Document:

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                                                                    Exhibit 10.8

PORTIONS OF THIS EXHIBIT HAVE BEEN OMITTED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION. SUCH PORTIONS ARE DESIGNATED "[***]."

                                                                      SCHEDULE B

                                LICENSE AGREEMENT

               THIS AGREEMENT MADE the 9th day of February, 1996.

BETWEEN:

                              WAL-MART CANADA INC.

                       (hereinafter called the "Licensor")

                                                               OF THE FIRST PART

                                     - and -

                      PCA PHOTO CORPORATION OF CANADA, INC.

                       (hereinafter called the "Licensee")

                                                              OF THE SECOND PART

                                     - and -

                             PCA INTERNATIONAL, INC.

                      (hereinafter called the "Guarantor")

                                                               OF THE THIRD PART

WHEREAS:

1.    The Licensor is the owner and operator of a discount department store
      chain under the trade name/trade mark Wal-Mart at several locations within
      Canada;

2.    The Licensee has requested and the Licensor has agreed to grant it
      licenses to operate portrait studios in certain of the Licensor's stores;

3.    The Licensor and the Licensee wish to enter into this Agreement for the
      purposes of establishing the framework within which the aforesaid
      licensees shall operate;

4.    The Guarantor has executed this Agreement for the purpose of guaranteeing
      the obligations of the Licensee under this Agreement.

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         NOW THEREFORE THIS AGREEMENT WITNESSES that in consideration of the
manual covenants, conditions and agreements herein contained, other good and
valuable consideration and the sum of Five Dollars ($5.00) paid by each party to
the other (the receipt and sufficiency of which are hereby acknowledged), the
parties hereto do hereby covenant and agree, each with the other, as follows:

1.00     Definitions and Recitals

1.01     For the purposes of this Agreement the following terms shall have the
meanings hereafter ascribed to them:

"Business Day" shall mean any day of the week except a Saturday, Sunday, or a
statutory holiday in the Province of Ontario;

"Gross Sales" shall mean the entire amount of all revenue and receipts, whether
from cash, cash equivalent, credit, or otherwise, of all sales of merchandise
(including gift and merchandise certificates), services provided, and any other
business activity conducted in connection with the Licensee's Businesses,
including mail or telephone orders received or filled in connection with any of
the Licensee's Businesses, deposits not refunded to purchasers, orders taken,
although said orders may be filled elsewhere, sales to employees, sales through
vending machines or other devices, and sales by a concessionaire, licensee,
third person or otherwise in relation to the Licensee's Businesses. Each sale
upon installment or credit shall be treated as a sales for the full price in the
week during which such sale was made, irrespective of the time when the Licensee
receives payment from its customer. No deduction shall be allowed for
uncollected or uncollectable credit accounts, unless and until same have been
incapable of collection by the Licensee for a period of six (6) months following
the occurrence of such sale, provided that in the event that same is
subsequently collected, whether in whole or in part, such collected amount shall
be added to Gross Sales as at the date of collection. "Gross Sales" shall not
include, however, (i) any sums collected and paid out for any sales or goods and
services tax imposed by any duly constituted governmental authority on any sale
effected in connection with the Licensee's Businesses; (ii) the exchange of
merchandise between the various locations of the Licensee, if any, where such
exchanges are made solely for the convenient operation of the business of the
Licensee and not for the purpose of consummating a sale which has theretofore
been made in connection with one of the Licensee's Businesses and/or for the
purpose of depriving the Licensor of the benefit of a sale which otherwise would
be made in connection with one of the Licensee's Businesses; (iii) the amount of
returns to shippers or manufacturers, nor the amount of any cash or credit
refund made upon any sales where the merchandise sold, or some part thereof, is
thereafter returned by purchaser and accepted by the Licensee; or (iv) sales of
the Licensee's trade fixtures;

"Licensee's Business" shall mean the operation of a portrait studio department
under the trade name within a Licensed Premise, whereby only the following
merchandise is sold, and/or the following services are provided to the public:
the taking and sale of portrait photographs, the taking of passport and
citizenship photographs, the sale of picture frames and other portrait
accessories which do not compete with those sold by the

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Licensor from time to time in its stores, the sale of photographic plaques, the
copying and restoration of old photographs, and the provisions and sale of
photographic lamination services, together with such other services and/or
merchandise as may be approved by the Licensor in writing from time to time, in
its sole absolute and unfettered discretion, which approval may be withheld for
any reason whatsoever; and "Licensee's Businesses" shall mean more than one or
all of the Licensee's Businesses collectively, as the case may be;

"Licensed Premise" shall mean such physical area within a Store as the Licensor
shall designate from time to time in its sole, absolute, and unfettered
discretion for the Licensee's Business, with respect to those Stores for which a
Licence Schedule has been executed by the parties from time to time. For greater
certainty "Licensed Premise" shall not include any Licensed Premise with respect
to which the application of this Agreement has been terminated save and except
as referred to in any Article 12.00 and any other provision of this Agreement
expressed to survive the termination of this Agreement; and "Licensed Premises"
shall mean more than one or all of the Licensed Premises collectively, as the
case may be;

"Licence Schedule" shall mean the executed license schedules forming Schedule
"A" attached hereto and forming a part of this Agreement, together with any New
Store Licence Schedules;

"New Store Licence Schedule" shall mean a new store licence schedule executed by
the parties in substantially the form set forth in Schedule "B" attached hereto
and forming part of this Agreement;

"Stores" shall mean those retail establishments owned and operated by the
Licensor from time to time (including, without in any way limiting the
generality of the foregoing, any indoor or enclosed mall area within which the
Licensor's is entitled to sell merchandise) as more particularly set forth in
Licence Schedule; and "Store" shall mean any one of the Stores;

"Trade Name" shall mean "Wal-Mart Portrait Studio";

"week" shall mean the period commencing at the opening of business each Saturday
and ending at the close of business on the immediately following Friday;

"year" shall mean with respect to each of the Licensee's Businesses, the three
hundred and sixty-five (365) day (and in the event that a year shall include
February 29th, three hundred and sixty-six (366) day) period following the
Commencement Date and each anniversary thereof with respect to such of the
Licensee's Businesses;

1.02  The recitals hereinbefore contained are true and correct and form an
integral part of this Agreement.

2.00  License

2.01  Subject to the provisions of this Agreement, the Licensor hereby grants
to the Licensee the right and licence to carry on the Licensee's Businesses
during the Term for

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the purposes set forth in Section 5.01. Notwithstanding the foregoing, the sales
area of the Licensee is to be an integral part of each Store, and neither party
shall limit access thereto or the flow of customer traffic through such area.
For greater certainty, the Licensor shall at all times maintain care, control
and access to the Licensed Premises.

2.02 The Licensor shall be entitled from time to time to unilaterally relocate a
Licensed Premise within a store for any reason whatsoever acting reasonably, by
the delivery of written notice to that effect to the Licensee. The Licensor
shall be further entitled if the Licensor ceases operation of a Store and
commences the operation of a new Store in the same market area to unilaterally
relocate the Licensed Premise of the old Store to the new Store, by the delivery
of written notice to that effect to the Licensee. The Licensee shall, comply
with the said notice and effect such work as the Licensor stipulates is
necessary or it to make the Licensed Premise comply with the said notice, and
the Licensor shall reimburse the Licensee for reasonable costs actually incurred
to effect such relocation (which for greater certainty shall not include any
charge for administrative work or overhead of the Licensee connected with such
move, or for any loss of business or lack of trade during any period within
which the Licensee's business operations are interrupted by the Licensor). In
the event that any such relocation precludes the Licensee from operating its
business as a result of work necessary to be effected by the Licensor to
facilitate such relocation, the Licensee shall not be required to pay the
Licence Fee in connection with the affected Licensed Premise for the period of
such interruption. The Licensor shall be entitled, acting reasonably, to
designate the time and manner within which the aforesaid work shall be effected
by the Licensee by the inclusion of same in the aforesaid notice, in which case
the Licensee shall comply with same. The Licensee covenants and agrees to effect
such work in a diligent and expedient fashion and to ensure that the areas
wherein the licensed Premise was formerly located is restored to its original
condition.

2.03 The Licensee, its employees, agents, contractors, service personnel, and
customers shall have, subject to Section 2.04, in common with all other persons
entitled thereto, free access to and use of all entrances, stairways, aisles,
corridors, washrooms, and other areas open to the public within a Store from
time to time as the Licensor shall designate during such time(s) as the Licensee
shall operate its business within the Licensed Premise in such Store.

2.04 Notwithstanding Section 2.03, the Licensee, its employees, agents,
contractors, and service personnel shall only have access to such portions of a
Store as the Licensor or its Store manager shall designate from time to time for
the purpose of transporting supplies, equipment, merchandise, goods, trade
fixtures, and/or such other chattels as the Licensee may require from time to
time, to and from the Licensed Premise. The Licensor shall retain exclusive
possession and control of all keys and security codes to the Store and its
security systems.

2.05 The Licensor shall have the right to install through or upon the Licensed
Premises such pipes, aisles, conduits, wires, apparatus, and other physical
installations in connection with any service system as may be proper to useful
for the Licensor's

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operations, but the same shall be installed so as to interfere as little as
possible with the Licensee's use of the Licensed Premises.

2.06 The Licensee acknowledges that it has examined the Licensed Premises in the
Stores and is thoroughly familiar with the condition thereof and accepts each
Licensed Premise in the condition existing as at their respective Commencement
Dates;

2.07 In the event that the parties shall from time to time desire that this
Agreement shall extend to any additional retail premises operated by the
Licensor, the parties shall give effect to same by executing a New Store Licence
Schedule.

2.08 The Licensor covenants and agrees that, subject to the provisions of this
Section 2.08, it shall not permit any person other than the Licensee to operate
a portrait studio on a permanent, temporary, or "travelling promotion" basis
within any Store wherein the Licensee carries on a Licensee's Business from time
to time. The Licensor further covenants and agrees that, as to any store
operated by the Licensor in Canada in which the Licensee does not carry on a
Licensee's Business, the Licensor shall grant to the Licensee a right-of-first
refusal to establish and operate a Licensee's Business, the Licensor shall grant
to the Licensee a right-of-first refusal to establish and operate a Licensee's
Business on the terms and conditions of this Agreement. In the event that the
Licensor delivers written notice to the Licensee that it wishes to carry on a
Licensee's Business in any store operated by the Licensor in Canada in which the
Licensee does not carry on a Licensee's Business, the Licensee shall advise the
Licensor in writing of its intentions within five (5) Business Days following
its receipt of such notice, and in the event that the Licensee fails to respond
to the Licensor in writing within such period of time, and/or advises that it is
not interested in operating a Licensee's Business as requested, the Licensor
shall be free to permit any other person to operate a portrait studio in such
store. For greater certainty and notwithstanding the foregoing, nothing herein
contained shall prevent the Licensor from: (i) operating a portrait studio in
any of its stores within which the Licensee does not carry on a Licensed
Business, and with respect to a permanent portrait studio only, provided that it
has granted the right-of-first refusal contemplated in this section to the
Licensee and the Licensee has failed to agree to operate a Licensee's Business
within such store in the manner and within the time specified above; (ii) itself
or any of its other licensees selling any merchandise in any Store, including
without limitation, picture frames, film, photographic equipment, film, and
other related merchandise; (iii) operating a photographic processing department
in any Store; (iv) operating a "Glamour Shots" or similar travelling promotional
program within any Store.

3.00 Term

3.01 This Agreement and the licenses created pursuant to this Agreement shall
commence on the date hereinabove set forth and, subject to earlier termination
as provided for in this Agreement, continue in effect for a term ending at 12:00
midnight on the day which is five years following the date of this Agreement
(the "Term").

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3.02 Notwithstanding the provisions of Section 3.01, in the event that a Licence
Schedule stipulates a later or earlier date of expiration than that set forth in
Section 3.01, the "Term" in respect of the Licensee's Business governed by such
Licence Schedule and the application of this Agreement thereto, shall commence
on the Commencement Date set forth in such Licence Schedule, and end at 12:00
midnight on the date which is five (5) years thereafter.

3.03 The Licensor shall have the option to unilaterally renew the Term with
respect to any of the Licensee's Businesses for one renewal period of two (2)
years for each such renewal, by delivery of written notice to that effect to the
Licensee on or before the date which is thirty (30) days prior to the expiry of
the term with respect to such Licensee's Business. The terms of this Agreement
and the license(s) created pursuant to this Agreement shall be continued for the
renewal period, upon the exercise of any such option to renew by the Licensor.

4.00 License Fees

4.01 The Licensee shall also pay to the Licensor in respect of each of the
Licensee's Businesses, an amount equal to [***] of the total Gross Sales made by
the Licensee, its employees, concessionaires, agents, licensees, contractors,
successors and assigns in connection with such Licensee's Business during each
year (the "Licence Fee"). The Licensee covenants and agrees to pay the Licence
Fee to the Licensor for each of the Licensees Businesses weekly, on the date
which is ten (10) Business Days following the end of each week.

4.02 In addition, the Licensee shall bear the cost of and pay to the Licensor
all applicable sales, goods and services, value added and other similar taxes
(the "Taxes") exigible from time to time with respect to any payment by it under
this Agreement, in accordance with the provisions of the legislation imposing
such tax or taxes. The Licensee shall pay the Taxes to the Licensor on the date
that it is required to make the payment to the Licensor to which such Taxes
apply.

