<PAGE>

                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                    FORM 10-Q

             [X] QUARTERLY REPORT UNDER SECTION 13 OR 15 (d) OF THE
                         SECURITIES EXCHANGE ACT OF 1934


  For Quarterly Period Ended September 28, 2002 Commission File Number 0-21068
  ----------------------------------------------------------------------------
                           Sight Resource Corporation

             (Exact name of registrant as specified in its charter)


               Delaware                                  04-3181524
   --------------------------------------------------------------------------
     (State or other jurisdiction         (I.R.S. Employer Identification No.)
   of incorporation or organization)


       6725 Miami Avenue, Suite 102, Cincinnati, OH           45243
       ---------------------------------------------------------------
       (Address of principal executive offices)             (Zip Code)


                                 (513) 527-9700
                                 --------------
              (Registrant's telephone number, including area code)


                                       N/A
                                       ---
                 (Former name, former address and former fiscal
                     year, if changed since the last report)

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.

                                YES  X    NO
                                    ---      ---

APPLICABLE ONLY TO CORPORATE ISSUERS: Indicate the number of shares outstanding
of each of the issuer's classes of common stock, as of the latest practicable
date:

On November 11, 2002, 30,667,709 shares (does not include 30,600 shares held as
treasury stock) of common stock, par value $0.01 per share, were outstanding.


<PAGE>


                           SIGHT RESOURCE CORPORATION
                                      INDEX
<TABLE>
<CAPTION>

PART I.  FINANCIAL INFORMATION                                                               PAGE
         ---------------------                                                               ----
<S>     <C>                                                                                  <C>
Item 1.  Financial Statements

          Consolidated Balance Sheets as of September 28, 2002 and
          December 29, 2001                                                                     1

          Consolidated Statements of Operations for the Three
          And Nine Months Ended September 28, 2002 and September 29, 2001                       2

          Consolidated Statements of Cash Flows for the
          Nine Months Ended September 28, 2002 and September 29, 2001                           3

          Notes to Consolidated Financial Statements                                            4

Item 2.  Management's Discussion and Analysis of Financial Condition and
          Results of Operations                                                                 7

Item 3.  Quantitative and Qualitative Disclosures about Market Risk                            17

Item 4.  Controls and Procedures                                                               17

PART II. OTHER INFORMATION

Item 5.  Submission of Matters to a Vote of Security Holders                                   17

Item 6.  Other Information                                                                     17

Item 7.  Exhibits and Reports on Form 8-K                                                      17

         Signatures                                                                            18
</TABLE>

<PAGE>

                          PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
                           SIGHT RESOURCE CORPORATION
                           Consolidated Balance Sheets
                 (In thousands, except share and per share data)
<TABLE>
<CAPTION>

                                                                                    As of                    As of
                                                                               September 28, 2002      December 29, 2001
                                                                               ------------------      -----------------
<S>                                                                             <C>                    <C>
Assets                                                                           (unaudited)
Current assets:
Cash and cash equivalents                                                                     $505                 $1,356
Accounts receivable, net of allowance of $2,115 and $1,915,
respectively                                                                                 2,489                  2,613
Inventories                                                                                  4,820                  4,666
Prepaid expenses and other current assets                                                      344                    395
                                                                                               ---                    ---

Total current assets                                                                         8,158                  9,030
                                                                                             -----                  -----

Property and equipment, net                                                                  2,174                  2,729

Other assets:
Intangible assets, net                                                                      19,273                 19,770
Web site development                                                                         2,288                  2,288
Other assets                                                                                   147                    127
                                                                                               ---                    ---

          Total assets                                                                     $32,040                $33,944
                                                                                           =======                =======

Liabilities and Stockholders' Equity
Current liabilities:
Revolver notes payable                                                                      $2,500                 $2,500
Current portion of long term debt                                                            5,108                  5,979
Current portion of capital leases                                                                9                     10
Accounts payable                                                                             5,205                  5,789
Accrued expenses                                                                             1,811                  1,813
Dividends payable                                                                              381                     -
                                                                                               ---                 -----

Total current liabilities                                                                   15,014                 16,091
                                                                                            ------                 ------

Non-current liabilities:
Long term debt, less current maturities                                                        798                    928
Capital leases                                                                                  11                     17
                                                                                                --                     --

Total non-current liabilities                                                                  809                    945
                                                                                               ---                    ---

Series B redeemable convertible preferred stock
1,452,119 shares issued and outstanding                                                      6,535                  6,535

Stockholders' equity:
Preferred Stock, $.01 par value. Authorized 5,000,000
shares; no shares of Series A issued and outstanding                                           --                     --
Common Stock, $.01 par value. Authorized 50,000,000
shares; 30,698,309 at September 28, 2002
and 29,597,703 at December 29, 2001 shares
issued and outstanding                                                                         307                    296
Additional paid-in capital                                                                  41,418                 41,810
Treasury stock at cost, 30,600 shares at September 28, 2002
and December 29, 2001                                                                         (137)                 (137)
Accumulated deficit                                                                        (31,906)              (31,596)
                                                                                           --------              --------

Total stockholders' equity                                                                   9,682                 10,373
                                                                                             -----                 ------

                                                                                           $32,040                $33,944
                                                                                           =======                =======
</TABLE>

See accompanying notes to consolidated financial statements.


                                        1
<PAGE>

                           SIGHT RESOURCE CORPORATION
                      Consolidated Statements of Operations
                 (In thousands, except share and per share data)
                                   (unaudited)

<TABLE>
<CAPTION>
                                                                          Three Months Ended            Nine Months Ended
                                                                          ------------------            -----------------
                                                                     SEPT 28, 2002   SEPT 29, 2001  SEPT 28, 2002   SEPT 29, 2001
                                                                     -------------   -------------  -------------   -------------
<S>                                                                      <C>              <C>          <C>             <C>
Net revenue                                                              $14,223          $15,290      $43,579         $45,859

Cost of revenue                                                            4,169            4,877       12,649          14,612
                                                                           -----            -----       ------          ------

Gross profit                                                              10,054           10,413       30,930          31,247

Selling, general and administrative expenses                               9,986           11,231       30,644          33,847
                                                                           -----           ------       ------          ------

Income (loss) from operations                                                 68             (818)         286          (2,600)

Interest expense, net                                                       (181)            (158)        (539)           (587)
                                                                            -----            -----        -----           -----


Loss before taxes                                                           (113)            (976)        (253)         (3,187)

Income tax  expense                                                           44               18           57              67
                                                                              --               --           --              --

Net Loss                                                                   (157)            (994)        (310)         (3,254)
                                                                           -----            -----        -----         -------

Dividends on redeemable convertible preferred stock                          127              366          381             623
                                                                             ---              ---          ---             ---

Net Loss attributable to common stockholders                            $  (284)       $  (1,360)     $  (691)        $ (3,877)
                                                                        --------       ----------     --------        --------

Basic and diluted Loss per common share                                   $(0.01)         $(0.05)       $(0.02)         $(0.26)
                                                                          -------         -------       -------         ------

Weighted average number of common shares outstanding -
Basic and Diluted                                                     30,698,000      24,821,000    30,329,000       14,781,000
                                                                      ----------      ----------    ----------       ----------
</TABLE>

See accompanying notes to consolidated financial statements.


                                        2

<PAGE>

                           SIGHT RESOURCE CORPORATION
                      Consolidated Statements of Cash Flows
                                 (In thousands)
<TABLE>
<CAPTION>

                                                                                               Nine Months Ended
                                                                                               -----------------
                                                                                    September 28, 2002        September 29, 2001
                                                                                    ------------------        ------------------
<S>                                                                                      <C>                     <C>
                                                                                                 (unaudited)
Operating activities:
Net loss                                                                                 $(310)                  $(3,254)
Adjustments to reconcile net loss to net cash provided by operating
activities:
Depreciation and amortization                                                             1,353                     2,630
Amortization and write-off of deferred financing costs                                       --                       105
Amortization of unearned compensation                                                        --                         5
Loss on disposal of assets                                                                   --                        22
Changes in operating assets and liabilities:
          Accounts receivable                                                               124                        41
          Inventories                                                                     (154)                     1,012
          Prepaid expenses and other current assets                                          51                       257
          Accounts payable and accrued expenses                                           (586)                     (218)
                                                                                          -----                     -----

              Net cash provided by operating activities                                     478                       600
                                                                                            ---                       ---

Investing activities:
Purchases of property and equipment                                                       (301)                     (347)
Proceeds from sale of assets                                                                 --                         2
Other assets (liabilities)                                                                 (20)                       (9)
                                                                                             --                       ---

          Net cash used in investing activities                                           (321)                     (354)
                                                                                          -----                     -----

Financing activities:
Principal payments                                                                      (1,008)                     (165)
Proceeds from notes                                                                          --                        76
Dividends on Preferred Shares                                                                --                        14
Merger Expenses                                                                              --                     (323)
Proceeds from issuance of stock                                                              --                     1,739
                                                                                             --                     -----

          Net cash provided by (used in) financing activities                           (1,008)                     1,341
                                                                                        -------                     -----

Net increase (decrease) in cash and cash equivalents                                      (851)                     1,587

Cash and cash equivalents, beginning of period                                            1,356                       532
                                                                                                                      ---

Cash and cash equivalents, end of period                                                 $  505                   $ 2,119
                                                                                         ======                   =======

Supplementary cash flow information:
          Interest paid                                                                    $349                      $441
          Income taxes paid                                                                  22                        55
</TABLE>

See accompanying notes to consolidated financial statements.


