<PAGE>
Registration No. 333-
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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Form S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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PCA INTERNATIONAL, INC.
(Exact name of registrant, as specified in its charter)
North Carolina 56-0888429
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
815 Matthews-Mint Hill Road
Matthews, North Carolina 28105
(704) 847-8011
(Address of principal executive officers)
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PCA International, Inc.
1996 Omnibus Long-Term Compensation Plan
(Full title of the plan)
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Bruce A. Fisher
815 Matthews-Mint Hill Road
Matthews, North Carolina 28105
(Name and address of agent for service)
(704) 847-8011
(Telephone number, including area code, of agent for service)
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CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
Proposed
Amount to maximum Proposed maximum
Title of securities be offering price per aggregate offering Amount of
to be registered registered unit (1) price (2) registration fee
<S> <C> <C> <C> <C>
Common Stock ($0.20 par value) 811,550 $16.13 (2) $13,086,244 (2) $4,512
shs. (1)
</TABLE>
(1) Consists of 811,550 shares reserved for issuance pursuant to the
PCA International, Inc. Omnibus Long-Term Compensation Plan. This
registration statement also relates to such indeterminate number of
additional shares of Common Stock of PCA International, Inc. as may
be issuable as a result of stock splits, stock dividends or
additional similar transactions.
(2) In accordance with Rule 457(h)(1) of Regulation C, the price for
the shares is computed on the basis of the average high and low
prices for the Common Stock on May 17, 1996 as reported on the
NASDAQ National Market System.
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<PAGE>
PART I
INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS
Item 1. Plan Information
The information specified in Item 1 will be sent or given to
employees and nonemployee directors as specified in Rule 428(b)(1) and
is not required to be filed as part of this Registration Statement.
Item 2. Registrant Information and Employee Plan Annual Information.
The information specified in Item 2 will be sent or given to
employees and nonemployee directors as specified in Rule 428(b)(1) and
is not required to be filed as a part of this Registration Statement.
<PAGE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference.
The following documents previously filed by PCA International,
Inc. (the "Corporation") with the Securities and Exchange Commission
(the "Commission") are incorporated herein by reference:
(a) Annual Report on Form 10-K for the year ended January
28, 1996;
(b) All other reports filed pursuant to Section 13 or
15(d) of the Securities Exchange Act of 1934 (the "Exchange Act") since
the end of the fiscal year covered by the annual report referred to in
(a) above; and
(c) The description of the Corporation's Common Stock
contained in the Corporation's registration statement filed under the
Exchange Act on Form 8-A, (SEC File No. 0-8550), including any amendment
or report filed for the purpose of updating such description.
In addition, all documents filed by the Corporation pursuant to
Sections 13(a), 13(c), 14, or 15(d) of the Exchange Act subsequent to
the date of this Registration Statement, and prior to the filing of a
post-effective amendment which indicates that all securities offered
hereby have been sold or which 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. Any statement contained in a document incorporated
or deemed to be incorporated by reference herein shall be deemed to be
modified or superseded for purposes of this Registration Statement to
the extent that a statement contained herein or in any other
subsequently filed document which also is or is deemed to be
incorporated by reference herein modifies or supersedes such statement.
Any such statement so modified or superseded shall not be deemed, except
as so modified or superseded, to constitute part of this Registration
Statement.
Item 4. Description of Securities
Not applicable.
Item 5. Interest of Named Experts and Counsel
Not applicable.
Item 6. Indemnification of Directors and Officers.
Section 55-2-02 of the North Carolina Business Corporation Act (the
"Business Corporation Act") enables a corporation in its articles of
incorporation to eliminate or limit, with certain exceptions, the
personal liability of a director for monetary damages for breach
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<PAGE>
of duty as a director. No such provision is effective to eliminate or
limit a director's liability for (i) acts or omissions that the director
at the time of the breach knew or believed to be clearly in conflict
with the best interests of the corporation, (ii) improper distributions
as described in Section 55-8-33 of the Business Corporation Act, (iii)
any transaction from which the director derived an improper personal
benefit or (iv) acts or omissions occurring prior to the date the
exculpatory provision became effective. The Corporation's articles of
incorporation limit the personal liability of its directors to the
fullest extent permitted by the Business Corporation Act.
Sections 55-8-50 through 55-8-58 of the Business Corporation Act
permit a corporation to indemnify its directors, officers, employees or
agents under either or both a statutory or nonstatutory scheme of
indemnification. Under the statutory scheme, a corporation may, with
certain exceptions, indemnify a director, officer, employee or agent of
the corporation who was, is, or is threatened to be made, a party to any
threatened, pending or completed legal action, suit or proceeding,
whether civil, criminal, administrative, or investigative because of the
fact that such person was or is a director, officer, agent or employee
of the corporation, or is or was serving at the request of such
corporation as a director, officer, employee or agent of another
corporation or enterprise. This indemnity may include the obligation to
pay any judgment, settlement, penalty, fine (including an excise tax
assessed with respect to an employee benefit plan) or reasonable
expenses incurred in connection with a proceeding (including counsel
fees), but no such indemnification may be granted unless such director,
officer, employee or agent (i) conducted himself in good faith, (ii)
reasonably believed (1) that any action taken in his official capacity
with the corporation was in the best interests of the corporation or (2)
that in all other cases his conduct was not opposed to the corporation's
best interests, and (iii) in the case of any criminal proceeding, had no
reasonable cause to believe his conduct was unlawful. Whether a
director has met the requisite standard of conduct for the type of
indemnification set forth above is determined by the board of directors,
a committee of directors, special legal counsel or the shareholders in
accordance with Section 55-8-55 of the Business Corporation Act. A
corporation may not indemnify a director under the statutory scheme in
connection with a proceeding by or in the right of the corporation in
which a director was adjudged liable to the corporation or in connection
with any other proceeding in which a director was adjudged liable on the
basis of having received an improper personal benefit.
In addition to, and notwithstanding the conditions of and
limitations on, the indemnification described above under the statutory
scheme, Section 55-8-57 of the Business Corporation Act permits a
corporation to indemnify, or agree to indemnify, any director or officer
against liability and expenses (including counsel fees) in any
proceeding (including proceedings brought by or on behalf of the
corporation ) arising out of the person's status as such or the person's
activities in such capacities, except for any liabilities or expenses
incurred on account of activities that were, at the time taken, known or
believed by the person to be clearly in conflict with the best interests
of the corporation. Because the Corporation's bylaws provide for
indemnification to the fullest extent permitted under the Business
Corporation Act, the registrant may indemnify its directors, officers,
employees and agents in advance with either the statutory or
nonstatutory standard.
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<PAGE>
Sections 55-8-52 and 55-8-56 of the Business Corporation Act require
a corporation, unless its articles of incorporation provide otherwise,
to indemnify a director or officer who has been wholly successful, on
the merits or otherwise, in the defense of any proceeding to which such
director or officer was, or was threatened to be, made a party because
he is or was a director or officer of the corporation. Unless
prohibited by the articles of incorporation, a director or officer who
is a party to a proceeding also may apply for and obtain court-ordered
indemnification, as provided in Sections 55-8-54 and 55-8-56, if the
court determines that such director or officer is entitled to the
mandatory indemnification as described above or is fairly and reasonably
entitled to indemnification in view of all the relevant circumstances,
whether or not he met the standard of conduct required for statutory
indemnification under Section 55-8-51 or was held liable to the
corporation in a proceeding by or in the right of the corporation
(except that a director held so liable to the corporation may recover
only reasonable expenses incurred).
Additionally, Section 55-8-57 of the Business Corporation Act
authorizes a corporation to purchase and maintain insurance on behalf of
an individual who is or was a director, officer, employee or agent of
the corporation against certain liabilities incurred by such persons,
whether or not the corporation is otherwise authorized by the Business
Corporation Act to indemnify such persons. The Corporation has obtained
policies insuring itself and its directors and officers to the extent
that the Corporation may be required or permitted to indemnify directors
or officers against certain liabilities arising from acts or omissions
in the discharging of their duties.
Item 7. Exemption from Registration Claimed
Not Applicable.
Item 8. Exhibits.
See the Exhibit Index on page 7.
Item 9. Undertakings.
(a) The undersigned Registrant hereby undertakes as follows:
(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 (the "Act");
(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;
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(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 (i) and (ii) do not apply if the
information required to be included in the 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 Exchange Act
that are incorporated by reference in this 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.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered that 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 Exchange Act (and, where applicable, each filing
of an employee benefit plan's annual report pursuant to Section 15(d) of
the Exchange Act) that is incorporated by reference in this 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;
and
(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.
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<PAGE>
SIGNATURES
The Registrant. Pursuant to the requirements of the Securities Act
of 1933, the Registrant certifies that it has reasonable grounds to
believe it meets all 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 Charlotte,
State of North Carolina on May 22, 1996.
PCA INTERNATIONAL, INC.
By: _____________________________
John Grosso
President 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.
Signature Title Date
______________________________ Chairman of the Board May 22, 1996
Joseph H. Reich
Director (Principal
______________________________ Executive Officer)
John Grosso
Senior Vice President
______________________________ Chief Financial Officer May 22, 1996
Bruce A. Fisher Secretary (Principal
Financial Officer and
Accounting Officer)
______________________________ Director May 22, 1996
R. Stuart Dickson *
______________________________ Director May 22, 1996
Peter B. Foreman *
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<PAGE>
______________________________ Director May 22, 1996
George Friedman *
______________________________ Director May 22, 1996
Charlotte H. Mason *
______________________________ Director May 22, 1996
Albert F. Sloan *
______________________________ Director May 22, 1996
Stanley Tulchin *
*By John Grosso, Attorney-in-Fact, pursuant to Power of Attorney
attached as Exhibit 24.1 hereto.
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EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit Filed Herewith (*) or
Number Description Incorporated by Reference to
<S> <C> <C>
4.1 Certificate of Incorporation for the Corporation Exhibit 4(b) to Registration
Statement on Form S-2
(No. 33-50738)
4.2 By-Laws of the Corporation as amended Exhibit 3.4 to the Registrant's
through May 29, 1992 Quarterly Report on Form10Q
for the Quarter ended May 3, 1992
4.3 PCA International, Inc. 1996 Omnibus *
Long-Term Compensation Plan
5.1 Opinion of Robinson, Bradshaw & Hinson, P.A. *
as to the legality of the securities
registered
23.1 Consent of KMPG Peat Marwick LLP *
24.1 Powers of Attorney for Directors signing *
this Registration Statement
</TABLE>
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PCA INTERNATIONAL, INC.
1996 OMNIBUS LONG-TERM COMPENSATION PLAN
ARTICLE 1 - PURPOSE AND TERM OF PLAN
1.1 Purpose. The purposes of the Plan are to aid PCA International,
Inc. ("PCA International") and its Subsidiaries (PCA International, Inc.
and its Subsidiaries collectively being referred to herein as the
"Company") in attracting and retaining Key Employees through a
competitive compensation package, to stimulate the efforts of such Key
Employees and to strengthen their desire to remain with the Company, to
aid the Company in attracting superior individuals to serve as
Nonemployee Directors and to provide appropriate compensation to such
Nonemployee Directors for their Service. Toward these objectives, the
Committee may grant Employee Stock Options, stock appreciation rights,
Performance Restricted Stock Awards, Performance Awards payable in
Common Stock or cash, performance units, and other incentive Awards to
Key Employees on the terms and subject to the conditions set forth in
the Plan. In addition, the Plan provides for the grant of options to
Nonemployee Directors as part of such Nonemployee Directors' annual
compensation and that such Nonemployee Directors may elect to take their
remaining compensation in the form of options.
1.2 Term. The Plan replaces and supersedes 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 such 1990 Non-Qualified Stock Option Plan and 1992
Non-Qualified Stock Option Plan 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 of PCA International
at the 1996 Annual Meeting of the shareholders. No Awards shall be
exercisable or payable before approval of the Plan has been obtained
from PCA International's shareholders. Awards shall not be granted
pursuant to Articles 7, 8, 9, 10 or 11 of the Plan after May 21, 2001;
except that the Committee may grant Awards after such date in
recognition of performance for Performance Cycles and Performance
Periods commencing prior to such date.
ARTICLE 2 - DEFINITIONS
2.1 Approved Reason. "Approved Reason" means a reason for terminating
employment with the Company that, in the opinion of the Committee, is in
the best interests of the Company, as determined by the Committee on a
case-by-case basis in its sole discretion.