4.03 The Licensee shall deliver to the Licensor together with each Licence Fee
Payment on the date which is ten (10) days following the end of each week, a
sales report (the "Sales Report") for the immediately preceding week containing
such information and in the format set forth in Schedule "C" attached hereto and
forming a part of this Agreement. For greater certainty, the parties acknowledge
and agree that the Sales Report shall be prepared individually for each of the
Licensee's Businesses and shall specify the Gross Sales for the immediately
preceding week, and all preceding weeks in the year, together with year to date
totals shown adjacent to the budgeted amounts for same previously agreed to with
the Licensor, Licence Fee, and Taxes for the applicable Licensee's Business,
together with a summary indicating the totals of same for all of the Licensee's
Business collectively. The Licensee further covenants to provide a Sales Report
detailing the foregoing information for the immediately preceding year
applicable

_________________________

[***] Redacted pursuant to a request for confidential treatment.

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to the Licensee's Business, on the date which is thirty (30) days following the
completion of such year. The Licensee covenants and agrees to make all of its
records pertaining to the Licensee's Businesses available to the Licensor and
its agents for inspection and/or audit forthwith following the receipt by it of
one (1) Business Day's prior written notice from the licensor and/or its agents
requesting same. The Licensee covenants and agrees to retain all such records
for a minimum of two (2) years following the end of each year of the Term. The
License shall provide the Sales Report to the Licensor prepared using Microsoft
Excel on a 3.5 inch computer disk, as well as on paper.

4.04 The parties covenant and agree to re-adjust any under or over payments of
the Licence Fee, and/or Taxes payable under this Agreement with respect to the
immediately preceding year of the Term, within fifteen (15) days following any
of the delivery by the Licensee to the Licensor of the annual sales report
referred to in Section 4.03, the date that a legitimate written request therefor
by the other party based on a reporting error and/or other failure to comply
with this Agreement, and/or the date that the Licensee becomes aware that it has
effected an underpayment to the Licensor. If a statement of Gross Sales
submitted by the Licensee in respect of one of the Licensee's Businesses is
found to be incorrect, so that such error resulted in an under-reporting of
Gross Sales to the Licensor which is greater than 3.5% of the Gross Sales for
such Licensee's Business for the applicable year, the Licensee shall pay all
costs incurred by the Licensor with respect to any audits of the Licensee' books
and records for all of the Licensee's Businesses for such year, including,
without limiting the generality of the foregoing, the costs of any internal
auditors of the Licensor.

4.05 The Licensee shall pay to the Licensor interest on any monies owing to the
Licensor which are past due under this Agreement at the rate of the annual rate
of interest announced from time to time by the Toronto-Dominion Bank as a
reference rate then in effect for determining interest rates on Canadian dollar
commercial loans in Canada plus 2%. Such interest shall accrue from the date
such monies first become due and payable to the Licensor and shall be calculated
and compounded semi-annually.

4.06 The Licensee covenants and agrees to deliver to the Licensor at the end of
each quarter of each of the Licensor's fiscal years (i.e. February 1 - January
31), copies of all of its most current financial statements, including without
limiting the generality of the foregoing, balance sheet, income statement,
statement of retained earnings, and cash flow statement, whether or not same
have been independently audited and/or prepared by a chartered accountant. In
addition to the forgoing, in the event that any of such financial statements
shall be audited and/or prepared by a chartered accountant from time to time,
the Licensee shall forthwith deliver copies of any audit report or other report
as to the adequacy of such financial statements to the Licensor. The Licensor of
any audit report or other report as to the adequacy of such financial statements
to the Licensor. The Licensor covenants and agrees to maintain any financial
statements and/or other information provided to it under this Section 4.06 in
the strictest of confidence and shall not disclose any of same to any other
person.

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5.00 Use of Licensed Premises

5.01 The Licensee shall be entitled to use each Licensed Premise for the purpose
of carrying on the Licensee's Business and for no other purpose, save and except
for such other purpose as the Licensor may approve in writing from time to time
following the receipt of a written request therefor from the Licensee which
approval may be withheld for any reason whatsoever.

5.02 The Licensee shall carry on each of the Licensee's Businesses on such days
and during such hours as are specified in Schedule "D" attached hereto and
forming part of this Agreement. For greater certainty, nothing in this Agreement
shall prevent the Licensee from extending the studio hours of operation on a
province by province or individual studio basis, provided that the Licensee must
first review such change with the Licensor and receive the Licensor's approval
to extend such hours of operation.

5.03 The Licensee hereby acknowledges that its business reputation, intended use
of the Licensed Premises as set forth in Section 5.01, potential for payment of
Licence Fees and ability to generate patronage to the Licensed Premises and the
Stores were all relied upon by the Licensor and served as significant and
material inducements contributing to the Licensor's decision to enter into this
Agreement with the Licensee. The Licensee hereby covenants and agrees: (i) to
carry on the Licensee's Businesses only under the Trade Name and under no other
name or trade name whatsoever without the Licensor's prior written consent which
may be withheld for any reason whatsoever, (ii) to continuously use the Licensed
Premises for the retail sale of its goods or services in accordance with its
permitted use set forth in Section 5.01, during the hours designated by the
Licensor pursuant to Section 5.02.

6.00 Operating Standards / Customer Complaints

6.01 The Licensee shall operate its business in an efficient, high class and
reputable manner. In addition, the Licensee will conduct all business in
conjunction with and abiding by the Licensor's philosophies, culture and
standards in force from time to time. The Licensee agrees with the Licensor that
the Licensee's business will be operated in a diligent and business-like manner
in conformity with the Licensor's standards and policies as may be amended from
time to time. The Licensee's employees will at all times, while on the
Licensor's premises, maintain a pleasant and courteous attitude towards
customers. While on the Licensor's premises, the Licensee's employees shall be
subject to the Licensor's rules and regulations as may be amended from time to
time. No smoking, food or drink will be allowed on the sales floor. The personal
appearance of the Licensee's employees, agents and workmen must be neat and
clean and all attire must be consistent with attire worn by the Licensor's sales
floor associates. The Licensee will instruct each employee to refer to the
Licensor's Store management for details on all such rules and regulations. The
Licensee shall not permit any odours or noise which are objectionable or
unpleasant to the Licensor or its customers to emanate within a Store nor take
any other action which would constitute a nuisance or would disturb or endanger
the customers or occupants of the Store, nor do anything which would tend to
injure the reputation of the Store or the Licensor.

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6.02 The Licensee shall not conduct within the Licensed Premises any "fire",
"bankruptcy", "going-out-of-business," "liquidation," or other similar sales,
and/or operate within the Licensed Premises a "wholesale" or "factory outlet"
store, a "cooperative store", a "second hand" store, a "surplus" store or a
store commonly referred to as a "discount house".

6.03 The Licensee shall maintain all its displays in a neat, and attractive
condition at all times.

6.04 The Licensee shall be solely responsible for the control and management of
its operations, employment practices and labour relations concerning the
Licensee's employees and other persons rendering services to it.

6.05 If the Licensor has any complaint concerning any employees of or persons
rendering services to the Licensee, the Licensor shall inform the Licensee of
said complaint. The Licensee shall forthwith thereafter take such actions as the
Licensee deems appropriate to rectify the subject matter of such complaint and
to prevent any similar recurrence in the future. The Licensee acknowledges and
agrees that the Licensor's store managers and assistant store managers shall be
entitled to settle any customer complaint pertaining to the Licensee and/or make
any payment to any customer to give effect to such settlement, and the Licensee
shall forthwith reimburse the Licensor for same upon receipt of a request to do
so from the Licensor.

6.06 All customer complaints involving the Licensee which are received by the
Licensor shall be referred to an employee of the Licensee who shall be
designated by the Licensee as its designated corporate representative. The
Licensee shall use its best efforts to respond to these complaints within a
reasonable period after receipt of same by the Licensee and the Licensee shall
make a diligent effort to promptly resolve complaints or otherwise satisfy
customers' concerns and, if so requested by the Licensor, shall advise the
Licensor of the status of any complaint and the efforts made to resolve or
satisfy same.

6.07 The Licensee shall not, without the Licensor's prior written consent which
may be withheld for any reason whatsoever, keep anything within a Licensed
Premise or use a Licensed Premise for any activity which increases the insurance
premium cost or invalidates any insurance policy carried by any person with
respect to the Store or any part thereof. All property kept, stored or
maintained within the Licensed Premises by or on behalf of the Licensee shall be
at the Licensee's sole risk.

6.08 The Licensee shall include the address and identity of its business
activities in the Licensed Premises in all print advertisements made by it in
which the address and identity of any similar local business activity of the
Licensee is mentioned.

6.09 The Licensor shall maintain and repair the Stores within which the Licensed
Premises are located to the standard that it deems acceptable, acting
reasonable, so as to permit the Licensee to operate its business therein.

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6.10 The Licensee covenants and agrees to provide a 10% discount on all
merchandise and services offered for sale in connection with the Licensee's
Business which is not "on sale" or offered at a "special promotional price" to
all persons entitled to use and who present at the time of purchase a valid
Wal-Mart associate discount card.

6.11 The Licensor hereby grants the Licensee a licence to operate the Licensee's
Businesses under the Trade Name, and the Licensee's advertising may specify the
local address of the store in which a Licensee's Business is situate. The
Licensee shall, subject to the terms of this section, be permitted to advertise
the Licensee's Businesses in all forms of media as the Trade Name. The Licensor
shall make all reasonable efforts to assist the Licensee in obtaining any
advertising or media discount that may be available to the Licensor from time to
time. Upon termination of this Agreement with respect to a Licensee's Business
or in its entirety (as the case may be), the license granted by this section
shall be automatically terminated and of no further force or effect with respect
to the applicable Licensee's Business(es). Any advertising by the Licensee using
the Trade Name, Licensor's name, and/or the mark/trademark "Wal-Mart", must be
approved in advance in writing by Licensor. Notwithstanding anything herein
contained all dealings by the Licensee with its creditors, suppliers, workmen,
contractors, agents, employees, and other similar persons shall be conducted
exclusively in the Licensee's name, and the Licensee shall not in any manner
obligate the Licensor on account thereof.

6.12 The Licensor warrants that the Licensee's conduct of the Licensed
Businesses under the Trade Name in conformity with this Agreement does not and
will not infringe or violate any trademark, trade name, or other intellectual
property rights of any other licensee of the Licensor. Provided that the
Licensee complies with its obligations under this Section 6.12, the Licensor
hereby agrees to indemnify, defend, and hold the Licensee and its parent and
affiliated corporations, employees, officers, agents, successors, and assigns
harmless from all losses, damages, and expenses, (including attorney's fees
incurred by such indemnified party) which such indemnified party may suffer as
the result of any breach of the Licensor's warranties under this Section 6.12.
The indemnity contained in this Section 6.12 shall survive the termination of
this Agreement. The Licensee hereby grants and covenants and agrees to cause the
other indemnified parties to grant the Licensor the exclusive right on behalf of
the aforesaid indemnified parties to defend, compromise, settle, retain and
instruct counsel, and/or otherwise deal with any claim, demand or other
assertion made of any of them with respect to the matters for which the Licensor
has agreed to indemnify any of them under this Section 6.12.

6.13 The Licensee acknowledges that the Licensor is the operator of discount
stores featuring a full stock of quality merchandise at low, competitive prices
and that the Licensor's reputation for competitive pricing and customer
satisfaction are imperative to its successful operation. The Licensee agrees
that each of the Licensee's Business must reasonably conform to that image. The
Licensee agrees to use its best efforts to offer to its customers the ability to
obtain photographic services (including portrait packages) from each Licensee's
Business at values equal to or better than verified, bona fide prices offered by
competitors in the market within which the applicable Licensee's Business is
carried on.

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     7.00 Construction/Alterations

     7.01 The Licensee shall not make any replacements, improvements,
     alterations or renovations to any part of a Licensed Premise (save and
     except for the installation and removal of non-affiliated movable trade
     fixtures which may be installed without drilling, cutting or other physical
     alteration of any part of the building within which the Store is located
     (referred to in this Agreement as "trade fixtures")) from that approved by
     the Licensor pursuant to this Agreement, without the prior written consent
     of the Licensor which may be withheld for any reason whatsoever.

     7.02 All alterations, additions, improvements and fixtures (save and except
     for trade fixtures, unattached readily movable furniture and office
     equipment) which may be made or installed by the Licensee within a Licensed
     Premise shall remain upon and become the property of Licensor upon the
     termination of this Agreement with respect to such Licensed Premise, unless
     the Licensor requests their removal in which event the Licensee shall
     remove the same and restore such Licensed Premises to its original
     condition at its sole cost and expense.

     7.03 All construction work done by the Licensee within a Licensed Premise
     shall be performed in a good and workmanlike manner to a standard which is
     acceptable to the Licensor, in its sole, absolute and unferrered direction,
     in compliance with all governmental requirements, and in such manner as to
     cause a minimum of interference with other construction in progress and
     with the transaction of business in the Store.