                                        3

<PAGE>

                           SIGHT RESOURCE CORPORATION
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(1)  THE COMPANY

       (a) Nature of Business

       Sight Resource Corporation (the "Company") manufactures, distributes and
       sells eyewear and related products and services.

       (b) Eyeshop Merger

       In July 2001, the Company merged with eyeshop.com, inc. ("Eyeshop"), an
       early-stage optical development company established by E. Dean Butler in
       late 1999. Concurrent with the merger, there were two Common Stock
       Purchase Agreements whereby the former shareholders of Eyeshop purchased
       additional shares of the Company. It was anticipated that, following the
       merger, available cash resources of the combined companies would be
       devoted to continuation and improvement of the business of the Company,
       with a decision to be made at a future date as to when the Eyeshop
       development activities should be resumed. As of September 28, 2002, no
       decision had been made to resume Eyeshop development activities.

       Pursuant to a merger agreement, the Company issued a total of 7,306,662
       shares of common stock to former Eyeshop stockholders and assumed
       1,757,096 stock options in connection with the merger. Further, former
       Eyeshop stockholders were also entitled to receive additional shares of
       the Company's common stock if and when certain options, warrants and
       other rights to receive the Company's common stock that were held by the
       Company's security holders as of May 23, 2001 are exercised. To date,
       none of these options, warrants or other rights have been exercised.

       Collectively, the former stockholders of Eyeshop together with the common
       stock purchasers associated with Eyeshop held approximately 18,876,162
       shares of the Company's common stock immediately after the merger and the
       common stock financings, or approximately 64% of the Company's issued and
       outstanding common stock and approximately 61% of the Company's issued
       and outstanding voting securities.

       The Company has completed its accounting for the merger. The treatment,
       for accounting purposes, was considered to be a purchase of Eyeshop's
       assets and assumption of Eyeshop's liabilities by the Company. The
       aggregate purchase price was $2,054,000 and the costs of the assets
       acquired and liabilities assumed have been allocated on the basis of the
       estimated fair value of the net assets acquired. There was no goodwill
       provided in the transaction.



                                        4

<PAGE>


                           SIGHT RESOURCE CORPORATION
            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)

(2)  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

      Basis of Presentation

      The accompanying consolidated financial statements have been prepared by
      the Company without audit, pursuant to the rules and regulations of the
      United States Securities and Exchange Commission the ("SEC"). In the
      opinion of the Company, these consolidated financial statements contain
      all adjustments (consisting of only normal, recurring adjustments)
      necessary to present fairly the Company's financial position as of
      September 28, 2002 and the results of its operations and cash flows for
      the periods presented.

      The Company's fiscal year ends on the last Saturday in December. Each
      quarter represents a 13-week period, except during a 53-week year in which
      case one quarter represents a 14-week period. The quarters and nine months
      ended September 28, 2002 and September 29, 2001 were 13-week and 39-week
      periods, respectively. Fiscal years 2002 and 2001 are 52-week fiscal
      years.

      The accompanying consolidated financial statements and related notes
      should be read in conjunction with the audited consolidated financial
      statements which are contained in the Company's Annual Report on Form
      10-K, as amended on Form 10-K/A, for the year ended December 29, 2001.

(3)  GOODWILL AND INTANGIBLE ASSETS

The Company adopted the provisions of Statement of Financial Accounting
Standards (SFAS) No. 141, Business Combinations ("Statement 141") effective July
1, 2001 and SFAS No. 142, Goodwill and Other Intangible Assets ("Statement
142"), effective December 30, 2001. Statement 141 addresses financial accounting
and reporting for business combinations requiring the use of the purchase method
of accounting and reporting for goodwill and other intangible assets requiring
that goodwill and intangible assets with indefinite useful lives no longer be
amortized, but instead tested for impairment at least annually in accordance
with the provisions of Statement 142. The Company had up to six months from the
adoption of Statement 142 to determine the fair value of each reporting unit and
compare it to the reporting unit's carrying amount. Statement 142 also requires
intangible assets with estimated useful lives be amortized over their respective
useful life to their estimated residual values, and reviewed for impairment. As
of September 28, 2002, goodwill had a value of $14,305,000 and other intangibles
with a definite useful life had a value of $4,968,000.

Based on independent third party enterprise valuations of each of the Company's
reporting units, the Company did not recognize any impairment of its goodwill
and intangible assets upon adoption of Statement 142. The Company completed its
initial review of Statement 142 during the second quarter 2002.

In the three and nine months ended September 29, 2001, $263,000 and $785,000,
respectively, of goodwill amortization was included in selling, general and
administrative expenses. The net loss for the three and nine months ended
September 29, 2001 without goodwill amortization would have been $731,000 ($0.04
per share) and $2,469,000 ($0.21 per share), respectively. No goodwill
amortization was incurred during 2002. For the year ended December 29, 2001,
goodwill amortization of $1,046,000 was included in selling, general and
administrative expenses. The net loss for the year ended December 29, 2001
without goodwill amortization would have been $4,441,000 or $0.28 per share. In
accordance with Statement 142, the Company will test each reporting unit's
goodwill for impairment as of the end of the fiscal year.



                                        5

<PAGE>

                           SIGHT RESOURCE CORPORATION
            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)

(4)  EARNINGS PER SHARE

        The following table provides a reconciliation of the numerators and
        denominators of the basic and diluted loss per share computations for
        the three and nine months ended September 28, 2002 and September 29,
        2001:
<TABLE>
<CAPTION>
                                                                     Three Months Ended              Nine Months Ended
                                                                     ------------------              ----------------
                                                                Sept 28, 2002  Sept 29, 2001    Sept 28, 2002  Sept 29, 2001
                                                                -------------  -------------    -------------  ------------
                                                                        (In thousands, except share and per share data)
<S>                                                                 <C>           <C>                <C>        <C>
Basic and Diluted Loss Per Share
Net loss                                                            $(157)        $(994)            $(310)       $(3,254)

Net loss available to common stockholders
                                                                    $(284)      $(1,360)            $(691)      $(3,877)
                                                                    ======      ========            ======      ========

Weighted average common shares outstanding                      30,698,000    24,821,000        30,452,000    14,781,000
Net loss per share                                                 $(0.01)       $(0.05)           $(0.02)       $(0.26)
                                                                   =======       =======           =======       =======
</TABLE>


Outstanding options, warrants and convertible preferred stock were not included
in the computation of diluted loss per share for the three and nine months
ended September 28, 2002 and September 29, 2001, because they would have been
antidilutive. The following table presents the weighted average number of
shares of common stock underlying outstanding options, warrants and
convertible preferred stock, which shares were not included in such computation
of diluted loss per share.

<TABLE>
<CAPTION>

                                                                 Three Months Ended               Nine Months Ended
                                                                 ------------------               ------------------
                                                            Sept 28, 2002   Sept 29, 2001    Sept 28, 2002   Sept 29, 2001
                                                            -------------   -------------    -------------   -------------
<S>                                                         <C>             <C>               <C>             <C>
Options                                                        6,206,596       328,500           6,206,596       328,500
Warrants                                                       1,992,568     1,005,463           1,992,568     1,005,108
Convertible preferred stock                                    3,243,900     1,452,119           3,243,900     1,452,119
                                                               ---------     ---------           ---------     ---------

Total                                                         11,443,064     2,786,082          11,443,064     2,785,727
                                                              ==========     =========          ==========     =========
</TABLE>


                                        6

<PAGE>


ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
         RESULTS OF OPERATIONS

OVERVIEW

The Company manufactures, distributes and sells eyewear and related products and
services. As of September 28, 2002, the Company's operations consisted of 115
eye care centers, and one optical laboratory and distribution center, and was
one of the fifteen largest providers in the United States based upon annual
sales. The Company's eye care centers operate primarily under the brand names
Cambridge Eye Doctors, E.B. Brown Opticians, Eyeglass Emporium, Kent Optical,
Shawnee Optical, Vision Plaza, and Vision World. The Company also provides, or
where necessary to comply with applicable law, administers the business
functions of optometrists, ophthalmologists and professional corporations that
provide vision related professional services.

