERFORMANCE RESTRICTED STOCK PROGRAM. The Performance Restricted Stock
Program provides Key Employee participants the opportunity to earn shares of the
Company's Common Stock based upon the achievement of objective goals determined
by the Committee. Under this program, the Committee may establish for any Key
Employee a Target Award for a Performance Cycle, which target is expressed as a
fixed number of shares of restricted Common Stock.
Each Performance Cycle will be one year or longer as set by the Committee.
Within the first 90 days of a Performance Cycle, the Committee will establish
written Performance Goals based on objective business criteria enumerated in the
Plan, including return on shareholders' equity, return on assets, return on
capital, profit margin, earnings per share, net earnings, operating earnings,
Common Stock price per share, and sales or market share. Awards are paid for the
Performance Cycle only if the Performance Goals are attained. At the same time,
the Committee will establish a Performance Formula that will determine, assuming
the Performance Goals for the Performance Cycle are achieved, what percentage of
the participant's Target Award for the Performance Cycle has been earned.
After the close of each Performance Cycle, the Committee will calculate,
based upon application of the Performance Formula to the Performance Goals, what
percentage of the Target Award has been earned for the period, although the
Committee will have the authority to reduce or eliminate an Award based on any
other objective or subjective criteria it deems appropriate.
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<PAGE>
Awards under this program will be paid in restricted Common Stock. Such
stock may not be sold, transferred or encumbered by the participant during the
restriction period established by the Committee, which shall be at least three
years.
Except in the case of a Change in Control, in the event a participant's
employment is terminated prior to completion of a Performance Cycle for any
reason other than death, disability, retirement or another reason approved by
the Committee (an "Approved Reason"), all of the Awards granted to the
participant for such cycle shall be forfeited. In addition, any such termination
(whether or not it occurs during a Performance Cycle) will cause the participant
to forfeit any restricted Common Stock that is subject to an unexpired
restriction period. In the event a participant's employment is terminated due to
death, disability, retirement or an Approved Reason prior to the completion of
such cycle, he or she shall receive, assuming Awards are earned for such cycle,
a pro rata Award based upon his or her employment during the cycle prior to
termination of employment and the participant will be entitled to keep
restricted Common Stock subject to an unexpired restriction period in a pro rata
amount based on the elapsed portion of the restriction period prior to
termination.
PERFORMANCE AWARD PROGRAM. The Performance Award Program is structured
similarly to the Performance Restricted Stock Program, and provides participants
the opportunity to earn Awards in the form of cash or Common Stock, subject to
such restrictions as the Committee determines.
Performance Awards will be based on written objective Performance Goals for
a Performance Period established by the Committee. Awards will be determined by
applying a Performance Formula to the Performance Goals attained in the
Performance Period to determine an Award expressed as a percentage of the
participant's base salary. The Committee will have the authority to reduce or
eliminate Awards in the same manner as under the Performance Restricted Stock
Program. The termination of a participant during a Performance Period will be
treated in the same manner as under the Performance Restricted Stock Program.
PERFORMANCE UNITS. The Plan allows the Committee to grant Awards in the
form of Performance Units, which are units valued by reference to criteria
chosen by the Committee, and which are payable in forms other than the Company's
Common Stock. Performance Units are similar to Performance Restricted Stock
Program Awards in that they are contingently awarded based on the attainment of
certain performance objectives over a fixed period. The length of such period,
the performance objectives to be achieved during the period, and the measure of
whether and to what degree such objectives have been achieved will be determined
by the Committee.
LIMITATION ON AWARDS. The maximum number of shares of Common Stock for
which stock options may be granted to any Key Employee in a calendar year is
20,000. The maximum number of shares of Common Stock for which stock
appreciation rights may be granted to any Key Employee in a calendar year is
20,000. The maximum number of shares of Common Stock for which an Award may be
made under the Performance Restricted Stock Program in any Performance Cycle
(which can in no event be shorter than 1 year) is 5,000. The maximum Award that
may be granted under the Performance Award Program for any Performance Period
(which can in no event be shorter than 1 year) is $100,000 or, in the event the
Performance Award is paid in shares of Common Stock, the Common Stock
equivalent.