     7.04 The Licensee covenants and agrees not to permit any construction lien,
     claim for lien, or other lien to arise and/or be registered against the
     title to the property upon which a Store is located as a direct or indirect
     result of any work undertaken by it or on its behalf in respect of a
     Licensed Premise. In the event that any such lien shall arise, the Licensee
     covenants and agrees to, forthwith following becoming aware of same, to
     take all possible action, including without limitation the payment of the
     monies claimed into court, in order to have such lien removed from the
     title to the property upon which a Store is located within five (5)
     Business Days thereafter. In the event that the Licensee defaults in the
     aforesaid obligation, the Licensor shall be entitled, if it so chooses, to
     undertake the Licensee's obligations on its behalf and to invoice the
     Licensee for all costs, including without limitation legal fees in their
     entirety, associated with same, which shall be payable by the Licensee to
     the Licensor forthwith upon receipt by the Licensee of a written demand
     therefor from the Licensor. The foregoing remedy of the Licensor is in
     addition to and not substitution for any other remedies available to the
     Licensor under this Agreement, at law, or in equity.

     7.05 The Licensee shall furnish, at its own expense, all affixed fixed
     improvements, and trade fixtures (including without in any way limiting the
     generality of the foregoing, cabinets, counters, displays, seating, tables,
     cash registers, cameras, computer equipment and all other furniture and
     equipment which it may require in to carry on each Licensee's Business
     (hereinbefore and hereinafter referred to as the "Equipment"). The Licensor
     may from time to time require the Licensee to refurbish or update any of
     the foregoing (save and except for any cameras or other photographic
     equipment which are not on

<PAGE>

                                      -12-

     display to the public) and it is specifically agreed and understood that
     the Licensor may remodel or refixture its retail sales floors from time to
     time during the terms hereof, and in the event the Licensor does so, the
     Licensor may require the Licensee, acting reasonably, to remodel and/or
     refixture a Licensed Premise at the Licensee's expense as necessary to
     reflect the remodelled or refixtured look of the Licensor.

     8.00 Insurance

     8.01 The Licensee shall, at its sole cost and expense, take out and keep in
     full force and effect at all times during the Term, with an insurer which
     is acceptable to the Licensor, a comprehensive public liability and
     property damage insurance policy with limits in an amount of not less than
     Two Million ($2,000,000.00) Dollars per occurrence. Such policy of
     insurance shall include coverage for personal injury liability, bodily
     injury liability, contractual liability, liability for damage to or losses
     relating to the Licensed Premises and any channels, property, merchandise,
     trade fixtures, or monies located therein from time to time, and "all-risk"
     liability insurance, such coverage to include the business operations
     conducted by the Licensee on the Licensed Premises. Such policy of
     insurance shall be endorsed with an endorsement providing that no
     cancellation of such policy will be effective unless the Licensor shall
     have received at least sixty (60) days prior written notice of such
     cancellation. The Licensee shall cause such policy of insurance to name the
     Licensor as an additional insured and be endorsed with a waiver of
     subrogation provision in favor of the Licensor. The Licensee shall cause a
     certificate of insurance executed by the insurer named in the applicable
     policy or policies of insurance or an insurance broker duly authorized by
     such insurer to execute such certificate with respect to such policy of
     insurance and endorsements, to be delivered to the Licensor concurrently
     with the Licensee's execution of this Agreement and/or from time to time
     following the receipt of a written request therefor from the Licensor.

     8.02 The Licensee covenants and agrees to register itself and all persons
     engaged for service by it under the workers compensation legislation
     applicable to a Licensed Premise.

     9.00 Compliance with Laws

     9.01 The Licensee shall, at its sole cost and expense, promptly comply with
     all statutes, regulations, ordinances, rules, laws, and other legal
     stipulations of any governmental authority having jurisdiction with respect
     to a Licensed Premise, pertaining to the Licensee's occupancy of, work
     undertaken within, and/or business operation(s) within a Licensed Premise.
     For greater certainty, the parties acknowledge and agree that the licensee
     shall be solely responsible to procure and maintain at all times during the
     term of this Agreement or any renewal thereof, any and all permits and/or
     approvals of any governmental authority having jurisdiction with respect to
     the Licensed Premise required in order to occupy, undertake improvements,
     and operate its business therein, and the Licensor shall have no
     obligations in this regard whatsoever.

<PAGE>

                                      -13-

     10.00 Confidentiality

     10.01 The Licensee acknowledges and agrees that certain information made
     available to it from time to time by the Licensor, including without
     limiting the generality of the foregoing, information disseminated at any
     management or other meeting(s) held by the Licensor at the Stores, is
     confidential in nature. For the purposes of this Agreement, such
     confidential information (hereinafter referred to as "Wal-Mart Confidential
     Information") shall be defined as information received by the Licensee, its
     agents or employees which is not generally known in the industry in which
     the Licensor is engaged, or which would logically be considered
     confidential and/or proprietary, or which would do the Licensor harm if
     divulged, or which is marked "Confidential" or "Proprietary" by the
     Licensor. Wal-Mart Confidential Information shall not either directly or
     indirectly be disclosed to others or used in any way by the Licensee or
     those for whom it is responsible at law, without the prior written
     permission of the Licensor, which may be withheld for any reason
     whatsoever. The provisions of this section shall survive and remain in full
     force and effect following any termination of this Agreement and/or the
     application of this Agreement to any of the Licensee's Business.

     10.02 The Licensor acknowledges and agrees that certain information made
     available to it from time to time by the Licensee, including without
     limiting the generality of the foregoing, Gross Sales of any or all of the
     Licensee's Businesses, is confidential in nature. For the purposes of this
     Agreement, such confidential information (hereinafter referred to as "PCA
     Confidential Information") shall be defined as information received by the
     Licensor, its agents or employees which is not generally known in the
     industry in which the Licensee is engaged, or which would logically be
     considered confidential and/or proprietary, or which would do the Licensee
     harm if divulged, or which is marked "Confidential" or "Proprietary" by the
     Licensee. PCA Confidential Information shall not either directly or
     indirectly be disclosed to others or used in any way by the Licensor or
     those for whom it is responsible at law, without the prior written
     permission of the Licensee, which may be withheld for any reason
     whatsoever. Notwithstanding the foregoing, the Licensor shall be entitled
     to disclose the following PCA Confidential Information to any person
     without the prior consent of the Licensee if same: (i) is already available
     to the public; (ii) becomes available to the public through no fault of the
     Licensor; (iii) is already known to the Licensor as shown by written
     records in the Licensor's possession at the time the PCA Confidential
     Information was received; and/or (iv) is required to be disclosed by law
     and/or enforcement of any contractual obligation owed by the Licensor to
     any third person. The provisions of this section shall survive and remain
     in full force and effect following any termination of this Agreement and/or
     the application of this Agreement to any of the Licensee's Businesses.

     11.00 Parking

     11.01 The Licensee shall comply with such rules and regulations as the
     Licensor may stipulate from time to time with respect to the parking of
     motor vehicles in the vicinity of any Store. In addition to the foregoing,
     the Licensee shall provide the license plate numbers of all automobiles of
     the Licensee, its employees, agents, and workmen, which

<PAGE>

                                      -14-

     are to be parked in the vicinity of any Store, and such persons shall only
     park in those area designated by the Licensor as employee parking from time
     to time.

     12.00 Defaults

     12.01 For the purposes of this Agreement, any one or more of the following
     events shall constitute a material default ("Material Default") of this
     Agreement:

           (a) failure of the Licensee to pay the License Fee, and/or Taxes on
               the date that same is due in accordance with the provisions of
               this Agreement;

           (b) any sale by the Licensee of all or substantially all of its
               assets or any sale or other transaction that results in the
               Guarantor's ownership and voting control, directly or indirectly,
               of less than 51% of the voting securities of the Licensee issued
               and outstanding from time to time, with respect to which the
               prior written consent of the Licensor has not been obtained,
               which consent may be withheld for any reason whatsoever;

           (c) the Licensee shall (i) generally not pay its debts as they fall
               due; (ii) admit in writing its inability to pay its debts
               generally, or shall make a general assignment for the benefit of
               creditors; (iii) institute or have instituted against in any
               proceeding seeking (A) to adjudicate it a bankrupt or insolvent,
               (B) any liquidation, winding-up, reorganization, arrangement,
               adjustment, protection, relief or composition of it or its debts
               under any law relating to bankruptcy, insolvency or
               re-organization or relief of debtors or otherwise, or (C) the
               entry of an order for relief or the appointment of a receiver,
               trustee or other similar official for it or any substantial part
               of its assets, and in the case of any such proceeding instituted
               against it (but not instituted by it), either such proceeding
               shall remain undismissed or unstayed for a period of thirty (30)
               days, or any of the actions sought in such proceeding (including
               the entry of an order for relief against it or the appointment of
               a receiver, trustee, custodian or other similar official for it
               or for any substantial part of its assets) shall occur; or (iv)
               take any corporate action to authorize any of the foregoing
               actions; and/or

           (d) the Licensee shall at any time operate or carry on any business
               in any way similar to a Licensee's Business (including without
               limitation a traveling or temporary portrait studio
               program/service) in any department store and/or junior department
               store in Canada (other than one operated from time to time by the
               Licensor) which is located with a twenty-five (25) mile radius of
               any retail discount department store operated from time to time
               by the Licensor under the trade name/trade mark Wal-Mart:

           (e) failure of the Licensee to fully comply with its obligations
               unders (S)7.04.

     12.02 In the event that a Material Default shall occur, the Licensor shall
     be entitled at any time thereafter to terminate this Agreement or the
     license created pursuant to this

<PAGE>

                                      -15-

     Agreement in respect of the Licensee's Business(es) in respect of which
     such default shall have occurred and the application of this Agreement to
     such Licensee's Business(es) (as the case may be) by the delivery of
     written notice to that effect to the Licensee, and upon the delivery of
     such written notice to the Licensee this Agreement or such license(s) and
     the application of this Agreement to such Licensee's Business(es) (as the
     same may be) shall, subject to any other provision contained herein which
     is expressed to survive such termination of this Agreement, be at an end.
     The parties acknowledge and agree that the occurrence of a Material Default
     shall be incapable of rectification by the Licensee, save and except with
     respect to a Material Default under Section 12.01(a) with respect to which
     the Licensee has tendered and the Licensor has accepted full payment
     together with interest as specified by this Agreement.

     12.03 In the event that the Licensee shall at any time fail to fully
     perform and/or comply with any provision contained in this Agreement, other
     than one giving rise to a Material Default, and the Licensor shall have
     delivered written notice to the Licensee requiring the rectification of
     same, in the event that such rectification shall not have been made by the
     date which is thirty (30) days following the date of delivery of the
     aforesaid notice to the Licensee to the satisfaction of the Licensor in its
     sole, absolute, and unferrered discretion, the Licensor shall be entitled
     at any time thereafter and prior to the rectification by the Licensee of
     any such default to terminate the license created pursuant to this
     Agreement in respect of the Licensee's Business(es) in respect of which
     such default shall have occurred and the application of this Agreement to
     such Licensee's Business(es) by the delivery of written notice to that
     effect to the Licensee, and upon the delivery of such written notice to the
     Licensee such license(s) and the application of this Agreement to such
     Licensee's Business(es) shall, subject to any other provision contained
     herein which is expressed to survive such termination of this Agreement, be
     at an end.

     12.04 The Licensee acknowledges and agrees that the Licensor may be a
     tenant of a Store. In the event that: (i) the Licensor's right to occupancy
     of a Store is terminated for any reason whatsoever, (ii) damage is caused
     to the Store which necessitates repairs taking in excess of sixty (60) days
     within which to restore the Store to a condition capable of operation as a
     retail establishment, and/or (iii) the Licensor elects to cease operation
     of a retail establishment within the Store, this Agreement shall in turn
     automatically be terminated and of no further force or effect with respect
     to such Store and the applicable Licensee's Business, subject to the
     Licensee paying to the Licensor the Licence Fee and Taxes and other monies
     that are owned to the Licensor hereunder in respect of such Licensee's
     Business to such date of termination, and notwithstanding any other
     provision of this Agreement, the Licensor shall bear no responsibility or
     liability to the Licensee with respect to any damage or loss which the
     Licensee may occasion by virtue of such termination of this Agreement with
     respect to such Store and Licensee's Business.

     12.05 Notwithstanding anything herein to the contrary and in addition to
     any other remedy available to the Licensor, it is specifically agreed
     between the parties that if at any time the Licensee's quality of
     merchandise, method of operation, merchandise variety, and/or financial
     stability or solvency is not reasonably acceptable to the Licensor with
     respect to any of the Licensee's Businesses, then the Licensor may give the
     Licensee

<PAGE>

                                      -16-

     written notice to that effect, which notice shall describe the nature of
     such deficiencies. The Licensee shall have thirty (30) days following the
     receipt by it of such notice within which to correct such deficiencies. If
     such deficiencies are not satisfactorily corrected within such thirty (30)
     day period in the sole absolute and unfettered discretion of the Licensor,
     it may unilaterally terminate the license created pursuant to this
     Agreement in respect of such Licensee's Business(es) and the application of
     this Agreement to such Licensee's Business(es) by the delivery at any time
     thereafter of ten (10) further days written notice to the Licensee to that
     effect, and upon the expiration of such ten (10) day period, such
     license(s) and the application of this Agreement to such Licensee's
     Business(es) shall, subject to any other provision contained herein which
     is expressed to survive such termination of this Agreement, be at an end.

