VISTA EYECARE INC, DEF 14A, 1999-03-29

VISTA EYECARE INC
DEF 14A, 1999-03-29
RETAIL STORES, NEC

Previous: UNITED AMERICAN HEALTHCARE CORP, S-8, 1999-03-29

Next: FOOD TECHNOLOGY SERVICE INC, 10KSB, 1999-03-29

<PAGE> 1

SCHEDULE 14A
(RULE 14A-101)

INFORMATION REQUIRED IN PROXY STATEMENT

SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )

Filed by the Registrant [X]

Filed by a Party other than the Registrant [ ]

Check the appropriate box:

<TABLE>
<S> <C>
[ ] Preliminary Proxy Statement [ ] Confidential, for Use of the Commission Only (as
permitted by Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
</TABLE>

VISTA EYECARE, INC.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)

- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of Filing Fee (Check the appropriate box):

[X] No fee required.

[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.

(1) Title of each class of securities to which transaction applies:

(2) Aggregate number of securities to which transaction applies:

(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):

(4) Proposed maximum aggregate value of transaction:

(5) Total fee paid:

[ ] Fee paid previously with preliminary materials:

[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.

(1) Amount Previously Paid:

(2) Form, Schedule or Registration Statement No.:

(3) Filing Party:

(4) Date Filed:
<PAGE> 2

VISTA EYECARE, INC.
296 GRAYSON HIGHWAY
LAWRENCEVILLE, GEORGIA 30045
(770) 822-3600

NOTICE OF ANNUAL MEETING OF SHAREHOLDERS

TO BE HELD APRIL 22, 1999

To the Shareholders:

The Annual Meeting of Shareholders of Vista Eyecare, Inc., a Georgia
corporation, will be held at the Gwinnett Civic and Cultural Center, Duluth,
Georgia, on Thursday, April 22, 1999, at 11:00 a.m., for the following purposes:

1. To elect a Board of seven Directors to serve for the ensuing year.

2. To approve an amendment to the Company's Restated Stock Option and
Incentive Award Plan (a) to increase the number of shares
authorized thereunder from 3,350,000 to 4,350,000 shares and (b) to
limit to 1,000,000 the number of shares which may be granted to any
one employee in any calendar year under such Plan.

3. To transact such other business as may properly come before the
meeting or any adjournments thereof.

Only shareholders of record at the close of business on Monday, March 1,
1999, will be entitled to vote at this meeting.

A proxy statement and a proxy solicited by the Board of Directors are
enclosed herewith. Please sign, date, and return the proxy promptly in the
enclosed business reply envelope. If you attend the meeting, you may, if you
wish, withdraw your proxy and vote in person.

By order of the Board of Directors,

MITCHELL GOODMAN
Secretary

Lawrenceville, Georgia
March 22, 1999

PLEASE COMPLETE AND RETURN THE ENCLOSED
PROMPTLY SO THAT YOUR VOTE MAY BE RECORDED AT
THE MEETING IF YOU DO NOT ATTEND PERSONALLY.
<PAGE> 3

VISTA EYECARE, INC.

PROXY STATEMENT

GENERAL

The Board of Directors (the "Board") of Vista Eyecare, Inc., a Georgia
corporation (the "Company"), is soliciting the enclosed proxy for use at the
1999 Annual Meeting of Shareholders (the "Meeting") to be held on April 22,
1999. Only shareholders of record at the close of business on March 1, 1999,
will be entitled to vote at the Meeting. On March 1, 1999, the Company had
issued and outstanding 21,168,728 shares of Common Stock ("Common Stock").

The Company's principal executive offices are located at 296 Grayson
Highway, Lawrenceville, Georgia 30045. The approximate date on which this proxy
statement and the accompanying proxy are being first sent to shareholders is
March 22, 1999.

VOTING

Each of the 21,168,728 shares of Common Stock outstanding as of the record
date entitles the holder to notice of, and vote on, each matter to be presented
at the Meeting or any adjournments thereof. Each share is entitled to one vote.
Except for the election of directors, the affirmative vote of the holders of a
majority of the voting shares of Common Stock present in person or by proxy at
the Meeting is required for approval of each matter expected to be acted upon at
the Meeting. Directors are elected by a plurality of the votes cast by the
shares entitled to vote. An automated system administered by the Company's
transfer agent tabulates the votes. Abstentions and "broker non-votes" (i.e.,
proxies from brokers or nominees indicating that such persons have not received
instructions from the beneficial owner or other persons entitled to vote shares
as to a matter with respect to which the brokers or nominees do not have
discretionary power to vote) will be treated as present for purposes of
determining the presence of a quorum, but will otherwise have no effect on the
election of directors. For purposes of determining approval of a matter
presented at the Meeting other than the election of directors, abstentions will
be deemed present and entitled to vote and will, therefore, have the same legal
effect as a vote "against" a matter presented at the Meeting. Broker non-votes
will be deemed not entitled to vote on the subject matter as to which the
non-vote is indicated and will, therefore, have no legal effect on the vote on
that particular matter.

REVOCABILITY OF PROXIES

Any person giving a proxy in the form accompanying this proxy statement has
the power to revoke it at any time before its exercise. It may be revoked by
filing with the Secretary of the Company an instrument of revocation or by the
presentation at the Meeting of a duly executed proxy bearing a later date. It
may also be revoked by attendance at the Meeting and election to vote in person.

SOLICITATION

The Company will bear the entire cost of preparing, assembling, printing
and mailing this proxy statement, the accompanying proxy and any additional
material which may be furnished to shareholders by the Company. Copies of
solicitation material will be furnished to brokerage houses, fiduciaries and
custodians to forward to beneficial owners of stock held in their name. The
solicitation of proxies will be made by the use
<PAGE> 4

of the mails and through direct communication with certain shareholders or their
representatives by officers, directors and employees of the Company, who will
receive no additional compensation therefor.

INFORMATION ABOUT THE BOARD AND ITS COMMITTEES

COMPENSATION OF DIRECTORS

Non-employee directors of the Company receive an annual retainer of
$10,000. Non-employee directors who also serve on committees receive additional
compensation as follows: for each committee meeting attended, the Chairman of
the committee receives $2,000, and each committee member receives $1,000. Non-
employee directors are also eligible to participate in the Restated Non-Employee
Director Stock Option Plan. Under this stock option plan, the four non-employee
directors (Messrs. David I. Fuente, Ronald J. Green, Campbell B. Lanier, III,
and J. Smith Lanier, II) serving on the date of the 1998 annual meeting of
shareholders were each granted an option to purchase 7,500 shares of Common
Stock and are entitled to automatic grants of additional options to purchase
7,500 shares upon the date of each subsequent annual meeting of shareholders.
Pursuant to this plan, Mr. James E. Kanaley, who joined the Board in October
1998, was granted an option to purchase 3,750 shares of Common Stock as of the
date he became a member of the Board. He will also be entitled to an automatic
grant of 7,500 shares upon the date of each annual meeting of shareholders. All
option grants are at exercise prices no less than the "fair market value" of a
share of Common Stock on the date of grant. All options vest 50 percent on the
second anniversary of the grant date and 25 percent on each of the third and
fourth anniversaries of the grant date, or 100 percent upon the death of the
director.

MEETINGS OF THE BOARD OF DIRECTORS

During 1998, there were nine meetings of the Board.

AUDIT COMMITTEE

In 1998, the Audit Committee consisted of two directors: Campbell B.
Lanier, III (Chairman) and J. Smith Lanier, II. The Audit Committee held two
meetings in 1998. The Audit Committee is responsible for recommending the
appointment of independent auditors, reviewing with the independent auditors the
scope and results of the audit engagement, establishing and monitoring the
Company's financial policies and control procedures, reviewing and approving
related party transactions, and reviewing and monitoring the provision of
non-audit services by the Company's auditors. Effective March 1, 1999, James E.
Kanaley was added as a member of this Committee.

COMPENSATION COMMITTEE

In 1998, the Compensation Committee consisted of David I. Fuente
(Chairman), Ronald J. Green and Campbell B. Lanier, III. The Compensation
Committee held four meetings in 1998. The Compensation Committee is responsible
for establishing salaries, bonuses, and other compensation for the Company's
officers and making awards under the Company's Restated Stock Option and
Incentive Award Plan. Effective March 1, 1999, Mr. Kanaley replaced Campbell B.
Lanier, III as a member of this Committee.

The Board has no nominating committee.