DIRECTOR FORMULA OPTIONS AND DEFERRAL OPTIONS. The Plan provides for the
grant, upon a nonemployee director's initial election or appointment as
director, of a Formula Option to purchase 10,000 shares of the Company's Common
Stock at an exercise price of no less than 100% of the fair-market value of the
Company's Common Stock on the date of grant. The formula for the grant of
Formula Options may not be altered by the Committee more often than once every
six months except as necessary to comply with the Code or the
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Employee Retirement Income Security Act. Formula Options may not be exercised
sooner than six months from (i) the date of grant or (ii) the date of
shareholder approval of the Plan, whichever is later. Formula Options become
immediately exercisable upon a director's death, disability, or retirement, or
upon a Change in Control of the Company.
The Plan also provides that nonemployee directors may elect annually to
receive their compensation for service as a director for the following year (not
including reimbursement of expenses) in the form of Deferral Options. Deferral
Options are granted at the commencement of the 12-month period for which the
election has been made. The number of Deferral Options granted to an electing
nonemployee director in any year shall be an amount whose value, as determined
by any generally accepted option pricing model, is equivalent on the date of
grant to the cash compensation which the nonemployee director would otherwise
have been entitled to receive for the year.
In general, Deferral Options become exercisable one year after the date of
grant (or such later date as the Committee shall determine) and are exercisable
at a price equal to the market price of the Company's Common Stock at the close
of business on the day of grant, or the preceding trading day if the date of
grant is not a trading day. Deferral Options become immediately exercisable upon
a director's death, disability, or retirement, or upon a Change in Control of
the Company. If a director's tenure ends for a reason other than death,
disability, retirement, or Change in Control, then the number of Deferral
Options granted for the year in which the tenure ends shall be reduced to
reflect the amount of compensation actually earned by the director in that year.
OTHER TERMS OF AWARDS. Awards may be paid in cash, Common Stock (with
restrictions as determined by the Committee), a combination of cash and Common
Stock, or any other form of property, as the Committee determines. If an Award
is granted in the form of a stock option, restricted stock award, or any other
stock-based grant, the Committee may include as a part of such Award an
entitlement to receive dividends or dividend equivalents. At the discretion of
the Committee, payment of a stock option, restricted stock award, dividend or
dividend equivalent may be deferred by a participant.
The Plan provides for the forfeiture of Awards (other than Formula Options
and Deferral Awards) in the event of termination of employment for a reason
other than death, disability, retirement, or an Approved Reason. The Plan
authorizes the Committee to promulgate administrative guidelines for the purpose
of determining what treatment will be afforded to a participant under the Plan
in the event of his death, disability, retirement, or termination for an
Approved Reason.
Upon the grant of any Award, the Committee may, by way of an Award Notice
or otherwise, establish such other terms, conditions, restrictions and/or
limitations governing the grant of such Award as are not inconsistent with the
Plan.
AVAILABLE SHARES. The maximum amount of Common Stock reserved and available
for issuance under the Plan is 811,550 shares, which number may be adjusted by
the Committee to reflect future stock splits, stock dividends, and other changes
in the capital structure of the Company. Shares of Common Stock related to
Awards that terminate by expiration, forfeiture, cancellation or otherwise
without the issuance of shares, are restored as available for grant under the
Plan.
ELIGIBILITY FOR PARTICIPATION. The selection of Key Employees to
participate in the Plan is within the discretion of the Committee. The Committee
has not determined how many Key Employees will ultimately participate in the
Plan. However, the Committee intends to grant Awards under the Plan to Key
Employees
9
<PAGE>
who the Committee believes can have a significant effect on the growth,
profitability, and success of the Company. There are approximately 100 employees
of the Company from whom the Committee may select participants. Only nonemployee
directors are eligible to receive Formula Options and Deferral Options. There
are currently seven nonemployee directors.