The Company operates one optical laboratory and distribution center. The
regional optical laboratory provides complete services to the Company's eye care
centers, including polishing, cutting and edging, tempering, tinting and coating
of ophthalmic lenses. The distribution center provides and maintains an
inventory of all accessories and supplies necessary to operate an eye care
center, as well as "ready made" eye care products, including contact lenses and
related supplies. The inventory of eyeglass lenses, frames, contact lenses,
accessories and supplies is acquired through a number of sources, domestic and
foreign. Management believes that the optical laboratory and distribution center
has the capacity to accommodate additional multi-site eye care centers. In early
2001, the Company operated two regional optical laboratories and three
distribution centers. During 2001, one laboratory and two distribution centers
were closed and their operations were consolidated into the remaining laboratory
and distribution center. The laboratory and distribution centers were closed in
an effort for the Company to realize greater operating efficiencies from lower
inventories and lower payroll costs.

The Company's results of operations and balance sheet include the accounts
(including revenues, assets and liabilities) of the Company, its wholly owned
subsidiaries, and five professional corporations ("PCs") of which the Company's
subsidiaries bear financial and operational risks and rewards. The Company has
no direct equity ownership in the PCs, but has rights and involvement that
permit the Company to consolidate the PCs into the Company's financial
statements. The Company, through its subsidiaries, provides, for a fee, certain
administrative and other services to each of the PCs. The outstanding voting
stock of each of the PCs is 100% owned by a licensed optometrist who generally
has, in turn, executed an agreement in favor of a subsidiary of the Company that
provides that if the employment of the optometrist-owner is terminated, then the
optometrist-owner must sell all of the outstanding stock of the PC to another
qualified person eligible to serve as a new optometrist-owner. The purchase
price for the sale of the PC stock is either (i) at a nominal per share price or
(ii) equal to the aggregate book value of the PC which will always be a nominal
amount because each PC operates and is expected to continue to operate at an
almost break-even level generating a nominal profit, if any at all.

Because the assets and liabilities of the PCs are, for accounting purposes,
consolidated with the assets and liabilities of the Company and its
subsidiaries, any transaction by which operating assets were transferred by a
Company subsidiary to a PC has been disregarded for accounting purposes. While
the holding of assets by the PCs lessens the Company's control over those
assets, the Company believes that the assets are adequately protected and
maintained.


                                        7
<PAGE>

RESULTS OF OPERATIONS

Three Months Ended September 28, 2002 and September 29, 2001

Net Revenue. During the three months ended September 28, 2002, the Company
generated net revenue of $14,223,000, as compared to net revenue of $15,290,000
for the three months ended September 29, 2001. The decrease of $1,067,000, or
7.0%, in net revenue primarily relates to four less eye care centers operating
during the three months ended September 28, 2002 as compared to the
corresponding period in 2001 and lower same store sales of 5.7%.

Cost of Revenue. Cost of revenue decreased from $4,877,000 for the operation of
the Company's 119 eye care centers during the three months ended September 29,
2001 to $4,169,000 for the operation of the Company's 115 eye care centers
during the three months ended September 29, 2002. Cost of revenue as a
percentage of net revenue decreased from 31.9% for the three months ended
September 29, 2001 to 29.3% for the three months ended September 28, 2002. The
improvement as a percentage of net revenue primarily reflects the consolidation
of optical laboratory operations, improved margins on frames and slightly higher
eye exam revenue. Cost of revenue principally consisted of the cost of
manufacturing, purchasing and distributing optical products to customers of the
Company.

Selling, General and Administrative Expenses. Selling, general and
administrative expenses decreased to $9,986,000 for the three months ended
September 28, 2002 from $11,231,000 for the three months ended September 29,
2001. The decrease of $1,245,000 primarily relates to reduced staffing levels
and lower amortization expenses of $263,000 resulting from the Company's
adoption of Statement 142. Selling, general and administrative expenses, as a
percentage of net revenue, decreased from 73.5% for the three months ended
September 29, 2001 to 70.2% for the three months ended September 28, 2002.

The Company adopted Statement 142 as of December 30, 2001 and had up to six
months from the date of adoption to complete its determination of the fair value
of each of the Company's reporting units. Based on independent third party
enterprise valuations of each of the Company's reporting units, the Company did
not recognize any impairment of its goodwill and intangible assets upon
completion of such determinations. Further, under the new guidelines set forth
in Statement 142, the Company ceased amortization of its goodwill, which reduced
selling, general and administrative expenses for the three months ended
September 28, 2002 by $263,000 compared to the three months ended September 29,
2001.

Interest Expense, Net. Interest expense, net increased to $181,000 for the three
months ended September 28, 2002 from $158,000 for the three months ended
September 29, 2001. The increase of $23,000 is primarily associated with higher
interest rates, offset in part by lower debt outstanding during the three months
ended September 28, 2002 compared with the 2001 period.

Income Tax Expense. The Company has a significant net operating loss
carryforward with a full valuation allowance and as such provides for income
taxes only to the extent that it expects to pay cash taxes (primarily state
taxes) for current income.

Net Loss. The Company realized a net loss of $157,000 for the three months ended
September 28, 2002 as compared to a net loss of $994,000 for the three months
ended September 29, 2001.

Dividends on Redeemable Convertible Preferred Stock. During the three months
ended September 28, 2002 the Company accrued $127,000 for cash dividends payable
to the redeemable convertible preferred stockholders. The dividends are accruing
pursuant to an agreement dated May 21, 2001 and are scheduled to be paid at the
earliest of the following events, as outlined in the letter with the redeemable
convertible preferred stockholder:


                                        8

<PAGE>

(i) the merger, consolidation, reorganization, recapitalization, dissolution or
liquidation of the Company where the stockholders of the Company immediately
following the consummation of the merger no longer own more than 50% of the
voting securities of the Company; (ii) the sale, lease, exchange or other
transfer of all or substantially all of the assets of the Company; (iii) the
consummation of an equity financing by the Company in which proceeds to the
Company, net of transaction costs, are greater than or equal to $10,000,000;
(iv) the end of the first twelve month period in which earnings before income
taxes, depreciation and amortization are equal to or greater than $5,000,000; or
(v) the refinancing of the Company's outstanding indebtedness to Fleet Bank. The
Company is presently unable to predict when the cash dividend will be paid.

During 2001, the Company paid dividends on its outstanding Preferred Shares by
issuing shares of Common Stock to the owner of the Preferred Shares.

Net Loss Attributable to Common Stockholders. The Company realized a net loss
attributable to common stockholders of $284,000, or $(0.01) per share, for the
three month period ended September 28, 2002 as compared to $1,360,000, or
$(0.05) per share, for the three month period ended September 29, 2001. The per
share net losses for the three months ended September 28, 2002 and September 29,
2001, were affected by an increase in the number of outstanding shares of common
stock primarily due to the closing of the merger with Eyeshop and related stock
purchase transactions that occurred between May 23, 2001 and July 20, 2001.


RESULTS OF OPERATIONS

Nine Months Ended September 28, 2002 and September 29, 2001

Net Revenue. During the nine months ended September 28, 2002, the Company
generated net revenue of $43,579,000, as compared to net revenue of $45,859,000
for the nine months ended September 29, 2001. The decrease of $2,280,000, or
5.0%, in net revenue primarily relates to seven less eye care centers operating
during the nine months ended September 28, 2002 as compared to the corresponding
period in 2001 and lower same store sales of 3.1%.

Cost of Revenue. Cost of revenue decreased from $14,612,000 for the operation of
the Company's 122 eye care centers during the nine months ended September 29,
2001 to $12,649,000 for the operation of the Company's 115 eye care centers
during the nine months ended September 28, 2002. Cost of revenue as a percentage
of net revenue decreased from 31.9% for the nine months ended September 29, 2001
to 29.0% for the nine months ended September 28, 2002. The improvement as a
percentage of net revenue primarily reflects the consolidation of optical
laboratory operations, improved margins on frames and slightly higher eye exam
revenue. Cost of revenue principally consisted of the cost of manufacturing,
purchasing and distributing optical products to customers of the Company.