2
<PAGE> 5

In 1998, all directors (except for Mr. Fuente) attended at least 75 percent
of the meetings of the Board and all committees of the Board of which they were
members.

ELECTION OF DIRECTORS
(PROPOSAL 1)

The directors of the Company are elected annually to serve until the next
annual meeting of shareholders and until their respective successors are
elected. The authorized number of directors of the Company is presently fixed at
seven. All the nominees are currently directors.

Each proxy executed and returned by a shareholder will be voted as
specified thereon by the shareholder. If no specification is made, such proxy
will be voted for the election of the nominees named below to constitute the
entire Board. In the event that any nominee withdraws or for any reason is not
able to serve as a director, the proxy will be voted for such other person as
may be designated by the Board as a substitute nominee, but in no event will the
proxy be voted for more than seven nominees. The management of the Company has
no reason to believe that any nominee will not serve if elected.

The Company's By-Laws contain an advance notice procedure for the
nomination of candidates for election to the Board. Notice of proposed
shareholder nominations for election of directors must be given to the Secretary
of the Company not less than 14 days nor more than 50 days prior to the meeting
at which directors are to be elected, unless the notice of meeting is given less
than 21 days prior to the meeting, in which case the notice of nomination must
be submitted not later than the 7th day following the day on which the notice of
meeting was mailed to shareholders. The notice of nomination must contain
information about each proposed nominee, including age, address, principal
occupation, financial standing, plans or ideas for managing the affairs of the
Company, the number of shares of stock of the Company beneficially owned by such
nominee and such other information as would be required to be disclosed under
the Securities Exchange Act of 1934 (the "Exchange Act"), in connection with any
acquisition of shares by such nominee or with the solicitation of proxies by
such nominee for his election as a director. Information must also be disclosed
by and about the shareholder proposing to nominate that person. The chairman of
a shareholder meeting may refuse to acknowledge the nomination of any person not
made in compliance with the foregoing procedure.

The foregoing summary description of the By-Laws is not intended to be
complete and is qualified in its entirety by reference to the text of the
By-Laws.

3
<PAGE> 6

INFORMATION CONCERNING DIRECTORS

The following information is provided, as of March 1, 1999, regarding the
nominees for election as directors:

Mr. Krause joined the Company in April 1994 as President and Chief
Executive Officer and a director. He was named Chairman of the Company in June
1995. From 1980 until joining the Company, he was President and General Manager
of the automotive and international divisions of Sherwin-Williams Company.

Mr. Feld joined the Company in October 1998 as President and Chief
Operating Officer and a director. Mr. Feld served as President and a member of
the Board of Directors of New West Eyeworks, Inc. since joining New West in May
1991, and as Chief Executive Officer of New West since February 1994. New West
was acquired by the Company in October 1998.

A director since April 1992, Mr. Fuente has been Chairman of the Board and
Chief Executive Officer of Office Depot, Inc. since 1987.

A director since December 1990, Mr. Green has been a partner in the
accounting firm of Stephen M. Berman & Associates, Atlanta, Georgia, since 1980.

Mr. Kanaley was employed at Bausch & Lomb Inc. from 1978 until his
retirement in 1997. From 1990 until 1993, he served as Senior Vice President and
Group President Contact Lens Care, and from 1993 until his retirement he served
as Senior Vice President and President, North American Healthcare. Mr. Kanaley
became a director in October 1998.

A director since October 1990, Mr. Campbell B. Lanier, III is Chairman of
the Board and Chief Executive Officer of ITC Holding Company, a
telecommunications services company located in West Point, Georgia. He is also
Chairman, Chief Executive Officer and director of Intercel, Inc. He also serves
as a director of Mindspring Enterprises, Inc.

A director since October 1990, Mr. J. Smith Lanier, II is Chairman of J.
Smith Lanier & Co., an insurance sales company. He is also a director of
Interface, Inc. Mr. Lanier is the uncle of Campbell B. Lanier, III.

4
<PAGE> 7

EXECUTIVE OFFICERS

The following table sets forth, as of March 1, 1999, certain information
regarding the executive officers of the Company:

<TABLE>
<CAPTION>
NAME AGE POSITIONS WITH THE COMPANY
- ---- --- --------------------------
<S> <C> <C>
James W. Krause............................ 54 Chairman of the Board and Chief Executive
Officer
Barry J. Feld.............................. 42 President and Chief Operating Officer
Richard D. Anderson........................ 40 Senior Vice President, Real Estate
Michael J. Boden........................... 51 Senior Vice President, Leased Retail
Operations
Eduardo Egusquiza.......................... 46 Senior Vice President, Information
Technology
Mitchell Goodman........................... 45 Senior Vice President, General Counsel and
Secretary
Charles M. Johnson......................... 49 Senior Vice President, Manufacturing and
Distribution
Angus C. Morrison.......................... 42 Senior Vice President, Chief Financial
Officer and Treasurer
Timothy W. Ranney.......................... 46 Vice President, Corporate Controller
Robert W. Stein............................ 43 Senior Vice President, Human Resources
James W. Swanson........................... 51 Senior Vice President, Vista Retail
Operations
Patric L. Welch............................ 48 Vice President, Professional Services
</TABLE>

For a description of the business experience of Mr. Krause and Mr. Feld,
see "Information Concerning Directors."

Mr. Anderson joined the Company in January 1999 and was named Senior Vice
President, Real Estate in February 1999. From 1987 until joining the Company, he
was employed by W.H. Smith, PLC where he served as Vice President, Real Estate
and Vice President, Development and Construction.

Mr. Boden joined the Company in June 1995 as Vice President, Sales and
Marketing and was named a Senior Vice President in February 1998. From 1992
until joining the Company, he served as Vice President -- Store Operations of
This End Up Furniture Company.

Mr. Egusquiza joined the Company in March 1998 as Senior Vice President,
Information Technology. From 1982 until joining the Company, he was employed by
Musicland Stores Corporation, Inc. where he served as Vice President of
Information Systems and Services.

Mr. Goodman joined the Company as General Counsel and Secretary in
September 1992 and was named a Vice President in November 1993 and Senior Vice
President in May 1998.

Mr. Johnson joined the Company in October 1997 as Senior Vice President,
Manufacturing and Distribution. From 1988 until joining the Company, he was
employed by the Sherwin-Williams Company, where he served as Vice President and
Director of Research and Development.

Mr. Morrison joined the Company in February of 1995 as Vice President,
Corporate Controller. He was appointed Senior Vice President, Chief Financial
Officer and Treasurer in March 1998. From 1993 until joining the Company, he was
Controller and Senior Financial Officer of the Soap Division of The Dial Corp.
He was Controller and Senior Financial Officer of the Food Division of the same
company from 1989 through 1992.

5
<PAGE> 8

Mr. Ranney joined the Company in September 1998 and was named Vice
President, Corporate Controller in October 1998. From 1991 until joining the
Company, he was employed by CVS Corporation where he served as Store Controller
and then as Director of Financial Systems.

Mr. Stein joined the Company as Director of Human Resources in May 1992. In
January 1993, he was appointed Vice President, Human Resources, and was
appointed Senior Vice President in February 1999.

Mr. Swanson joined the Company in October 1998 and was named Senior Vice
President, Vista Retail Operations in February 1999. He joined New West
Eyeworks, Inc. in July 1991 and served as Chief Operating Officer and Executive
Vice President of New West from September 1997 until joining the Company. New
West was acquired by the Company in October 1998.

Mr. Welch joined the Company as Director Eastern Region in November 1994
and was appointed Vice President, Professional Services in February 1997. He was
District Manager of D.O.C. Optics Corp. from 1993 until joining the Company.

COMMON STOCK OWNERSHIP OF CERTAIN
BENEFICIAL OWNERS AND MANAGEMENT

The Company is not aware of any person who, on March 1, 1999, was the
beneficial owner of five percent (5%) or more of outstanding shares of Common
Stock, except as set forth below.