2.2 Award. "Award" means any form of stock option, stock appreciation
right, performance unit, Performance Award payable in cash or shares of
Common Stock, shares of Performance Restricted Stock under the
Performance Restricted Stock Program, or other incentive Award granted
under the Plan, whether singly, in combination, or in tandem, to a
Participant by the Committee pursuant to such terms, conditions,
restrictions, and limitations, if any, as the
<PAGE>
Committee may establish by the Award Notice or otherwise, and any
Formula Option or Deferral Option.
2.3 Award Notice. "Award Notice" means a written notice from the
Company to a Participant that establishes the terms, conditions,
restrictions, and limitations applicable to an Award in addition to
those established by this Plan and by the Committee's exercise of its
administrative powers.
2.4 Award Payment Date. "Award Payment Date" means, for a Performance
Cycle or Performance Period, the date the Awards for such Performance
Cycle or Performance Period shall be paid to Participants. The Award
Payment Date for a Performance Cycle or Performance Period shall occur
as soon as administratively possible following the completion of the
certifications required pursuant to Subsection 9.5.3, in the case of a
Performance Cycle, and Subsection 10.5.3, in the case of a Performance
Period.
2.5 Board. "Board" means the Board of Directors of PCA International.
2.6 Cause. "Cause," in the case of a Key Employee, means (a) the
willful and continued failure by an Employee to substantially perform
his or her duties with his or her employer after written warnings
identifying the lack of substantial performance are delivered to the
Employee by his or her employer to specifically identify the manner in
which the employer believes that the Employee has not substantially
performed his or her duties, or (b) the willful engaging by an Employee
in illegal conduct that is materially and demonstrably injurious to PCA
International or a Subsidiary.
"Cause" means, in the case of a Nonemployee Director, termination of
such Nonemployee Director's Service by PCA International's shareholders
for cause pursuant to the Bylaws of PCA International.
2.7 CEO. "CEO" means the Chief Executive Officer of PCA International.
2.8 Change In Control. "Change In Control" means, (i) as the result of
a tender offer, merger, consolidation, sale of assets, or any
combination of such transactions, the persons who were members of the
Board immediately before the transaction cease to constitute at least a
majority thereof, and (ii) such occurrence would be a change of control
of the Company of a nature that such event would be required to be
reported in response to Item 1(a) of the Current Report on Form 8-k, as
in effect on the date hereof, promulgated pursuant to Section 13 of the
Exchange Act (whether or not the Company is required to file such a
report).
2.9 Change In Control Price. "Change In Control Price" means the
merger or tender price paid for a share of Common Stock upon a Change of
Control.
2.10 Change In Ownership. "Change In Ownership" means a Change In
Control that results directly or indirectly in the Common Stock ceasing
to be actively traded on the primary
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securities exchange or quotation system on which the Common Stock is
traded immediately prior to such Change in Control.
2.11 Code. "Code" means the Internal Revenue Code of 1986, as amended
from time to time, including regulations thereunder and successor
provisions and regulations thereto.
2.12 Committee. "Committee" means the Compensation Committee of the
Board, unless and until its members are not qualified to serve on the
Committee pursuant to the provisions of the Plan, in which case the
Board will designate the members of the Committee; provided that the
Committee shall at all times consist of two or more Directors, each of
whom is both a "disinterested person" within the meaning of Rule 16b-3
under the Exchange Act and an "outside director" within the meaning of
the definition of such term as contained in Treasury Regulation Section
1.162-27(e)(3), or any successor definition; provided further that no
Director shall be appointed a member of the Committee who has received
any Award other than an Award under Article 12 in the year prior to such
appointment; provided further that no Committee member may receive an
Award other than pursuant to Article 12.
2.13 Common Stock. "Common Stock" means Common Stock, $.20 par value
per share, of PCA International, which may be newly issued, treasury
stock, shares issued and outstanding or shares owned by a Subsidiary.
2.14 Company. "Company" means PCA International and its Subsidiaries.
2.15 Covered Employee. "Covered Employee" means an Employee who is a
"Covered Employee" within the meaning of Section 162(m) of the Code.
2.16 Deferral Stock Option. "Deferral Stock Option" means an award of
stock options to a Nonemployee Director pursuant to the election of such
Nonemployee Director to receive such stock option in lieu of cash
compensation in accordance with Subsection 12.3 of this Plan.
2.17 Director. "Director" means a director of PCA International.
2.18 Disability. "Disability," in the case of a Key Employee, means a
disability under the terms of the PCA International long-term disability
plan maintained by the Company or any successor plan thereto.
2.19 Disability. "Disability," in the case of a Nonemployee Director,
means the permanent and lasting inability, by reason of physical or
mental infirmity, or both, of an employee to perform his or her duties
as Director. Such Disability shall be determined exclusively by the
Board, with or without reference to the certificate of a qualified
physician.
2.20 Effective Date. "Effective Date" means the date an Award is
determined to be effective by the Committee upon its grant of such
Award.
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<PAGE>
2.21 Employee. "Employee" means either (a) a salaried employee of PCA
International or (b) a salaried employee of a Subsidiary.
2.22 Employee Stock Option. "Employee Stock Option" means an Award
granted to a Key Employee in the form of a stock option pursuant to
Article 7.
2.23 Exchange Act. "Exchange Act" means the Securities Exchange Act of
1934, as amended from time to time, including rules thereunder and
successor provisions and rules thereto.
2.24 Formula Option. "Formula Option" means an Option granted to a
Nonemployee Director of the Company pursuant to Section 12.2 of the
Plan.
2.25 Good Reason. "Good Reason" means any of the following (without the
Participant's written consent):
(i) the assignment to the Participant by the Company of
duties inconsistent with the Participant's position, duties,
responsibilities and status with the Company immediately prior to a
Change in Control, or a change in the Participant's titles or
offices as in effect immediately prior to Change in Control of the
Company, or any removal of the Participant from or any failure to
reelect the Participant to any of such positions, except in
connection with the termination of his employment because of
Disability, Retirement or Cause or as a result of the Participant's
death or by the Participant other than for Good Reason;
(ii) a reduction by the Company in the Participant's base
salary as in effect immediately prior to the Change in Control;
(iii) any failure by the Company to continue in effect any
benefit plan or arrangement (including, without limitation, the
Company's profit sharing plan, Group Annuity Contract, group life
insurance plan, senior participant survivor life insurance
supplement, and medical, dental, accident and disability plans) in
which the Participant is participating at the time of a Change in
Control (or any other plans providing the Participant with
substantially similar benefits) (hereinafter referred to as
"Benefit Plans"), or the taking of any action by the Company which
would adversely affect the Participant's participation in or
materially reduce the Participant's benefits under any such Benefit
Plan or deprive the Participant of any material fringe benefit
enjoyed by the Participant at the time of a Change in Control;
(iv) any failure by the Company to continue in effect any
incentive plan or arrangement (including, without limitation, any
annual incentive compensation plan, long-term performance incentive
plan, long-term incentive bonus plan, as amended, bonus and
contingent bonus arrangements and credits and the right to receive
performance awards and similar incentive compensation benefits) in
which the Participant is participating at the time of a Change in
Control (or any other plans or arrangements providing him with
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substantially similar benefits) hereinafter referred to as
"Incentive Plans") or the taking of any action by the Company which
would adversely affect the Participant's participation in any such
Incentive Plan or reduce the Participant's benefits under any such
Incentive Plan, expressed as a percentage of his base salary, by
more than 10 percentage points in any fiscal year as compared to
the immediately preceding fiscal year.
(v) any failure by the Company to continue in effect any plan
or arrangement to receive securities of the Company (including,
without limitation, this Plan, and any other plan or arrangement to
receive and exercise stock options, stock appreciation rights,
restricted stock or grants thereof) in which the Participant is
participating at the time of a Change in Control of the Company (or
plans or arrangements providing him with substantially similar
benefits) (hereinafter referred to as "Securities Plans") or the
taking of any action by the Company which would adversely affect
the Participant's participation in or materially reduce the
Participant's benefits under any such Securities Plan;
(vi) the Participant's relocation to any place more than
thirty (30) miles from the location at which the Participant
performed the Participant's duties prior to a Change in Control,
except for required travel by the Participant on the Company's
business to an extent substantially consistent with the
Participant's business travel obligations at the time of a Change
in Control; or
(vii) any failure by the Company to provide the
Participant with the number of paid vacation days to which the
Participant is entitled at the time of a Change in Control.
2.26 Initial Election Date. "Initial Election Date" means, for each
Director, the later to occur of (i) the date of the 1996 annual meeting
of the shareholders of PCA International or (ii) the date of the
Director's initial election or appointment to the Board.
2.27 Key Employee. "Key Employee" means a senior level Employee who
holds a position of responsibility in a managerial, administrative, or
professional capacity.
2.28 Negative Discretion. "Negative Discretion" means the discretion
authorized by the Plan to be applied by the Committee in determining the
size of an Award for a Performance Period or Performance Cycle if, in
the Committee's sole judgment, such application is appropriate.
Negative Discretion may only be used by the Committee to eliminate or
reduce the size of an Award. By way of example and not by way of
limitation, in no event shall any discretionary authority granted to the
Committee by the Plan, including but not limited to Negative Discretion,
be used to: (a) grant Awards for a Performance Period or Performance
Cycle if the Performance Goals for such Performance Period or
Performance Cycle have not been attained; or (b) increase an Award above
the maximum amount payable under Section 7.7, 8.7, 9.10 or 10.7 of the
Plan.
2.29 Nonemployee Director. "Nonemployee Director" means a member of the
Board who is not an Employee.
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2.30 Nonemployee Director Option. "Nonemployee Director Option" means a
Formula Option or a Deferral Option.
2.31 Nonemployee Director Option Agreement. "Nonemployee Director
Option Agreement" means an Option Agreement between the Company and the
Nonemployee Director pursuant to which the Nonemployee Director Option
is awarded stock options as set forth in the Plan.
2.32 PCA International. "PCA International" means PCA International,
Inc.
2.33 Participant. "Participant" means any Key Employee who has been
selected for a grant of stock options pursuant to Article 7, any Key
Employee who has been selected for a grant of stock appreciation rights
pursuant to Article 8, any Key Employee who for a Performance Cycle has
been selected to participate in the Performance Restricted Stock Program
pursuant to Article 9, any Key Employee who for a Performance Period has
been selected to participate in the Performance Award Program pursuant
to Article 10, any Key Employee who has been selected for a grant of
performance units pursuant to Article 11, and any Nonemployee Director
who is eligible to receive a grant of Formula Options pursuant to
Section 12.2, or who elects to receive Deferral Options pursuant to
Article 12.
2.34 Performance Awards. "Performance Awards" means the Performance
Awards granted to Key Employees pursuant to Article 10. All Performance
Awards are intended to qualify as "performance-based compensation" under
Section 162(m) of the Code.
2.35 Performance Criteria. "Performance Criteria" means the one or more
criteria that the Committee shall select for purposes of establishing
the Performance Goal(s) for a Performance Period or Performance Cycle.
The Performance Criteria that will be used to establish such Performance
Goal(s) shall be limited to the following: Return On Net Assets
("RONA"), return on shareholders' equity, return on assets, return on
capital, shareholder returns, profit margin, earnings per share, net
earnings, operating earnings, Common Stock price per share, and sales or
market share. To the extent required by Section 162(m) of the Code, the
Committee shall, within the first 90 days of a Performance Period or
Performance Cycle (or, if longer, within the maximum period allowed
under Section 162(m) of the Code), define in an objective fashion the
manner of calculating the Performance Criteria it selects to use for
such Performance Period or Performance Cycle.
2.36 Performance Cycle. "Performance Cycle" means the one or more
periods of time, which may be of varying and overlapping durations, but
which shall be at least one year in length, as the Committee may select,
over which the attainment of one or more Performance Goals will be
measured for the purpose of determining a Participant's right to and the
payment of an Award under the Performance Restricted Stock Program.
2.37 Performance Formula. "Performance Formula" means, for a
Performance Period or Performance Cycle, the one or more objective
formulas applied against the relevant Performance Goals to determine,
with regard to the Award of a particular Participant, whether all, some
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portion but less than all, or none of the Award has been earned for the
Performance Period or Performance Cycle. In the case of an Award under
the Performance Restricted Stock Program, in the event the Performance
Goals for a Performance Cycle are achieved, the Performance Formula
shall determine what percentage of the Participant's Target Award for
the Performance Cycle will be earned.