     12.06 Upon any termination of this Agreement in its entirety or with
     respect to one of the Licensee's Businesses, the Licensee shall, at its
     sole cost and expense, forthwith following the date that such termination
     shall be effective:

           (a)  immediately return all store badges and security identification
                which may be in the possession of the Licensee;

           (b)  immediately discontinue its use of the applicable Licensed
                Premise and remove any and all of its merchandise, chattels,
                trade fixtures, and other property, from such Licensed Premise;

           (c)  remove any and all Signs in or about the applicable Licensed
                Premise;

           (d)  repair any and all damage or alterations caused to the physical
                installations in the Store to the standard and condition that
                existed immediately prior to the granting of the license in
                respect of such Licensee's Business; and

           (e)  deliver to the Licensor any and all materials with respect to
                such Licensee's Business containing or bearing the Licensor's
                trademark/trade name "Wal-Mart" whether alone or in conjunction
                with any other name or mark.

     The Licensor retains the right to perform any work necessary to remove the
     merchandise, chattels, trade fixtures, and/or any other property of the
     Licensee within the Licensed Premise, and bill the Licensee for any and all
     expenses the Licensor may incur in such process and the Licensee shall
     forthwith pay same. Notwithstanding anything herein contained, in the event
     that the Licensee fails to comply with (S) 12.06(b) within twenty-one (21)
     days following the date of the termination of this Agreement in its
     entirety or with respect to a Licensee's Business (as the case may be), the
     Licensor shall be entitled to retain for its own use, sell, or otherwise
     deal with such merchandise, chattels, trade fixtures, and/or any other
     property of the Licensee located therein, without notice and without any
     liability with respect thereto to the Licensee or any other person. The
     Licensor shall be entitled to set off any monies owing to it pursuant to
     this provision which are not paid in accordance with this provision against
     any monies it may then or in

<PAGE>

                                      -17-

     the future owe to the Licensee. The provisions of this Section 12.06 shall
     survive the termination of this Agreement.

     12.07 In the event that the Gross Sales in respect of a Licensee's Business
     shall be less than $90,000 during the first year of the Term for such
     Licensee's Business, $99,000 during the second year of the Term for such
     Licensee's Business, $108,900 during the third year of the term for such
     Licensee's Business, $ 119,800 during the fourth year of the Term for such
     Licensee's Business, and/or $ 131,780 during the fifth year of the Term for
     such Licensee's Business or any year thereafter, the Licensor, may
     unilaterally terminate the license created pursuant to this Agreement in
     respect of such Licensee's Business and the application of this Agreement
     to such Licensee's Business(es) by the delivery at any time thereafter of
     ninety (90) days written notice to the Licensee to that effect, and upon
     the expiration of such ninety (90) day period, such license and the
     application of this Agreement to such Licensee's Business shall, subject to
     any other provision contained herein which is expressed to survive such
     termination of this Agreement, be at an end. In the event that on any
     annual anniversary of the Commencement Date set forth for those Licensee's
     Businesses listed in Schedule "A" (the "Anniversary Date"), the Gross Sales
     in respect of five (5%) percent or greater of the Licensee's Businesses
     described in Schedule "A" and Schedule "B" for the immediately preceding
     year are less than $ 90,000 (such Licensee's Businesses being herein
     referred to as the "Non-Performing Stores"), the Licensee, may unilaterally
     terminate the license created pursuant to this Agreement in respect of the
     Non-Performing Stores and the application of this Agreement to any such
     Non-Performing Store(s) by the delivery within ten (10) days following the
     Anniversary Date of ninety (90) days written notice to the Licensor to that
     effect, and upon the expiration of such ninety (90) day period, such
     license and the application of this Agreement to such Non-Performing Stores
     shall, subject to any other provision contained herein which is expressed
     to survive such termination of this Agreement, be at an end. For the
     purposes of the foregoing sentence, the Gross Sales in respect of any
     Licensee's Business that has not been in operation for a full one year
     period leading up to the Anniversary Date shall be extrapolated for a one
     year period by multiplying the Gross Sales for same to the Anniversary Date
     by 365 and dividing that product by the number of days from and including
     such Licensee's Business's Commencement Date to the Anniversary Date.

     12.08 In the event that the Licensor shall at any time be entitled to or
     already have terminated the application of this Agreement and the licenses
     created pursuant to this Agreement in respect of thirty-three (33%) percent
     or more of the number of Licensee's Businesses described in Schedule "A"
     and Schedule "B", the Licensor, may unilaterally terminate the license
     created pursuant to this Agreement in respect of such Licensee's Business
     and the application of this Agreement to such Licensee's Business(es) by
     the delivery at any time thereafter of one hundred and eighty (180) days
     written notice to the Licensee to that effect, and upon the expiration of
     such one hundred and eighty (180) day period, such license and the
     application of this Agreement to such Licensee's Business shall, subject to
     any other provision contained herein which is expressed to survive such
     termination of this Agreement, be at an end.

<PAGE>

                                      -18-

     13.00 Indemnity

     13.01 The Licensee hereby agrees to indemnify and save the Licensor, its
     directors, officers, employees, and agents, harmless from and against any
     and all claims, damages, losses, liabilities, demands, suits, judgments,
     causes of action, legal proceedings, penalties or other sanctions and any
     and all costs and expenses arising in connection therewith including legal
     fees and disbursements on a solicitor and on his own client basis
     (including, without limitation, all such legal fees and disbursements in
     connection with any and all appeals) which may, either directly or
     indirectly, in any way result from or arise out of or be in relation to the
     Licensee's use and/or occupation of the Licensed Premises, the Licensee's
     business operations, and/or this Agreement (save and except as a result of
     the negligence and/or recklessness of the Licensor and/or its employees),
     including, without limiting the generality of the foregoing, arising by
     reason of or in connection with:

           (a)  any breach, violation, non-observance or non-performance by the
                Licensee or by any of its servants, employees, agents, invitees
                or any other persons for whom it is responsible, of any of the
                terms or conditions contained in this Agreement;

           (b)  any damage to property whether or not owned by the Licensor
                howsoever occasioned;

           (c)  any damage, theft, or other loss in any way related to or in
                respect of any property, chattels, fixtures, merchandise and/or
                monies of the Licensee located from time to time in or about a
                Licensed Premise;

           (d)  any illness, disease or injury to any person or persons caused
                either directly or indirectly by the carrying on of the
                Licensee's Business(es), including death resulting at any time
                therefrom;

           (e)  any negligent act(s) or omission(s) of the Licensee, or anyone
                for whose acts it may be responsible at law and/or in equity;

           (f)  the occurrence of any Material Default; and/or

           (g)  any legal expenses incurred by the Licensor with respect to the
                exercise of any of its rights under this Agreement with respect
                to or following a default hereunder by the licensee, on a
                solicitor and client basis.

     The provisions of this section shall survive and remain in full force and
     effect following any termination of this Agreement and/or the application
     of this Agreement to any Licensee's Business.

     14.00 Taxes

     14.01 Save and except as herein provided, the Licensee shall be solely
     responsible for bearing the cost of and paying any and all license fees and
     taxes, whether presently

<PAGE>

                                      -19-

     existing or created during the Term, including without in any way limiting
     the generality of the foregoing, realty, sales, goods and services, value
     added, business and corporate taxes, applicable to the Licensee's
     Businesses and/or the Licensed Premises. Notwithstanding the foregoing,
     with respect to realty taxes, the parties acknowledge and agree that the
     Licensor shall bear the cost of and pay same with respect to the Licensed
     Premises, but only to the amounts applicable to each Licensed Premise as at
     their respective Commencement Dates together with any increases which are
     not attributable to the Licensee's Business and/or the Licensed Premises.
     If anything pertaining to this Agreement and/or the use of a Licensed
     Premise by the Licensee causes the assessed value and/or realty taxes or
     other taxes payable, whether directly or indirectly, by the Licensor to
     increase, the Licensee shall forthwith reimburse the full amount of any
     increase in such realty or other taxes to the Licensor following receipt by
     the Licensee of a written demand therefor from the Licensor. The Licensor
     shall be entitled to set off any monies owing to it pursuant to this
     provision which are not paid in accordance with this provision against any
     monies it may then or in the future owe to the Licensee. In the event that
     any such taxes are billed to the Licensor, then the Licensee covenants and
     agrees to pay the same to the Licensor forthwith following receipt of a
     written demand therefor from the Licensor.

     14.02 In the event that a Licensed Premise is separately assessed from the
     balance of the Store within which it is located so that its assessed value
     per square foot becomes greater than two (2) times that for the balance of
     the Store, and the Licensee has undertaken and exhausted all possible
     appeals of such assessment and/or the quantum of such assessment without
     success in reducing such assessment beneath the aforesaid threshold, the
     Licensee may unilaterally terminate the license created pursuant to this
     Agreement in respect of such Licensee's Business and the application of
     this Agreement to such Licensee's Business(es) by the delivery at any time
     thereafter of thirty (30) days written notice to the Licensor to that
     effect, and upon the expiration of such thirty (30) day period, such
     license and the application of this Agreement to such Licensee's Business
     shall, subject to any other provision contained herein which is expressed
     to survive such termination of this Agreement, be at an end.

     15.00 Utilities

     15.01 The Licensor shall provide lighting, electrical, heating,
     air-conditioning, and water service (collectively the "Utilities"), and
     janitorial service as is necessary to operate the Licensee's Business, and
     shall construct to each Licensed Premise rough-ins for the Licensee to
     connect its equipment and machinery to the Utilities. The Licensee
     covenants and agrees to reimburse the Licensor for the cost of any physical
     construction, installations, and/or alterations to a Store and/or its
     service systems made by the Licensor in order to make the Utilities and
     rough-ins available at each Licensed Premise. Notwithstanding the
     foregoing, the Licensor shall not be responsible for any temporary
     interruption in such services or for any damage to the Licensee's property
     cause by any temporary interruption in such services or for any damage to
     the Licensee's property caused by any temporary interruption in any of such
     services, power surge, electrical failure, or other mechanical problem.

<PAGE>

                                      -20-

     15.02 If the Licensee wants a separate telephone line to a Licensed
     Premises, Licensee shall be responsible for its telephone equipment,
     installation and charges. In the event Licensor installs and provides
     telephone equipment to Licensee in any Licensed Premise at Licensee's
     request, Licensee shall reimburse Licensor for the costs of said
     installation and equipment. The Licensee may list such telephone number in
     any telephone directory using the Trade Name.

     16.00 Maintenance

     16.01 During such times as the Licensee carries on a Licensee's Business,
     it shall keep, operate and maintain the applicable Licensed Premise in a
     clean and sanitary condition and shall leave same in a reasonably neat and
     tidy condition after using same, including without limitation, following
     the termination of any licence with respect to such Licensee's Business.

     17.00 Signs and Advertising

     17.01 The Licensee shall not paint, display, install, erect or affix any
     sign, fixture, advertisement, notice, lettering or decoration (a "Sign")
     within the Licensed Premises without the prior written consent of the
     Licensor which may be withheld for any reason whatsoever. In addition to
     the foregoing and without in any way limiting same, any Sign displayed,
     installed, erected or affixed by the Licensee within or about a Licensed
     Premise shall be professionally prepared, type set and manufactured, and
     shall not include any hand written text, script, logos, and/or designs. Any
     Sign displayed, installed erected or affixed by the Licensee in
     contravention of this provision may be removed by the Licensor at any time
     at the sole cost and expense of the Licensee, and the Licensee shall
     forthwith reimburse the Licensor for the cost of same following receipt of
     a written demand therefor from the Licensor.

     17.02 The Licensee shall, subject to the Licensor's approval as required by
     (S)17.01, at its sole cost and expense provide and install such reasonable
     number of signs as the Licensor shall require from time to time in each
     Licensed Premise in a conspicuous location in full view of all customers at
     all times the Store is open for business. Letters, numbers, background
     color and all other aspects of such signs shall be stipulated by the
     Licensor acting reasonably. Such signage is to be located in the Licensed
     Premises and to compliment the surrounding decor.

     18.00 Notices

     18.01 Any notice or other communication required or permitted to be given
     by this Agreement shall be in writing and shall be effectively given if:

           (a)  delivered personally;

           (b)  sent by prepaid courier services;

           (c)  sent by registered mail; or

<PAGE>

                                      -21-

           (d)  sent by prepaid telecopier, telex or other similar means of
                electronic communication and confirmed by mailing the original
                document so sent by prepaid mail on the same or following day,

     in the case of notice to:

           (a)  in the case of notice to the Licensor at:

                33 Adelaide Street West
                Toronto, Ontario
                M5H 1P5

           Attention: Specialty Division Marketing Manager and Kim MacGregor

           Telecopier No. (416) 361-5886

           (b)  in case of notice to the Licensee at:

                815 Matthews-Mint Hill Road
                Matthews, North Carolina
                United States of America
                28105

           Attention: John Grosso

           Telecopier No. (704) 847-8010

     or at such other address as the party to whom such notice or other
     communication is to be given shall have advised the party giving same in
     the manner provided in this section. Any notice or other communication
     delivered personally or by prepaid courier service shall be deemed to have
     been given and received on the day it is so delivered at such address,
     provided that if such day is not a Business Day such notice or other
     communication shall be deemed to have been given and received on the next
     following Business Day. Any notice or other communication sent by
     registered mail shall be deemed to have been given and received on the
     fifth Business Day following the date of mailing. Any notice or other
     communication transmitted by telecopier, telex or other similar form of
     electronic communication shall be deemed given and received on the day of
     its transmission provided that such day is a Business Day and such
     transmission is completed before 5:00 p.m. on such day, failing which such
     notice or other communication shall be deemed given and received on the
     first Business Day after its transmission. Regardless of the foregoing, if
     there is a mail stoppage or labour dispute or threatened labour dispute
     which has affected or could affect normal mail delivery by the applicable
     postal service, then no notice or other communication may be delivered by
     registered mail. If there has been a mail stoppage and if a party sends a
     notice or other communication by telecopier, telex or other similar means
     of electronic communication, such party shall be relieved from the
     obligation to mail the original document in accordance with this section.