Selling, General and Administrative Expenses. Selling, general and
administrative expenses decreased to $30,644,000 for the nine months ended
September 28, 2002 from $33,847,000 for the nine months ended September 28,
2001. The decrease of $3,203,000 primarily relates to reduced staffing levels
and lower amortization expenses of $785,000 resulting from the Company's
adoption of Statement 142. Selling, general and administrative expenses, as a
percentage of net revenue, decreased from 73.8% for the nine months ended
September 29, 2001 to 70.3% for the nine months ended September 28, 2002.

The Company adopted Statement 142 as of December 30, 2001 and had up to six
months from the date of adoption to complete its determination of the fair value
of each of the Company's reporting units. Based on independent third party
enterprise valuations of each of the Company's reporting units, the Company did
not recognize any impairment of its goodwill and intangible assets upon
completion of such determinations. Further, under the new guidelines set forth
in Statement 142, the Company ceased amortization of its goodwill, which reduced
selling, general and administrative expenses for the nine months ended September
28, 2002 by $785,000 compared to the nine months ended September 28, 2001.

Interest Expense, Net. Interest expense, net decreased to $539,000 for the nine
months ended September 28, 2002 from $587,000 for the nine months ended
September 29, 2001. The decrease of $48,000 is primarily associated with a lower
average balance of debt outstanding during the nine months ended September 28,
2002 as compared to the corresponding period in 2001.

Income Tax Expense. The Company has a significant net operating loss
carryforward with a full valuation allowance and as such provides for income
taxes only to the extent that it expects to pay cash taxes (primarily state
taxes) for current income.

Net Loss. The Company realized a net loss of $310,000 for the nine months ended
September 28, 2002 as compared to a net loss of $3,254,000 for the nine months
ended September 29, 2001.

Dividends on Redeemable Convertible Preferred Stock. During the nine months
ended September 28, 2002 the Company accrued $381,000 for cash dividends payable
to the redeemable convertible preferred stockholders. The dividends are accruing
pursuant to an agreement dated May 21, 2001 and are scheduled to be paid at the
earliest of the following events, as outlined in the letter with the redeemable
convertible preferred stockholder:

(i) the merger, consolidation, reorganization, recapitalization, dissolution or
liquidation of the Company where the stockholders of the Company immediately
following the consummation of the merger no longer own more than 50% of the
voting securities of the Company; (ii) the sale, lease, exchange or other
transfer of all or substantially all of the assets of the Company; (iii) the
consummation of an equity financing by the Company in which proceeds to the
Company, net of transaction costs, are greater than or equal to $10,000,000;
(iv) the end of the first twelve month period in which earnings before income
taxes, depreciation and amortization are equal to or greater than $5,000,000; or
(v) the refinancing of the Company's outstanding indebtedness to Fleet Bank. The
Company is presently unable to predict when the cash dividend will be paid.

During 2001, the Company paid dividends on its outstanding Preferred Shares by
issuing shares of Common Stock to the owner of the Preferred Shares.

Net Loss Attributable to Common Stockholders. The Company realized a net loss
attributable to common stockholders of $691,000, or $0.02 per share, for the
nine month period ended September 28, 2002 as compared to a net loss of
$3,877,000, or $0.26 per share, for the nine month period ended September 29,
2001. The per share net losses for the nine months ended September 28, 2002 and
the per share loss for the nine months ended


                                       9
<PAGE>

September 29, 2001, were affected by an increase in the number of outstanding
shares of common stock primarily due to the closing of the merger with Eyeshop
and related stock purchase transactions that occurred between May 23, 2001 and
July 20, 2001.

LIQUIDITY AND CAPITAL RESOURCES

At September 28, 2002, the Company had $505,000 in cash and cash equivalents and
a working capital deficit of $6,856,000 in comparison to $1,356,000 in cash and
cash equivalents and working capital deficit of approximately $7,061,000 as of
December 29, 2001. The reduction in working capital deficit of $205,000 is
primarily due a decrease in outstanding indebtedness and accounts payable offset
in part by a decrease in cash. The largest portion of the net working capital
deficit at September 28, 2002 was debt of $7,270,000 that matures on December
31, 2002. The Company needs to raise additional funds during 2002 to replace
maturing bank debt and may seek to raise those funds through additional
financings, including public or private equity offerings. There can be no
assurance that such funds will be available on terms acceptable to the Company,
if at all. If adequate funds are not available, the Company may be required to
limit its operations, which would have a material and adverse affect on the
Company. In addition, in its report on the Company's consolidated financial
statements as of and for the period ended December 29, 2001, the Company's
independent auditors have expressed substantial doubt about the Company's
ability to continue as a going concern due to the Company's recurring losses and
ability to pay its outstanding debts.

As of November 18, 2002, the Company is in substantial negotiations with both
its existing lender and a new potential senior lender. The potential loan value
of the Company's tangible assets do not support repayment or refinancing of the
entire amount owed to Fleet Bank of $7,120,000, as of November 18, 2002. Based
on various term sheets received by the Company, the potential loan value of the
Company's tangible assets is between $2,500,000 and $4,000,000. The difference
between potential loan value from a new lender and amounts owed Fleet is
approximately $3,100,000 to $4,600,000. This difference will require the Company
to either (a) close a transaction with new equity, subordinated debt or
additional collateral pledged outside of the Company's existing assets, (b)
negotiate forgiveness for a portion of outstanding debt with Fleet Bank or (c)
accomplish some combination of (a) and (b) above. The Company is also in
substantial negotiations with a group to invest new equity or subordinated debt
and with Fleet Bank for forgiveness of a portion of outstanding indebtedness.
The Company is optimistic that the sum of these transactions will be complete
before December 31, 2002. Because the Company does not have legally binding
commitment letters or contracts with the parties above, there can be no
guarantee that these transactions will be complete by December 31, 2002. If the
Company is, by December 31, 2002, unable to complete the necessary transactions
or negotiate an extension with Fleet Bank, the Company will be in default in
respect of the Fleet Bank indebtedness. Default under the loan agreement could
materially and adversely affect the Company's business and financial condition.

Effective April 1, 1999, the Company acquired all of the outstanding shares of
capital stock of Kent Optical Company and its associated companies
(collectively, "Kent"). The purchase price paid in connection with this
acquisition was $5,209,000 in cash, $1,000,000 in notes payable over three years
and 160,000 shares of common stock. In addition, the Company offered to issue
additional consideration to the Kent stockholders if the market price of the
Company's common stock did not equal or exceed $5.00 per share at any time
during the period from April 23, 2000 to April 23, 2001, which the market price
of the common stock did not achieve. The amount of additional consideration due
to the Kent stockholders for each


                                       10
<PAGE>

share of common stock issued in the acquisition and held by them on April 23,
2001 is equal to the difference between $5.00 and the greater of (a) the market
price of the common stock on April 23, 2001 or (b) $2.73. At the Company's
option, the additional consideration may be paid to the Kent stockholders in
cash or in additional shares of the Company's common stock valued at its market
price on the date that the additional consideration becomes payable to the Kent
stockholders. At the time of acquisition, the Company included the value of this
additional consideration in its determination of the purchase price. As a result
of the Company's obligation to issue additional consideration to the former Kent
stockholders, on February 7, 2002, the Company entered into a settlement
agreement in which it agreed to pay such additional consideration by issuing
1,100,636 shares of its common stock to the former Kent stockholders. The shares
were issued on February 27, 2002. Additionally, the payment terms and interest
on the outstanding acquisition notes of $667,000 and outstanding obligations
from the acquisition contract of $100,000 were revised, as disclosed in the
Company's annual report.