CHANGE IN OWNERSHIP OR CONTROL. For all Awards (other than Formula Options
and Deferral Options, the treatment of which has been discussed above) in the
event of a Change in Control (defined as a change in a majority of directors
resulting from a tender offer, merger or similar transaction), a participant
whose employment is terminated for a reason other than death, disability, cause,
voluntary resignation or retirement, within two years of the date of such event
will be entitled to the following treatment under the Plan: (i) all of the
terms, conditions, restrictions and limitations in effect on any of the
participant's outstanding Awards will immediately lapse, (ii) all of the
participant's outstanding Awards will automatically become 100% vested, (iii)
all of the participant's outstanding stock options, SARs, Common Stock Awards,
unpaid Performance Restricted Stock and Performance Awards and other stock-based
Awards will be immediately paid and (iv) all of the participant's outstanding
Performance Units will be paid.
The Plan also provides that, if the Company's Common Stock ceases to be
actively traded on the exchange or quotation system on which it is then traded,
then all participants, regardless of whether their employment is terminated,
will automatically receive the same treatment afforded to a participant
terminated without cause upon a Change in Control.
PLAN ADMINISTRATION AND TERMINATION. The Committee that administers the
Plan may be either the Compensation Committee of the Board or another committee
designated by the Board, provided, that each of the members of the Committee
must be both a "disinterested director" and an "outside director" as defined
under applicable law. No member of the Committee is eligible to be selected to
participate in the Plan except through Formula Options and Deferral Options.
Among the powers granted to the Committee are the authority to interpret the
Plan, establish rules and regulations for its operation, select Key Employees of
the Company and its subsidiaries to receive Awards, and determine the form and
amount and other terms and conditions of such Awards.
The Plan authorizes the Committee to grant Common Stock Awards to Key
Employees during the period from May 22, 1996 through May 21, 2001; except that
the Committee may grant Awards under the Performance Award Program and
Performance Restricted Stock Program after such date in recognition of
performance for Performance Cycles and Performance Periods commencing prior to
such date. The Committee may suspend or terminate the Plan at any time, with or
without prior notice. In general, the Committee may not make substantive
amendments to the Plan without shareholder approval.
10
<PAGE>
NEW PLAN BENEFITS
No Awards have been made to date under the Plan. Based on options actually
granted under the Company's 1990 and 1992 plans, if the Plan had been in effect
during fiscal year 1995, the following Awards would have been granted:
<TABLE>
<CAPTION>
NAME AND POSITION DOLLAR VALUE ($)(1) NUMBER OF UNITS
<S> <C> <C>
Jan M. Rivenbark............................................................ $54,600 35,000
Executive Vice President
Chief Operating Officer
Eric H. Jeltrup............................................................. $39,000 25,000
Executive Vice President
Chief Technical Officer
Charlotte H. Mason(2)....................................................... $15,600 10,000
Peter B. Foreman(2)......................................................... $ 9,360 6,000
George Freidman(2).......................................................... $ 8,424 5,400
Albert F. Sloan(2).......................................................... $ 8,424 5,400
</TABLE>
(1) Based on closing price of $12.56 per Common Share on March 29, 1996.
(2) Nonemployee director.
FEDERAL INCOME TAX CONSEQUENCES
The following is a brief summary of the principal United States federal
income tax consequences under current federal income tax laws related to Awards
under the Plan. This summary is not intended to be exhaustive and, among other
things, does not describe state or local tax consequences.
STOCK OPTIONS. A participant who is granted an incentive stock option
within the meaning of Section 422 of the Code should not realize any taxable
income at the time of the grant or at the time of exercise. Similarly, the
Company is not entitled to any deduction at the time of grant or at the time of
exercise. If the participant makes no disposition of the shares acquired
pursuant to an incentive stock option before the latter of two years from the
date of grant of such option and one year from the exercise of such option, any
gain or loss realized on a subsequent disposition of the shares will be treated
as a long-term capital gain or loss. Under such circumstances, the Company will
not be entitled to any deduction for federal income tax purposes.