<PAGE>

                                      -22-

     19.00 No Liability

     19.01 The Licensor shall not be liable or responsible in any way for any
     death or injury arising from or out of any occurrence in, upon, at, or
     relating to the Licensee's Businesses and/or the Licensed Premises, or for
     any loss of or damage or injury to any property, including without
     limitation the merchandise, chattels, trade fixtures, and/or any other
     property located therein from time to time, belonging to the Licensee or
     its employees or to any other person while such property is in the Licensed
     Premises, whether or not such property has been entrusted to employees of
     the Licensor, or for any consequential or economic damages, loss or injury
     or for damages for personal discomfort or inconvenience however caused
     (including, without limitation, by negligence, fundamental breach of
     contract or the breach of a fundamental term of any contract), save and
     except if any of same are the result of the negligence and/or recklessness
     of the Licensor or any of its employees. All merchandise, chattels, trade
     fixtures, and/or any other property of the Licensee kept or stored on or in
     the Licensed Premises shall be so kept or stored at the risk of the
     Licensee only and the Licensee shall hold the Licensor harmless from and
     against any claims arising out of damage to same, including, but not
     limited to, any subrogation claims by the Licensee's insurers.

     20.00 No Waiver

     20.01 No condoning or waiver by the Licensor of any default or breach by
     the Licensee at any time or times in respect of any of the obligations,
     terms, covenants and conditions contained in this Agreement to be performed
     or observed by the Licensee shall be deemed or construed to operate as a
     waiver of the Licensor's rights under this Agreement in respect of any
     continuing or subsequent default or breach nor so as to defeat or affect in
     any way the rights and remedies of the Licensor under this Agreement in
     respect of any such continuing or subsequent default or breach. Unless
     expressly waived in writing, the failure of the Licensor to insist in any
     one or more cases upon the strict performance of any of the obligations,
     terms, covenants and conditions contained in this Agreement to be performed
     or observed by the Licensee shall not be deemed or construed to operate as
     a waiver for the future strict performance or observance of such
     agreements, terms, covenants and conditions.

     21.00 Relationship and Assignment

     21.01 The rights granted to the Licensee hereby are personal only and
     create no interest or right in the Store and/or the leasehold interest of
     the Licensor in the Store. This Agreement shall not create or confer upon
     the parties hereto, in any way or for any purpose, any relationship except
     that of contracting parties, and in particular does not create a
     partnership, a joint venture or a landlord and tenant relationship between
     the Licensor and the Licensee or an employer-employee relationship between
     the Licensor and the employees of and other persons rendering services to
     the Licensee.

     21.02 The Licensee shall not assign, transfer or set over this Agreement or
     any part thereof, any rights therein or thereto, and/or in any way permit
     anyone other than itself to carry on the Licensee's Business within a
     Licensed Premise, without having obtained the

<PAGE>

                                      -23-

     prior written consent of the Licensor, which consent may be withheld for
     any reason whatsoever. In the event that the Licensor sells its entire
     business operation at any Store to any third person or otherwise transfers
     its entire right of possession in a Store to a third person, it shall
     forthwith deliver written notice to the Licensee of that fact and upon the
     expiration of thirty (30) days following the later of the date of delivery
     of such notice to the Licensee and the date of completion of such
     transaction, the license granted to the Licensee and the application of
     this Agreement with respect to the Licensee's Business within such Store
     shall, subject to any other provision contained herein which is expressed
     to survive such termination of this Agreement, be at an end.

     22.00 Entire Agreement

     22.01 This Agreement continues the entire agreement between the parties
     regarding the Licensee's use of the Licensed Premises. It is understood and
     agreed that there are no agreements, conditions, warranties, terms,
     representations or arrangements, oral or written, statutory or otherwise,
     other than those contained herein, and that all prior conversations,
     understandings, arrangements, statements, communications or agreements,
     oral or written, with respect to this Agreement are hereby superseded.

     23.00 Governing Law

     23.01 This Agreement shall be governed by and construed in accordance with
     the laws of the Province of Ontario and the laws of Canada applicable
     therein.

     24.00 Time of the Essence

     24.01 Time is of the essence of this Agreement and every part hereof.

     25.00 Interpretation

     25.01 This Agreement shall be read with all changes in gender and number
     required by the context. The headings contained in this Agreement are for
     convenience of reference only, and shall not affect the interpretation of
     this Agreement.

     26.00 Payments in Canadian Currency

     26.01 All references herein to currency are to Canadian currency and all
     payments shall be made in Canadian currency.

     27.00 Severability

     27.01 If for any reason whatsoever any term, covenant or condition of this
     Agreement, or the application thereof to any person, firm or corporation or
     circumstance, is to any extent held or rendered invalid, unenforceable or
     illegal, then such term, covenant or condition:

           (a)  shall be deemed to be independent of the remainder of this
                Agreement and to be severable and divisible therefrom, and its
                invalidity, unenforceability

<PAGE>

                                      -24-

                or illegality shall not affect, impair or invalidate the
                remainder of this Agreement or any part thereof; and

           (b)  continues to be applicable to and enforceable to the fullest
                extent permitted by law against any person and circumstance
                other than those as to which it has been held or rendered
                invalid, unenforceable or illegal.

     28.00 Force Majeure

     28.01 Notwithstanding any other provisions of this Agreement, whenever and
     to the extent that either party is unable to fulfill or is delayed or
     restricted in the fulfillment of any of its obligations under this
     Agreement by reason of any of the following impediments:

           1.   strike;

           2.   lockout;

           3.   war or acts of military authority;

           4.   rebellion or civil commotion;

           5.   material or labour shortage not within the control of such
                Owners;

           6.   fire, explosion;

           7.   flood, wind, water, earthquake or other casualty;

           8.   any applicable lawful statute, by-law, ordinance, regulation or
                order;

           9.   acts of God; or

           10.  any act of the landlord of the store to terminate or deny
                possession of the Store to the Licensor, whether temporary or
                not;

     not caused by the default, act, or omission of the other party and not
     avoidable or surmountable by the exercise of reasonable effort or foresight
     by it (save and except with reference to item 10 above for which the
     Licensor shall have no such obligations whatsoever), then so long as any
     such impediment exists, such party shall be temporarily relieved from the
     fulfillment of such obligation and the other party shall not be entitled to
     compensation for any damage, inconvenience, nuisance or discomfort thereby
     occasioned and, to the extent necessitated thereby, there shall be a
     postponement of any deadline, compliance with which would be otherwise
     adversely affected by such impediment, provided that at the expiration of
     such temporary relief, such party shall forthwith proceed with fulfillment
     of such obligation.

<PAGE>

                                      -25-

     29.00 Encumbrance

     29.01 The licensee shall not charge, mortgage, hypothecate, pledge, give a
     security interest in, or otherwise encumber this Agreement and/or the
     alterations, additions, improvements and fixtures (save and except for
     trade fixtures, unattached readily movable furniture and office equipment)
     installed from time to time by the Licensee within any Licensed Premise
     without the prior written consent of the Licensor, which consent may be
     withheld for any reason whatsoever.

     30.00 Schedules

     30.01 The following Schedules whether attached hereto or acknowledged as a
     separate document shall form a part of this Agreement:

                Schedule "A" - License Schedules;
                Schedule "B" - Form of New Store License Schedule;
                Schedule "C" - Form of Sales Report;
                Schedule "D" - Days and Hours of Operation.

     31.00 Successors and Assigns

     31.01 Subject to any restrictions herein contained, this Agreement shall
     enure to the benefit of and be binding upon the parties and their
     respective successors and permitted assigns.

     32.00 Guarantee

     32.01 The Guarantor covenants and agrees with the Licensor to guarantee the
     performance of each and every one of the Licensee's obligations under this
     Agreement, including, without in any way limiting the generality of the
     foregoing, payment of the Licence Fee and Taxes, and further covenants and
     agrees to fully perform each and every obligation of the Licensee contained
     in this Agreement in the event that the Licensee fails to do so. The
     obligations of the Licensee and the Guarantor under this Agreement shall be
     joint and several.

     33.00 Language

     33.01 The parties acknowledge and agree that they have required that this
     Agreement be prepared in the English language. Les parties reconnaissent
     avoir exige que les presentes soient redigees en langue anglaise.

<PAGE>
                                      -26-

     IN WITNESS WHEREOF the parties have executed this Agreement this 9th day of
February, 1996, with effect as of the date hereinabove set forth.

                                    WAL-MART CANADA INC.

                                    Per: /s/ J. Richard Blickstead
                                        ----------------------------------------
                                        J. Richard Blickstead - Vice President

                                    PCA PHOTO CORPORATION OF CANADA, INC.

                                    Per: /s/ John Grosso
                                        ----------------------------------------
                                    John Grosso - President

                                    PCA INTERNATIONAL, INC.

                                    Per: /s/ John Grosso
                                        ----------------------------------------
                                        John Grosso - President

<PAGE>

                                      -27-

                                  SCHEDULE "A"

                                LICENCE SCHEDULE

     The Licensor does hereby grant a non-exclusive license to the Licence and
the Licensee does hereby accept such licence in accordance with the Licence
Agreement between the parties made the 9/th/ day of February, 1996 to carry on a
Licensee's Business in or about each of the following Wal-Mart stores (each of
which shall be a "Store"), each of which shall have a Commencement Date in
respect of the Licensee's Business located in or about the applicable Store as
set forth adjacent to the applicable store (for greater certainty, the format
below show the Wal-Mart Store #, followed by its municipal address, and the
Commencement Date applicable to the Licensee's Business within the Store):

3002
Centre Regional Manicouagan, 630 Boul. Laflech, Baie-Comeau, PQ G5C 2Y3
April 22, 1996

3005
Brantford Plaza, King Georges Rd., (24 HWY), Brantford, ON N3R 5L7
April 22, 1996

3008
Lougheed Mall, 9855 Austin Ave., Ste 300, Burnaby, B.C. V3J IN5
April 22, 1996

3009
Westbrook Plaza, 1212 37/th/ Street W., Calgary, BT T3C IS3
April 22, 1996

3010
Macleod Mall SC., 9650 Macleod Trail, Calgary, AB T2J 0P7
April 22, 1996

3011
Northland Village SC., 5005 Northland Drive NW, Calgary, AB T2L 2K1
April 22, 1996

3013
Deerfoot Mall, 901-64th Ave., NE, Calgary, AB T2E 7P4
April 22, 1996

3019
West Oak Mill, 32700 South Fraser Way, Abbotsford, BC V2T 4M5
April 22, 1996

<PAGE>

                                      -28-

3020
Brookdale Mall SC., 950 Brookdale Ave., Cornwall, ON K6J 4P5
April 22, 1996

3023
Les Galeries Drummond, 355 Boul. St. Joseph, Drummondville, PQ J2C 2B1
April 22, 1996

3026
# 1 Capilano SC, 50/th/ St. & 101 Ave., Edmonton, AB T6A 0A2
April 22, 1996

3027
296 Mayfield Common, 167/th/ St. & Stoney Plan Rd., Edmonton, AB T5P 4B4
April 22, 1996

3029
Heritage Mall, 2323 111/th/ Street, Edmonton, AB T6J 5E5 April 22, 1996

3036
Exploits Valley Mall, 19 Cromer Ave., Grand Falls Windsor, NFLD A2A 1X3
April 22, 1996

3039
Les Galeries Joliette, 1055 Boul. Firestone, Joliette, PQ J6E 2W4
April 22, 1996

3042
Orchard Park SC., 2271 Harvey Ave., Kelowna, BC V1Y 6H2
April 22, 1996

3043
Frontenac Mall SC., 300 Bath Rd., Kingston, ON K7M 4X5
April 22, 1996

3045
Fairview Park Mall, 2960 Kingsway, Kitchener, ON N2C 1X1
April 22, 1996

3049
Argyle Shopping Mall, 1928 Dundas St. E., London, ON N5V 1P7
April 22, 1996

3050
Oakridge Makk, 1201 Oxford St. W., London, ON N6H 1V9
April 22, 1996

<PAGE>

                                      -29-

3055
Square One SC., 100 City Centre Dr., Mississauga, ON L5B 2C9
April 22, 1996

3060
Chako-Mika Mall, 100 Lakeside Dr., Nelson, BC V1L 5W8
April 22, 1996

3065
Place D'Orleans SC., 110 Place D'Orleans Drive, Orleans, ON K1C 2L9
April 22, 1996

3075
Parkland Mall SC., 6375 50/th/ Ave., Red Deer, AB T4N 4C7
April 22, 1996

3076
Northgate SC., 353 North Albert St., Regina, SK S4R 3C5
April 22, 1996

3082
Lambton Mall, London Rd., Sarnia, ON N7S 1P9
April 22, 1996

3086
Plaza Rock Forest, 4857 Boul. Bourque, Rock Forest, PQ J1N 1E8
April 22, 1996

3090
Les Galeries Richelieu, 978 Boul. Du Seminaire, St. Jean, PQ 3JA 1B8
April 22, 1996

3091
Loch Lomond SC., 80 McDonald St., St. John, NB E2J 1M4
April 22, 1996

3098
Guildwood Town SC., 1000 Guildwood Town Centre, Surrey, BC V3R 1N3
April 22, 1996

3100
Cape Breton SC., Junction of Hwy 4&5, Sydney, NS B1S 1P4
April 22, 1996

3105
North Park SC., 1305 Lawrence Ave. W., Toronto, ON M6L 1A5
April 22, 1996

<PAGE>

                                      -30-

3106
Dufferin Mall, 900 Dufferin St., Toronto, ON M6H 4A9
April 22, 1996

3113
Whitby Mall SC., Thickson Rd. & Hwy #2, Whitby, ON L1N 2L2
April 22, 1996

3114
Gateway Plaza, Dougall Ave., Windsor, ON N9E 1S7
April 22, 1996

3115
Eastown SC., 1950 Lauzon Rd., Windsor, ON M8T 2Z4
April 22, 1996

3118
Garden City Square, 845 Leila Ave., Winnipeg, MB R2V 3J6
April 22, 1996

3122
King's Hwy #62 & Cloverleaf Dr., Belleville, ON K8P 4Z5
April 22, 1996

3123
35 Molson Park Drive, Barrie, ON L4M 4S7
April 22, 1996

3124
777 Memorial Ave., Thunder Bay, ON P7B 3Z7
April 22, 1996

3125
640 Rue Maloney Quest, Gatineau, PQ J8T 8K7
April 22, 1996

3130
50 Quarry Edge Drive, Brampton, ON L6V 4K2
April 22, 1996

The licences created pursuant to this Licence Schedule shall commence on the
Commencement Date and, subject to earlier termination as provided for in the
Agreement, continue in effect for each Licensee's Business for a term ending at
12:00 midnight on the day which is five (5) years following the Commencement
Date for such Licensee's Business (the "Term").