2.38 Performance Goal. "Performance Goal" means, for a Performance
Period or Performance Cycle, the one or more goals established by the
Committee for the Performance Period or Performance Cycle based upon the
Performance Criteria. The Committee is authorized at any time during
the first 90 days of a Performance Period or Performance Cycle, or at
any time thereafter (but only to the extent the exercise of such
authority after the first 90 days of a Performance Period or Performance
Cycle would not cause the Awards granted to the Covered Employees for
the Performance Period or Performance Cycle to fail to qualify as
"performance-based compensation" under Section 162(m) of the Code), in
its sole and absolute discretion, to adjust or modify the calculation of
a Performance Goal for such Performance Period or Performance Cycle in
order to prevent the dilution or enlargement of the rights of
Participants, (a) in the event of, or in anticipation of, any unusual or
extraordinary corporate item, transaction, event or development; (b) in
recognition of, or in anticipation of, any other unusual or nonrecurring
events affecting the Company, or the financial statements of the
Company, or in response to, or in anticipation of, changes in applicable
laws, regulations, accounting principles, or business conditions; and
(c) in view of the Committee's assessment of the business strategy of
the Company, performance of comparable organizations, economic and
business conditions and any other circumstances deemed relevant.
2.39 Performance Period. "Performance Period" means the one or more
periods of time, which may be varying and overlapping durations, but
which shall be at least one year in length, as the Committee may select,
over which the attainment of one or more Performance Goals will be
measured for the purpose of determining a Participant's right to and the
payment of a Performance Award.
2.40 Performance Restricted Stock. "Performance Restricted Stock" means
an Award of Common Stock subject to the restrictions set forth in
Section 9.6 awarded to a Key Employee pursuant to Article 9.
2.41 Performance Restricted Stock Award. "Performance Restricted Stock
Award" means an Award granted pursuant to Article 9 in the form of
shares of Performance Restricted Stock. All Restricted Stock Awards are
intended to qualify as "performance-based compensation" under Section
162(m) of the Code.
2.42 Performance Restricted Stock Program. "Performance Restricted
Stock Program" means the program established under Article 9 of the Plan
pursuant to which selected Key Employees receive Awards for a
Performance Cycle in the form of shares of Performance Restricted Stock
based upon attainment of Performance Goals for such Performance Cycle.
All Awards granted
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to Covered Employees under the Performance Restricted Stock Program are
intended to qualify as "performance-based compensation" under Section
162(m) of the Code.
2.43 Plan. "Plan" means this PCA International, Inc. 1996 Omnibus
Long-Term Compensation Plan, as amended or modified from time to time.
2.44 Retirement. "Retirement" means, in the case of a Key Employee, for
all Plan purposes other than Section 18.12, a termination of employment
from the Company on or after attainment of Normal Retirement Age as
defined under the PCA International, PCA Inc. 401(k) Plan.
"Retirement" means, in the case of a Nonemployee Director, for all Plan
purposes other than Section 18.12, the termination of such Nonemployee
Director's Service on or after age 70, or at any earlier age with the
consent of the Board.
2.45 Restriction Period. "Restriction Period" means the period of time
beginning on the Effective Date of the grant of Performance Restricted
Stock and ending three (3) year(s) after such date, or such longer
period as the Committee shall determine in its sole discretion.
2.46 Service. "Service" means service as a Director.
2.47 Subsidiary. "Subsidiary" means a corporation or other business
entity in which PCA International directly or indirectly has an
ownership interest of 80 percent or more.
2.48 Target Award. "Target Award" means, for a Performance Cycle, the
target Award amount, expressed as a number of shares of Performance
Restricted Stock, established for each Participant selected by the
Committee for the Performance Cycle. The fact, however, that a Target
Award is established for a Participant shall not in any manner entitle
such Participant to receive an Award for such Performance Cycle.
2.49 Unit. "Unit" means a bookkeeping entry used by the Company to
record and account for the grant of performance units until the
performance unit is paid, cancelled, forfeited or terminated, as the
case may be.
ARTICLE 3 - ELIGIBILITY
Only Key Employees are eligible to participate in Awards under Articles
7, 8, 9, 10 and 11 of the Plan. Only Nonemployee Directors shall
participate in Awards under Article 12 of the Plan. For purposes of
Articles 7, 8, 9, 10, and 11 of the Plan, the Committee shall select,
from time to time, Participants from those Key Employees who, in the
opinion of the Committee, can further the Plan's purposes. Once a
Participant is so selected, the Committee shall determine the type or
types of Awards to be made to the Participant and shall establish in the
related Award Notices the terms, conditions, restrictions, and
limitations, if any, applicable to the Awards in addition to those set
forth in this Plan and the administrative rules and regulations issued
by the Committee.
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ARTICLE 4 - PLAN ADMINISTRATION
4.1 Responsibility. The Committee shall have total and exclusive
responsibility to control, operate, manage, and administer the Plan in
accordance with its terms.
4.2 Authority of the Committee. The Committee shall have all the
authority that may be necessary or helpful to enable it to discharge its
responsibilities with respect to the Plan. Without limiting the
generality of the preceding sentence, the Committee shall have the
exclusive right to: (a) interpret the Plan; (b) determine eligibility
for the participation in the Plan; (c) decide all questions concerning
eligibility for and the amount of Awards payable under the Plan; (d)
construe any ambiguous provision of the Plan; (e) correct any default;
(f) supply any omission; (g) reconcile any inconsistency; (h) issue
administrative guidelines as an aid to administer the Plan and make
changes in such guidelines as it from time to time deems proper; (i)
make regulations for carrying out the Plan and make changes in such
regulations as it from time to time deems proper; (j) determine whether
Awards should be granted singly, in combination, or in tandem; (k) to
the extent permitted under the Plan, grant waivers of Plan terms,
conditions, restrictions, and limitations; (l) accelerate the vesting,
exercise, or payment of an Award or the Performance Period of an Award
when such action or actions would be in the best interest of the
Company; (m) establish such other types of Awards, besides those
specifically enumerated in Article 5 hereof, that the Committee
determines are consistent with the Plan's purpose; (n) subject to
Section 7.2, grant Awards in replacement of Awards previously granted
under this Plan or any other executive compensation plan of the Company;
(o) establish and administer the Performance Goals and certify whether,
and to what extent, they have been attained; and (p) take any and all
other action it deems necessary or advisable for the proper operation or
administration of the Plan; provided that in no event shall the
Committee have the power to determine eligibility for participation
under Article 12 or to determine the number, price, vesting period, or
timing of Formula Options granted under Article 12 (all of which
determinations are automatic under the provisions of the Plan).
4.3 Discretionary Authority. The Committee shall have full
discretionary authority in all matters related to the discharge of its
responsibilities and the exercise of its authority under the Plan,
including without limitation its construction of the terms of the Plan
and its determination of eligibility for participation and Awards under
the Plan. It is the intent of the Plan that the decisions of the
Committee and its action with respect to the Plan shall be final,
binding and conclusive upon all persons having or claiming to have any
right or interest in or under the Plan.
4.4 Section 162(m) of the Code. With regard to all Covered Employees,
the Plan shall, for all purposes, be interpreted and construed in
accordance with Section 162(m) of the Code.
4.5 Action by the Committee. The Committee may act only by a majority
of its members. Any determination of the Committee may be made, without
a meeting, by a writing or writings signed by all of the members of the
Committee. In addition, the Committee may authorize any one or more of
its number to execute and deliver documents on behalf of the Committee.
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4.6 Delegation of Authority. The Committee may delegate some or all of
its authority under the Plan to any person or persons provided that any
such delegation be in writing; provided, however, that only the
Committee may select and grant Awards to Participants who are subject to
Section 16 of the Exchange Act or are Covered Employees.
ARTICLE 5 - FORMS OF AWARDS
5.1 In General. Awards may, at the Committee's sole discretion, be
paid in the form of stock options pursuant to Article 7, stock
appreciation rights pursuant to Article 8, Performance Restricted Stock
Awards pursuant to Article 9, Performance Awards pursuant to Article 10,
performance units pursuant to Article 11, and any form established by
the Committee pursuant to Section 4.2(m), or a combination thereof.
Awards may also be paid in the form of Formula Options and Deferral
Options pursuant to Article 12. All Awards shall be subject to the
terms, conditions, restrictions and limitations of the Plan. The
Committee may, in its sole judgment, subject an Award, except Formula
Options and Deferral Options granted pursuant to Article 12, to such
other terms, conditions, restrictions, and limitations (including, but
not limited to, the time and conditions of exercise and restrictions on
transferability and vesting), provided they are not inconsistent with
the terms of the Plan. Awards under a particular Article of the Plan
need not be uniform and Awards under two or more Articles may be
combined into a single Award Notice. Any combination of Awards may be
granted at one time and on more than one occasion to the same
Participant. For purposes of the Plan, the value of any Award granted
in the form of Common Stock shall be the closing price at which a share
of Common Stock trades on the date of the grant's Effective Date, or the
next preceding trading day if such date was not a trading date, on the
primary securities exchange or quotation system on which the Common
Stock is then traded.
ARTICLE 6 - SHARES SUBJECT TO PLAN
6.1 Available Shares. The maximum number of shares of Common Stock
that shall be available for grant of Awards under the Plan (including
incentive stock options) during its term, shall not exceed 811,550.
(Such amount shall be subject to adjustment as provided in Section 6.2.)
Any shares of Common Stock related to Awards that terminate by
expiration, forfeiture, cancellation, or otherwise without the issuance
of such shares shall be available again for grant under the Plan.
Moreover, shares of Common Stock with respect to which a stock
appreciation right has been exercised and paid in cash shall again
become eligible for grant under the Plan; provided that if such shares
of Common Stock subject to Awards are settled in cash in lieu of Common
Stock or are exchanged with the Committee's permission for Awards not
involving Common Stock, such shares shall not be available again for
grant under the Plan. The maximum number of shares available for
issuance under the Plan shall not be reduced to reflect any dividends or
dividend equivalents that are reinvested into additional shares of
Common Stock or credited as additional performance shares. The shares
of Common Stock available for issuance under the Plan may be authorized
and unissued shares, treasury shares, shares issued and outstanding or
shares owned by a Subsidiary.
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6.2 Adjustment to Shares.
6.2.1 In General. The provisions of this Subsection 6.2.1 are
subject to the limitation contained in Subsection 6.2.2. If there
is any change in the number of outstanding shares of Common Stock
through the declaration of stock dividends, stock splits or the
like, the number of shares available for Awards, the shares subject
to any Award and the option prices or exercise prices of Awards
shall be automatically adjusted. If there is any change in the
number of outstanding shares of Common Stock through any change in
the capital account of PCA International, or through a merger,
consolidation, separation (including a spin-off or other
distribution of stock or property), reorganization (whether or not
such reorganization comes within the meaning of such term in
Section 368(a) of the Code) or partial or complete liquidation, the
Committee shall make appropriate adjustments in the maximum number
of shares of Common Stock that may be issued under the Plan and any
adjustments and/or modifications to outstanding Awards as it, in
its sole discretion, deems appropriate. In event of any other
change in the capital structure or in the Common Stock of PCA
International, the Committee shall also be authorized to make such
appropriate adjustments in the maximum number of shares of Common
Stock available for issuance under the Plan and any adjustments
and/or modifications to outstanding Awards as it, in its sole
discretion, deems appropriate. The maximum number of shares
available for issuance under the Plan shall be automatically
adjusted to the extent necessary to reflect any dividend
equivalents paid in the form of Common Stock.
6.2.2 Covered Employees. In no event shall the Award of any
Participant who is a Covered Employee be adjusted pursuant to
Subsection 6.2(a) to the extent it would cause such Award to fail
to qualify as "performance-based compensation" under Section 162(m)
of the Code.
ARTICLE 7 - EMPLOYEE STOCK OPTION PROGRAM
7.1 In General. Awards may be granted to Key Employees in the form of
Employee Stock Options. These Employee Stock Options may be incentive
stock options within the meaning of Section 422 of the Code or
non-qualified stock options (i.e., stock options that are not incentive
stock options), or a combination of both. All Awards under the Plan
issued to Covered Employees in the form of Employee Stock Options shall
qualify as "performance-based compensation" under Section 162(m) of the
Code.
7.2 Terms and Conditions of Stock Options. An Employee Stock Option
shall be exercisable in whole or in such installments and at such times
as may be determined by the Committee. The price at which Common Stock
may be purchased upon exercise of an Employee Stock Option shall be not
less than 100% of the closing price at which a share of Common Stock
trades on the date of the grant's Effective Date, or the next preceding
trading day if such date was not a trading date, on the primary
securities exchange or quotation system on which the Common Stock is
then traded. Moreover, all Options shall expire not later than 10 years
from the
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Effective Date of the grant. Employee Stock Options shall not be
repriced, i.e., there shall be no grant of an Employee Stock Option(s)
to a Participant in exchange for a Participant's agreement to
cancellation of a higher-priced Employee Stock Option(s) that was
previously granted to such Participant.