A participant who is granted a non-qualified stock option will not have
taxable income at the time of grant, but will have taxable income at the time of
exercise equal to the difference between the exercise price of the shares and
the market value of the shares on the date of exercise. The Company will be
entitled to a corresponding deduction for the same amount.
OTHER AWARDS. The grant of an SAR has no federal tax consequences for the
participant or the Company. The exercise of an SAR results in taxable income to
the participant equal to the difference between the exercise price of the shares
and the market price of such shares as of the date of exercise and a
corresponding deduction by the Company.
A participant who has been granted either Performance Awards or Performance
Units will not realize taxable income at the time of grant, and the Company will
not be entitled to a deduction at such time. A participant will realize ordinary
income at the time the Award is paid, and the Company will have a corresponding
deduction. If an Award is paid in the form of Common Stock, the participant will
be treated as
11
<PAGE>
having received taxable compensation in an amount equal to the then fair-market
value of the Common Stock distributed to him or her and the Company will receive
a corresponding deduction for the same amount.
A participant who has been granted an Award of restricted shares of Common
Stock will not realize taxable income at the time of grant, and the Company will
not be entitled to a deduction at the time of grant, assuming that the
restrictions constitute a substantial risk of forfeiture for federal income tax
purposes. Generally, when such restrictions lapse, the participant will receive
taxable income in an amount equal to the excess of the fair-market value of the
shares at such time over the amount, if any, paid for such shares. The Company
will be entitled to a corresponding deduction.
LIMITATION ON INCOME TAX DEDUCTION. The Plan has been designed to enable
any Award granted by the Committee under the Plan to a Key Employee to qualify
as "performance-based compensation" under Section 162(m) of the Code. Through
such qualification, the Company can preserve the deductibility of certain
compensation in the event that the annual compensation of a Key Employee exceeds
$1,000,000.
OTHER INFORMATION
The Plan, if approved, will replace and supersede the PCA International,
Inc. 1990 Non-Qualified Stock Option Plan and 1992 Non-Qualified Stock Option
Plan, except with respect to options and shares of Common Stock issued and
outstanding under the 1990 and 1992 plans which will continue to be governed by
the terms of such plans. The Plan shall become effective as of March 6, 1996,
subject to its approval by the shareholders. Approval of the Plan requires the
affirmative vote of a majority of the shares of Common Stock present or
represented by proxy and entitled to vote at the Meeting.
FOR THE REASONS SET FORTH ABOVE, THE BOARD UNANIMOUSLY RECOMMENDS A VOTE
"FOR" THE APPROVAL OF THE PLAN.
ITEM 3
RATIFICATION OF APPOINTMENT OF INDEPENDENT ACCOUNTANTS
The Board of Directors has recommended that KPMG Peat Marwick LLP, which
firm has been the independent accountants of the Company since 1990, be
continued as the Company's independent accountants for the fiscal year ending
February 2, 1997. Services provided to the Company and its subsidiaries by KPMG
Peat Marwick LLP with respect to fiscal year 1995 included the examination of
the Company's consolidated financial statements, limited reviews of quarterly
reports, services related to filings with the Securities and Exchange
Commission, and consultations on various tax and accounting matters.
Representatives of KPMG Peat Marwick LLP will be present at the Annual Meeting
to respond to appropriate questions and to make such statements as they may
desire.
THE BOARD OF DIRECTORS RECOMMENDS THAT SHAREHOLDERS VOTE "FOR" RATIFICATION
OF THE APPOINTMENT OF KPMG PEAT MARWICK LLP AS THE COMPANY'S INDEPENDENT
ACCOUNTANTS FOR THE 1996 FISCAL YEAR.
12
<PAGE>
ITEM 4
OTHER BUSINESS
OTHER MATTERS TO BE PRESENTED
As of the date of this proxy statement, the only business which the Board
of Directors intends to present, and knows that others will present, at the
meeting is that hereinabove set forth. If any other matter or matters are
properly brought before the meeting or any adjournments or postponements
thereof, the persons named in the accompanying form of proxy will vote the proxy
on such matters in accordance with their best judgment.