As of September 28, 2002, the Company had warrants outstanding which provide it
with potential sources of financing as outlined below. However, because the
current market value of the Company's common stock is significantly less than
the exercise prices for most of the warrants with the greatest potential for
proceeds, it is unlikely that any significant proceeds will be realized by the
Company.
<TABLE>
<CAPTION>
                                                                                             Exercise
                                                                             Potential         Price       Expiration
                             Securities                          Number       Proceeds       Per Share        Date
                             ----------                          ------      ---------       ---------        ----
<S>                                                             <C>          <C>             <C>        <C>
Carlyle Warrants............................................    1,000,000      $200,000        $0.20      January 2009

Class II Warrants...........................................      679,684     2,100,224         3.09      November 2002
Bank Austria AG, f/k/a Creditanstalt, Warrants..............      150,000       693,750         4.63      December 2003
Fleet Warrants..............................................       50,000        25,500         0.51      August 2010
Fleet Warrants..............................................       50,000         7,810         0.16      December 2010
                                                                   ------         -----         ----      -------------

                                                                1,929,684    $3,027,284
                                                                =========    ==========
</TABLE>


The Company also has outstanding 62,884 Class I Warrants. The Class I Warrants
entitle the holder to purchase an amount of shares of the Company's common stock
equal to an aggregate of up to 19.9% of the shares of common stock purchasable
under the Company's warrants and options outstanding as of October 9, 1997,
which have not subsequently terminated or expired, on the same terms and
conditions of existing warrant and option holders. The purchaser is obligated to
exercise these warrants at the same time the options and warrants of existing
holders are exercised, subject to certain limitations. The amount of proceeds
from the exercise of these Class I Warrants cannot be estimated at this time.
However, for the same reasons stated above, it is unlikely that any proceeds
would be realized by the Company.

On April 15, 1999, the Company entered into a credit agreement (the "1999
Agreement") with Fleet National Bank ("Fleet") pursuant to which the Company
could borrow $10,000,000 on an acquisition line of credit, of which $7,000,000
is on a term loan basis and $3,000,000 is on a revolving line of credit basis,
subject to certain performance criteria and an asset-related borrowing base for
the revolver. The performance criteria include, among others, financial
condition covenants such as net worth requirements, indebtedness to net worth
ratios, debt service coverage ratios, funded debt coverage ratios, and pretax
profit, net profit and EBITDA requirements.

At December 25, 1999, the Company was not in compliance with the following
financial covenants of the 1999 Agreement: minimum net worth, minimum debt
service coverage, maximum funded debt service coverage and minimum net profit.
However, on March 31, 2000, the Company and Fleet entered into a modification
agreement (the "Original Modification Agreement") that amended the 1999
Agreement in order to, among other things, waive the Company's default, adjust
certain covenants to which the Company is subject and terminate the acquisition
line of credit. In addition, the Original Modification Agreement limited the
revolving line note to $2,500,000 and the term loan to $6,750,000 and
established the maturity date for each of these credit lines as March 31, 2001.
As part of the Original Modification Agreement, the Company issued to Fleet
warrants to purchase 50,000 shares of the Company's common stock at an exercise
price of $0.51 per share, which was equal to the average closing price of the
common stock for the last five trading days for the month of August 2000, and
warrants to purchase 50,000 shares of the Company's common stock at an exercise
price of $0.156 per share, which was equal to the average closing price of the
Company's common stock for the last five trading days for the month of December
2000. In August 2000, as a result of a bank merger, Sovereign Bank of New
England ("Sovereign") became the successor party to Fleet in the 1999 Agreement
and the Original Modification Agreement.

On November 30, 2000, the Company and Sovereign entered into a second
modification agreement (the "Second Modification Agreement") that amended the
terms of the Original Modification Agreement in order to, among other things,
defer certain payments required under the term note and amend certain terms and
conditions of the 1999 Agreement. At December 30, 2000, the Company was in
default for non-compliance with certain negative covenants contained in the
Second Modification Agreement relating to minimum net worth, minimum debt
service coverage, maximum funded debt service coverage and minimum net profit.

On March 26, 2001, the Company and Sovereign entered into the Third Modification
Agreement (the "Third Modification Agreement") that amended the terms of the
Original Modification Agreement and the Second Modification Agreement in order
to, among other things, waive the Company's default, adjust or delete certain
covenants to which the Company was subject, change the repayment terms and
extend the maturity date of the loans to December 31, 2002. In addition, the
Third Modification Agreement required that the Company close an equity financing
of at least $1,000,000 with third party investors on or before May 31, 2001. The
Third Modification Agreement established the following annual interest rates for
both the revolving line and term loans: (i) from February 1, 2001 through
September 30, 2001 - six (6%) percent, (ii) from October 1, 2001 through
December 31, 2001 - seven (7%) percent, (iii) from January 1, 2002 through
December 31, 2002 - prime rate subject to a minimum rate of eight (8%) percent
and a maximum rate of eleven (11%) percent. The scheduled monthly



                                       11
<PAGE>

principal payments did not begin until July 1, 2001 and were set as $30,000
from July 1, 2001 through December 31, 2001, and $100,000 from January 1, 2002
through December 31, 2002. On May 14, 2001, the Company entered into the
Amended and Restated Third Modification Agreement which restated the terms
described above and extended the date for which the Company was required to
close an equity financing to July 2001. In July 2001, the Company obtained net
equity proceeds of $1,753,000. In August 2001, Sovereign sold the loan back to
Fleet.

On July 12, 2002 the Company entered into a Fourth Modification Agreement with
Fleet Bank and Kent Optometric Providers, Inc. (a professional corporation).
The purpose of the fourth modification was for Fleet to approve of a
restructure of Kent Optical Company such that the Company, its subsidiaries and
affiliated professional corporations complied with certain business contracts.

In November 2002, the Company entered into a Fifth Modification Agreement with
Fleet Bank that reduced the November 2002 principal payment from $100,000 to
$50,000.

As of September 28, 2002, the Company's outstanding indebtedness under the 1999
Agreement was $2,500,000 under the revolving line of credit and $4,770,000 under
the term loan.

The Company was in compliance with the covenants contained in the Amended and
Restated Third Modification Agreement for the nine months ended September 28,
2002. The Company has obtained waivers from the bank for all breaches of loan
covenants to date, but the Company may not receive waivers for any future
breaches that may occur. Any breach that is not waived may result in the bank
declaring the breach to be a default under the 1999 Agreement, which would
require immediate repayment of all outstanding principal and accrued interest at
a time when the Company may not be able to repay the bank.

On July 20, 2001, pursuant to an Agreement and Plan of Merger (the "Merger
Agreement") dated as of May 23, 2001 by and among the Company, Eyeshop
Acquisition Corporation, a Delaware corporation and wholly-owned subsidiary of
the Company ("EAC"), and eyeshop.com, inc. ("Eyeshop"), EAC merged with and
into Eyeshop (the "Merger") and Eyeshop became a wholly-owned subsidiary of the
Company.

Pursuant to the Merger Agreement, former Eyeshop stockholders are also entitled
to receive additional shares of the Company's common stock if and when the
options, warrants and other rights to receive the Company's common stock that
were held by the Company's security holders as of May 23, 2001 are exercised.
The Company issued a total of 7,306,662 shares of Common Stock to former
Eyeshop stockholders in connection with the Merger. Concurrently with the
Eyeshop merger, the Company assumed outstanding options under the Eyeshop stock
option plan to purchase up to an aggregate of 1,757,096 shares of the Company's
common stock.

RECENT ACCOUNTING PRONOUNCEMENTS

The Company adopted the provisions of Statement 141, effective July 1, 2001 and
Statement 142, effective December 30, 2001. Statement 141 addresses financial
accounting and reporting for business combinations requiring the use of the
purchase method of accounting and reporting for goodwill and other intangible
assets requiring that goodwill and intangible assets with indefinite useful
lives no longer be amortized, but instead be tested for impairment at least
annually in accordance with the provisions of Statement 142. Under Statement
142, the Company was required to reassess the useful lives and residual values
of all intangible assets acquired in purchase business combinations, and make
any necessary amortization period adjustments by the end of the first interim
period after adoption. In addition, to the extent an intangible asset is
identified as having an indefinite useful life, the Company was required to
test the intangible asset for impairment in accordance with the provisions of
Statement 142 within the first interim period. Any impairment loss would be
measured as of the date of adoption and recognized as the cumulative effect of
a change in accounting principle in the first interim period.


                                       12
<PAGE>

In connection with the transitional goodwill impairment evaluation, Statement
142 requires the Company to perform an assessment of whether there is an
indication that goodwill, which totaled $14,305,000 million at December 30,
2001, is impaired as of December 30, 2001, the date of adoption. To accomplish
this, the Company has identified its reporting units and determined the carrying
value of each reporting unit by assigning the assets and liabilities, including
the existing goodwill and intangible assets, to those reporting units as of the
date of adoption. The Company had up to six months from the date of adoption to
determine the fair value of each reporting unit and compare it to the reporting
unit's carrying amount. To the extent a reporting unit's carrying amount exceeds
its fair value, an indication exists that the reporting unit's goodwill may be
impaired and the Company must perform the second step of the transitional
impairment test. In the second step, the Company must compare the implied fair
value of the reporting unit's goodwill, determined by allocating the reporting
unit's fair value to all of its assets (recognized and unrecognized) and
liabilities in a manner similar to a purchase price allocation in accordance
with Statement 141, to its carrying amount, both of which would be measured as
of the date of adoption, which is December 30, 2001 for the Company. This second
step is required to be completed as soon as possible, but no later than the end
of the year of adoption. Any transitional impairment loss would be recognized as
the cumulative effect of a change in accounting principle in the Company's
consolidated statement of operations.