<PAGE>

                                      -31-

     IN WITNESS WHEREOF the parties have executed this Licence Schedule this
9/th/ day of February, 1996.

                                    WAL-MART CANADA INC.

                                    Per: /s/ J. Richard Blickstead           c/s
                                         ------------------------------------
                                         J. Richard Blickstead - Vice President

                                    PCA PHOTO CORPORATION OF CANADA, INC.

                                    Per: /s/ John Grosso                     c/s
                                         ------------------------------------
                                         John Grosso - President

<PAGE>

                                      -32-

                                  SCHEDULE "B"

                           NEW STORE LICENCE SCHEDULE

     WHEREAS Wal-Mart Canada Inc. (the "Licensor") and PCA Photo Corporation of
     Canada, Inc. (the "Licence") entered into a License Agreement dated the 9th
     day of February, 1996 (the "Licence Agreement");

     AND WHEREAS the Licensor and the Licensee desire that a further retail
     store of the Licensor be made subject to the Licence Agreement;

     NOW THEREFORE THIS AGREEMENT WITNESSES that in consideration of the mutual
     covenants, conditions and agreements herein contained, other good and
     valuable consideration and the sum of Five Dollars ($5.00) paid by each
     party to the other (the receipt and sufficiency of which are hereby
     acknowledged), the parties hereto do hereby covenant and agree, each with
     the other, as follows:

     All of the capitalized terms used in this New Store License Schedule shall
     have the meanings ascribed to them in the License Agreement unless
     otherwise defined.

     The Licensor does hereby grant a non-exclusive license to the Licensee and
     the Licensee does hereby accept such license in accordance with the License
     Agreement between the parties made the * day of *, 199* to carry on a
     Licensee's Business in or about Wal-Mart Store # * located at * (the
     "Store").

     The Commencement Date in respect of the Licensee's Business located in or
     about this Store shall be *.

     The license created pursuant to this New Store License Schedule shall
     commence on the Commencement Date and, subject to earlier termination as
     provided for in the License Agreement, continue in effect for a term ending
     at 12:00 midnight on the day which is five (5) years following the
     Commencement Date for such Licensee's Business (the "Term").

     Upon the execution of this New Store License Schedule, the Licensee's
     Business located in or about this Store shall become subject to the terms
     of the License Agreement.

          IN WITNESS WHEREOF the parties have executed this License Schedule
     this * day of *, 199*.

                                           WAL-MART CANADA INC.

                                           Per: _______________________c/s
                                               *

<PAGE>

                                      -33-

                                        PCA PHOTO CORPORATION OF
                                        CANADA, INC.

                                        Per:_______________________________ c/s
                                            John Grosso - President

<PAGE>

                                      -34-

                                   SCHEDULE C

                                  SALES REPORT
                                  All Sections
                          Sales thru: 3/15/96 (week 7)

<TABLE>
<CAPTION>
                        #                                 Customers             Average
                     Locations       Gross Sales         Photographed           Purchase        License    G.S.T.
                                 ------------------   ------------------   ------------------
           Week      Operating    Budget    Actual     Budget    Actual     Budget    Actual      Fee       Taxes
        ----------  -----------  --------  --------   --------  --------   --------  --------   --------   -------
           <S>      <C>          <C>       <C>        <C>       <C>        <C>       <C>        <C>        <C>
                 1

                 2

                 3

                 4

                 5

                 6

                 7
                     ----------  --------  --------   --------  --------   --------  --------   --------   -------
        Cumulative
                     ==========  ========  ========   ========  ========   ========  ========   ========   =======
</TABLE>

<PAGE>

                                      -35-

                                   SCHEDULE C

                                  SALES REPORT
                             Store # _______________
                          Sales thru: 3/15/96 (week 7)

<TABLE>
<CAPTION>
                        #                                 Customers             Average
                     Locations       Gross Sales         Photographed           Purchase        License    G.S.T.
                                 ------------------   ------------------   ------------------
           Week      Operating    Budget    Actual     Budget    Actual     Budget    Actual      Fee       Taxes
        ----------  -----------  --------  --------   --------  --------   --------  --------   --------   -------
           <S>      <C>          <C>       <C>        <C>       <C>        <C>       <C>        <C>        <C>
                 1

                 2

                 3

                 4

                 5

                 6

                 7
                     ----------  --------  --------   --------  --------   --------  --------   --------   -------
        Cumulative
                     ==========  ========  ========   ========  ========   ========  ========   ========   =======
</TABLE>

<PAGE>

                                      -36-

                                  SCHEDULE "D"

                                License Agreement
                           Days and Hours of Operation

     In accordance with Section 5.02 of the License Agreement, the following
     sets forth the Days and Hours of Operation for the Licensee's Business:

     Days of Operation:

          Licensee's Business will operate seven (7) days a week, Monday through
          Sunday, excluding all Canadian holidays whereby the Licensor's retail
          establishment is closed due to the holiday.

     Hours of Operation:

          Monday through Friday:

          All Licensee's Businesses will operate on Monday through Friday
          according to the following schedule and based on the preference of the
          Licensor on a region by region or province by province basis, studio
          hours as follows:

               a)   Open at 10:00 AM and operate through 2:00 PM. From 2:00 PM
                    to 3:00 PM, there will be posted one (1) hour lunch break in
                    all studios. Operations in all studios will continue from
                    3:00 PM to 7:00 PM for total operating hours Monday through
                    Friday in all studios of eight (8) hours. Operating hours
                    and all lunch hours will be prominently posted in all
                    studios and in all advertising and in-store merchandising
                    materials.

                                       or

               b)   Open at 11:00 AM and operate through 3:00 PM. From 3:00 PM
                    to 4:00 PM, there will be posted one (1) hour lunch break in
                    all studios. Operations in all studios will continue from
                    4:00 PM to 8:00 PM for total operating hours Monday through
                    Friday in all studios of eight (8) hours. Operating hours
                    and all lunch hours will be prominently posted in all
                    studios and in all advertising and in-store merchandising
                    materials.

          Saturday:

               All studios will open at 9:00 AM and operate through 1:30 PM.
               From 1:30 PM to 2:30 PM, there will be posted one (1) hour lunch
               break in all studios. Operations in all studios will continue
               from 2:30 PM to 8:00 PM for total operating hours on Saturday in
               all studios of ten (10) hours.

<PAGE>

                                      -37-

               Within the framework of the ten (10) operating hours, Licensee
               will vary the hours of operation on a region by region and/or
               province by province basis as the Licensor determines to most
               closely match the Licensor store hours of operation. Operating
               hours and all lunch hours will be prominently posted in all
               studios and in all advertising and in-store merchandising
               materials.

          Sunday:

               All studios will open at 10:00 AM and operate through 2:00 PM.
               From 2:00 PM to 3:00 PM, there will be posted one (1) hour lunch
               break in all studios. Operations in all studios will continue
               from 3:00 PM to 7:00 PM for total operating hour on Sunday of
               eight (8) hours. Within the framework of the eight (8) operating
               hours, Licensee will vary the hours of operation on a region by
               region and/or province by province basis as the Licensor
               determines to most closely match the Licensor store hours of
               operation. If any of the Licensor stores are open for business
               less than nine (9) hours on a Sunday, Licensee's hours of
               operation will coincide with the posted store hours in that
               situation. Operating hours and all lunch hours will be
               prominently posted in all studios and in all advertising and
               in-store merchandising materials.

          Christmas Season:

          During the eight-week holiday season, from approximately November
          /1/st through December 25/th/, Licensee will extend the hours of
          operation on Monday through Friday and Sunday to ten (10) hours per
          day (from eight [8] hours per day) in consideration of higher traffic
          and extended store hours by the Licensor. During this eight-week
          period, operating hours for all seven days of the week will be from
          9:00 AM to 8:00 PM with a posted one (1) hour lunch break from 1:30 PM
          to 2:30 PM. Within the framework of the ten (10) operating hours per
          day, Licensee will vary the hours of operation on a region by region
          and/or province by province basis as the Licensor determines to most
          closely match the Licensor store hours of operation. Operating hours
          and all lunch hours will be prominently posted in all studios and in
          all advertising and in-store merchandising materials.<PAGE>

                                                                    Exhibit 10.9

                             PCA INTERNATIONAL, INC.
                            STOCK OPTION PLAN (1998)

                                    ARTICLE 1

                                     GENERAL

                  1.1      Purpose.

                  The purpose of the PCA International, Inc. Stock Option Plan
(1998) (the "Plan") is to provide for certain officers, directors and key
personnel (as defined in Section 1.3) of PCA International, Inc. (the "Company")
and certain of its Affiliates (as defined in Section 1.6) an equity-based
incentive to maintain and to enhance the performance and profitability of the
Company.

                  1.2      Administration.

                           (a)      The Plan shall be administered by a
committee (the "Committee") appointed by the Board of Directors of the Company
(the "Board"), which Committee shall consist of two or more members of the
Board. The members of the Committee shall be appointed by, and may be changed at
any time and from time to time in the discretion of, the Board.

                           (b)      The Committee shall have the authority (i)
to exercise all of the powers granted to it under the Plan, (ii) to construe,
interpret and implement the Plan and any Stock Option Agreements (as defined in
Section 1.7) executed pursuant to the Plan, (iii) to prescribe, amend and
rescind rules relating to the Plan, (iv) to make any determination necessary or
advisable in administering the Plan, and (v) to correct any defect, supply any
omission and reconcile any inconsistency in the Plan.

                           (c)      The determination of the Committee on all
matters relating to the Plan or any Plan agreement shall be conclusive.

                           (d)      No member of the Committee shall be liable
for any action or determination made in good faith with respect to the Plan or
any award hereunder.

                           (e)      Notwithstanding anything to the contrary
contained herein: (i) until the Board shall appoint the members of the
Committee, the Plan shall be administered by the Board and (ii) the Board may,
in its sole discretion, at any time and from time to time, resolve to administer
the Plan. In either of the foregoing events, the term Committee as used herein
shall be deemed to mean the Board.

<PAGE>

                                                                               2

                  1.3      Persons Eligible for Awards.

                  Awards under the Plan may be made to such officers, directors
and employees ("key personnel") of the Company or its Affiliates as the
Committee shall from time to time in its sole discretion select; provided,
however, that officers who are not employees of either the Company or an
Affiliate shall not be eligible to receive awards under the Plan.

                  1.4      Types of Awards Under Plan.

                           (a)      Awards may be made under the Plan in the
form of stock options ("options"), as more fully set forth in Article 2. Options
granted under the Plan may either be (i) "nonqualified" stock options subject to
the provisions of section 83 of the Internal Revenue Code of 1986, as amended
(the "Code"), or (ii) options intended to qualify for incentive stock option
treatment described in Code section 422.

                           (b)      All options when granted are intended to be
nonqualified options, unless the applicable Stock Option Agreement explicitly
states that an option is intended to be an incentive stock option. If an option
is granted with the stated intent that it be an incentive stock option, and if
for any reason such option (or any portion thereof) shall not qualify as an
incentive stock option, then, to the extent of such nonqualification, such
option (or portion) shall be regarded as a nonqualified option appropriately
granted under the Plan provided that such option (or portion) otherwise
satisfies the terms and conditions of the Plan relating to nonqualified options
generally.

                  1.5      Shares Available for Awards.

                           (a)      Subject to Section 3.5 (relating to
adjustments upon changes in capitalization), as of any date, the total number of
shares of Common Stock with respect to which options may be granted under the
Plan shall equal the excess (if any) of 555,000 shares, minus the sum of (i) the
number of shares of Common Stock then subject to outstanding options under this
Plan and (ii) the number of shares in respect of which options have been
exercised (or disposed of to the Company for consideration (other than for a new
option)) under this Plan.