REPORT OF THE COMPENSATION AND STOCK OPTION PLAN ADMINISTRATION COMMITTEES
The Company's executive compensation and incentive programs are designed to
attract and retain able and talented executives who can build shareholder value
and accelerate the growth of the Company.
The Compensation Committee believes the best interests of the shareholders
are served if a significant portion of the compensation paid to the Company's
executive group is directly dependent upon annual and long-term Company
performance. This approach links executive remuneration more closely to gains
enjoyed by the Company's shareholders. Accordingly, compensation of the
Company's executives is divided into three components: annual base salary,
annual cash bonuses, and long-term incentive compensation.
The largest component of the Company's executive compensation program is
cash compensation in the form of a base salary. Each year, the Compensation
Committee reviews the base salary levels for the executive group and recommends
annual salaries to the Board of Directors. The Committee subjectively considers
each executive's individual achievements during the prior year and Company
performance factors such as achievement of the prior year's financial targets,
and goals for the coming year with respect to sales, growth, earnings, income
from operations, earnings per share, and return on capital. The Committee also
considers, both directly and through the use from time-to-time of independent
compensation consultants, the compensation levels of executives of industry
competitors and other companies similar to the Company (in terms of size, nature
of business, and geographic location) with which the Company competes for
executive talent. The Committee may also take into account anticipated future
responsibilities, and employee loyalty and continuity of service. The
Compensation Committee believes the level of base salaries for senior executives
is equivalent to or lower than salaries of executives with similar
responsibilities for competing companies.
Annual cash bonuses are intended to reward executives for positive
performance in any given year. The annual cash bonus compensation for executives
for each fiscal year is established by the Compensation Committee, subject to
Board approval, after the results for such year are known. Cash bonuses are
based on targets established for each executive at the commencement of each
fiscal year. Approximately fifty percent of the target bonus payment is based on
the Committee's subjective evaluation of individual performance during the year,
and such compensation is discretionary in the judgment of the Committee and the
Board. The remaining fifty percent of the target bonus payment is based on
attainment of Company-wide financial objectives. These bonus criteria are
established separately for each executive, and no standard relative weights are
given to any of the above factors.
The Company has used stock options as its primary incentive for long-term
commitment, although the Board may consider other forms of long-term incentive
compensation in the future. The Board believes that the use of stock-based
incentives helps to align the interests of the Company's executives with those
of its shareholders because of the direct link created between shareholder value
and the value of each optionee's investment in the Company. Stock-based
long-term incentive compensation encourages executives to take a
13
<PAGE>
shareholder-oriented view of the impact of their decisions and actions. The
Stock Option Plan Administration Committee has the responsibility for
identifying the optionees to receive grants and establishing terms of the
options, including the conditions for exercise and the amount of the exercise
price. Normally, the number of shares subject to a stock option granted to a
particular executive or employee depends upon past performance of the optionee
and the position held by the optionee. At this time, the Stock Option Plan
Administration Committee and the Board have made the determination, based in
part upon the recommendation of an independent compensation consulting firm,
that the number of options already granted and outstanding to the directors,
executives and other employees of the Company is adequate to create the desired
long-term incentives.
Regulations of the SEC require the Compensation Committee and the Stock
Option Plan Administration Committee to disclose their bases for compensation
reported for Mr. Grosso, the Chief Executive Officer, in 1995 and to discuss the
relationship between the Company's performance during the last fiscal year and
Mr. Grosso's compensation.