<TABLE>
<CAPTION>
AMOUNT AND NATURE OF PERCENT
BENEFICIAL OWNERSHIP OF CLASS
-------------------- --------
<S> <C> <C>
Campbell B. Lanier, III................................... 2,627,218(a)(b) 12.4
Rayna Casey............................................... 1,808,152(c) 9.9
Edward G. Weiner.......................................... 1,505,800(d) 8.4
</TABLE>

- ---------------

(a) Includes shares owned by the following individuals and entities, who may be
deemed a "group" within the meaning of the beneficial ownership provisions
of the federal securities laws: Mr. Lanier (136,957 shares); Mr. Lanier's
wife (750 shares); Campbell B. Lanier, IV (25,550 shares); ITC Service
Company (1,546,248 shares); the Campbell B. Lanier, III Grantor Retained
Annuity Trust (the "Trust") (700,000 shares); William H. Scott, III (782,782
shares, inclusive of 700,000 shares owned by the Trust, of which Mr. Scott
is the sole trustee); Martha J. Scott (28,000 shares, inclusive of 10,000
shares owned by the Scott Trust, of which Ms. Scott is the sole trustee);
William H. Scott, III Irrevocable Trust F/B/O Martha Scott (the "Scott
Trust") (10,000 shares); Bryan W. Adams (8,000 shares); J. Douglas Cox
(48,406 shares); and Sandy Cox (29,900 shares).
(b) Includes 20,625 shares which Mr. Lanier has the right to acquire under the
Company's Non-Employee Director Stock Option Plan.
(c) Includes 159,948 shares owned by a trust of which Ms. Casey is the trustee
and her daughter the beneficiary. Ms. Casey's address is 712 West Paces
Ferry Road, Atlanta, Georgia.
(d) Includes 25,000 shares that Mr. Weiner owns but which he may be obligated to
transfer to a director of the Company. Mr. Weiner's address is 500 Southeast
Mizner Boulevard, Boca Raton, Florida 33432.

6
<PAGE> 9

The following table sets forth information, as of March 1, 1999, concerning
beneficial ownership by all directors and nominees, by each of the executive
officers named in the Summary Compensation Table below, and by all directors and
executive officers as a group.

<TABLE>
<CAPTION>
PERCENT OF
NUMBER OF SHARES OUTSTANDING
NAME AND ADDRESS OF BENEFICIAL OWNER(1) BENEFICIALLY OWNED COMMON STOCK
- --------------------------------------- ------------------ ------------
<S> <C> <C>
Campbell B. Lanier, III................................. 2,627,218(2)(3) 12.4
James W. Krause......................................... 639,378(4) 3.0
J. Smith Lanier, II..................................... 275,360(3)(5) 1.3
Ronald J. Green......................................... 109,625(3)(6) *
Barry J. Feld........................................... 140,000(7) *
David I. Fuente......................................... 73,625(3)(8) *
James E. Kanaley........................................ 0 *
Mitchell Goodman........................................ 59,706(9) *
Robert W. Stein......................................... 78,352(10) *
Michael J. Boden........................................ 81,827(11) *
Angus C. Morrison....................................... 71,000(12) *
Eduardo A. Egusquiza.................................... 5,000(13) *
Charles M. Johnson...................................... 5,000(13) *
Richard D. Anderson..................................... 0 *
Timothy W. Ranney....................................... 0 *
James W. Swanson........................................ 2,000 *
All directors and executive officers as a group
(seventeen persons)................................... 4,168,091 19.0
</TABLE>

- ---------------

* Represents less than one percent of the outstanding Common Stock.
(1) Unless otherwise indicated below, the address of the persons named is 296
Grayson Highway, Lawrenceville, GA 30045.
(2) Includes shares owned by the following individuals and entities, who may be
deemed a "group" within the meaning of the beneficial ownership provisions
of the federal securities laws: Mr. Lanier (136,957 shares); Mr. Lanier's
wife (750 shares); Campbell B. Lanier, IV (25,550 shares); ITC Service
Company (1,546,248 shares); the Campbell B. Lanier, III Grantor Retained
Annuity Trust (the "Trust") (700,000 shares); William H. Scott, III
(782,782 shares, inclusive of 700,000 shares owned by the Trust, of which
Mr. Scott is the sole trustee); Martha J. Scott (28,000 shares, inclusive
of 10,000 shares owned by the Scott Trust, of which Ms. Scott is the sole
trustee); William H. Scott, III Irrevocable Trust F/B/O Martha Scott (the
"Scott Trust") (10,000 shares); Bryan W. Adams (8,000 shares); J. Douglas
Cox (48,406 shares); and Sandy Cox (29,900 shares).
(3) Includes 20,625 shares which this individual has the right to acquire under
the Company's Non-Employee Director Stock Option Plan.
(4) Includes 412,500 shares which Mr. Krause has the right to acquire under the
Company's Restated Stock Option and Incentive Award Plan (the "Plan"). Also
includes 30,000 shares of restricted stock awarded under the Plan.
(5) Includes 1,800 shares owned by Mr. Lanier's wife, as to which he disclaims
beneficial ownership.
(6) Includes 9,000 shares owned by Mr. Green's children, as to which he
disclaims beneficial ownership.
(7) Includes 40,000 shares which Mr. Feld has the right to acquire under the
Plan.

7
<PAGE> 10

(8) Includes 25,000 shares which Mr. Fuente has the right to acquire from Mr.
Weiner pursuant to a stock option agreement.
(9) Includes 46,978 shares which Mr. Goodman has the right to acquire pursuant
to the Plan, and 2,728 shares owned by Mr. Goodman's wife, as to which he
disclaims beneficial ownership. Also includes 10,000 shares of restricted
stock awarded under the Plan.
(10) Includes 64,661 shares which Mr. Stein has the right to acquire pursuant to
the Plan. Also includes 10,000 shares of restricted stock awarded under the
Plan.
(11) Includes 68,750 shares which Mr. Boden has the right to acquire pursuant to
the Plan. Also includes 10,000 shares of restricted stock awarded under the
Plan.
(12) Includes 7,200 shares held as custodian for Mr. Morrison's children, 47,500
shares which Mr. Morrison has the right to acquire pursuant to the Plan,
and 8,000 shares of restricted stock under the Plan.
(13) Represents 5,000 shares of restricted stock awarded under the Plan.

SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

Section 16(a) of the Exchange Act requires the Company's directors,
executive officers and holders of more than ten percent (10%) of Common Stock to
file with the Securities and Exchange Commission (the "Commission") initial
reports of ownership and reports of changes in ownership of Common Stock and
other equity securities of the Company. The Company believes that, during 1998,
its officers, directors and holders of more than ten percent (10%) of Common
Stock complied with all Section 16(a) filing requirements, except for Barry J.
Feld and Campbell B. Lanier, III. Mr. Feld filed one report four days late
covering six transactions. Mr. Lanier, and the other members of the group
described in Note 2 to the beneficial ownership table set forth on page 7 of
this proxy statement, each filed one late report as a result of a purchase of
the Company's Common Stock by ITC Service Company. In making these statements,
the Company has relied upon the written representations of its directors and
officers and upon copies of reports furnished to the Company.

COMPENSATION OF EXECUTIVE OFFICERS

The following table discloses compensation received from the Company by the
Company's Chief Executive Officer, and the Company's four most highly
compensated officers other than the Chief Executive Officer (all such
individuals, collectively, the "named executive officers").

SUMMARY COMPENSATION TABLE

<TABLE>
<CAPTION>
LONG TERM COMPENSATION
ANNUAL COMPENSATION ------------------------------------------------
NAME AND -------------------------------------- RESTRICTED SECURITIES
PRINCIPAL FISCAL OTHER ANNUAL STOCK UNDERLYING ALL OTHER
POSITION YEAR SALARY($) BONUS($) COMPENSATION($) AWARDS($)(1) OPTIONS/SARS(#) COMPENSATION($)
- --------- ------ --------- -------- --------------- ------------ --------------- ---------------
<S> <C> <C> <C> <C> <C> <C> <C>
James W. Krause...... 1998 368,000 101,500 -- 79,688(2) 250,000 20,000(3)
Chairman of 1997 338,000 247,000 -- 72,000 50,000 20,000(3)
the Board 1996 307,000 177,000 143,000(4) -- 50,000 20,000(3)
and Chief
Executive Officer
Michael J. Boden..... 1998 193,000 38,000 -- 26,563(5) 15,000 --
Senior Vice 1997 185,000 135,000 -- 24,000 15,000 --
President, Leased 1996 178,000 97,000 -- -- 15,000 --
Retail Operations
</TABLE>