Based on independent third party enterprise valuations of each of the Company's
reporting units, the Company did not recognize any impairment of its goodwill
and intangible assets upon adoption of Statement 142. During the second quarter
2002, the Company finalized the enterprise evaluations. Further, under the
Statement 142's new guidelines, the Company ceased amortization of its goodwill,
which favorably impacts the three and nine months ended September 28, 2002 by
$263,000 and $785,000, respectively, compared to the prior periods.

Effective January 1, 2002, the Company adopted SFAS No. 144, "Accounting for the
Impairment or Disposal of Long-Lived Assets" ("Statement 144"). Statement 144
retained many of the fundamental provisions of SFAS No. 121, "Accounting for the
Impairment of Long-Lived Assets and for Long-Lived Assets to be Disposed Of"
("Statement 121"), but resolved certain implementation issues associated with
that Statement. Statement 144 also requires the results of operations of a
component entity that is classified as held for sale or has been disposed of to
be reported as discontinued operations in the Condensed Consolidated Statements
of Earnings if certain conditions are met. These conditions include elimination
of the operations and cash flows of the component entity from the ongoing
operations of the Company, and no significant continuing involvement by the
Company in the operations of the component entity after the disposal
transaction. The adoption of Statement 144 did not have a material impact on the
Company's consolidated results of operations. In August 2001, the Financial
Accounting Standards Board ("FASB") issued SFAS No. 143, "Accounting for Asset
Retirement Obligations" ("Statement 143"), which will be effective for the
Company beginning January 1, 2003. Statement 143 addresses the financial
accounting and reporting for obligations associated with the retirement of
tangible long-lived assets and the associated asset retirement costs.

In April 2002, the FASB issued SFAS No. 145, "Rescission of FASB Statements No.
4, 44, 64, Amendment of FASB Statement No. 13, and Technical Corrections"
("Statement 145"), which will be effective for the Company beginning January 1,
2003. Statement 145 rescinds FASB Statement No. 4, 44, 64 and amends SFAS No.
13, "Accounting for Leases", to eliminate an inconsistency between the required
accounting for sale-leaseback transactions and the required accounting for
certain lease modifications that have economic effects that are similar to
sale-leaseback transactions.

In July 2002, the FASB issued Statement 146, "Accounting for Costs Associated
With Exit or Disposal Activities" ("Statement 146"), which will be effective for
exit or disposal activities initiated after December 31, 2002. Statement 146
will require that a company record exit or disposal costs when they are incurred
and can be measured at fair value, and subsequently adjust the recorded
liability for changes in estimated cash flows. Statement 146 also revises
accounting for specified employee and contract terminations that are part of
restructuring activities.

The Company has assessed the impact of Statements 143, 145 and 146, and
estimates that the impact of these standards will not be material.

MANAGEMENT'S DISCUSSION OF CRITICAL ACCOUNTING POLICIES

In December 2001, the SEC requested that all registrants identify and describe
their most "critical accounting policies" in Management's Discussion and
Analysis. The SEC indicated that a "critical accounting policy" is one which is
both important to the portrayal of the company's financial condition and results
and requires management's most difficult, subjective or complex judgments, often
as a result of the need to make estimates about the effect of matters that are
inherently uncertain. The Company believes that the following of the Company's
accounting policies fit this definition.

Revenue Recognition and Allowance for Bad Debts

The Company recognizes revenue from the sale of eyewear at the time an order is
complete and revenue from eyecare services when the service is performed. The
Company has fee for service arrangements with most of its third party payers.
The Company recognizes revenue with third party payers net of contractual
allowances. The level of management judgment used to determine revenue is small.

Because of various circumstances, such as changes in third party plan
contractual allowances, changes in patient co-pays, and goods or services denied
by third party payers, the Company reviews the agings of receivables from third
party payers and patients on at least a monthly basis. Sometimes claims have
incomplete or inaccurate information, and the Company re-submits those claims to
the third party payer. If amounts are denied by the third party payer and the
Company has recourse to the patient, the Company pursues payment from the
patient. Based on the Company's history of collectibility of older third party
payer and patient receivables, the Company provides a reserve for
uncollectibility.


                                       13
<PAGE>

At September 28, 2002 and December 29, 2001, the Company had reserved for 46%
and 42%, respectively, of the gross amount of the outstanding third party payer
and patient receivables. If actual collectibility of these receivables is
significantly different from management's estimate, it could have a material
(favorable or unfavorable) result on the operating results and liquidity of the
Company.

Impairment of Long-Lived Assets

The Company records impairment losses on long-lived assets when changes in
circumstances indicate that the assets carrying amount may not be recoverable
and the undiscounted cash flows estimated to be generated by those assets are
less than the book value of those assets. The Company's cash flow estimates are
based on historical results adjusted to reflect the Company's best estimate of
future market and operating conditions. In performing this analysis, the Company
considers such factors as current results, trends and future prospects, in
addition to other economic factors. The Company did not record any charges for
the impairment of long-lived assets. At September 28, 2002, the Company had
long-lived assets, including goodwill and other intangibles of $19,273,000,
property and equipment of $2,174,000, and web site development costs of
$2,288,000.

Conditions that could cause future impairment are deterioration of on-going or
forecasted operating results resulting from increased competition, a recession
in the United States or lack of liquidity causing the Company to limit its
operations. If one or more of these conditions occur, the future analyses may
indicate that certain long-lived assets are impaired, at which time the Company
would recognize an impairment charge. That impairment charge may be material and
have a significant impact on the Company's results of operations.

Further, the Company's web site development relates to software acquired in the
Eyeshop merger. It was anticipated that, following the merger, available cash
resources of the combined companies would be devoted to continuation and
improvement of the business of the Company, with a decision to be made at a
future date as to when the Eyeshop development activities should be resumed. As
of September 29, 2002, no decision had been made to the timing of resuming
Eyeshop web site development activities. If the Company were to make a future
decision to not resume development of this web site, then it is possible that
the Company may have to recognize an impairment charge up to the entire amount
of $2,288,000 and that charge may have a material impact on the Company's
results of operations.

Income Taxes

The Company has a history of unprofitable operations and these losses have
generated a sizeable federal tax net operating loss, or NOL, carryforward of
approximately $28,074,000 as of December 29, 2001 and September 28, 2002.
Generally accepted accounting principles require that the Company records a
valuation allowance against deferred tax assets if it is "more likely than not"
that the Company will not be able to generate sufficient future taxable income
to recover the deferred tax assets recorded. Due to the size of the net deferred
tax assets in relation to the Company's history of unprofitable operations, the
Company has not recognized any of the net deferred tax assets. The Company
currently provides for income taxes only to the extent that it expects to pay
cash taxes (primarily state taxes) for current income.

It is possible, however, that the Company could be profitable in the future at
levels which cause management to conclude that it is more likely than not that
the Company will realize all or a portion of the net deferred tax assets. Upon
reaching such a conclusion, the Company would immediately record the estimated
net realizable value of the net deferred tax assets at that time and would then
provide for income taxes at a rate equal to the Company's combined federal and
state effective rates, which would


                                       14
<PAGE>

approximate 40% under current tax rates. Subsequent revisions to the estimated
net realizable value of the net deferred tax assets could cause the Company's
provision for income taxes to vary significantly from period to period, although
the Company's cash tax payments would remain unaffected until the benefit of the
deferred tax assets are utilized.

The rate of utilization of the Company's NOL carryforward may be limited under
Section 382 of the Internal Revenue Code due to changes in ownership of shares
of the Company occurring over the past several years. To date, the Company has
not determined whether in fact the utilization of its NOL carryforward is
limited.