The Compensation Committee has followed the philosophy described above in
determining Mr. Grosso's compensation. During fiscal year 1995, Mr. Grosso's
base salary was increased 3.8% over his base salary for 1994. This moderate
increase reflected a combination of the relatively modest financial performance
of the Company in 1994 and Mr. Grosso's substantial efforts during 1994 in
restructuring the Company's top management roles, his greater emphasis on longer
term, strategic planning for the Company's business, and his leadership in
better positioning the Company to take full advantage of its technological
capabilities. In considering Mr. Grosso's annual bonus to be paid in 1996 in
respect of performance in fiscal year 1995, the Committee has considered both
the Company's strong financial performance for 1995 and Mr. Grosso's successful
and continuing efforts in diversifying the business of the Company and improving
its competitive position. This diversification effort was the principal
subjective criterion for Mr. Grosso's annual bonus compensation. The Stock
Option Plan Administration Committee did not grant any stock options to Mr.
Grosso in fiscal year 1995.
The above report is presented by the nonemployee directors who compose the
Compensation Committee and the Stock Option Plan Administration Committee.
Peter B. Foreman Joseph H. Reich George Friedman
14
<PAGE>
The tables that follow reflect the decisions included in this report:
I. SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG-TERM COMPENSATION
ANNUAL COMPENSATION AWARDS PAYOUTS
OTHER ANNUAL RESTRICTED OPTIONS LTIP
FISCAL SALARY BONUS COMPENSATION STOCK AWARDS NO. OF PAYOUTS
NAME AND PRINCIPAL POSITION YEAR ($) ($) ($) ($) SHARES ($)
<S> <C> <C> <C> <C> <C> <C> <C>
John Grosso 1995 $228,881 $68,664 0
President 1994 $220,644 $ 0 25,000
Chief Executive Officer 1993 $208,125 $ 1,250 25,000
Jan M. Rivenbark 1995 $186,500 $55,950 35,000
Executive Vice President 1994 $168,533 $28,160 $ 3,529(2) 15,000
Chief Operating Officer 1993 $155,000 $ 1,250 $ 20,117(2) 20,000
Eric H. Jeltrup 1995 $186,500 $55,950 25,000
Executive Vice President 1994 $172,000 $46,000 15,000
Chief Technical Officer 1993 $152,350 $ 1,250 20,000
Bruce A. Fisher 1995 $148,750 $44,625 0
Senior Vice President 1994 $137,767 $23,200 10,000
Chief Financial Officer 1993 $123,375 $ 1,250 15,000
R. Michael Spencer 1995 $138,638 $27,728 0
Senior Vice President 1994 $133,412 $21,528 0
Treasurer 1993 $123,375 $ 1,250 15,000
<CAPTION>
ALL OTHER
COMPENSATION
NAME AND PRINCIPAL POSITION ($)(1)
<S> <C>
John Grosso $6,900
President $4,872
Chief Executive Officer $4,842
Jan M. Rivenbark $6,900
Executive Vice President $4,872
Chief Operating Officer $1,551
Eric H. Jeltrup $6,900
Executive Vice President $4,872
Chief Technical Officer $3,545
Bruce A. Fisher $6,843
Senior Vice President $4,453
Chief Financial Officer $2,871
R. Michael Spencer $6,377
Senior Vice President $4,330
Treasurer $2,871
</TABLE>
(1) Company's portion of Profit Sharing Plan contribution
(2) Relocation cost reimbursed by the Company
II. OPTION GRANT TABLE
OPTIONS GRANTED IN THE LAST FISCAL YEAR AND POTENTIAL REALIZABLE VALUES
<TABLE>
<CAPTION>
POTENTIAL
REALIZABLE VALUE
INDIVIDUAL GRANTS AT ASSUMED ANNUAL
% OF RATES OF
TOTAL OPTIONS TOTAL STOCK PRICE
GRANTED OPTIONS EXERCISE OR APPRECIATION FOR
IN FISCAL YEAR GRANTED BASE PRICE EXPIRATION OPTION TERM(2)
NAME (#) (1) IN FISCAL YEAR ($/SH) DATE 5% ($) 10% ($)
<S> <C> <C> <C> <C> <C> <C>
Jan M. Rivenbark.................... 35,000 17.5% $ 11.00 5/24/2005 $192,500 $385,000
Eric H. Jeltrup..................... 25,000 12.5% $ 11.00 5/24/2005 $137,500 $275,000
</TABLE>
(1)The options vest pro rata over a five-year period from the date of grant, May
24, 1995.