8
<PAGE> 11

<TABLE>
<CAPTION>
LONG TERM COMPENSATION
ANNUAL COMPENSATION ------------------------------------------------
NAME AND -------------------------------------- RESTRICTED SECURITIES
PRINCIPAL FISCAL OTHER ANNUAL STOCK UNDERLYING ALL OTHER
POSITION YEAR SALARY($) BONUS($) COMPENSATION($) AWARDS($)(1) OPTIONS/SARS(#) COMPENSATION($)
- --------- ------ --------- -------- --------------- ------------ --------------- ---------------
<S> <C> <C> <C> <C> <C> <C> <C>
Mitchell Goodman..... 1998 148,000 39,000 -- 26,563(5) 15,000 --
Senior Vice 1997 141,000 99,000 17,000(6) 24,000 15,000 --
President, 1996 135,000 75,000 17,000(6) -- 15,000 --
General Counsel and
Secretary
Charles M. Johnson... 1998 197,000 39,000 -- 26,563(7) 15,000 --
Senior Vice 1997(8) 41,000 70,000 -- -- 75,000 --
President,
Manufacturing and
Distribution
Angus C. Morrison.... 1998 160,000 31,000 -- 28,155(9) 25,000 --
Senior Vice 1997 107,000 49,000 -- 14,438 10,000 --
President, Chief 1996 98,000 37,000 -- -- 10,000 --
Financial Officer
and Treasurer
</TABLE>

- ---------------

(1) Restricted Stock Awards vest and restrictions lapse after five-year
performance period to the extent and depending upon achievement by the
Company of return on asset goals relative to a comparison group of
companies. For awards made in 1998, restricted shares, to the extent not
vested after five years, vest after ten years of employment. Vesting is
accelerated automatically upon a change of control (as defined). Dividends
(if any are declared) will be paid on restricted stock.
(2) As of January 2, 1999, Mr. Krause had restricted stock holdings representing
30,000 shares of Common Stock with a value of $161,250.
(3) The Company has executed a "split dollar" insurance agreement with Mr.
Krause. The annual premium (payable by the Company) is $20,000. The term
life portion of this premium is $2,500; the non-term life portion is
$17,500.
(4) $83,000 represents reimbursement of relocation expenses; $60,000 represents
tax reimbursement payments on the foregoing.
(5) As of January 2, 1999, this executive had restricted stock holdings
representing 10,000 shares of Common Stock with a value of $53,750.
(6) Represents partial forgiveness of $50,000 loan made in 1992.
(7) As of January 2, 1999, Mr. Johnson had restricted stock holdings
representing 5,000 shares of Common Stock with a value of $26,875.
(8) Mr. Johnson joined the Company in October 1997.
(9) As of January 2, 1999, Mr. Morrison had restricted stock holdings
representing 8,000 shares of Common Stock with a value of $43,000.

9
<PAGE> 12

OPTION GRANTS IN LAST FISCAL YEAR

The following table provides information on option grants to the named
executive officers by the Company in 1998. In accordance with rules of the
Commission, there are shown the hypothetical gains or "option spreads" that
would exist for the respective options. These gains are based on assumed rates
of annual compound stock price appreciation of 5% and 10% from the date the
options were granted over the full option term.

<TABLE>
<CAPTION>
POTENTIAL REALIZABLE
VALUE AT ASSUMED
NO. OF % OF TOTAL ANNUAL RATES OF STOCK
SECURITIES OPTIONS/SARS PRICE APPRECIATION
UNDERLYING GRANTED TO FOR OPTION TERMS($)(2)
OPTION/SARS EMPLOYEES IN EXERCISE OR EXPIRATION ----------------------
GRANTED FISCAL YEAR(1) BASE PRICE($) DATE 5% 10%
----------- -------------- ------------- ---------- -------- ----------
<S> <C> <C> <C> <C> <C> <C>
James W. Krause............ 200,000(3) 17.2 5.3125 2/17/08 667,500 1,693,500
50,000(4) 4.3 5.3125 2/17/08 166,875 423,375
Michael J. Boden........... 15,000(4) 1.3 5.3125 2/17/08 50,063 127,013
Mitchell Goodman........... 15,000(4) 1.3 5.3125 2/17/08 50,063 127,013
Charles M. Johnson......... 15,000(4) 1.3 5.3125 2/17/08 50,063 127,013
Angus C. Morrison.......... 15,000(4) 1.3 5.3125 2/17/08 50,063 127,013
</TABLE>

- ---------------

(1) The Company granted options covering 1,163,000 shares to employees in 1998.
(2) These amounts represent assumed rates of appreciation only. Actual gains, if
any, on stock option exercises and holdings of Common Stock are dependent on
the future performance of Common Stock and overall stock market conditions.
There can be no assurance that the amounts reflected in this table will be
achieved.
(3) Grant under the Company's Restated Stock Option and Incentive Award Plan.
Option vests 50% on each of eighth and ninth anniversaries of grant date,
subject to (a) continued employment and (b) accelerated vesting if Company
attains defined earnings per share goals. Expiration date is 10th
anniversary of grant date.
(4) Grants under the Company's Restated Stock Option and Incentive Award Plan.
Options vest 50% on second anniversary of grant date and 25% on each of the
third and fourth anniversary of grant date, subject to continued employment.
Expiration date is 10th anniversary of grant date.

10
<PAGE> 13

AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND
FISCAL YEAR END OPTION VALUES

The following table provides information, as of January 2, 1999, regarding
the number and value of options held by the named executive officers.

<TABLE>
<CAPTION>
NO. OF SECURITIES UNDERLYING VALUE OF UNEXERCISED
UNEXERCISED OPTIONS AT IN-THE-MONEY OPTIONS
SHARES FISCAL YEAR END AT FISCAL YEAR END($)
ACQUIRED ON VALUE ------------------------------ ---------------------------
EXERCISE(#) REALIZED($) EXERCISABLE UNEXERCISABLE(1) EXERCISABLE UNEXERCISABLE
----------- ----------- ----------- ---------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
James W. Krause........... 150,000 28,200 362,500 337,500 65,625 103,125
Michael J. Boden.......... -- -- 45,000 50,000 66,094 42,657
Mitchell Goodman.......... -- -- 31,978 41,250 19,688 27,189
Charles M. Johnson........ -- -- 0 90,000 0 938
Angus C. Morrison......... -- -- 31,250 48,750 17,813 19,688
</TABLE>

- ---------------

(1) Shares represented were not exercisable as of January 2, 1999, and future
exercisability is subject to the executive's remaining employed by the
Company for up to four years from grant date of options.

CHANGE IN CONTROL ARRANGEMENTS

There are agreements between the Company and the named executive officers
which provide severance benefits in the event of termination of employment under
certain circumstances following a change in control of the Company (as defined).
The circumstances are termination by the Company (other than because of death or
disability commencing prior to a threatened change in control (as defined), or
for cause (as defined)), or by an officer as the result of a voluntary
termination (as defined). Following any such termination, in addition to
compensation and benefits already earned, the officer will be entitled to
receive a lump sum severance payment equal to up to three times the officer's
annual rate of base salary.

Cause for termination by the Company is the: (i) commission of any act that
constitutes, on the part of the officer, (a) fraud, dishonesty, gross
negligence, or willful misconduct and (b) that directly results in material
injury to the Company, or (ii) officer's material breach of the agreement, or
(iii) officer's conviction of a felony or crime involving moral turpitude.

Circumstances which would entitle the officer to terminate as a result of
voluntary termination following a change in control include, among other things:
(i) the assignment to the officer of any duties inconsistent with the officer's
title and status in effect prior to the change in control or threatened change
in control; (ii) a reduction by the Company of the officer's base salary; (iii)
the Company's requiring the officer to be based anywhere other than the
Company's principal executive offices; (iv) the failure by the Company, without
the officer's consent, to pay to the officer any portion of the officer's then
current compensation; (v) the failure by the Company to continue in effect any
material compensation plan in which the officer participates immediately prior
to the change in control or threatened change in control; or (vi) the failure by
the Company to continue to provide the officer with benefits substantially
similar to those enjoyed by the officer under any of the Company's life
insurance, medical, or other plans. The term of each agreement is for a rolling
three years unless the Company gives notice that it does not wish to extend such
term, in which case the term of the agreement would expire three years from the
date of the notice.

11
<PAGE> 14

REPORT OF THE COMPENSATION COMMITTEE

A. GENERAL

Compensation of the Company's senior management is reviewed by the
Compensation Committee (the "Committee"), which also administers the stock
option and incentive award program of the Company, and grants awards thereunder.
The compensation philosophy of the Company is based on the premise that the
Company's achievements result from the coordinated efforts of its employees. The
Company strives to achieve those objectives through teamwork that is focused on
meeting the expectations of customers and shareholders.