7.3 Restrictions Relating to Incentive Stock Options. Employee Stock
Options issued in the form of incentive stock options shall, in addition
to being subject to the terms and conditions of Section 7.2, comply with
Section 422 of the Code. Accordingly, the aggregate fair-market value
(determined at the time the option was granted) of the Common Stock with
respect to which incentive stock options are exercisable for the first
time by a Participant during any calendar year (under this Plan or any
other plan of the Company) shall not exceed $100,000 (or such other
limit as may be required by the Code). The price at which Common Stock
may be purchased upon exercise of an incentive stock option shall not be
less than 100% of the closing price at which a share of Common Stock
trades on the date of the grant's Effective Date, or the next preceding
trading day if such date was not a trading date, on the primary
securities exchange or quotation system on which the Common Stock is
then traded, provided that in the case of an incentive stock option
granted to a Key Employee who at the time of grant owns (as is defined
in Section 424(d) of the Code) stock of the Company or the Subsidiaries
possessing more than 10% of the total combined voting power of all
classes of stock of the Company or any of the Subsidiaries, the price at
which Common Stock may be purchased upon exercise of such incentive
stock option shall be not less than 110% of such price, on the Effective
Date of the incentive stock option's grant. In no event may the price
at which Common Stock may be purchased upon exercise of such incentive
stock option be less than the par value of the Common Stock subject to
such incentive stock option. From the maximum number of shares
available for issuance under the Plan under Section 6.1, the number of
shares of Common Stock that shall be available for incentive stock
options granted under the Plan is 200,000.
7.4 Additional Terms and Conditions. The Committee may, by way of the
Award Notice or otherwise, establish such other terms, conditions,
restrictions, and limitations, if any, of any Employee Stock Option
Award, provided they are not inconsistent with the Plan.
7.5 Exercise. Upon exercise, the option price of an Employee Stock
Option may be paid in cash, shares of Common Stock, a combination of the
foregoing, or such other consideration as the Committee may deem
appropriate. The Committee shall establish appropriate methods for
accepting Common Stock, whether restricted or unrestricted, and may
impose such conditions as it deems appropriate on the use of such Common
Stock to exercise an Employee Stock Option. Subject to Section 18.9,
Employee Stock Options awarded under the Plan may be exercised by way of
any broker-assisted exercise program, provided such program is available
at the time of the Employee Stock Option's exercise. The Committee may
permit a Participant to satisfy any amounts required to be withheld
under the applicable Federal, state and local tax laws, in effect from
time to time, by electing to have the Company withhold a portion of the
shares of Common Stock to be delivered for the payment of such taxes.
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7.6 Nontransferability of Employee Stock Options. No Employee Stock
Option granted pursuant to the Plan shall be transferable otherwise than
by will or by the laws of descent and distribution or pursuant to a
qualified domestic relations order as defined by the Code. During the
lifetime of an optionee, the Employee Stock Option shall be exercisable
only by the optionee personally or by the optionee's legal
representative.
7.7 Maximum Award Payable. Notwithstanding any provision contained in
the Plan to the contrary, the maximum number of shares for which
Employee Stock Options may be granted under the Plan to any one
Participant for a calendar year is 20,000 shares of Common Stock.
ARTICLE 8 - STOCK APPRECIATION RIGHTS
8.1 In General. Awards may be granted to employees in the form of
stock appreciation rights ("SARs"). An SAR may be granted in tandem
with all or a portion of a related Employee Stock Option under the Plan
("Tandem SARs"), or may be granted separately ("Freestanding SARs"). A
Tandem SAR may be granted either at the time of the grant of the related
Employee Stock Option or at any time thereafter during the term of the
Employee Stock Option. SARs shall entitle the recipient to receive a
payment equal to the appreciation in market value of a stated number of
shares of Common Stock from the exercise price to the market value on
the date of exercise. All Awards under the Plan issued to Covered
Employees in the form of an SAR shall qualify as "performance-based
compensation" under Section 162(m) of the Code.
8.2 Terms and Conditions of Tandem SARs. A Tandem SAR shall be
exercisable to the extent, and only to the extent, that the related
Employee Stock Option is exercisable, and the "exercise price" of such
an SAR (the base from which the value of the SAR is measured at its
exercise) shall be the option price under the related Employee Stock
Option. However, at no time shall a Tandem SAR be issued if the option
price of its related Employee Stock Option is less than the fair-market
value of the Common Stock, as determined by the Committee, on the
Effective Date of the Tandem SAR's grant. If a related Employee Stock
Option is exercised as to some or all of the shares covered by the
Award, the related Tandem SAR, if any, shall be cancelled automatically
to the extent of the number of shares covered by the Employee Stock
Option exercise. Upon exercise of a Tandem SAR as to some or all of the
shares covered by the Award, the related Employee Stock Option shall be
cancelled automatically to the extent of the number of shares covered by
such exercise, and such shares shall not again be eligible for grant in
accordance with Section 6.1. Moreover, all Tandem SARs shall not expire
later than 10 years from the Effective Date of the SAR's grant.
8.3 Terms and Conditions of Freestanding SARs. Freestanding SARs shall
be exercisable in whole or in such installments and at such times as may
be determined by the Committee. The exercise price of a Freestanding
SAR shall be not less than 100% of the closing price at which a share of
Common Stock trades on the date of the grant's Effective Date, or the
next preceding trading day if such date was not a trading date, on the
primary securities exchange or quotation system on which the Common
Stock is then traded. Moreover, all Freestanding SARs shall not expire
later than 10 years from the Effective Date of the Freestanding SAR's
grant.
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8.4 Deemed Exercise. The Committee may provide that an SAR shall be
deemed to be exercised at the close of business on the scheduled
expiration date of such SAR if at such time the SAR by its terms remains
exercisable and, if so exercised, would result in a payment to the
holder of such SAR.
8.5 Additional Terms and Conditions. The Committee may, by way of the
Award Notice or otherwise, determine such other terms, conditions,
restrictions, and limitations, if any, of any SAR Award, provided they
are not inconsistent with the Plan.
8.6 Nontransferability of SARs. No SAR granted pursuant to the Plan
shall be transferable otherwise than by will or by the laws of descent
and distribution or pursuant to a qualified domestic relations order as
defined by the Code. During the lifetime of the Participant to whom the
SAR was granted, the SAR shall be exercisable only by such Participant
personally or by the holder's legal representative.
8.7 Maximum Award Payable. Notwithstanding any provision contained in
the Plan to the contrary, the maximum number of shares for which SARs
may be granted under the Plan to any one Participant for a calendar year
is 20,000 shares of Common Stock.
ARTICLE 9 - PERFORMANCE RESTRICTED STOCK PROGRAM
9.1 Purpose. The purposes of the Performance Restricted Stock Program
are: (a) to promote the interests of the Company and its shareholders
by providing a means to acquire a proprietary interest in the Company to
selected Key Employees who are in a position to make a substantial
contribution to the continued progress and success of the Company; (b)
to attract and retain qualified individuals to serve as Employees in
those positions; (c) to enhance long-term performance of the Company by
linking a meaningful portion of the compensation of selected Key
Employees to the achievement of specific long-term financial objectives
of the Company; and (d) to motivate and reward selected Key Employees to
undertake actions to increase the price of the Common Stock.
9.2 Eligibility. Any Key Employee is eligible to participate in the
Performance Restricted Stock Program. Within the first 90 days of a
Performance Cycle (or, if longer, within the maximum period allowed
under Section 162(m) of the Code), the Committee will select those Key
Employees who will be Participants for such Performance Cycle. However,
designation of a Key Employee as a Participant for a Performance Cycle
shall not in any manner entitle the Participant to receive payment of an
Award for the cycle. The determination as to whether or not such
Participant becomes entitled to payment of an Award for such Performance
Cycle shall be decided solely in accordance with the provisions of this
Article 9. Moreover, designation of a Key Employee as a Participant for
a particular Performance Cycle shall not require designation of such Key
Employee as a Participant in any subsequent Performance Cycle and
designation of one Key Employee as a Participant shall not require
designation of any other Key Employee as a Participant in such
Performance Cycle or in any other Performance Cycle.
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9.3 Description of Awards. Awards granted under the Performance
Restricted Stock Program provide Participants with the opportunity to
earn shares of Performance Restricted Stock, subject to the terms and
conditions of Section 9.6 below. Each Award granted under the Plan for
a Performance Cycle shall consist of a Target Award expressed as fixed
number of shares of Performance Restricted Stock. In the event the
Performance Goals for the Performance Cycle are achieved, the
Performance Formula shall determine, with regard to a particular
Participant, what percentage of the Participant's Target Award for the
Performance Cycle will be earned. All of the Awards issued under the
Performance Restricted Stock Program to Covered Employees are intended
to qualify as "performance-based compensation" under Section 162(m) of
the Code.
9.4 Procedure for Determining Awards. Within the first 90 days of a
Performance Cycle (or, if longer, within the maximum period allowed
under Section 162(m) of the Code), the Committee shall establish in
writing for such Performance Cycle the following: the specific
Performance Criteria that will be used to establish the Performance
Goal(s), the kind(s) and level(s) of the Performance Goal(s), whether
the Performance Goal(s) is(are) to apply to the Company, PCA
International, a Subsidiary, or any one or more subunits of the
foregoing, the amount of the Target Award and the Performance Formula.
9.5 Payment of Awards.
9.5.1 Condition to Receipt of Awards. Except as provided in
Section 9.8, a Participant must be employed by the Company on the
Performance Cycle's Award Payment Date to be eligible for an Award
for such Performance Cycle.
9.5.2 Limitation. A Participant shall be eligible to receive
an Award for a Performance Cycle only if:
9.5.2.1 the Performance Goals for such cycle are achieved;
and
9.5.2.2 the Performance Formula as applied against such
Performance Goals determines that all or some portion of the
Participant's Target Award has been earned for the Performance
Period.
9.5.3 Certification. Following the completion of a Performance
Cycle, the Committee shall meet to review and certify in writing
whether, and to what extent, the Performance Goals for the
Performance Cycle have been achieved. If the Committee certifies
that the Performance Goals have been achieved, it shall, based upon
application of the Performance Formula to the Performance Goals for
such cycle, also calculate and certify in writing for each
Participant what percentage of the Participant's Target Award has
been earned for the cycle. The Committee shall then determine the
actual size of each Participant's Award for the Performance Cycle
and, in so doing, shall apply Negative Discretion, if and when it
deems appropriate.
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9.5.4 Negative Discretion. In determining the actual size of
an individual Award to be paid for a Performance Cycle, the
Committee may, through the use of Negative Discretion, reduce or
eliminate the amount of the Award earned under the Performance
Formula for the Performance Cycle if, in its sole judgment, such
reduction or elimination is appropriate.
9.5.5 Timing of Award Payments. The Awards granted by the
Committee for a Performance Cycle shall be paid to Participants on
the Award Payment Date for such Performance Cycle.
9.5.6 New Participants. Participants who are employed by the
Company after the Committee's selection of Participants for the
Performance Cycle, as well as Key Employees who are selected by the
Committee to be Participants after such date, shall, in the event
Awards are paid for the Performance Cycle, only be entitled to a pro
rata Award. The amount of the pro rata Award shall be determined by
multiplying the Award the Participant would have otherwise been paid
if he or she had been a Participant for the entire Performance Cycle
by a fraction, the numerator of which is the number of full months
he or she was eligible to participate in the Performance Restricted
Stock Program during the Performance Cycle and the denominator of
which is the total number of full months in the Performance Cycle.
For purposes of this calculation, a partial month of participation
shall be treated as a full month of participation to the extent a
Participant participates in the Performance Restricted Stock Program
for 15 or more days of such month; and shall not be taken into
consideration to the extent the Participant participates in the
Performance Restricted Stock Program for less than 15 days of such
month.
9.5.7 Noncompetition. No Participant shall receive payment of
an Award if, subsequent to the commencement of the Performance Cycle
and prior to the Award Payment Date for such cycle, the Participant
engages in the conduct prohibited under Section 13.3.
9.6 Performance Restricted Stock: Terms and Conditions. Shares of
Performance Restricted Stock shall be subject to the following terms and
conditions:
9.6.1 Subject to the provisions of the Plan and the Performance
Restricted Stock Agreement referred to in paragraph 9.6.4, until the
expiration of the Restriction Period, the Participant shall not be
permitted to sell, assign, transfer, pledge, or otherwise encumber
shares of Performance Restricted Stock.