(2)These values are hypothetical; there is no assurance that the stock will
achieve these rates of appreciation.
15
<PAGE>
III. OPTIONS EXERCISED AND YEAR-END VALUE TABLE
AGGREGATED OPTIONS EXERCISED IN THE LAST FISCAL YEAR AND FISCAL YEAR-END OPTION
VALUES
<TABLE>
<CAPTION>
NUMBER OF VALUE OF UNEXERCISED
UNEXERCISED OPTIONS HELD IN-THE-MONEY OPTIONS HELD
SHARES ACQUIRED VALUE AT JANUARY 28, 1996 AT JANUARY 28, 1996
ON EXERCISE REALIZED EXERCISABLE/ EXERCISABLE/
NAME (#) ($) UNEXERCISABLE (#) UNEXERCISABLE ($)(1)
<S> <C> <C> <C> <C>
John Grosso 0 $ 0 135,000/ $ 231,000/
54,500 $ 0
Jan M. Rivenbark 0 $ 0 47,000/ $ 0/
77,000 $ 0
Eric H. Jeltrup 0 $ 0 74,000/ $ 330,000/
49,000 $ 0
Bruce A. Fisher 5,000 $38,542 46,500/ $ 84,333/
20,000 $ 0
R. Michael Spencer 0 $ 0 48,000/ $ 110,000/
12,000 $ 0
</TABLE>
(1)Based on closing price of $9.00 per Common Share on January 28, 1996.
IV. COMPARISON OF FIVE-YEAR CUMULATIVE TOTAL RETURN
AMONG PCA INTERNATIONAL, INC.
NASDAQ U.S. AND NASDAQ NON-FINANCIAL INDICES
(Performance Graph appears here. The plot points are listed in the
table below.)
Jan 91 Jan 92 Jan 93 Jan 94 Jan 95 Jan 96
NASDAQ U.S. 100 153 173 199 190 268
NASDAQ Non-Financial 100 152 161 187 173 240
PCA International, Inc. 100 266 286 170 154 155
Assumes $100 invested on January 31, 1991, in PCA Common Stock, NASDAQ U.S.
Index and NASDAQ Non-Financial Index.
Total Return assumes reinvestment of dividends.
There are 12 industry peer group indices developed for NASDAQ by the Center
for Research in Securities Prices at the University of Chicago. The
Non-Financial Index includes PCA International, Inc.
16
<PAGE>
SHAREHOLDERS' PROPOSALS
If a shareholder intends to present a proposal at the 1997 Annual Meeting
of Shareholders of the Company, such a proposal, if otherwise eligible for
inclusion in Management's proxy statement under the rules promulgated by the
Securities and Exchange Commission, must be received at the Company's principal
executive offices shown on the first page of this proxy statement no later than
December 15, 1996, in order to be included in Management's proxy statement for
that meeting.
SOLICITATION
The expenses of the solicitation of proxies, including the costs of
preparing and distributing the proxy materials, the handling and tabulation of
proxies received and charges of brokerage houses and other institutions,
nominees or fiduciaries in forwarding such documents to beneficial owners, will
be paid by the Company. In addition to the mailing of proxy materials,
solicitation may be made in person or by telephone or facsimile by directors,
officers or regular employees of the Company, or by other persons who may be
engaged to perform soliciting activities. The Company presently plans to engage
Wachovia Bank of North Carolina, N.A., to assist in the soliciting of proxies
from street name holders of shares. The anticipated cost is approximately
$5,000.
ADDITIONAL INFORMATION AVAILABLE ON REQUEST
THE COMPANY WILL PROVIDE WITHOUT CHARGE TO EACH PERSON SOLICITED BY THIS
PROXY STATEMENT, ON THE WRITTEN REQUEST OF ANY SUCH PERSON, A COPY OF THE
COMPANY'S ANNUAL REPORT ON FORM 10-K (INCLUDING THE FINANCIAL STATEMENTS AND THE
SCHEDULES THERETO) AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION FOR THE
COMPANY'S MOST RECENT FISCAL YEAR. SUCH WRITTEN REQUESTS SHOULD BE DIRECTED TO
MR. BRUCE A. FISHER, PCA INTERNATIONAL, INC., 815 MATTHEWS-MINT HILL ROAD,
MATTHEWS, NORTH CAROLINA 28105.