Consolidation Accounting

The Company's results of operations and balance sheet include the accounts
(including revenues, assets and liabilities) of the Company, its wholly owned
subsidiaries, and five professional corporations ("PCs") of which the Company's
subsidiaries bear financial and operational risks and rewards. The Company has
no direct equity ownership in the PCs, but has rights and involvement that
permit, under the tests set forth in FASB Emerging Issues Task Force bulletin
97-2, "Application of FASB Statement No. 94, Consolidation of All Majority-Owned
Subsidiaries, and APB Opinion No. 16, Business Combinations, To Physician
Practice Management Entities," the Company to consolidate the PCs into the
Company's financial statements. The Company, through its subsidiaries, provides,
for a fee, certain administrative and other services to each of the PCs. The
outstanding voting stock of each of the PCs is 100% owned by a licensed
optometrist who generally has, in turn, executed an agreement in favor of a
subsidiary of the Company that provides that if the employment of the
optometrist-owner is terminated, then the optometrist-owner must sell all of the
outstanding stock of the PC to another qualified person eligible to serve as a
new optometrist-owner. The purchase price for the sale of the PC stock is either
(i) at a nominal per share price or (ii) equal to the aggregate book value of
the PC which will always be a nominal amount because each PC operates and is
expected to continue to operate at an almost break-even level generating a
nominal profit, if any at all.

Because the assets and liabilities of the PCs are, for accounting purposes,
consolidated with the assets and liabilities of the Company and its
subsidiaries, any transaction by which operating assets were transferred by a
Company subsidiary to a PC has been disregarded for accounting purposes. While
the holding of assets by the PCs lessens the Company's control over those
assets, the Company believes that the assets are adequately protected and
maintained.

BUSINESS RISKS AND CAUTIONARY STATEMENTS

Statements in this Quarterly Report on Form 10-Q under the caption "Management's
Discussion and Analysis of Financial Condition and Results of Operations," as
well as oral statements that may be made by the Company or by officers,
directors or employees of the Company acting on the Company's behalf, that are
not historical fact constitute "forward-looking statements" within the meaning
of the Private Securities Litigation Reform Act of 1995. Such forward-looking
statements involve known and unknown risks, uncertainties and other factors that
could cause the actual results of the Company to be materially different from
the historical results or from any results expressed or implied by such
forward-looking statements. Such factors include, but are not limited to, the
risk factors set forth below.

The Company does not intend to update any forward-looking statements to reflect
events or circumstances after the date of such statements or to reflect the
occurrence of anticipated or unanticipated events.

RISKS RELATED TO THE COMPANY'S BUSINESS

The Company has experienced losses in each year of operation since inception in
November 1992. For the fiscal year ended December 29, 2001, the Company incurred
a net loss of approximately $5,500,000 bringing its accumulated deficit to
approximately $31,600,000 at December 29, 2001. The loss for the nine months
ended September 28, 2002 was $310,000. The Company may never achieve
profitability and, if it achieves profitability, it may not be able to maintain
profitability.

The Company's primary loan facilities expire at December 31, 2002 and the
Company may not be able to obtain financing or refinancing.

As of September 28, 2002, the Company owed Fleet Bank $2,500,000 under a
revolving loan and $4,770,000 under a term loan. Interest rates on the loans
during 2002 are at prime rate with a minimum of 8% and a maximum of 11%. The
principal payments during 2002 on the term loan are $100,000 per month. Given
the Company's history, including substantial historical losses, the Company may
not be able to obtain financing or refinancing at terms acceptable to the
Company. The Company is making every effort to refinance these loans. The
failure to obtain additional financing would result in the declaration of a
default with such loan facilities and could materially and adversely affect the
Company's business and financial condition. Any additional equity financing, if
available, may be dilutive to the Company's stockholders and any debt financing,
if available, may involve restrictions on the Company's financing and operating
activities.

As of November 18, 2002, the Company is in substantial negotiations with both
its existing lender, and a new potential senior lender. The potential loan value
of the Company's tangible assets do not support repayment or refinancing of the
entire amount owed to Fleet Bank of $7,120,000, as of November 18, 2002. Based
on various term sheets received by the Company, the potential loan value of the
Company's tangible assets is between $2,500,000 and $4,000,000. The difference
between potential loan value from a new lender and amounts owed Fleet is
approximately $3,100,000 to $4,600,000. This difference will require the Company
to either (a) close a transaction with new equity, subordinated debt or
additional collateral pledged outside of the Company's existing assets, (b)
negotiate forgiveness for a portion of outstanding debt with Fleet Bank or (c)
accomplish some combination of (a) and (b) above. The Company is also in
substantial negotiations with a group to invest new equity or subdebt and with
Fleet Bank for forgiveness of a portion of outstanding indebtedness. The Company
is optimistic that the sum of these transactions will be complete before
December 31, 2002. Because the Company does not have legally binding commitment
letters or contracts with the parties above, there can be no guarantee that
these transactions will be complete by December 31, 2002. If the Company is, by
December 31, 2002, unable to complete the necessary transactions or negotiate an
extension with Fleet Bank, the Company will be in default in respect of the
Fleet Bank indebtedness. Default under the loan agreement could materially and
adversely affect the Company's business and financial condition.

The Company has previously breached certain loan covenants for which waivers of
such breaches have been granted, but the Company may not be able to obtain
waivers of any future breaches of loan covenants that may occur, which could
result in a default under existing or future loan agreements.

The Company has previously defaulted on a credit line agreement due to
non-compliance with negative covenants relating to minimum net worth, minimum
debt service coverage, maximum funded


                                       15
<PAGE>

debt service coverage and minimum net profit. The Company has obtained waivers
from the bank for all breaches of loan covenants to date, but future breaches
may occur for which the Company may not be able to obtain waivers. Any breach
that is not waived may result in the bank declaring the breach to be a default
under the loan agreement, which would require immediate repayment of all
outstanding principal and accrued interest at a time when the Company may not be
able to repay the bank. Accordingly, the declaration of a default under the loan
agreement could materially and adversely affect the Company's business and
financial condition.

The Company is dependent upon certain key management personnel and may not be
able to attract and retain additional personnel.

The Company's future success is dependent in part on the Company's ability to
retain certain key personnel, particularly E. Dean Butler, the Company's
Chairman and Carene S. Kunkler, the Company's President and Chief Executive
Officer, and the Company's ability to recruit and retain qualified personnel
over time. The Company may not be able to retain its existing personnel or
attract additional qualified employees in the future.

The primary eye care market is highly competitive. The Company's current and
potential competitors include many larger companies with substantially greater
financial, operating, marketing and support resources.

The optical industry is highly competitive and includes chains of retail optical
stores, multi-site eye care centers, and a large number of individual opticians,
optometrists and ophthalmologists who provide professional services and/or
dispense prescription eyewear. Because retailers of prescription eyewear
generally service local markets, competition varies substantially from one
location or geographic area to another. The Company believes that the principal
competitive factors affecting retailers of prescription eyewear are location and
convenience, quality and consistency of product and service, price, product
warranties, and a broad selection of merchandise. In the Company's current
regional markets, the Company faces competition from national and regional
retail optical chains which, in many cases, have greater financial resources
than the Company.

The Company may not be able to acquire new managed primary eye care contracts,
existing contracts may not be expanded in any meaningful way and the Company
may not be successful in retaining existing managed care business.

As an increasing percentage of optometric and ophthalmologic patients are coming
under the control of managed care entities, the Company believes that its
success will, in part, be dependent upon the Company's ability to negotiate, on
behalf of existing and prospective affiliated practices, contracts with HMOs,
employer groups and other private third party payors pursuant to which services
will be provided on a risk-sharing or capitated basis by some or all affiliated
practices. The proliferation of contracts that pass much of the risk of
providing care from the payor to the provider in markets the Company serves may
result in greater predictability of revenues, but greater unpredictability of
expenses. The Company may not be able to negotiate, on behalf of the affiliated
practices, satisfactory arrangements on a risk-sharing or capitated basis. In
addition, to the extent that patients or enrollees covered by such contracts
require more frequent or extensive care than anticipated, operating margins may
be reduced or, in the worst case, the revenues derived from such contracts may
be insufficient to cover the costs of the services provided. As a result,
affiliated practices may incur additional costs, which would reduce or eliminate
anticipated earnings under such contracts. Any such reduction or elimination of
earnings would have a material adverse affect on the Company's business and
results of operations. Further, the Company may not be successful in retaining
existing managed care business. If the Company were to loose a significant
managed care account, it could have a material adverse affect on the Company's
business and results of operations. Currently, the Company is appealing a
potential loss of managed care business that represents approximately 2.5% of
the Company's overall revenue. In September, the Company was notified that its
first appeal was denied and requested a second appeal hearing. The second appeal
hearing occurred in November and the Company to date has not been notified of
the determination from the second hearing. If the Company is unsuccessful in the
appeal process, the Company may elect to litigate the matter. If the Company is
unsuccessful in the appeal process, the Company could gradually lose this
business as patients over time use other eye care providers.