COMPENSATION PHILOSOPHY

The goals of the compensation program are to align compensation with
business objectives and performance, and to enable the Company to attract,
retain and reward executive officers who contribute to the long-term success of
the Company. The Company's compensation program for executive officers,
including the chief executive officer, is based on the same four principles
applicable to compensation decisions for all employees of the Company:

- The Company pays competitively.

- The Company pays for performance.

- The Company strives for fairness in the administration of pay.

- The Company believes that employees should understand the performance and
pay administration process.

Stock Option Program

The purpose of this program is to provide additional incentives to
employees to work to maximize shareholder value. The option program also
utilizes vesting periods to encourage key employees to continue in the employ of
the Company. The Company grants stock options annually to key field and
administrative employees, including executive officers.

B. 1998 COMPENSATION DECISIONS

1. 1998 CASH COMPENSATION

a. Salary Compensation

In 1998, the Committee awarded Mr. Krause a raise based on Mr. Krause's
achievements and compensation of other chief executive officers at comparable
companies. Evaluation of his performance was subjective and no fixed weights
were assigned to the factors considered. Salary compensation for the other named
executive officers in 1998 was similar to salary compensation for 1997. Raises
were approved on the basis of a merit grid system applied to all employees of
the Company. Evaluation of performance was subjective and no fixed weights were
assigned to the factors considered. In 1998, the Committee also approved
compensation arrangements for Messrs. Feld, Anderson, Ranney and Swanson, all of
whom joined the Company in late 1998. Such arrangements were approved on the
basis of a variety of factors, including the executive's previous compensation
and comparable positions at other companies.

12
<PAGE> 15

b. Bonus Compensation

The Company has in place an incentive compensation plan pursuant to which
each executive officer (including the chief executive officer) is entitled to
receive a bonus if the Company meets certain financial goals (based on defined
improvement in earnings per share) and the executive meets defined individual
performance goals. Because of the acquisitions completed by the Company in 1998,
the Company did not meet its financial goals for this year. The Committee
determined, however, to award partial bonuses for 1998 because, before giving
effect to the financial impact of the acquisitions, the Company did meet its
1998 financial goals. Individual awards were determined on the basis of
achievement of individual goals.

2. 1998 EQUITY COMPENSATION

a. Option Grants

Executive officers receive annual grants of stock options. Annual grants
were made in February of 1998: Mr. Krause received a grant covering 50,000
shares and each other named executive officer received a grant covering 15,000
shares. To provide additional incentive to Mr. Krause, the Committee approved a
grant covering 200,000 shares in February of 1998. Vesting of the option is
accelerated if the Company attains certain earnings per share goals. To the
extent not sooner vested, the option vests 50% on the eighth and ninth
anniversaries of the grant date. The Committee approved a similar award (also
covering 200,000 shares) to Mr. Feld, upon his joining the Company in October
1998. The Committee also approved grants covering 50,000 shares to each of Mr.
Anderson and Mr. Swanson upon their joining the Company and a grant covering
35,000 shares to Mr. Ranney upon his joining the Company.

b. Restricted Stock Awards

The Committee awarded restricted stock in 1998 to the named executive
officers and certain other individuals. The awards vest over ten years, but
vesting can be accelerated to five years depending upon the Company's
performance, measured at the end of such five year period, relative to a peer
group of companies. Mr. Krause received an award of 15,000 shares and each other
named executive officer received an award of 5,000 shares.

3. INTERNAL REVENUE CODE SECTION 162(M)

Section 162(m) of the Internal Revenue Code limits the deductibility of
compensation in excess of $1,000,000 paid to certain executives of public
companies. Because the 1998 compensation levels of the Company's executive
officers were well below the $1,000,000 threshold the Committee did not, in
1998, adopt any policies or programs with respect to this section of the
Internal Revenue Code. All members of the Committee, however, qualify as outside
directors within the meaning of Section 162(m).

COMPENSATION COMMITTEE

David I. Fuente (Chairman)
Ronald J. Green
James E. Kanaley

13
<PAGE> 16

PERFORMANCE GRAPH

NOTE: The stock price performance shown on the graph below is not
necessarily indicative of future price performance.

Comparison of Five-Year Cumulative Total Return
among the Company, the NASDAQ Composite
Index, and the NASDAQ Retail Group Index

<TABLE>
<S> <C> <C> <C> <C> <C> <C>
31-DEC-93 31-DEC-94 30-DEC-95 28-DEC-96 3-JAN-98 2-JAN-99
VISTA EYECARE, INC. $100 $52 $41 $57 $83 $74
NASDAQ COMPOSITE INDEX $100 $98 $138 $170 $210 $293
NASDAQ RETAIL GROUP $100 $91 $100 $120 $140 $170

</TABLE>

14
<PAGE> 17

COMPENSATION COMMITTEE INTERLOCKS
AND INSIDER PARTICIPATION

In 1998, David I. Fuente, Ronald J. Green and Campbell B. Lanier, III
served as members of the Compensation Committee.

CERTAIN TRANSACTIONS

The Company paid insurance premiums of approximately $665,000 in 1998 for
insurance policies purchased through an agency in which J. Smith Lanier, II, a
director of the Company, has a substantial ownership interest. The Audit
Committee (which has ratified the purchase of insurance by the Company from this
insurance agency) and management of the Company believe that these premiums are
comparable to those which could have been obtained from unaffiliated companies.

APPROVAL OF THE AMENDMENT TO THE COMPANY'S
RESTATED STOCK OPTION AND INCENTIVE AWARD PLAN
(PROPOSAL 2)

In 1996, the Company adopted the Restated Stock Option and Incentive Award
Plan (the "Plan") pursuant to which incentive stock options qualifying under
Section 422A of the Internal Revenue Code (the "Code"), nonqualified stock
options and other equity awards may be granted to key employees. A total of up
to 3,350,000 shares of Common Stock may be granted under the Plan. The purposes
of the Plan are to promote greater stock ownership in the Company by those
employees who are principally responsible for its future growth and continued
success; to more closely link the personal interests of participants to those of
the Company's shareholders; and to provide flexibility to the Company in its
ability to motivate, attract and retain the services of participants upon whose
judgment, initiative and special effort the continued success of the Company
depends.

At its meeting on March 8, 1999, the Board, in order to ensure that the
Company has appropriate long-term incentives and competitive compensation
opportunities for its key officers and employees, approved an amendment to the
Plan (the "Amendment"). The Amendment contains two provisions which were adopted
expressly subject to approval of the shareholders: (a) a provision increasing
the number of shares authorized under the Plan from 3,350,000 to 4,350,000
shares and (b) a provision limiting to 1,000,000 the number of shares which may
be granted to any one employee in any calendar year under the Plan.

In connection with the adoption by the Board of the Amendment, the
Compensation Committee (the "Committee") approved general non-binding guidelines
for future grants of stock options to executive officers of the Company. In
particular, the Committee approved the following annual grant levels: for the
Chief Executive Officer, 40,000 shares; for the Chief Operating Officer, 24,000
shares; and for all other executive officers, 12,000 shares.

15
<PAGE> 18

INCREASE IN AUTHORIZED SHARES

The Plan currently authorizes the issuance of up to 3,350,000 shares of
Common Stock. The following table shows as of January 2, 1999 the number of
shares authorized for issuance under the Plan, the aggregate number of options
and equity awards heretofore granted, the number of options exercised, the
number of shares currently subject to outstanding options, and the number of
shares available for the grant of future options:

<TABLE>
<CAPTION>
TOTAL NUMBER OF
OPTIONS AND
EQUITY NUMBER OF SUBJECT TO AVAILABLE FOR
AWARDS GRANTED OPTIONS OUTSTANDING GRANT OF
AUTHORIZED (NET OF FORFEITURES) EXERCISED OPTIONS FUTURE OPTIONS
---------- -------------------- --------- ----------- --------------
<S> <C> <C> <C> <C>
3,350,000................................... 3,141,437 830,807 2,208,630 208,563
</TABLE>

Thus, as of January 2, 1999, 208,563 shares remain unused under the Plan
and will be available for use under the Plan. In addition to the 208,563 shares,
it is proposed that 1,000,000 new shares be made available under the Plan,
making an aggregate of 1,208,563 shares available for the grant of future
options and other equity awards. On the basis of the guidelines described above,
the Company contemplates that stock options covering approximately 350,000
shares will typically be granted each year.