By order of the Board of Directors,
Bruce A. Fisher
Senior Vice President and Secretary
April 20, 1996
17
<PAGE>
*****************************************************************************
APPENDIX
PCA INTERNATIONAL, INC. PROXY
815 MATTHEWS-MINT HILL ROAD
MATTHEWS, NORTH CAROLINA 28105
PROXY FOR ANNUAL MEETING OF SHAREHOLDERS
MAY 22, 1996
THE UNDERSIGNED hereby appoints JOHN GROSSO and BRUCE A. FISHER, and each of
them, proxy, with full power of substitution, to vote all the shares the
undersigned is entitled to vote at the annual Meeting of Shareholders of PCA
INTERNATIONAL, INC. to be held on May 22, 1996 at 10:00 A.M. at the Company's
principal executive offices located at 815 Matthews-Mint Hill Road, Matthews,
North Carolina, and at any adjournment or postponement thereof, and to take
action on the proposals listed hereon and any other business that may lawfully
come before the meeting, hereby revoking all proxies as to said shares
heretofore given by the undersigned and ratifying and confirming all that said
proxy may lawfully do by virtue hereof.
UNLESS A CONTRARY DIRECTION IS INDICATED, THIS PROXY WILL BE VOTED "FOR" ALL
NOMINEES AND PROPOSALS LISTED HEREIN. IF SPECIFIC INSTRUCTIONS ARE INDICATED,
THIS PROXY WILL BE VOTED IN ACCORDANCE THEREWITH.
In his discretion, each Proxy is authorized to vote upon such other business
as may properly come before the meeting or any adjournment or postponement
thereof.
The Board of Directors recommends a vote FOR all nominees, FOR the Company's
1996 Omnibus Long-Term Compensation Plan, and FOR the proposal to ratify the
selection of KPMG Peat Marwick LLP as Independent Auditors.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS.
- - -------------------------------------------------------------------------------
1. ELECTION OF DIRECTORS (for all nominees listed, except as marked to the
contrary).
TO ELECT EACH OF THE EIGHT NOMINEES LISTED BELOW TO SERVE UNTIL THE 1997
ANNUAL MEETING OF SHAREHOLDERS OR UNTIL THEIR SUCCESSORS ARE ELECTED AND
QUALIFIED: FOR [ ] WITHHOLD AUTHORITY [ ]
R. Stuart Dickson, Peter B. Foreman, George Friedman, John Grosso, Charlotte
H. Mason, Joseph H. Reich, Albert F. Sloan, Stanley Tulchin.
(INSTRUCTION: To withhold authority to vote for any individual nominee,
write that nominee's name in the space below.)
WITHHOLD AUTHORITY FOR:_____________________________________________________
(CONTINUED AND TO BE SIGNED ON THE OTHER SIDE)
- - -------------------------------------------------------------------------------
2. TO APPROVE THE 1996 OMNIBUS LONG-TERM COMPENSATION PLAN:
FOR [ ] AGAINST [ ] ABSTAIN [ ]
3. TO RATIFY THE SELECTION OF KPMG PEAT MARWICK LLP AS INDEPENDENT AUDITORS:
FOR [ ] AGAINST [ ] ABSTAIN [ ]
Dated: ______________________, 1996
____________________________________
(Signature of Shareholder)
____________________________________
(Signature of Shareholder)
(Please sign exactly as name appears
on left. Joint owners should each
sign. Executors, administrators,
trustees, etc., should so indicate
when signing.)
The above-signed hereby acknowledges
receipt of the Notice of Annual
Meeting of Shareholders and the Proxy
Statement furnished therewith.
<PAGE>