                           In accordance with (and without limitation upon) the
preceding sentence, options may be granted in respect of shares covered by
previously-granted options that have expired, terminated or been canceled for
any reason whatsoever (other than by reason of exercise or disposition to the
Company for consideration (other than for a new option)).

                           (b)      Shares of Common Stock that shall be subject
to issuance pursuant to the Plan shall be authorized and unissued or treasury
shares of Common Stock.

<PAGE>
                                                                               3

                           (c)      Without limiting the generality of the
foregoing, the Committee may, with the grantee's consent, cancel any option
under the Plan and issue a new option in substitution therefor upon such terms
as the Committee may in its sole discretion determine, provided that the
substituted option shall satisfy all applicable Plan requirements as of the date
such new option is granted. The foregoing is not intended to prevent or limit
the Committee's authority to make equitable adjustments to options upon the
occurrence of certain events as herein provided, including, without limitation,
adjustments pursuant to Section 3.5 (relating to adjustments upon changes in
capitalization).

                  1.6      Definitions of Certain Terms.

                           (a)      The term "Affiliate" as used herein means
any person or entity which, at the time of reference, directly, or indirectly
through one or more intermediaries, controls, is controlled by, or is under
common control with, the Company.

                           (b)      The term "Cause" as used herein means (i) a

determination by the Committee that the grantee has, in any material respect,
willfully failed to follow any of the Company's written policies or any written
directives of the Board or of any employee of the Company superior in rank to
such grantee and, if such failure is susceptible of being cured as determined by
the Committee in good faith, the failure of the grantee to cure such failure
within 10 days after receiving written notice (stating with specificity the
nature of such failure) from the Committee (the "Cure Period"); or (ii) any act
of gross negligence, willful misconduct, fraud or personal dishonesty by the
grantee involving the assets of the Company or any of its Affiliates and
resulting in economic or reputational harm to the Company; or (iii) the
conviction of, or a plea of guilty or nolo contendere by the grantee to, a
charge of any crime involving moral turpitude or a felony; or (iv) the breach by
the grantee in any material respect of any contract or other agreement between
the Company or any of its Affiliates and the grantee and, if such breach is
susceptible of being cured as determined by the Committee in good faith, the
failure of the grantee to cure such breach within the Cure Period;
notwithstanding the foregoing, with respect to those grantees who (i) are
parties to the Stockholders Agreement dated as of August 25, 1998 among the
Company, certain management stockholders and certain other stockholders, or (ii)
are parties to employment agreements with the Company, and such employment
agreements contain a definition of "Cause," the term "Cause" herein shall be
deemed to have the meaning set forth in such Stockholders Agreement or
employment agreement. As used in this Agreement, a termination for Cause shall
be deemed to have occurred with respect to a grantee if such grantee resigns
from his or her employment with the Company and its subsidiaries after
committing any act which, with notice or lapse of time or both, would constitute
an event of Cause under this definition.

                           (c)      The term "Change in Control" as used herein
means any time when (i) Jupiter Partners II LLC ("Jupiter") has received cash
proceeds from the sale

<PAGE>
                                                                               4

of 50% or more of the Common Stock purchased on the Effective Date, and (ii) the
Company has not completed an Initial Public Offering and is not public following
the transaction by which Jupiter sold its stake.

                           (d)      The term "Common Stock" as used herein means
the shares of common stock, par value $.20 per share, of the Company and any
other shares into which such common stock shall thereafter be changed by reason
of a recapitalization, merger, consolidation, split-up, combination, exchange of
shares or the like.

                           (e)      The term "Disability," with respect to a
grantee, shall be defined in the long-term disability plan maintained by the
Company.

                           (f)      The term "Effective Date" means
                                    August 25, 1998.

                           (g)      The term "Fair Market Value" of a share of
Common Stock as of any determination date shall be determined by the Committee
in its sole discretion (taking into consideration the lack of liquidity and
non-control nature of such share); provided, however, that in no event shall the
Fair Market Value of any share of Common Stock be less than its par value and;
provided, further, that if such determination date occurs at a time when the
Common Stock is publicly-traded following an Initial Public Offering, the Fair
Market Value of a share of Common Stock shall be the average of the last
reported sales prices of the Common Stock for the 30 consecutive days
immediately preceding the date on which such determination is to be made, as
reported by NASDAQ National Market System or a national securities exchange.

                           (h)      The term "Initial Public Offering" means the
first time following the Effective Date a registration statement filed under the
Securities Act of 1933 with the Securities and Exchange Commission (other than
(i) a registration statement filed on Form S-4 or any successor form thereto
relating to a merger or similar transaction or (ii) a registration statement
filed on Form S-8 or any successor form thereto with respect to the issuance of
Common Stock, or securities convertible into or exercisable or exchangeable for,
Common Stock or rights to acquire Common Stock or such securities, granted or to
be granted to employees or directors of the Company or any subsidiary of the
Company) respecting an offering, whether primary or secondary, of Common Stock
(or, if so determined by the Committee, securities convertible into, or
exchangeable for, Common Stock or rights to acquire Common Stock or such
securities) is declared effective and the securities so registered are issued
and sold in a public offering.

                           (i)      The term "Person" means any individual,
corporation, partnership, limited liability company, joint venture, association,
joint stock company, trust, unincorporated organization or government or any
agency or political subdivision thereof.

<PAGE>

                                                                               5

                  1.7      Agreements Evidencing Awards.

                           (a)      Options granted under the Plan shall be
evidenced by written agreements. Any such written agreements shall (i) contain
such provisions not inconsistent with the terms of the Plan as the Committee may
in its sole discretion deem necessary or desirable and (ii) be referred to
herein as "Stock Option Agreements."

                           (b)      Each Stock Option Agreement shall set forth
the number of shares of Common Stock subject to the option granted thereby, and
the amount (the "option exercise price") payable by the grantee to the Company
in connection with the exercise of the option evidenced thereby.

                                    ARTICLE 2

                                  STOCK OPTIONS

                  2.1      Grant of Options.

                  The Committee may grant options to purchase shares of Common
Stock in such amounts and subject to such terms and conditions as the Committee
shall from time to time in its sole discretion determine, subject to the terms
of the Plan.

                  2.2      Exercisability of Options.

                           (a)      Exercisability Determined by Stock Option
Agreement. Subject to the other provisions of the Plan, each Stock Option
Agreement shall set forth the period during which and the conditions subject to
which the option evidenced thereby shall be exercisable, as determined by the
Committee in its sole discretion.

                           (b)      Exercisability Period. Except to the extent
otherwise provided in the applicable Stock Option Agreement:

                                    (i)  each option shall become cumulatively
          exercisable with respect to 20% of the shares of Common Stock subject
          thereto, rounded up to the next full share, on each of the first,
          second, third and fourth anniversary of the date of grant (or, in the
          case of the first group of options granted under the Plan, the
          Effective Date) if, and only if, the grantee is still employed by the
          Company on each relevant date; and

                                    (ii) each option shall become 100%
          exercisable on the fifth anniversary of the date of grant (or, in the
          case of the first group of options granted under the Plan, the
          Effective Date) if, and only if, the grantee is still employed by the
          Company at such date.

<PAGE>

                                                                               6

                           (c)      Change in Control; Ownership Change.  Upon a
Change in Control, each option automatically shall become exercisable in respect
of 100% of the shares of Common Stock subject thereto. Upon a Change in Control,
unless otherwise determined by the Committee, each option must be exercised
prior to or simultaneous with the Change in Control and, if not so exercised,
such option shall terminate and be canceled. Upon the sale by the Company or by
any stockholder of the Company in one transaction or a series of related
transactions of Common Stock which constitutes 50% or more of the outstanding
Common Stock of the Company following such transaction or transactions (which
transaction or transactions do not constitute a Change in Control), then the
Committee may determine that each option shall become exercisable in respect of
100% of the shares of Common Stock subject thereto and must be exercised
immediately following such transaction or transactions and, if not so exercised,
such option shall terminate and be cancelled.

                           (d)      Term.  Except to the extent otherwise
provided in the Plan or the applicable Stock Option Agreement, each option shall
terminate and lapse, and be no longer exercisable, on the eighth (8th)
anniversary of the date of grant (or, in the case of the first group of options
granted under the Plan, on the eighth (8th) anniversary of the Effective Date).

                           (e)      Partial Exercise Permitted.  Except to the
extent otherwise provided in the Plan or the applicable Stock Option Agreement,
an option granted under the Plan may be exercised from time to time as to all or
part of the full number of shares as to which such option shall then be
exercisable.

                           (f)      Notice of Exercise; Exercise Date.  An
option shall be exercisable by the grantee (or, in the case of the grantee's
death or disability, his or her beneficiary or representative) by the filing of
a written notice of exercise with the Company, on such form and in such manner
as the Committee shall in its sole discretion prescribe, and by payment in
accordance with Section 2.3.

                  2.3      Payment of Option Price.

                           (a)      Tender Due Upon Notice of Exercise.  Unless
the applicable Stock Option Agreement otherwise provides, any written notice of
exercise of an option shall be accompanied by payment of the full exercise price
for the shares being purchased. The grantee shall have no right to receive
shares of Common Stock with respect to an option exercise prior to such payment
on the option exercise date.

                           (b)      Manner of Payment. Payment of the exercise
price shall be made in any combination of the following:

<PAGE>

                                                                               7

                                    (i)  by certified or official bank check
     payable to the Company (or such other consideration acceptable to the
     Committee); and

                                    (ii) if the Company has completed an Initial
     Public Offering and has Common Stock registered under the Securities
     Exchange Act of 1934, and if and to the extent provided in the applicable
     Stock Option Agreement, by delivery of previously acquired shares of Common
     Stock owned by the grantee for at least six months (or such longer period
     as the Committee may prescribe) having a Fair Market Value (determined as
     of the option exercise date) equal to the portion of the option exercise
     price being paid thereby, provided that the Committee may require the
     grantee to furnish an opinion of counsel acceptable to the Committee to the
     effect that such delivery would not result in the grantee or the Company
     incurring any liability under the Securities Exchange Act of 1934.

                           (c)      Issuance of Shares.  As soon as practicable
after receipt of full payment, the Company shall, subject to the provisions of
Section 3.2 (relating to restrictions) and Section 3.13 (relating to the
obligation to become a party to the Stockholders Agreement), deliver to the
grantee one or more certificates for the shares of Common Stock so purchased,
which certificates may bear such legends as the Company may deem appropriate
concerning restrictions on the disposition of the shares in accordance with
applicable contractual restrictions, securities laws, rules and regulations or
otherwise.

                  2.4      Special ISO Requirements. In order for a grantee to
receive special tax treatment with respect to stock acquired under an option
granted as an incentive stock option, the grantee of such option must be, at all
times during the period beginning on the date of grant and ending on the day
three months before the date of exercise of such option, an employee of the
Company or any of the Company's parent or subsidiary corporations (within the
meaning of Code section 424), or of a corporation or a parent or subsidiary
corporation of such corporation issuing or assuming a stock option in a
transaction in which Code section 424(a) applies. If an option granted under the
Plan is intended to be an incentive stock option, the option exercise price
shall in no event be less than 100% of the fair market value (as determined
pursuant to the Code) of the Common Stock on the date of grant. If an option
granted under the Plan is intended to be an incentive stock option, and if the
grantee, at the time of grant, owns stock possessing 10 percent or more of the
total combined voting power of all classes of stock of the grantee's employer
corporation or of its parent or subsidiary corporation, then (i) the option
exercise price per share shall in no event be less than 110% of the fair market
value of the Common Stock on the date of such grant and (ii) such option shall
not be exercisable after the expiration of five years after the date such option
is granted.

                  2.5      Default Provisions Concerning Termination of
                           Employment.

                           (a)      General Rule. Except as otherwise provided
in the Plan or applicable Stock Option Agreement or as determined by the
Committee in its sole

<PAGE>
                                                                               8

discretion, if the grantee's employment terminates for any reason (including by
reason of death or Disability) other than (x) for Cause or (y) upon the
resignation of the grantee, (i) the portion of any options granted to such
grantee that were exercisable under Section 2.2 immediately prior to such
termination of employment will remain outstanding and exercisable as otherwise
provided in the Plan, and (ii) the portion of such options that were not
exercisable under Section 2.2 immediately prior to such termination shall
terminate and expire. The employment of a grantee shall be deemed to have
terminated if the grantee is no longer employed by the Company or by a company
which is an Affiliate of the Company.

                           (b)      Termination for Cause. All options granted
to a grantee, whether or not exercisable, shall immediately terminate and expire
on the effective date of termination of the grantee's employment if the grantee
is terminated for Cause. In addition, no options shall be exercisable during any
Cure Period (as defined in Section 1.6(b)). Notwithstanding anything herein to
the contrary, if the Committee determines that a grantee voluntarily terminated
his or her employment at a time when the Company or an Affiliate could have
terminated such grantee's employment for Cause, for purposes of the Plan, such
grantee shall be treated as if his or her employment had been terminated for
Cause.