INDIVIDUAL LIMITATION ON AWARDS

The Plan currently provides that no named executive officer may be awarded,
in any 12 month period, grants covering more than 500,000 shares. The Plan
contains this provision so that awards under the Plan will typically qualify as
performance based compensation under Section 162(m) of the Code. The Amendment
amends the limitation described above to limit awards to any employee in any
calendar year to 1,000,000 shares. If the Amendment is approved, awards under
the Plan are still expected to typically qualify as performance based
compensation under Section 162(m) of the Code, but there will be greater
flexibility under the Plan. In addition, as amended, the limitation will apply
to all employees of the Company, and not only the named executive officers. The
Committee has no current plans to make any awards under the Plan which would
approach either the current limit or the limitation contained in the Amendment.

SUMMARY OF THE PLAN

The following summary of certain features of the Plan is qualified in its
entirety by reference to the full text thereof.

Generally. The Plan is a flexible plan that provides the Committee broad
discretion to fashion the terms of awards to provide eligible participants with
such stock-based incentives as the Committee deems appropriate. It permits the
issuance of awards in a variety of forms, including (i) nonqualified stock
options ("NQSO's") and incentive stock options ("ISO's"; NQSO's and ISO's
collectively, "Options"), (ii) performance shares, and (iii) restricted stock
awards.

Administration. The Plan is administered by the Committee, each member of
which is a "disinterested person" within the meaning of Section 16 of, and Rule
16b-3 under, the Exchange Act. The Plan vests broad powers in the Committee to
administer and interpret the Plan. The Committee's powers include authority,
within the limitations set forth in the Plan, to (i) select the persons to be
granted awards, (ii) determine the size and type of awards, (iii) construe and
interpret the Plan, (iv) establish, amend or waive rules and regulations for the
administration of the Plan and (v) determine whether an award, award agreement
or

16
<PAGE> 19

payment of an award should be amended, reduced or eliminated, to the extent the
Plan gives discretion to the Committee to do so.

Eligibility. In general, any key employees of the Company or any
subsidiary of the Company, including key employees who are also directors, are
eligible to receive awards under the Plan. Notwithstanding the foregoing, no
person who is a member of the Committee is eligible to receive awards under the
Plan.

Number of Shares Available. The Plan currently provides for the grant of
up to 3,350,000 shares of Common Stock. If the Amendment is approved by the
Shareholders, the Plan will provide for the grant of 4,350,000 shares of Common
Stock, inclusive of all such shares previously granted and not returned to the
Plan. Under certain circumstances, shares subject to an award that remain
unissued upon termination of the award will become available for additional
awards under the Plan. In the event of a stock dividend, stock split,
recapitalization or similar event, the Committee will equitably adjust the
aggregate number of shares subject to the Plan and the number, class and price
of shares subject to awards outstanding.

Amendment and Termination. The Plan may be amended, modified or terminated
by the Board, subject to shareholder approval if such an amendment would (a)
materially modify the eligibility requirements thereunder, (b) increase the
total number of shares allowed to be issued thereunder, (c) extend the term
thereof, (d) require shareholder approval under Rule 16b-3 of the Exchange Act
or, in any case, if the Board determines that shareholder approval is
appropriate. Unless earlier terminated by the Board or the shareholders, the
Plan will terminate on February 27, 2006.

Code Section 162(m). At all times when the Committee determines that it is
desirable to satisfy the conditions of Section 162(m) of the Code, all awards
granted under the Plan will comply with such conditions. The Committee is
nevertheless empowered to grant awards that would not constitute "performance
based" compensation under Section 162(m). If changes are made to Section 162(m)
to permit greater flexibility with respect to any awards available under the
Plan, the Committee may, subject to the restrictions set forth in the preceding
paragraph regarding amendment thereof, make any adjustments it deems
appropriate.

AWARDS UNDER THE PLAN

Stock Options. The Committee in its discretion will determine the number
of shares of Common Stock subject to Options to be granted to each participant.
Currently, the Plan provides that no named executive officer may be granted
Options to purchase more than 500,000 shares during any 12 month period. If the
Amendment is adopted, the Plan will be amended to provide that no employee may
be granted Options to purchase more than 1,000,000 shares during any calendar
year. The Committee has adopted non-binding guidelines for annual grants of
stock options which are substantially below this 1,000,000 share limit.

The Committee may grant NQSO's, ISO's or a combination thereof to
participants. ISO's, however, may only be granted to a participant if the
aggregate fair market value of the Common Stock underlying ISO's granted to the
participant under all plans of the Company that become exercisable for the first
time during any calendar year is less than $100,000. ISO's granted under the
Plan will provide for the purchase of Common Stock at prices not less than 100%
of the fair market value thereof on the date the Option is granted. NQSO's
granted under the Plan will provide for the purchase of Common Stock at prices
determined by the Committee, but in any event not less than 85% of the fair
market value thereof on the date the Option is granted. No Option granted will
be exercisable later than the tenth anniversary date of its grant.

17
<PAGE> 20

Options will be exercisable at such times and subject to such restrictions
and conditions as the Committee approves. Other than as set forth in the option
agreement, Options will not be transferable by the holder other than by will or
applicable laws of descent and distribution. The option exercise price is
payable in cash or, if approved by the Committee, in shares of Common Stock
having a fair market value equal to the exercise price or in a combination of
cash and such shares. Upon termination of a participant's employment due to
death, disability or retirement, all Options outstanding will immediately vest
and will be exercisable for the shorter of their remaining term or one year
after termination of employment in the case of death, one year after termination
of employment in the case of disability, and six months after termination of
employment in the case of retirement. Upon termination of employment of a
participant other than for any reason set forth above, all Options held by the
participant which are not vested as of the effective date of termination will be
forfeited. However, the Committee, in its sole discretion, may immediately vest
all or any portion of the Options of a participant not vested as of such date.
In the case of termination by the Company without cause, the participant may
exercise any vested Options for the shorter of their remaining term or six
months following the termination of employment, and in the case of termination
by the Company for cause or voluntary termination of employment by the
participant (other than due to retirement), the Options will be forfeited
immediately upon the termination of employment.

Performance Shares. The Committee may grant performance shares to
employees of the Company or its subsidiaries in such amounts, and subject to
such terms and conditions, as the Committee in its discretion determines;
provided, however, that no employee may currently earn more than 500,000
performance shares with respect to any performance period. If the Amendment is
approved, this limit will be increased to 1,000,000 shares. Each performance
share will have a value equal to the fair market value of a share of Common
Stock on the date the performance share is earned. The Committee in its
discretion will set performance goals to be achieved over performance periods of
not less than two years. The extent to which the performance goals are met will
determine the number of performance shares earned by participants. The
performance measure to be used for purposes of grants to Named Executive
Officers will be one or more of the following: total shareholder return, return
on assets, return on equity, earnings per share and ratio of operating overhead
to operating revenue, unless and until the shareholders vote to change such
performance measures. In the event that applicable tax and/or securities laws
change to permit the Committee discretion to alter the governing performance
measures without obtaining shareholder approval, the Committee will have the
sole discretion to make such changes without obtaining shareholder approval. In
any event, with respect to employees that are not Named Executive Officers, the
Committee may approve performance measures not listed above without shareholder
approval.

After the applicable performance period has ended, the Committee will
certify the extent to which the established performance goals have been
achieved, and each holder of performance shares will be entitled to receive
payout on the number of performance shares earned by the participant over the
performance period, to be determined as a function of the extent to which the
corresponding performance goals have been achieved. The grantee of a performance
share award will receive payment, within seventy-five days following the end of
the applicable performance period, of earned performance shares in cash or
shares of Common Stock (or in a combination of cash and shares of Common Stock),
which have, as of the close of the applicable performance period, an aggregate
fair market value equal to the value of the earned performance shares. If the
employment of a participant is terminated by reason of death, disability or
retirement or at the request of the Company without cause during the performance
period, the participant will receive a prorated payout with respect to the
performance shares earned, which will be determined by the Committee, in its
sole discretion, and will be based upon the length of time the participant held
the performance shares during the applicable performance period and upon
achievement of the established performance goals. Such payment will be made at
the same
18
<PAGE> 21

time as payments are made to participants who did not terminate employment
during the applicable performance period. If a participant's employment is
terminated for any other reason, all performance shares will be forfeited by the
participant to the Company. Performance shares may not be sold, transferred,
pledged, assigned or otherwise alienated or hypothecated, other than by will or
by the laws of descent and distribution.