9.6.2 Except as provided in this Section 9.6 and the
Performance Restricted Stock Agreement, the Participant shall have,
with respect to the shares of Performance Restricted Stock, all of
the rights of a shareholder of the Company holding shares of the
Common Stock, including, if applicable, the right to vote the shares
and the right to receive any cash dividends. If so determined by the
Committee in the applicable Performance Restricted Stock Agreement,
dividends payable in Common Stock shall be paid in the form of
Performance Restricted Stock on which such dividend was paid, held
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subject to the same conditions and restrictions of the underlying
Performance Restricted Stock.
9.6.3 Except to the extent otherwise provided in the applicable
Performance Restricted Stock Agreement, this Section 9.6.3, and
Articles 16 and 17, upon a Participant's termination of employment
during an unexpired Restriction Period, all shares still subject to
such unexpired Restriction Period held by that Participant shall be
forfeited by that Participant. In the event of the termination of
employment of a Participant because of death, Disability,
Retirement, or for an Approved Reason, the unexpired Restriction
Period(s) shall lapse as to a pro-rata portion of such Performance
Restricted Stock, which pro-rata portion shall be equal to the
portion of the applicable Restriction Period(s) that has elapsed as
of the date of such termination of employment, and such pro-rata
portion shall become free of all restrictions and become fully
vested and transferable. The remaining portion of the Performance
Restricted Stock for which the Restriction Period has not expired
shall be forfeited by the Participant.
Notwithstanding anything contained in this Section 9.6.3 to the
contrary, as to any Participant who, on the date of his or her
termination of employment because of death, Disability, Retirement
or for an Approved Reason, holds any Performance Restricted Stock
that has not been outstanding for a period of at least six months
from the Effective Date of such Performance Restricted Stock and who
on the date of such termination is required to report under Section
16 of the Exchange Act, such Performance Restricted Stock shall not
become free of restrictions, vested, and transferable pursuant to
this Section 9.6.3 until the first business day next following the
end of such six-month period.
9.6.4 Each Performance Restricted Stock award shall be
confirmed by, and be subject to the terms of, a Performance
Restricted Stock Agreement.
9.7 Performance Restricted Stock Certificates. Shares of Performance
Restricted Stock shall be evidenced in such manner as the Committee may
deem appropriate, including book-entry registration or issuance of one
or more stock certificates. Any certificate issued in respect of shares
of Performance Restricted Stock shall be registered in the name of such
Participant and shall bear an appropriate legend referring to the terms,
conditions, and restrictions applicable to such Performance Restricted
Stock, substantially in the following form:
"The transferability of this certificate and the shares of stock
represented hereby are subject to the terms and conditions
(including forfeiture) of the PCA International, Inc. Omnibus
Long-Term Compensation Plan and a Performance Restricted Stock
Agreement. Copies of such Plan and Agreement are on file at the
offices of PCA International, Inc., 815 Matthews-Mint Hill Road,
Matthews, North Carolina 28105.
The Committee may require that the certificates evidencing such
shares be held in custody by the Company until the restrictions thereon
shall have lapsed and that, as a condition of any
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Award of Performance Restricted Stock, the Participant shall have
delivered a stock power, endorsed in blank, relating to the Common Stock
covered by such Award.
If and when the applicable Restriction Period expires without a
prior forfeiture of the Performance Restricted Stock, unlegended
certificates for such shares shall be delivered to the Participant
promptly upon surrender of the legended certificates.
9.8 Termination of Employment During Performance Cycle. In the event a
Participant's employment is terminated prior to an Award Payment Date
for a Performance Cycle for any reason other than death, Disability,
Retirement or for an Approved Reason, all of such Participant's Awards
for such Performance Cycle shall be forfeited. In the event a
Participant terminates employment due to death, Disability, or
Retirement, or for an Approved Reason, prior to the Award Payment Date
for a Performance Cycle, the Participant shall receive, if Awards are
paid for such Performance Cycle and if he or she complies with the
requirements of Subsection 9.5.7 through the Award Payment Date, a pro
rata Award. The amount of the pro rata Award shall be determined by
multiplying the Award the Participant would have otherwise been paid if
he or she had been a Participant through the Award Payment Date for the
Performance Cycle by a fraction, the numerator of which is the number of
full months he or she was a Participant during such Performance Cycle
and the denominator of which is the total number of full months in the
Performance Cycle. For purposes of this calculation, a partial month of
participation shall: (1) be treated as a full month of participation to
the extent a Participant participates in the Performance Restricted
Stock Program for 15 or more days of such month; and (2) not be taken
into consideration to the extent the Participant participates in the
Performance Restricted Stock Program for less than 15 days of such
month. Such pro rata Award shall be paid in the form of shares of
Common Stock, not subject to any restrictions, limitations or escrow
requirements. In the event of Disability, or Retirement or termination
for an Approved Reason, the pro rata Award shall be paid directly to the
Participant and, in the event of death, to the Participant's estate.
9.9 Awards. On or promptly after the Award Payment Date for a
Performance Cycle, the Committee shall issue to each Participant the
Award, in the form of shares of Performance Restricted Stock, he or she
has earned for such Performance Cycle. Such shares of Performance
Restricted Stock shall be subject to such terms, conditions,
limitations, and restrictions of Section 9.6 and such other as the
Committee, in its sole judgment, determines.
9.10 Maximum Award Payable. Notwithstanding any provision contained
in the Plan to the contrary, the Maximum Award Payable to any one
Participant under the Plan for a Performance Cycle is 5,000 shares of
Performance Restricted Stock.
ARTICLE 10 - PERFORMANCE AWARD PROGRAM
10.1 Eligibility. Only Key Employees shall be eligible to receive
Performance Awards. Within the first 90 days of a Performance Period
(or, if longer, within the maximum period allowed under Section 162(m)
of the Code), the Committee shall select those Key Employees
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who will be Participants for such Performance Period. However,
designation of a Key Employee as a Participant for a Performance Period
shall not in any manner entitle the Participant to receive a Performance
Award for the Performance Period. The entitlement of any Participant to
payment of a Performance Award for such Performance Period shall be
decided solely in accordance with the provisions of this Article 10.
Moreover, designation of a Key Employee as a Participant for a
particular Performance Period shall not require designation of such Key
Employee as a Participant in any subsequent Performance Period, and
designation of one Key Employee as a Participant shall not require
designation of any other Key Employee as a Participant in such
Performance Period or in any other Performance Period. All of the
Performance Awards issued under the Performance Award Program to Covered
Employees are intended to qualify as "performance-based compensation"
under Section 162(m) of the Code.
10.2 Calculation of Performance Incentive Base Salary. Within the
first 90 days of a Performance Period (or, if longer, within the maximum
period allowed under Section 162(m) of the Code), the Committee shall
calculate the Participant's Performance Incentive Base Salary for the
Performance Period then beginning. The Performance Incentive Base
Salary for any Performance Period shall be the Participant's base salary
as of the date the Performance Goal(s) for such Performance Period is
set by the Committee. Once the Performance Incentive Base Salary is
determined, the Performance Incentive Base Salary will not change for
that Performance Period.
10.3 Procedure for Determining Awards. With regard to a particular
Performance Period, the Committee shall, using its full discretion,
select the length of such Performance Period. Within the first 90 days
of a Performance Period (or, if longer, within the maximum period
allowed under Section 162(m) of the Code), the Committee shall establish
in writing for such Performance Period (i) the specific Performance
Criteria that will be used to establish the Performance Goal(s) for such
Performance Period and the kind(s) and level(s) of such Performance
Goal(s) and (ii) an award matrix detailing the Performance Award for
each Participant if such Performance Goals are attained. The amount of
a Participant's Performance Award will be calculated from the
Performance Formula for the Performance Period, which Performance
Formula shall be equal to the product of the Participant's Incentive
Base Salary and the percentage derived from the award matrix.
10.4 Performance Awards. On the Award Payment Date for a
Performance Period, the Committee shall issue to each Participant the
Award, in the form of cash or Common Stock, as the Committee may
determine in its sole discretion. Shares of Common Stock shall be
subject to such terms, conditions, limitations, and restrictions as the
Committee, in its sole judgment, determines.
10.5 Payment of Awards.
10.5.1 Condition to Receipt of Awards. Except as provided in
Sections 10.6 and Articles 16 and 17, a Participant must be employed
by the Company on the Performance Period's Award Payment Date to be
eligible for an Award for such Performance Period.
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10.5.2 Limitation. A Participant shall be eligible to receive an
Award for a Performance Period only if: (i) the Performance Goals
for such Performance Period are achieved; and (ii) the Performance
Formula as applied against such Performance Goals determines that
all or some portion of the Performance Award has been earned by that
Participant for the Performance Period.
10.5.3 Certification. Following the completion of a Performance
Period, the Committee shall meet to review and certify in writing
whether, and to what extent, the Performance Goals for the
Performance Period have been achieved. If the Committee certifies
that the Performance Goals have been achieved, it shall, based upon
application of the Performance Formula to the Performance Goals for
such Performance Period, also calculate and certify in writing for
each Participant what percentage of the Performance Award has been
earned for the Performance Period. The Committee shall then
determine the size of each Participant's Award for the Performance
Period and, in so doing, shall apply Negative Discretion if and when
it deems appropriate.
10.5.4 Negative Discretion. In determining the size of an
individual Award to be paid for a Performance Period, the Committee
may, through the use of Negative Discretion, reduce or eliminate the
amount of the Award earned under the Performance Formula for the
Performance Period if, in its sole discretion, such reduction or
elimination is appropriate.
10.5.5 Timing of Award Payments. The Performance Awards granted
by the Committee for a Performance Period shall be paid to
Participants on or promptly after the Award Payment Date for such
Performance Period.
10.5.6 New Participants. Participants who commence employment by
the Company after the Committee's selection of Participants for the
Performance Period, as well as Key Employees who are selected by the
Committee to be Participants after such date, shall, in the event
Awards are paid for the Performance Period, be entitled to a pro
rata Award. The amount of the pro rata Award shall be determined by
multiplying the Award the Participant would have otherwise been paid
if he or she had been a Participant for the entire Performance
Period by a fraction, the numerator of which is the number of full
months he or she was eligible as a Participant to participate in the
Performance Award Program during the Performance Period and the
denominator of which is the total number of full months in the
Performance Period. For purposes of this calculation, a partial
month of participation shall: (i) be treated as a full month of
participation to the extent a Participant participates in the
Performance Award Program for 15 or more days of such month; and
(ii) not be taken into consideration to the extent the Participant
participates in the Performance Award Program for less than 15 days
of such month.
10.6 Termination of Employment During Performance Period. In the
event a Participant's employment terminates because of death,
Disability, Retirement or for an Approved Reason prior to the Award
Payment Date for a Performance Period, the Participant shall receive, if
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Awards are paid for such Performance Period, through the Award Payment
Date, a pro rata Performance Award. The amount of the pro rata
Performance Award shall be determined by multiplying the Performance
Award the Participant would have otherwise been paid if he or she had
been a Participant through the Award Payment Date for the Performance
Period by a fraction, the numerator of which is the number of full
months he or she was a Participant during such Performance Period and
the denominator of which is the total number of full months in the
Performance Period. For purposes of this calculation, a partial month
of participation shall: (1) be treated as a full month of participation
to the extent a Participant participates in the Performance Award
Program for 15 or more days of such month; and (2) not be taken into
consideration to the extent the Participant participates in the
Performance Award Program for less than 15 days of such month. Such pro
rata Performance Award shall be paid in the form of cash. In the event
of death, Disability, Retirement or for an Approved Reason, the pro rata
Performance Award shall be paid directly to the Participant and, in the
event of death, to the Participant's estate, no more than 120 days after
the Award Payment Date for such Performance Period. In the event a
Participant's employment terminates for any reason other than death,
Disability, Retirement or an Approved Reason, such Participant shall
have no right to any Performance Award for the Performance Period in
which such Participant's employment is terminated.
10.7 Maximum Award Payable. Notwithstanding any provision
contained in the Plan to the contrary, the maximum Performance Award
payable to any one Participant under the Plan for a calendar year is
$100,000, or, in the event the Performance Award is paid in shares of
Common Stock, the equivalent Common Stock award thereof, based on the
closing price at which a share of Common Stock trades on the date of the
grant's Effective Date, or the next preceding trading day if such date
was not a trading date, on the primary securities exchange or quotation
system on which the Common Stock is then traded.