                           (c)      Resignation. Except as otherwise provided in
the Plan or applicable Stock Option Agreement or as determined by the Committee
in its sole discretion, if the grantee's employment terminates upon resignation
of the grantee, (i) the portion of any options granted to such grantee that were
exercisable under Section 2.2 immediately prior to termination of employment
will remain outstanding and exercisable for a period of sixty (60) days
following such termination and shall terminate and expire following such
sixtieth (60th) day and (ii) the portion of such options that were not
exercisable under Section 2.2 immediately prior to such termination shall
terminate and expire upon such termination.

                           (d)      Leave of Absence. The Committee may in its
sole discretion determine (i) whether any leave of absence shall constitute a
termination of employment for purposes of the Plan and (ii) the impact, if any,
of any such leave on outstanding awards under the Plan.

                  2.6      Noncompetition Agreements.

                  Notwithstanding anything in Section 2.2 to the contrary,
unless a Stock Option Agreement provides otherwise or as determined by the
Committee in its sole discretion, all options granted to a grantee, whether or
not exercisable, shall automatically terminate and expire if the grantee
breaches in any material respect (after giving effect to

<PAGE>

                                                                               9

any grace period contained therein) any of the provisions of any noncompetition
or confidentiality agreement now existing or hereafter in effect between such
grantee and the Company or if the grantee breaches any of the following
provisions:

                           (a)      The grantee shall not, directly or
indirectly, as principal, agent, manager, employee, partner, shareholder,
director, officer, consultant or otherwise, participate in or engage in the
Lines of Business, as hereinafter defined; provided, however, that the grantee
may own up to one percent (1%) of the outstanding securities of any corporation
which is engaged in the Lines of Business, so long as such securities are traded
on a national securities exchange or are included in the National Association of
Securities Dealers Quotation System. "Lines of Business" shall mean the
provision of portrait photography services through itinerant or traveling
operations or permanent studios or any other portrait photography service, the
processing or developing of photographic film in connection with such provision
and any other lines of business in which the Company may engage.

                           (b)      The grantee shall not directly or indirectly
cause or attempt to cause any supplier or customer of the Company, or any of its
subsidiaries or affiliates, or any governmental body or public agency, not to do
business with the Company or such subsidiary or affiliate or to transfer all or
part of its business from the Company, or such subsidiary or affiliate, or
otherwise interfere or attempt to interfere with any business relationship
between the Company, or any of its subsidiaries or affiliates, and any of such
suppliers, customers, government bodies or public agencies.

                           (c)      The grantee shall keep and retain in
confidence and shall not, without the prior written consent of the Company,
disclose to any persons, firm or corporation or otherwise use for his own
benefit or the benefit of another any of the proprietary, confidential or secret
information or trade secrets of the Company.

                           (d)      The grantee shall not, while employed by the
Company and for a period of one year following the termination of the grantee's
employment with the Company, directly or indirectly, hire, solicit or encourage
to leave the employment of the Company or any subsidiary of the Company any
director, officer or employee of the Company or any such subsidiary, or hire any
such person who has left the employment of the Company or any such subsidiary,
within the 12-month period prior to the grantee's hiring of such person.

                                    ARTICLE 3

                                  MISCELLANEOUS

                  3.1      Amendment of the Plan; Modification of Awards.

<PAGE>

                                                                              10

                           (a)      Plan Amendments. The Board may, without
stockholder approval, at any time and from time to time suspend, discontinue or
amend the Plan in any respect whatsoever; provided, however, that no such
suspension, discontinuance or amendment shall adversely affect the rights of a
grantee with respect to any outstanding option without the written consent of
such grantee.

                           (b)      Award Modifications.  Subject to the terms
and conditions of the Plan, the Committee may, with the grantee's consent, amend
outstanding Stock Option Agreements with a grantee, including, without
limitation, any amendment that would (i) accelerate the time or times at which
such grantee's options become exercisable and/or (ii) extend the scheduled
termination or expiration date of such grantee's options; provided, however,
that no such suspension, discontinuance or amendment shall adversely affect the
rights of a grantee with respect to any outstanding option without the written
consent of such grantee.

                  3.2      Restrictions.

                           (a)      The Company shall not be required to issue
     or deliver any certificate or certificates for shares of Common Stock
     purchased upon the exercise of an option or portion thereof prior to
     fulfillment of all of the following conditions:

                                    (i)     the obtaining of any approval or
     other clearance from any state, federal, local or foreign governmental
     agency or other regulatory organization which the Committee shall determine
     to be reasonably necessary or advisable;

                                    (ii)    a bona fide written representation
     and agreement, in a form reasonably satisfactory to the Committee, signed
     by the grantee or other person, stating that the shares of Common stock are
     being acquired for such person's own account for investment and without any
     present intention of distributing or reselling said shares or any of them
     except as may be permitted under the Securities Act of 1933 and then
     applicable rules and regulations thereunder; provided, however, that the
     Committee may take whatever additional actions it deems reasonably
     necessary to ensure the observance and performance of such representation
     and agreement and to effect compliance with such Act and any other federal
     or state securities laws or regulations, if applicable;

                                    (iii)   in the event the option or portion
     thereof shall be exercised pursuant to Section 2.2 by any person or persons
     other than the optionee, appropriate proof of the right of such person or
     persons to exercise the option; and

<PAGE>

                                                                              11

                                     (iv)    such assurances as the Company may
     reasonably require, from the grantee or the grantee's counsel, that the
     issuance of shares to the grantee will not cause any liability to the
     Company under any federal or state securities or other law.

                  3.3      Nontransferability.

                  Except as agreed to by the Committee, no option granted to any
grantee under the Plan shall be assignable or transferable by the grantee other
than by will or by the laws of descent and distribution, and during the lifetime
of the grantee, all rights with respect to any such award granted to the grantee
under the Plan shall be exercisable only by him or her. Notwithstanding the
foregoing, the Committee may permit the transfer of options to (a) the spouse,
parents or siblings (by blood or adoption) of the grantee or the lineal
descendants (by blood or adoption) of such grantee or such grantee's spouse,
parents or siblings, (b) a trust, the beneficiaries of which include only such
grantee or spouse, parents or siblings (by blood or adoption) of such grantee or
the lineal descendants (by blood or adoption) of such grantee, spouse, parents
or siblings, or a charitable trust that is an affiliate of such grantee, or (c)
upon such grantee's death, executors, administrators, trustees, legatees or
beneficiaries of such grantee, in any such case, upon the agreement of any such
transferee to be bound by the terms of the Plan, the Stockholders Agreement and
any Stock Option Agreement.

                  3.4      Withholding Taxes.

                           (a)      Whenever under the Plan shares of Common
Stock are to be delivered pursuant to an award, the Committee may require as a
condition of delivery that the grantee remit an amount sufficient to satisfy all
federal, state and other governmental withholding tax requirements related
thereto. Whenever amounts are to be paid under the Plan, the Company may, as a
condition of payment, deduct therefrom, or from any salary or other payments due
to the grantee, an amount sufficient to satisfy all federal, state and other
governmental withholding tax requirements related thereto or to the delivery of
any shares of Common Stock under the Plan.

                           (b)      Without limiting the generality of the
foregoing, from and after the date that the Company has completed an Initial
Public Offering and has Common Stock registered under the Securities Exchange
Act of 1934, (i) a grantee may elect to satisfy all or part of the foregoing
withholding requirements by delivery of unrestricted shares of Common Stock
owned by the grantee for at least six months (or such longer period as the
Committee may determine) having a Fair Market Value (determined as of the date
of such delivery by the grantee) equal to all or part of the amount to be so
withheld and (ii) the Committee may permit any such delivery to be made by
withholding shares of Common Stock from the shares otherwise issuable pursuant
to the award giving rise to the tax withholding obligation (in which event the
date of delivery shall be deemed the date such award was exercised).

<PAGE>

                                                                              12

                  3.5      Adjustments Upon Changes in Capitalization.

                  The number of shares of Common Stock which may be issued
pursuant to options under the Plan, the number of shares of Common Stock
issuable under outstanding options and the option exercise price of options
theretofore granted under the Plan shall be equitably adjusted, as determined by
the Committee in its sole discretion, if there is any change in the Common Stock
by way of stock split, reverse stock split, stock dividend, reclassification,
merger, consolidation, reorganization, recapitalization or any other means.

                  3.6      Right of Discharge Reserved.

                  Nothing in the Plan or in any Stock Option Agreement shall
confer upon any person the right to continue in the service of the Company or an
Affiliate or affect any right which the Company or an Affiliate may have to
terminate the service of such person.

                  3.7      No Rights as a Stockholder.

                  No grantee or other person shall have any of the rights of a
stockholder of the Company with respect to shares subject to an option until the
issuance of a stock certificate (including any restricted stock certificate,
unless otherwise provided in an applicable Stock Option Agreement) to such
grantee or other person for such shares. Except as otherwise provided in Section
3.5 (relating to adjustments upon changes in capitalization) or as otherwise
determined by the Committee, no adjustment shall be made for dividends,
distributions or other rights (whether ordinary or extraordinary, and whether in
cash, securities or other property) for which the record date is prior to the
date such stock certificate is issued.

                  3.8      Nature of Payments.

                           (a)      Any and all awards or payments hereunder
shall be granted, issued, delivered or paid, as the case may be, in
consideration of services performed for the Company or for its Affiliates by the
grantee.

                           (b)      All such awards and payments shall be
considered special incentive payments to the grantee and shall not, unless
otherwise determined by the Committee, be taken into account in computing the
grantee's salary or compensation for the purposes of determining any benefits
under (i) any pension, retirement, life insurance or other benefit plan of the
Company or any Affiliate or (ii) any agreement between the Company or any
Affiliate and the grantee.

<PAGE>

                                                                              13

                           (c)      Other than expressly as set forth in the
Plan or any Stock Option Agreement, no grantee (or any permitted transferee)
shall have any rights relating to the grant, exercisability or continuance of
any award made hereunder beyond the period provided for herein or in the
applicable Stock Option Agreement.

                  3.9      Non-Uniform Determinations.

                  The Committee's determinations under the Plan need not be
uniform and may be made by it selectively among persons who receive, or are
eligible to receive, awards under the Plan (whether or not such persons are
similarly situated). Without limiting the generality of the foregoing, the
Committee shall be entitled, among other things, to make non-uniform and
selective determinations, and to enter into non-uniform and selective Stock
Option Agreements, as to (a) the persons to receive awards under the Plan, and
(b) the terms and provisions of awards under the Plan.

                  3.10     Other Payments or Awards.

                  Nothing contained in the Plan shall be deemed in any way to
limit or restrict the Company, any Affiliate or the Committee from making any
award or payment to any person under any other plan, arrangement or
understanding, whether now existing or hereafter in effect.

                  3.11     Section Headings.

                  The section headings contained herein are for the purposes of
convenience only and are not intended to define or limit the contents of said
sections.

                  3.12     Effective Date and Term of Plan.

                           (a)      The Plan shall be deemed adopted and become
effective on the Effective Date.

                           (b)      The Plan shall terminate eight years after
the Effective Date (the "Termination Date"). After the Termination Date, no
awards shall be made under the Plan. Notwithstanding the foregoing, all options
granted under the Plan prior to the Termination Date shall remain in effect
until such options have been satisfied or terminated in accordance with the
terms and provisions of the Plan and the applicable Stock Option Agreement.

                  3.13     Stockholders Agreement.

<PAGE>

                                                                              14

                  Each grantee (and permitted transferee, as a condition of
transfer) of an option shall, as a condition to the exercisability of such
option or at any other time at the request of the Committee, execute and deliver
a Stockholders Agreement in substantially the form of Exhibit A hereto.

                  3.14     Governing Law.

                  The Plan shall be governed by the laws of the State of North
Carolina applicable to agreements made and to be performed entirely within such
state.

<PAGE>

                             PCA INTERNATIONAL, INC.

                            STOCK OPTION PLAN (1998)

<PAGE>

                                TABLE OF CONTENTS

                                                                           Page
                                                                           ----

ARTICLE 1 GENERAL ........................................................    1
1.1       Purpose ........................................................    1
1.2       Administration .................................................    1
1.3       Persons Eligible for Awards ....................................    2
1.4       Types of Awards Under Plan .....................................    2
1.5       Shares Available for Awards ....................................    2
1.6       Definitions of Certain Terms ...................................    3
1.7       Agreements Evidencing Awards ...................................    5

ARTICLE 2 STOCK OPTIONS ..................................................    5
2.1       Grant of Options ...............................................    5
2.2       Exercisability of Options ......................................    5
2.3       Payment of Option Price ........................................    6
2.4       Special ISO Requirements .......................................    7
2.5       Default Provisions Concerning Termination of Employment ........    8
2.6       Noncompetition Agreements ......................................    8

ARTICLE 3 MISCELLANEOUS ..................................................   10
3.1       Amendment of the Plan; Modification of Awards ..................   10
3.2       Restrictions ...................................................   10
3.3       Nontransferability .............................................   11
3.4       Withholding Taxes ..............................................   11
3.5       Adjustments Upon Changes in Capitalization .....................   12
3.6       Right of Discharge Reserved ....................................   12
3.7       No Rights as a Stockholder .....................................   12
3.8       Nature of Payments .............................................   12
3.9       Non-Uniform Determinations .....................................   13
3.10      Other Payments or Awards .......................................   13
3.11      Section Headings ...............................................   13
3.12      Effective Date and Term of Plan ................................   13
3.13      Stockholders Agreement .........................................   14
3.14      Governing Law ..................................................   14

                                       i

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