Restricted Stock. The Committee may from time to time grant restricted
stock awards to employees of the Company or its subsidiaries. Each grant of
restricted stock will be evidenced by a written grant agreement between the
participant and the Company setting forth the terms and conditions of the grant,
as determined by the Committee, at its discretion, to be necessary or desirable.
Terms may include a requirement for payment by the participant to the Company
for the restricted stock which is granted.

Each grant of restricted stock will be subject to restrictions, determined
by the Committee in its discretion, for a period of at least one year (the
"Restricted Period"). Such restrictions may include only the requirement of
continued employment or may include other financial performance based criteria
established by the Committee. The restricted stock will be forfeitable (and all
rights of the participant in the Common Stock will terminate) unless the
participant has remained a full-time employee of the Company or of any of its
subsidiaries until the expiration of the Restricted Period and any other
conditions prescribed by the Committee are met. However, the Committee may,
after a grant, in its discretion, shorten the Restricted Period or waive any
condition to the lapse of the restrictions. The grant agreement may, at the
discretion of the Committee and subject to any prescribed terms and conditions,
also provide for the lapse of restrictions upon the occurrence of such specified
events as a change in control of the Company or the termination of the
participant's employment by reason of the participant's death, disability,
retirement or discharge without cause.

During the Restricted Period the participant will have all the rights of a
Company shareholder, including the right to receive dividends and vote the
shares of restricted stock, except as follows. Cash dividends will be paid
either in cash or in restricted stock, as the Committee determines. In addition,
the restricted stock may not be transferred, assigned or encumbered unless and
until all restrictions have lapsed. The restricted stock will be forfeited to
the Company if all conditions to the lapse of the restrictions have not been met
or waived at or prior to the expiration of the Restricted Period.

Change in Control. Upon the occurrence of certain change in control events
and approval of the Committee (in its discretion), (i) all Options outstanding
will become immediately exercisable; (ii) the target payout obtainable under all
performance shares and annual incentive awards will be deemed to have been fully
earned for the entire performance period and each participant will be paid in
cash a pro rata portion of such target payout based on the elapsed portion of
the applicable performance period; (iii) all restrictions on restricted stock
will lapse, and (iv) the Committee may, in its discretion, make any other
modifications to any awards as determined by the Committee to be appropriate
before the effective date of such change in control.

FEDERAL TAX CONSEQUENCES

The following summary of federal income tax consequences with respect to
the Plan is not comprehensive and is based upon laws and regulations currently
in effect. Such laws and regulations are subject to change.

Options. There are generally no federal tax consequences either to the
employee receiving Options (the "Optionee") or to the Company upon the grant of
an Option. Upon exercise of an ISO, the Optionee will not recognize any income
and the Company will not be entitled to a deduction for tax purposes, although
such exercise may give rise to a liability for the Optionee under the
Alternative Minimum Tax provisions of the Code. Generally, if the Optionee
disposes of shares acquired upon exercise of an ISO within two years of the
19
<PAGE> 22

date of grant or one year of the date of exercise, the Optionee will recognize
compensation income and the Company will be entitled to a deduction for tax
purposes in the taxable year in which such disposition occurred in the amount of
the excess of the fair market value of the shares of Common Stock on the date of
exercise over the option exercise price (or the gain on sale, if less).
Otherwise, the Company will not be entitled to any deduction for tax purposes
upon disposition of such shares, and the entire gain for the Optionee will be
treated as a capital gain. Upon exercise of a NQSO, the amount by which the fair
market value of the Common Stock on the date of exercise exceeds the option
exercise price will generally be taxable to the Optionee as compensation income
and will generally be deductible for tax purposes by the Company. The
disposition of shares of Common Stock acquired upon exercise of a NQSO will
generally result in a capital gain or loss for the Optionee, but will have no
tax consequences for the Company.

Performance Shares. The grant of a performance share award will not result
in income for the grantee or in a tax deduction for the Company. Upon the
settlement of such a right or award, the grantee will recognize ordinary income
equal to the fair market value of any shares of Common Stock and/or any cash
received and the Company will be entitled to a tax deduction in the same amount.

Restricted Stock. The Company is of the opinion that a participant will
realize compensation income in an amount equal to the fair market value of the
restricted stock (whether received as a grant or as a dividend), less any amount
paid for such restricted stock, at the time when the participant's rights with
respect to such restricted stock are no longer subject to a substantial risk of
forfeiture, unless the participant elected, pursuant to a special election
provision in the Code, to be taxed on the restricted stock at the time it was
granted or received as a dividend, as the case may be. Dividends paid to the
participant during the Restricted Period will be taxable as compensation income
rather than as dividend income, unless the election referred to above was made.
The Company is also of the opinion that it will be entitled to a deduction under
the Code in the amount and at the time that compensation income is realized by
the participant.

The amount of income realized by each participant and the amount of the
deduction available to the Company will be affected by any change in the market
price of Common Stock during the Restricted Period.

20
<PAGE> 23

OPTION GRANTS

The following table reflects certain grants of Options expected to be made
by the Committee on April 22, 1999, if the Amendment is approved by the
shareholders. Each grant is expected to be for a ten-year term, at an exercise
price equal to the fair market value of a share of Common Stock as of the date
of grant. Other than as follows, it is not possible to determine either the
benefits or amounts that will be received by any persons or groups of persons
under the Plan (as amended by the Amendment) or that would have been received
had the Amendment been in effect during the last fiscal year.

NEW PLAN BENEFITS
VISTA EYECARE, INC. RESTATED STOCK OPTION AND INCENTIVE AWARD PLAN

<TABLE>
<CAPTION>
DOLLAR NUMBER
NAME AND POSITION VALUE($)(1) OF UNITS
----------------- ----------- --------
<S> <C> <C>
James W. Krause, Chairman of the Board and Chief Executive
Officer................................................... -0- 40,000
Michael J. Boden, Senior Vice President, Leased Retail
Operations................................................ -0- 12,000
Mitchell Goodman, Senior Vice President, General Counsel and
Secretary................................................. -0- 12,000
Charles M. Johnson, Senior Vice President, Manufacturing and
Distribution.............................................. -0- 12,000
Angus C. Morrison, Senior Vice President, Chief Financial
Officer and Treasurer..................................... -0- 12,000
Executive Group............................................. -0- 184,000
Non-Executive Directors Group............................... -0- -0-
Non-Executive Officer Employee Group........................ -0- 168,000
</TABLE>

- ---------------

(1) Market value based on stock price (as of grant date) of the shares covered
by the options less the exercise price (which is expected to equal such
stock price).

Voting Requirements. Approval of the Amendment will require the
affirmative vote of a majority of the shares of Common Stock represented in
person or by proxy and entitled to vote at the Meeting.

THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" APPROVAL OF THE AMENDMENT,
AND THE ENCLOSED PROXY WILL BE VOTED IN THAT MANNER UNLESS THE SHAREHOLDER
EXECUTING THE PROXY SPECIFICALLY VOTES TO THE CONTRARY OR ABSTAINS FROM VOTING
ON THIS PROPOSAL.

INFORMATION CONCERNING THE COMPANY'S INDEPENDENT ACCOUNTANTS

The Board has selected the firm of Arthur Andersen LLP, independent public
accountants, to audit the accounts of the Company and its subsidiaries for the
year 1999. Arthur Andersen LLP has served the Company in this capacity since
1990. Representatives of Arthur Andersen LLP are expected to be present at the
Meeting and will be afforded an opportunity to make a statement if they so
desire. Such representatives will be available to respond to appropriate
questions.

SHAREHOLDER PROPOSALS FOR 2000 ANNUAL MEETING

All proposals of shareholders must be submitted to the Secretary of the
Company no later than November 22, 1999, in order to be considered for inclusion
in the Company's 2000 proxy materials. The Company's By-Laws require notice to
the Board or the President, as the case may be, in advance of any regular
shareholders' meeting, of any shareholder proposals. The By-Laws further require
that in connection

21
<PAGE> 24

with such proposals the shareholders provide certain information to the Board or
the President, as the case may be. If a shareholder intends to present a floor
proposal (other than a proposal which concerns the nomination and election of
directors) for consideration at the 2000 Annual Meeting, the Company must
receive notice of such proposal between 90 and 120 days prior to such meeting.
The foregoing summary description of the By-Laws is not intended to be complete
and is qualified in its entirety by reference to the text of the By-Laws.

OTHER MATTERS

The Board is not aware of any matters to come before the Meeting other than
the election of the directors and the Amendment. If any other matter should come
before the Meeting, then the persons named in the enclosed form of proxy will
have discretionary authority to vote all proxies with respect thereto in
accordance with their judgment.