ARTICLE 11 - PERFORMANCE UNITS
11.1 Grants. Awards may be granted in the form of performance
units. Performance units, as that term is used in this Plan, shall
refer to Units valued by reference to designated criteria established by
the Committee, but performance units shall not be payable in Common
Stock.
11.2 Performance Criteria. Performance units shall be contingent
on the attainment during a Performance Period of certain performance
objectives. The length of the Performance Period, the performance
objectives to be achieved during the Performance Period, and the measure
of whether and to what degree such objectives have been attained shall
be conclusively determined by the Committee in the exercise of its
absolute discretion. Performance objectives may be revised by the
Committee, at such times as it deems appropriate during the Performance
Period, in order to take into consideration any unforeseen events or
changes in circumstances.
11.3 Additional Terms and Conditions. The Committee may, by way of
the Award Notice or otherwise, determine such other terms, conditions,
restrictions, and limitations, if any, of any Award of performance
units, provided they are not inconsistent with the Plan.
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ARTICLE 12 - NONEMPLOYEE DIRECTOR OPTIONS
12.1 Eligible Awards. Only Nonemployee Directors are eligible to
receive Formula Options and Deferral Options, which shall be
nonqualified stock options (i.e. options that are not incentive stock
options within the meaning of Section 422 of the Code).
12.2 Formula Options.
12.2.1 Each Nonemployee Director shall automatically receive, upon
his or her initial election or appointment as a Director, subject to
any subsequent approval by the Company's shareholders required by
Rule 16b-3, an option to purchase 10,000 shares of Common Stock
("Formula Options").
12.2.2 Terms and Conditions of Formula Options
12.2.2.1 Exercise Price. The price at which Common Stock may
be purchased upon exercise of a Formula Option shall be not
less than 100% of the closing price at which a share of Common
Stock traded on the date of the grant of the Formula Option,
or the next preceding date if such date is not a trading date,
on the primary securities exchange or quotation system on
which the Common stock is then traded on the date of grant of
such Formula Options.
12.2.2.2 Vesting. Subject to the provisions of Sections
10.3.4.3 and 10.3.4.4, after one (1) year, from the Effective
date of such Formula Option, such Formula Option shall become
exercisable for all shares of Common Stock covered thereby;
provided that in the event the Service of the Non-employee
Director holding such option terminates prior to the end of
such vesting period for reason other than death, Disability or
Retirement, such option shall be forfeited and shall lapse
immediately.
12.2.2.3 Term of Exercisability. Upon the termination of the
Service of a Nonemployee Director because of death, Disability
or Retirement, the nonexercised Formula Options held by such
Nonemployee Director shall become immediately exercisable as
to 100% of the Shares of Common Stock covered thereby;
provided that in the event the Service of the Non-employee
Director holding such option terminates prior to the end of
such vesting period for reason other than death, Disability or
Retirement, such option shall be forfeited and shall lapse
immediately. Once any portion of a Formula Option becomes
exercisable, it shall remain exercisable for the lesser of
(10) ten years after the date of grant, (2) one year from the
date the Participant shall cease, by reason of the
Participant's death, Disability or Retirement, to be a
Nonemployee Director, or (3) three months from the date the
Participant shall cease, for any reason other than such
Participant's death or Disability, to be a Nonemployee
Director;
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provided, however, that if the Participant shall cease to be a
Nonemployee Director and then die or become Disabled within
three months thereafter, the Formula Option shall remain
exercisable for one year after the date of the Participant's
death. Notwithstanding any contrary provision in the Plan,
upon a Change in Control, no additional terms, conditions,
restrictions, or limitations shall be placed upon any Formula
Option granted under this Article 12 and each Formula Option
outstanding shall become immediately exercisable as to all of
the shares of Common Stock covered thereby and shall be valued
and cashed out on the basis of the Change in Control Price
within 90 days of the Change in Control; provided that any
such options having an exercise price equal to or greater than
the Change in Control Price shall have a value of zero, shall
be cancelled, and the owner thereof shall not be entitled to
any payment.
12.2.2.4 Exercise and Payment. Upon exercise, the option
price of a Formula Option may be paid in cash, shares of
Common Stock, a combination of the foregoing, or such other
consideration as the Committee may deem appropriate. The
Committee shall establish appropriate methods for accepting
Common Stock, whether restricted or unrestricted, and may
impose such conditions as it deems appropriate on the use of
such Common Stock to exercise a stock option. Subject to
Section 18.9, stock options awarded under the Plan may be
exercised by way of a broker-assisted exercise program,
provided such program is available at the time of the option's
exercise. The Committee may permit a Participant to satisfy
any amounts required to be withheld under the applicable
federal, state and local tax laws in effect from time to time,
by electing to have the Company withhold a portion of the
shares of Common Stock to be delivered for the payment of such
taxes.
12.2.2.5 Option Agreements. Each Award of a Formula Option
under this Plan shall be evidenced by a written agreement
signed by the Participant.
12.2.3 The provisions of the formula contained in Subsections
12.2.1 and 12.2.2 of this Plan shall not be altered or amended more
often than every six (6) months except as necessary to comply with
the Code and the rules and regulations thereunder.
12.2.4 The formula contained in Subsections 12.2.1 and 12.2.2 of
this Plan is intended to comply with Rule 16b-3(c)(2)(ii)
promulgated under Section 16(b) of the Exchange Act.
12.3 Deferral Options.
12.3.1 Election. Each year, at least six months prior to the date
of the scheduled annual shareholders' meeting of PCA International
(or, for Nonemployee Directors whose Initial Election Date shall
fall within the period of six months prior to such scheduled annual
meeting, on said Initial Election Date), each Nonemployee Director
may, subject to any
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approval by the shareholders of the Company required by Rule 16b-3,
make an irrevocable election to receive, in lieu of all or any part
of the cash compensation to which such member would otherwise be
entitled as a member of the Board and any committee thereof (other
than reimbursement of expenses) for the period from the next
scheduled annual shareholders' meeting to the day prior to the
following annual meeting, Deferral Options; provided, however, that
a Participant may make his or her first election on, or at any time
prior to, his or her Initial Election Date. An election made
hereunder shall be effective, beginning on the Initial Election Date
or the annual meeting dates following such Initial Election Date,
for the grant of such number of Deferral Options as is determined by
the Committee at the Effective Date to constitute an amount of
Deferral Options equivalent to the cash compensation elected to be
forgone. In making such determination of equivalency, the Committee
shall rely upon the Black-Scholes option pricing model or other
generally accepted method of pricing options.
Each such election shall be in writing and shall be delivered to the
Secretary of the Company. The Effective Date of any such Deferral
Option shall be the date six months after such Nonemployee
Director's Initial Election Date and, for subsequent elections, the
date of PCA International's annual shareholders' meeting following
such elections.
12.3.2 Terms and Conditions of Deferral Options.
12.3.2.1 Exercise Price. The price at which Common Stock may
be purchased upon exercise of a Deferral Option shall be not
less than 100% of the closing price at which a share of Common
Stock trades on the date of the grant of the Deferral Option,
or the next preceding date if such date is not a trading date,
on the primary securities exchange or quotation system on
which the Common Stock is then traded.
12.3.2.2 Vesting. Subject to the provisions of Sections
12.3.2.3 and 10.3.4.4, after one (1) year, or such longer time
as the Committee shall determine, from the Effective date of
such Deferral Option, such Deferral Option shall become
exercisable for all shares of Common Stock covered thereby.
12.3.2.3 Acceleration due to Termination of Service, Change in
Control. If the Service of any Participant ends during the
1-year period for which cash compensation has been waived,
such Participant's rights in such Deferral Option shall be as
follows:
12.3.2.3.1 Upon the termination of such Nonemployee
Director's Service because of death, Disability or
Retirement during such 1-year period, each
unexercised Deferral Option held by that Nonemployee
Director shall become immediately exercisable as to
100% of the shares of Common Stock covered thereby;
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12.3.2.3.2 Upon the termination of such Nonemployee
Director's Service during such 1-year period for any
reason other than death, Disability or Retirement, a
portion of the shares of Common Stock covered by the
Deferral Option thereby shall become immediately
exercisable as follows:
12.3.2.3.2.1 The shares of Common Stock covered
by a Deferral Option attributable to the
election to forgo cash compensation for the
1-year period in which such Participant's
Service terminates shall be prorated and such
Option shall become immediately exercisable to
the extent of that portion of the shares of
Common Stock attributable to the time of Service
during that 1-year period; and
12.3.2.3.2.2 As to the balance of the shares
of Common Stock covered by such Deferral Option
for such 1-year period, such Deferral Option
shall lapse immediately.
Notwithstanding any contrary provision in the Plan,
upon a Change in Control, no additional terms,
conditions, restrictions, or limitations shall be
placed upon any Deferral Option granted under this
Article 12, and each Deferral Option outstanding
shall become immediately exercisable as to all of the
shares of Common Stock covered thereby and shall be
valued and cashed out on the basis of the Change in
Control Price within 90 days of the Change in
Control; provided that any such options having an
exercise price equal to or greater than the Change in
Control Price shall have a value of zero, shall be
cancelled, and the owner thereof shall not be
entitled to any payment.
12.3.2.4 Term of Exercisability. Once any portion of a
Deferral Option becomes exercisable, it shall remain
exercisable only for the lesser of (i) 10 years after the
date of grant (or such lesser number of years as the
Committee shall determine) or (ii) 1-year (or such greater
number of years as the Committee shall determine) after
the Service of a Participant terminates for any reason.
Subject to the provisions of Section 12.3.2.3.1, if
applicable, each such Deferral Director Option may be
exercised in whole or in part not earlier than 6 months
(or such longer time as the Committee shall provide in the
written agreement referred to in Section 12.3.2.6) after
the date of grant and shall expire on the date ten years
after the date of grant.
12.3.2.5 Exercise and Payment. Upon exercise, the option
price of a Deferral Option may be paid in cash, shares of
Common Stock, a
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combination of the foregoing, or such other consideration
as the Committee may deem appropriate. The Committee shall
establish appropriate methods for accepting Common Stock,
whether restricted or unrestricted, and may impose such
conditions as it deems appropriate on the use of such
Common Stock to exercise a stock option. Subject to
Section 18.9, stock options awarded under the Plan may be
exercised by way of a broker-assisted exercise program,
provided such program is available at the time of the
option's exercise. The Committee may permit a Participant
to satisfy any amounts required to be withheld under the
applicable federal, state and local tax laws in effect
from time to time, by electing to have the Company
withhold a portion of the shares of Common Stock to be
delivered for the payment of such taxes.
12.3.2.6 Option Agreements. Each Award of a Deferral
Option under this Plan shall be evidenced by a written
agreement signed by the Nonemployee Director.
12.3.3 Rule 16b-3 Compliance. The grant of Deferral Options is
intended to comply in all respects with Rule 16b-3(d)(1) of the
Exchange Act such that the grant of all Deferral Options issued
under the Plan shall be exempt from Section 16(b) of the Exchange
Act.
12.4 Nontransferability of Formula and Deferral Options. No Formula or
Deferral Option granted pursuant to the Plan shall be transferable
otherwise than by will or by the laws of descent and distribution or
pursuant to a qualified domestic relations order as defined by the Code.
During the lifetime of an optionee, the Formula Option and Deferral
Option shall be exercisable only by the optionee personally or by the
optionee's legal representative.
ARTICLE 13 - PAYMENT OF AWARDS
13.1 In General. In the absence of a Plan provision to the contrary,
payment of Awards may, at the discretion of the Committee, be made in
cash, Common Stock, a combination of cash and Common Stock, or any other
form of property as the Committee shall determine. In addition, payment
of Awards may include such terms, conditions, restrictions, and
limitations, if any, as the Committee deems appropriate, including, in
the case of Awards paid in the form of Common Stock, restrictions on
transfer and forfeiture provisions; provided, however, such terms,
conditions, restrictions, and limitations are not inconsistent with the
Plan. Further, payment of Awards may be made in the form of a lump sum
or installments, as determined by the Committee.
13.2 Termination of Employment. If employment with the Company of a
Key Employee who is a Participant terminates for a reason other than
death, Disability, Retirement, or any Approved Reason, unpaid Awards
granted under Articles 7, 8, 9, 10 and 11, including, but not by way of
limitation, Awards earned or exercised but not yet paid, all unpaid
dividends and
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dividend equivalents, and all interest accrued on the foregoing shall be
cancelled or forfeited, as the case may be, unless the Participant's
Award Notice provides otherwise. The Committee shall, notwithstanding
Sections 4.4 and 18.11 to the contrary, have the authority to promulgate
rules and regulations to determine the treatment of an Award under the
Plan in the event of the Key Employee Participant's death, Disability,
Retirement or termination for an Approved Reason; provided, however, in
the case of Awards issued under the Performance Restricted Stock
Program, such rules and regulations are consistent with Section 9.8, and
in the case of Awards under the Performance Award Program, such rules
and regulations are consistent with Section 10.6.
13.3 Noncompetition. As to all Awards made pursuant to Articles 7, 8,
9, 10 and 11, unless the Award Notice specifies otherwise, a Participant
shall forfeit all unpaid Awards, including, but not by way of
limitation, Awards earned or exercised but not yet paid, all unpaid
dividends and dividend equivalents and all interest, if any, accrued on
the foregoing if, (i) in the opinion of the Committee, the Participant,
without the prior written consent of the Company, engages directly or
indirectly in any manner or capacity as principal, agent, partner,
officer, director, stockholder, employee, or otherwise, in any business
or activity competitive with the business conducted by PCA International
or any Subsidiary; (ii) at any time divulges to any person or any entity
other than the Company any trade secrets, methods, processes or the
proprietary or confidential information of the Company; or (iii) the
Participant performs any act or engages in any activity that the
Committee determines is inimical to the best interests of the Company.
For purposes of this Section 13.3, a Participant shall not be deemed a
stockholder if the Participant's record and beneficial ownership amount
to not more than 5% of the outstanding capital stock of any company
subject to the periodic and other reporting requirements of the Exchange
Act.
ARTICLE 14 - DIVIDEND AND DIVIDEND EQUIVALENT
If an Award is granted in the form of a Restricted Stock Award,
stock option, or Common Stock share, or in the form of any other
stock-based grant, the Committee may choose, at the time of the grant of
the Award or any time thereafter up to the time of the Award's payment,
to include as part of such Award an entitlement to receive dividends or
dividend equivalents, subject to such terms, conditions, restrictions,
and limitations, if any, as the Committee may establish. Dividends and
dividend equivalents shall be paid in such form and manner (i.e., lump
sum or installments) and at such time(s) as the Committee shall
determine. All dividends or dividend equivalents that are not paid
currently may, at the Committee's discretion, accrue interest, be
reinvested into additional shares of Common Stock or, in the case of
dividends or dividend equivalents credited in connection with
performance shares, be credited as additional performance shares and
paid to the Participant if and when, and to the extent that, payment is
made pursuant to such Award. The total number of shares available for
grant under Section 6.1 shall not be reduced to reflect any dividends or
dividend equivalents that are reinvested into additional shares of
Common Stock or credited as additional performance shares.
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ARTICLE 15 - DEFERRAL OF AWARDS
At the discretion of the Committee, payment of any Award,
dividend, or dividend equivalent, or any portion thereof, may be
deferred by a Participant until such time as the Committee may
establish. All such deferrals shall be accomplished by the delivery of
a written, irrevocable election by the Participant prior to the time
established by the Committee for such purpose, on a form provided by the
Company. Further, all deferrals shall be made in accordance with
administrative guidelines established by the Committee to ensure that
such deferrals comply with all applicable requirements of the Code.
Deferred payments shall be paid in a lump sum or installments, as
determined by the Committee. Deferred Awards may also be credited with
interest, at such rates to be determined by the Committee and, with
respect to those deferred Awards denominated in the form of Common
Stock, with dividends or dividend equivalents.
ARTICLE 16 - CHANGE IN OWNERSHIP
16.1 Background. The provisions of this Article 16 shall apply only to
Awards made pursuant to Articles 7, 8, 9, 10 and 11 and shall not apply
to Awards made pursuant to Article 12. Notwithstanding any provision
contained in the Plan, including, but not limited to, Sections 4.4 and
18.11, the provisions of this Article 16 shall control over any contrary
provision. Upon a Change In Ownership: (i) the terms of this Article
16 shall immediately become operative, without further action or consent
by any person or entity; (ii) all terms, conditions, restrictions and
limitations in effect on any unexercised, unearned, unpaid and/or
deferred Award, or any other outstanding Award, shall immediately lapse
as of the date of such event; (iii) no other terms, conditions,
restrictions and/or limitations shall be imposed upon any Awards on or
after such date, and in no circumstance shall an Award be forfeited on
or after such date; and (iv) except in those instances where a prorated
Award is required to be paid under this Article 16, all unexercised,
unvested, unearned and/or unpaid Awards or any other outstanding Awards
shall automatically become one hundred percent (100%) vested
immediately.
16.2 Dividends and Dividend Equivalents. Upon a Change In Ownership,
all unpaid dividends and dividend equivalents and all interest accrued
thereon, if any, shall be treated and paid under this Article 16 in the
identical manner and time as the Award under which such dividends or
dividend equivalents have been credited. For example, if upon a Change
In Ownership, an Award under this Article 16 is to be paid in a prorated
fashion, all unpaid dividends and dividend equivalents with respect to
such Award shall be paid according to the same formula used to determine
the amount of such prorated Award.
16.3 Treatment of Performance Units and Performance Awards. Upon a
Change In Ownership, any Participant in the Performance Award Program or
Performance Unit Program, whether or not he or she is still employed by
the Company, shall be paid, as soon as practicable but in no event later
than 90 days after the Change In Ownership, a pro rata Award for each
Performance Period in which the Participant was selected to participate
and during which the Change In Ownership occurs ("Current Performance
Period"). The amount of such pro rata
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Award shall be determined by annualizing (over the current Performance
Period) the level of the applicable Performance Criteria for the
Performance Goal for such Current Performance Period up to the end of
the month preceding the Change In Ownership, determining the Performance
Award that would have been payable for such Performance Period had such
annualized level been the actual level of the applicable Performance
Criteria for the Performance Goal for such Current Performance Period,
and multiplying such Performance Award so determined by a fraction, the
numerator of which shall be the number of full months in the Current
Performance Period prior to the date of the Change In Ownership and the
denominator of which shall be the total number of full months in the
Performance Period. For purposes of this calculation, a partial month
shall be treated as a full month to the extent 15 or more days in such
month have elapsed.
16.4 Treatment of Awards under Performance Restricted Stock Program.
Upon a Change In Ownership, any Participant of the Performance
Restricted Stock Program, whether or not he or she is still employed by
the Company, shall be paid, as soon as practicable but in no event later
than 90 days after the Change In Ownership, a pro rata Award for each
Performance Cycle in which the Participant was selected to participate
and during which the Change In Ownership occurs. The amount of the pro
rata Award shall be determined by multiplying the Target Award for such
Performance Cycle for Participants by a fraction, the numerator of which
shall be the number of full months in the Performance Cycle prior to the
date of the Change In Ownership and the denominator of which shall be
the total number of full months in the Performance Cycle. For purposes
of this calculation, a partial month shall be treated as a full month to
the extent 15 or more days in such month have elapsed.
16.5 Valuation of Awards. Upon a Change In Ownership, all outstanding
shares of Common Stock, Freestanding SARs, stock options (including
incentive stock options), Restricted Stock Awards, performance units and
all other outstanding stock-based Awards (including those earned as a
result of the application of Section 16.4 above and those granted by the
Committee pursuant to its authority under Subsection 4.2(m) hereof),
shall be valued and cashed out on the basis of the Change In Control
Price and shall be cancelled; provided that any Options granted under
this Plan having an exercise price equal to or greater than the Change
in Control Price shall have a value of zero, shall be cancelled, and the
owner thereof shall not be entitled to any payment.
16.6 Payment of Awards. Upon a Change In Ownership, any Participant,
whether or not he or she is still employed by the Company, shall be
paid, in a single lump sum cash payment, as soon as practicable but in
no event later than 90 days after the Change In Ownership, all of his or
her shares of Common Stock, Freestanding SARs, stock options (including
incentive stock options), Restricted Stock Awards, Performance Awards
and (including those earned as a result of the application of Section
16.3 above) performance units, and all other outstanding stock-based
Awards (including those earned as a result of the application of Section
16.4 above and those granted by the Committee pursuant to its authority
under Subsection 4.2(m) hereof) and all other outstanding Awards.
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16.7 Deferred Awards. Upon a Change In Ownership, all Awards deferred
by a Participant under Article 15 hereof, but for which he or she has
not received payment as of such date, shall be paid in a single lump sum
cash payment as soon as practicable, but in no event later than 90 days
after the Change In Ownership. For purposes of making such payment, the
value of all Awards which are stock based shall be determined by the
Change In Control Price.
16.8 Section 16 of the Exchange Act. Notwithstanding anything
contained in this Article 16 to the contrary, any Participant who, on
the date of the Change In Ownership, holds any stock options or
Freestanding SARs that have not been outstanding for a period of at
least six months from their date of grant and who on such date is
required to report under Section 16 of the Exchange Act shall not be
paid such an Award until the first day next following the end of such
six-month period.
16.9 Miscellaneous. Upon a Change In Ownership, (i) the provisions of
Sections 13.2, 13.3 and 18.3 hereof shall become null and void and of no
further force and effect; and (ii) no action, including, but not by way
of limitation, the amendment, suspension, or termination of the Plan,
shall be taken which would affect the rights of any Participant or the
operation of the Plan with respect to any Award to which the Participant
may have become entitled hereunder on or prior to the date of such
action or as a result of such Change In Ownership.
ARTICLE 17 - CHANGE IN CONTROL
17.1 Background. Notwithstanding any provision contained in the Plan,
including, but not limited to, Sections 4.4 and 18.11, the provisions of
this Article 17 shall control over any contrary provision except with
respect to Awards made pursuant to Article 12 (as to which Article 12
this Article 17 shall not apply). All Participants shall be eligible
for the treatment afforded by this Article 17 if their employment
terminates within two years following a Change in Control, unless the
termination is due to (i) death, (ii) Disability, (iii) Cause, (iv)
termination by the Participant other than for Good Reason, or
(v) Retirement.
17.2 Vesting and Lapse of Restrictions. If a Participant is eligible
for treatment under this Article 17, (i) all of the terms, conditions,
restrictions and limitations in effect on any of his or her unexercised,
unearned, unpaid and/or deferred Awards shall immediately lapse as of
the date of his or her termination of employment, (ii) no other terms,
conditions, restrictions and/or limitations shall be imposed upon any of
his or her Awards on or after such date, and in no event shall any of
his or her Awards be forfeited on or after such date; and (iii) except
in those instances where a prorated Award is required to be paid under
this Article 17, all of his or her unexercised, unvested, unearned
and/or unpaid Awards shall automatically become one hundred percent
(100%) vested immediately upon his or her termination of employment.
17.3 Dividends and Dividend Equivalents. If a Participant is eligible
for treatment under this Article 17, all of his or her unpaid dividends
and dividend equivalents and all interest accrued thereon, if any, shall
be treated and paid under this Article 17 in the identical manner and
time as the Award under which such dividends or dividend equivalents
have been credited.
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<PAGE>
17.4 Treatment of Awards under the Performance Award Program and
Performance Unit Program. If a Participant is eligible for treatment
under this Article 17, for each Performance Period in which the
Participant was selected to participate and during which his or her
termination of employment occurs ("Termination Current Performance
Period"), he or she shall be considered to have earned and, therefore,
be entitled to receive that prorated portion of the Award for such
Termination Current Performance Period. The amount of such pro rata
Award shall be determined by assuming that the Performance Goal for such
Termination Current Performance Period was attained at a level of 100%
or the equivalent thereof, determining the Performance Award that would
have been payable for such Performance Period had the Performance Goal
been attained at a level of 100% or the equivalent thereof, and
multiplying such Performance Award so determined by a fraction, the
numerator of which shall be the number of full months in the Termination
Current Performance Period prior to the date of the Change In Ownership
and the denominator of which shall be the total number of full months in
the Performance Period.
The Participant shall be paid, as soon as practicable but in no
event later than 90 days after the date of his or her termination of
employment, a pro rata Award so determined, in cash.
17.5 Treatment of Awards under Performance Restricted Stock Program.
If a Participant of the Performance Restricted Stock Program is eligible
for treatment under this Article 17, he or she shall be paid, as soon as
practicable but in no event later than 90 days after the date of his or
her termination of employment, a pro rata Award for each Performance
Cycle in which the Participant was selected to participate and during
which the Change In Ownership occurs. The amount of the pro rata Award
shall be determined by multiplying the Target Award for such Performance
Cycle for such Participants by a fraction, the numerator of which shall
be the number of full months in the Performance Cycle prior to the date
of his or her termination of employment and the denominator of which
shall be the total number of full months in the Performance Cycle. For
purposes of this calculation, a partial month shall be treated as a full
month to the extent 15 or more days in such month have elapsed. To the
extent Target Awards have not yet been established for the Performance
Cycle, the Target Award for the immediately preceding Performance Cycle
shall be used.