VOTING OF PROXIES

On matters coming before the Meeting as to which a choice has been
specified by the shareholders on the proxies, the shares will be voted
accordingly. If no choice is so specified, the shares will be voted FOR the
election of management's nominees for directors and FOR approval of the
Amendment.

By order of the Board of Directors,

MITCHELL GOODMAN
Secretary

Dated: March 22, 1999

22
<PAGE> 25

(VISTA EYECARE, INC. LOGO)

WWW.VISTAEYECARE.COM
<PAGE> 26
[X] PLEASE MARK VOTES
AS IN THIS EXAMPLE

<TABLE>
<S> <C> <C> <C> <C>
-------------------------
VISTA EYECARE, INC. 1. Election of Directors WITH- FOR ALL
------------------------- FOR HOLD EXCEPT
Barry J. Feld Campbell B. Lanier, III [ ] [ ] [ ]
David I. Fuente J. Smith Lanier, II [ ] [ ] [ ]
James E. Kanaley Ronald J. Green [ ] [ ] [ ]
James W. Krause

NOTE: If you do not wish your shares voted "FOR" a particular nominee,
RECORD DATE SHARES: mark the "FOR All EXCEPT" box and strike a line through that nominee's
name. Your shares shall be voted for the remaining nominees.

FOR AGAINST ABSTAIN
2. Approval of Amendment to the Company's [ ] [ ] [ ]
Restated Stock Option and Incentive Award
Plan.

In their discretion, the proxies are authorized to vote upon any other
business that may properly come before the meeting or at any adjournment(s)
thereof.

----------
Please be sure to sign and date this Proxy. Date
- ------------------------------------------------------

Shareholder sign here Co-owner sign here
- ------------------------------------------------------

DETACH CARD DETACH CARD
</TABLE>

Dear Shareholder:

Please take note of the important information enclosed with this Proxy.

Your vote counts, and you are strongly encouraged to exercise your right to
vote your shares.

Please mark the boxes on this proxy card to indicate how your shares will
be voted. Then sign the card, detach it and return your proxy vote in the
enclosed postage paid envelope.

Thank you in advance for your prompt consideration.

Sincerely,

Vista Eyecare, Inc.

<PAGE> 27

VISTA EYECARE, INC.
ANNUAL SHAREHOLDERS MEETING
APRIL 22, 1999
PROXY SOLICITED BY THE BOARD OF DIRECTORS

The undersigned does hereby appoint JAMES W. KRAUSE and MITCHELL GOODMAN and
each of them proxies of the undersigned with full power of substitution in each
of them to vote at the annual meeting of shareholders of the Company to be held
on April 22, 1999 at 11:00 a.m., and at any and all adjournments thereof, with
respect to all shares which the undersigned would be entitled to vote, and with
all powers which the undersigned would possess if personally present. This
proxy revokes all prior proxies given by the undersigned. Without limiting the
generality of the foregoing, said proxies are authorized to vote upon the
following matters:

UNLESS OTHERWISE SPECIFIED, THIS PROXY WILL BE VOTED FOR THE NOMINEES NAMED
ON THE REVERSE SIDE HEREOF AND FOR APPROVAL OF THE AMENDMENT TO THE COMPANY'S
RESTATED STOCK OPTION AND INCENTIVE AWARD PLAN.

Please sign exactly as your name or names appear on the reverse side. For
more than one owner as shown, each should sign. When signing in a fiduciary
capacity, please give full title. If this proxy is submitted by a corporation,
it should be executed in the full corporate name by a duly authorized officer;
if a partnership, please sign in partnership name by authorized person.

<PAGE> 28

APPENDIX

SECOND AMENDMENT TO THE
NATIONAL VISION ASSOCIATES, LTD.
RESTATED STOCK OPTION AND
INCENTIVE AWARD PLAN

THIS AMENDMENT is made as of the 8th day of March, 1999, by
VISTA EYECARE, INC. (formerly known as NATIONAL VISION ASSOCIATES, LTD.), a
Georgia corporation (the "Company");

W I T N E S S E T H:

WHEREAS, the Board of Directors (the "Board") of the Company
established the National Vision Associates, Ltd. Restated Stock Option and
Incentive Award Plan (the "Plan") effective February 27, 1996 and amended the
Plan effective February 12, 1997; and

WHEREAS, Article 14 of the Plan permits the Board to amend the Plan,
subject to certain restrictions set forth therein; and

WHEREAS, the Board desires to amend the Plan to change the name of the
Plan to reflect the Company's name change from National Vision Associates, Ltd.
to Vista Eyecare, Inc.; and

WHEREAS, the Board desires to amend the Plan to increase the number of
shares available for award or grant under the Plan, and for certain other
purposes;

NOW, THEREFORE, the Plan is hereby amended as follows:

The name of the Plan is changed to "Vista Eyecare, Inc. Restated Stock
Option and Incentive Award Plan" and the name of the Company, as set forth in
the Plan, is changed to "Vista Eyecare, Inc."

Section 4.1 is hereby amended by deleting the first sentence in its
entirety and substituting in lieu thereof the following:

"Subject to adjustment as provided in Section 4.3, the gross number of
Shares available for Awards or Grants shall be four million three
hundred fifty thousand (4,350,000) Shares."

<PAGE> 29

Section 6.1 is hereby amended by deleting the third full paragraph of
such Section in its entirety and substituting in lieu thereof the following:

"The maximum number of Shares subject to Options which can be granted
under the Plan during any calendar year to any Employee shall be one
million (1,000,000) Shares; provided, however, that the maximum number
of Option Shares available for grant to any Employee during any
calendar year shall be correspondingly reduced by the number of Shares
underlying any SAR awarded under Article 7 hereof to the Employee
during the same period."

Section 6.6 is hereby amended by deleting the second sentence of such
Section in its entirety and substituting in lieu thereof the following:

"The Option Price upon exercise of any Option shall be payable to the
Company in full either: (a) in cash, or (b) by tendering previously
acquired Shares (or by attestation of ownership of such Shares) having
an aggregate Fair Market Value at the time of exercise equal to the
total Option Price (provided that the Shares which are tendered must
have been held by the Participant for the period required by the
Committee, in its sole discretion), or (c) by a combination of (a) and
(b)."

Section 6.8 is hereby amended by deleting the second full paragraph of
such Section in its entirety and substituting in lieu thereof the following:

"If a Participant's employment is terminated by the Company or
Subsidiary for Cause, or if such Participant voluntarily terminates his
employment (other than a voluntary termination following a Change in
Control), the Participant's right to exercise any then vested
outstanding Options shall terminate immediately upon termination of
employment. If the Participant's employment is terminated by the
Company or Subsidiary without Cause, or if the Participant voluntarily
terminates his employment after a Change in Control, any Options vested
as of his date of termination shall remain exercisable at any time
prior to their expiration date or for six (6) months after his date of
termination of employment, whichever period is shorter."

2
<PAGE> 30

Section 7.1 is hereby amended by deleting the second full paragraph of
such Section in its entirety and substituting in lieu thereof the following:

"The maximum number of Shares underlying SARs which can be awarded
under the Plan during any calendar year to any Employee shall be one
million (1,000,000) Shares; provided, however, that the maximum number
of Shares available for award to any Employee during any calendar year
shall be correspondingly reduced by the number of Shares subject to
Options granted to the Employee during the same period."

Section 8.1 is hereby amended by deleting the second full paragraph of
such Section in its entirety and substituting in lieu thereof the following:

"The maximum number of Shares that may be awarded under a Stock Award
(whether restricted or unrestricted) to any Employee during any
calendar year shall be one million (1,000,000) Shares."

Section 9.1 is hereby amended by deleting the second sentence of such
Section in its entirety and substituting in lieu thereof the following:

"The Committee shall have complete discretion in determining the number
of Performance Shares granted to each Participant; provided, however,
that (subject to the terms of Article 14 hereof) no Employee may earn
more than one million (1,000,000) Performance Shares with respect to
any performance period."

Items 1, 4, and 5 of this Second Amendment shall be effective March 8,
1999. Items 2, 3, 6, 7, and 8 of this Second Amendment shall be effective on the
date such amendments are approved by the shareholders of the Company. Except as
hereby modified, the Plan shall remain in full force and effect.

IN WITNESS WHEREOF, this SECOND AMENDMENT has been executed on behalf
of the Company pursuant to action taken by the Board effective the date first
above written.

VISTA EYECARE, INC.

By:
-------------------------------