17.6 Valuation of Awards. If a Participant is eligible for treatment
under this Article 17, his or her Award shall be valued and cashed out
in accordance with the provisions of Section 16.5.
17.7 Payment of Awards. If a Participant is eligible for treatment
under this Article 17, he or she shall be paid, in a single lump sum
cash payment, as soon as practicable but in no event later than 90 days
after the date of his or her termination of employment, all of his or
her shares of Common Stock, Freestanding SARs, stock options (including
incentive stock options), Restricted Stock Awards, Performance Awards
and performance units and shares (including those earned as a result of
the application of Section 17.4 above), all other outstanding
stock-based Awards (including those earned as a result of the
application of Section 17.5 above and
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those granted by the Committee pursuant to its authority under
Subsection 4.2(m) hereof) and all other outstanding Awards.
17.8 Deferred Awards. If a Participant is eligible for treatment under
this Article 17, all of his or her deferred Awards for which payment has
not been received as of the date of his or her termination of employment
shall be paid to the Participant in a single lump sum cash payment as
soon as practicable, but in no event later than 90 days after the date
of the Participant's termination. For purposes of making such payment,
the value of all Awards which are stock based shall be determined by the
Change In Control Price.
17.9 Section 16 of the Exchange Act. Notwithstanding anything
contained in this Article 17 to the contrary, any Participant who, on
the date of his or her termination of employment under the conditions
described in Section 17.1, holds any stock options or Freestanding SARs
that have not been outstanding for a period of at least six months from
their date of grant and who on the date of such termination is required
to report under Section 16 of the Exchange Act shall not be paid such
Award until the first business day next following the end of such
six-month period.
17.10 Miscellaneous. Upon a Change In Control, (i) the provisions of
Sections 13.2, 13.3 and 18.3 hereof shall become null and void and of no
force and effect insofar as they apply to a Participant who has been
terminated under the conditions described in Section 17.1 above, and
(ii) no action, including, but not by way of limitation, the amendment,
suspension or termination of the Plan, shall be taken which would affect
the rights of any Participant or the operation of the Plan with respect
to any Award to which the Participant may have become entitled hereunder
on or prior to the date of the Change In Control or to which he or she
may become entitled as a result of such Change In Control.
17.11 Legal Fees. PCA International shall pay all legal fees and
related expenses incurred by a Participant in seeking to obtain or
enforce any payment, benefit or right he or she may be entitled to under
the Plan after a Change In Control; provided, however, the Participant
shall be required to repay any such amounts to PCA International to the
extent a court of competent jurisdiction issues a final and
non-appealable order setting forth the determination that the position
taken by the Participant was frivolous or advanced in bad faith.
ARTICLE 18 - MISCELLANEOUS
18.1 Nonassignability. No Awards rights shall be subject in any manner
to alienation, anticipation, sale, transfer (except by will or the laws
of descent and distribution), assignment, pledge, or encumbrance prior
to payment pursuant to the Plan.
18.2 Withholding Taxes. The Company shall be entitled to deduct from
any payment under the Plan, regardless of the form of such payment, the
amount of all applicable income and employment taxes required by law to
be withheld with respect to such payment or may require the Participant
to pay to it such tax prior to and as a condition of the making of such
payment. In accordance with any applicable administrative guidelines it
establishes, the Committee may
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allow a Participant to pay the amount of taxes required by law to be
withheld from an Award by withholding from any payment of Common Stock
due as a result of such Award, or by permitting the Participant to
deliver to the Company, shares of Common Stock having a fair-market
value, as determined by the Committee, equal to the amount of such
required withholding taxes.
18.3 Amendments to Awards. The Committee may at any time unilaterally
amend any unexercised, unearned, or unpaid Award, including, but not by
way of limitation, Awards earned but not yet paid, to the extent it
deems appropriate; provided, however, that any such amendment which, in
the opinion of the Committee, is adverse to the Participant shall
require the Participant's consent.
18.4 Regulatory Approvals and Listings. Notwithstanding anything
contained in this Plan to the contrary, the Company shall have no
obligation to issue or deliver certificates of Common Stock evidencing
Stock Awards or any other Award resulting in the payment of Common Stock
prior to (i) the obtaining of any approval from any governmental agent
which the Company shall, in its sole discretion, determine to be
necessary or advisable, (ii) the admission of such shares to listing on
the stock exchange on which the Common Stock may be listed and (iii) the
completion of any registration or other qualification of said shares
under any state or Federal law or ruling of any governmental body that
the Company shall, in its sole discretion, determine to be necessary or
advisable.
18.5 No Right to Continued Employment or Grants. Participation in the
Plan shall not give any Employee any right to remain in the employ of
PCA International or any Subsidiary. PCA International, or, in the case
of employment with a Subsidiary, the Subsidiary, reserves the right to
terminate any Employee at any time. Further, the adoption of this Plan
shall not be deemed to give any Employee or any other individual any
right to be selected as a Participant or to be granted an Award.
18.6 Amendment/Termination. The Committee may suspend or terminate the
Plan at any time with or without prior notice. In addition, the
Committee may, from time to time and with or without prior notice, amend
the Plan in any manner, but may not without shareholder approval adopt
any amendment that would require the vote of the shareholders of PCA
International pursuant to Section 16 of the Exchange Act or Section
162(m) of the Code, but only insofar as such amendment affects Covered
Employees.
18.7 Governing Law. The Plan shall be governed by and construed in
accordance with the laws of the State of North Carolina, except as
superseded by applicable Federal Law.
18.8 No Right, Title, or Interest in Company Assets. No Participant
shall have any rights as a shareholder as a result of participation in
the Plan until the date of issuance of a stock certificate in his or her
name and, in the case of restricted shares of Common Stock, such rights
are granted to the Participant under the Plan. To the extent any person
acquires a right to receive payments from the Company under the Plan,
such rights shall be no greater than the
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rights of an unsecured creditor of the Company and the Participant shall
not have any rights in or against any specific assets of the Company.
All of the Awards granted under the Plan shall be unfunded.
18.9 Section 16 of the Exchange Act. In order to avoid any Exchange
Act violations, the Committee may, from time to time, impose additional
restrictions upon an Award, including but not limited to, restrictions
regarding tax withholdings and restrictions regarding the Participant's
ability to exercise Awards under any broker-assisted exercise program.
18.10 No Guarantee of Tax Consequences. No person connected with the
Plan in any capacity, including, but not limited to, PCA International
and its Subsidiaries and their directors, officers, agents and employees
makes any representation, commitment, or guarantee that any tax
treatment, including, but not limited to, Federal, state and local
income, estate and gift tax treatment, will be applicable with respect
to amounts deferred under the Plan, or paid to or for the benefit of a
Participant under the Plan, or that such tax treatment will apply to or
be available to a Participant on account of participation in the Plan.
18.11 Compliance with Section 162(m). If any provision of the Plan,
other than the application of those contained in Articles 17 or 18
hereof, would cause the Awards granted to a Covered Person not to
qualify as "performance-based compensation" under Section 162(m) of the
Code, that provision, insofar as it pertains to the Covered Person,
shall be severed from, and shall be deemed not to be a part of this
Plan, but the other provisions hereof shall remain in full force and
effect.
18.12 Other Benefits. No Award granted under the Plan shall be
considered compensation for purposes of computing benefits under any
retirement plan of the Company nor affect any benefits or compensation
under any other benefit or compensation plan of the Company now or
subsequently in effect.
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ROBINSON, BRADSHAW HINSON, P.A.
<TABLE>
<S> <C> <C>
ATTORNEYS AT LAW
101 NORTH TRYON STREET, SUITE 1900 SOUTH CAROLINA OFFICE
PETER C. BUCK CHARLOTTE, NORTH CAKOLINA 28246 THE GUARDIAN BUILDING
INTERNET [email protected] TELEPHONE (704) 377-2536 ONE LAW PLACE - SUITE 600
FAX (704) 378-4000 P.O. DRAWER 12070
ROCK HILL, S.C. 29731
TELEPHONE (803) 325-2900
FAX (803) 325 2929
</TABLE>
May 17, 1996
PCA International, Inc.
815 Matthews-Mint Hill Road
Matthews, North Carolina 28105
Ladies and Gentlemen:
We refer to the Registration Statement of Form S-8 of PCA
International, Inc., a North Carolina corporation (hereinafter
referred to as the "Company"), to be filed with the Securities
and Exchange Commission for the purpose of registering under the
Securities Act of 1933, as amended, 811,550 shares of the
Company's Common Stock, par value $.20 per share (the "Shares"),
in connection with The PCA International, Inc. 1996 Omnibus
Long-Term Compensation Plan (the "Plan"). We have examined the
Articles of Incorporation and the Bylaws, as amended, of the
Company, resolutions adopted by the Board of Directors of the
Company, and other Company records, together with applicable
certificates of public officials and other documents that we have
deemed relevant.
Based upon the foregoing and subject to the conditions set
forth below, it is our opinion that the Shares, if and when
originally issued and sold as contemplated by the Registration
Statement and in accordance with the Plan, will be legally
issued, fully paid and nonassessable.
We have assumed that the Company and those participants
acquiring Shares under the Plan will have complied with the
relevant requirements of the Plan and that the Board of Directors
of the Company shall determine in each instance that the
consideration received or to be received by the Company from the
participants in the Plan is adequate consideration for the Shares
issued under the Plan.
The opinions expressed herein are contingent upon the
Company's Articles of Incorporation and Bylaws not being further
amended prior to the issuance of the Shares.
We hereby consent to the filing of this opinion as an
exhibit to said Registration Statement. In giving such consent,
<PAGE>
PCA International, Inc.
May 17, 1996
Page 2
we do not hereby admit that we are in the category of persons
whose consent is required under Section 7 of the Securities Act
of 1933.
This opinion is limited to the North Carolina Business
Corporation Act, and we express no opinion with respect to the
laws of any other state or jurisdiction.
Sincerely yours,
ROBINSON, BRADSHAW & HINSON, P.A.
(Signature of Peter C. Buck appears here)
Peter C. Buck
PCB/bdg
<PAGE>
The Board of Directors
PCA International, Inc.:
We consent to the incorporation by reference in the Registration Statement
on Form S-8 of PCA International, Inc. of our report dated March 6, 1996,
relating to the consolidated balance sheets of PCA International, Inc. and
subsidiaries as of January 28, 1996 and January 29, 1995, and the related
consolidated statements of inocme, changes in stockholders' equity and cash
flows for each of the years in the three-year period January 28, 1996, and
related schedule, which report appears in the January 28, 1996, Annual
Report on Form 10-K of PCA International, Inc.
(Signature of KPMG Peat Marwick LLP)
KPMG PEAT MARWICK LLP
Charlotte, North Carolina
May 24, 1996
<PAGE>
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS that each of the undersigned, in his
capacity as a director of PCA International, Inc. (the "Company"),
does hereby constitute and appoint John Grosso his true and lawful
attorney-in-fact, to execute in his name, place and stead, in his
capacity as a director of the Company, the Company's registration
statement on Form S-8 relating to the Company's 1996 Omnibus
Long-Term Compensation Plan and any and all amendments thereto as
said attorney-in-fact shall deem necessary or appropriate, together
with all exhibits and other documents and instruments necessary or
incidental in connection therewith, and to file the same or cause
the same to be filed with the Securities and Exchange Commission.
Said attorney-in-fact shall have full power and authority to do and
perform in the name and on behalf of the undersigned, in any and
all capacities, every act whatsoever necessary or desirable in
connection with such registration statement on Form S-8, as fully
and for all intents and purposes as the undersigned might or could
do in person, the undersigned hereby ratifying and approving the
acts of said attorney-in-fact.
IN WITNESS WHEREOF, each of the undersigned has executed this Power
Of Attorney on the dates set forth herein below.
_____________________ _________________________
Date R. Stuart Dickson
_____________________ _________________________
Date Charlotte H. Mason
_____________________ _________________________
Date Peter B. Foreman
_____________________ _________________________
Date Albert F. Sloan
_____________________ _________________________
Date George Friedman
_____________________ _________________________
Date Stanley Tulchin
_____________________ _________________________
Date Joseph H. Reich