                                       16
<PAGE>

The Company may be exposed to significant risk from liability claims if the
Company is unable to obtain insurance at acceptable costs or is otherwise unable
to protect itself against potential product liability claims.

The provision of professional eye care services entails an inherent risk of
professional malpractice and other similar claims. The Company does not
influence or control the practice of medicine or optometry by professionals or
have responsibility for compliance with certain regulatory and other
requirements directly applicable to individual professionals and professional
groups. As a result of the relationship between the Company's affiliated
practices and itself, the Company may become subject to some professional
malpractice actions under various theories. Claims, suits or complaints relating
to professional services provided by affiliated practices may be asserted
against the Company in the future.

The Company may not be able to retain adequate liability insurance at reasonable
rates and the Company's insurance may not be adequate to cover claims asserted
against it, in which event its business and results of operations may be
materially adversely affected.

The Company's operations and success are dependent upon its ability to enter
into agreements with health care providers.

Certain states prohibit the Company from practicing medicine, employing
physicians to practice medicine on the Company's behalf or employing
optometrists to render optometric services on the Company's behalf. Accordingly,
the success of the Company's operations as a full-service eye care provider
depends upon its ability to enter into agreements with health care providers,
including institutions, independent physicians and optometrists, to render
surgical and other professional services at facilities owned or managed by the
Company. The Company may not be able to enter into agreements with other health
care providers on satisfactory terms or such agreements may not be profitable to
the Company.
The Company is subject to extensive federal, state and local regulation, which
could materially affect the Company's operations.

The health care industry is highly regulated by federal, state and local law.
The regulatory environment in which the Company operates may change
significantly in the future. The Company expects to modify agreements and
operations from time to time as the business and regulatory environment changes.
Although the Company believes that its operations comply with applicable law,
the Company may not be able to address changes in the regulatory environment
successfully.

 The Company's common stock was delisted from the Nasdaq Stock Market, which
makes it more difficult for stockholders to sell shares of the Company's common
stock. On September 11, 2000, the Nasdaq National Market ("Nasdaq") terminated
the Company's listing on Nasdaq and the Company's common stock began trading on
the Over-the-Counter Bulletin Board (the "OTC"). Stockholders are likely to find
it more difficult to trade the Company's common stock on the OTC than on Nasdaq.
In order for the Company's common stock to resume trading on Nasdaq, the Company
must satisfy all of Nasdaq's requirements for initial listing, apply for listing
and be accepted for listing by Nasdaq. The Company does not currently satisfy
Nasdaq's initial listing requirements and may never satisfy Nasdaq's listing
requirements or, if the Company does satisfy such requirements in the future,
the Company's securities may not be accepted for listing by Nasdaq. If the
Company's securities are not accepted for listing on Nasdaq or another stock
exchange, it will also likely be more difficult for the Company to raise equity
capital.


                                       17
<PAGE>

ITEM 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The Company has not entered into any transactions using derivative financial
instruments or derivative commodity instruments and believes that its exposure
to market risk associated with other financial instruments (such as investments)
is not material.

As of September 28, approximately $7,270,000 of the Company's debt is subject
to a floating interest rate and every 1% increase in the relevant interest rate
would adversely affect the Company on an annual basis by $73,000.

ITEM 4.  REPORT ON CONTROLS

         The Company's Chief Executive Officer, Carene Kunkler, and the
Company's Chief Financial Officer, Duane Kimble, have evaluated the Company's
disclosure controls and procedures within 90 days of the filing of this report.
Ms. Kunkler and Mr. Kimble have concluded that the Company's disclosure controls
and procedures systems are functioning effectively to provide reasonable
assurance that the Company can meet its disclosure obligations. The reporting
process is designed to ensure that information required to be disclosed by the
Company in the reports that it files or submits with the Commission is recorded,
processed, summarized and reported within the time period specified in the
Commission's rules and forms. Since the date of Ms. Kunkler's and Mr. Kimble's
evaluation, there have been no significant changes in the Company's internal
controls or in other factors that could significantly affect those controls.


PART II - OTHER INFORMATION

ITEM 5.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

None.

ITEM 6.  OTHER INFORMATION

None.

ITEM 7.  EXHIBITS AND REPORTS ON FORM 8-K

        (a)   Exhibits - See Index to Exhibits
        (b)   No reports on Form 8-K were filed during the three months ended
              September 28, 2002.



                                       18
<PAGE>

                                   SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.

                                            Sight Resource Corporation

Date:    November 18, 2002               By: /S/    Carene S. Kunkler
         -----------------               -------    -----------------

                                         Carene S. Kunkler
                                         President and Chief Executive Officer
                                         (duly authorized officer)

Date:    November 18, 2002               By: /S/    Duane D. Kimble, Jr.
         -----------------               -------    --------------------

                                         Duane D. Kimble, Jr.
                                         Chief Financial Officer
                                         (principal financial officer)





                                       19
<PAGE>


                                 CERTIFICATIONS

I, Carene S. Kunkler, certify that:

     1.  I have reviewed this quarterly report on Form 10-Q of Sight
         Resource Corporation (the "registrant");

     2.  Based on my knowledge, this quarterly report does not contain any
         untrue statement of a material fact or omit to state a material fact
         necessary to make the statements made, in light of the circumstances
         under which such statements were made, not misleading with respect to
         the period covered by this quarterly report;

     3.  Based on my knowledge, the financial statements, and other financial
         information included in this quarterly report, fairly present in all
         material respects the financial condition, results of operations and
         cash flows of the registrant as of, and for, the periods presented in
         this quarterly report;

     4.  The registrant's other certifying officer and I are responsible for
         establishing and maintaining disclosure controls and procedures (as
         defined in Exchange Act Rules 13a -14 and 15d-14) for the registrant
         and we have:

               a)   designed such disclosure controls and procedures to ensure
                    that material information relating to the registrant,
                    including its consolidated subsidiaries, is made known to us
                    by others within those entities, particularly during the
                    period in which this quarterly report is being prepared;

               b)   evaluated the effectiveness of the registrant's disclosure
                    controls and procedures as of a date within 90 days prior to
                    the filing date of this quarterly report (the "Evaluation
                    Date"); and

               c)   presented in this quarterly report our conclusions about the
                    effectiveness of the disclosure controls and procedures
                    based on our evaluation as of the Evaluation Date;

     5.  The registrant's other certifying officer and I have disclosed, based
         on our most recent evaluation, to the registrant's auditors and the
         audit committee of the registrant's board of directors;

               a)   all significant deficiencies in the design or operation of
                    internal controls which could adversely affect the
                    registrant's ability to record, process, summarize and
                    report financial data and have identified for the
                    registrant's auditors any material weaknesses in internal
                    controls; and

               b)   any fraud, whether or not material, that involves management
                    or other employees who have a significant role in the
                    registrant's internal controls; and

     6.  The registrant's other certifying officer and I have indicated in this
         quarterly report whether or not there were significant changes in
         internal controls or in other factors that could significantly affect
         internal controls subsequent to the date of our most recent evaluation,
         including any corrective actions with regard to significant
         deficiencies and material weaknesses.



Date:    November 18, 2002                By: /S/    Carene S. Kunkler
         -----------------                -------    -----------------

                                          Carene S. Kunkler
                                          President and Chief Executive Officer

<PAGE>

                                 CERTIFICATIONS

I, Duane D. Kimble, Jr., certify that:

     1.  I have reviewed this quarterly report on Form 10-Q of Sight Resource
         Corporation (the "registrant");

     2.  Based on my knowledge, this quarterly report does not contain any
         untrue statement of a material fact or omit to state a material fact
         necessary to make the statements made, in light of the circumstances
         under which such statements were made, not misleading with respect to
         the period covered by this quarterly report;

     3.  Based on my knowledge, the financial statements, and other financial
         information included in this quarterly report, fairly present in all
         material respects the financial condition, results of operations and
         cash flows of the registrant as of, and for, the periods presented in
         this quarterly report;

     4.  The registrant's other certifying officer and I are responsible for
         establishing and maintaining disclosure controls and procedures (as
         defined in Exchange Act Rules 13a -14 and 15d-14) for the registrant
         and we have:

               a)   designed such disclosure controls and procedures to ensure
                    that material information relating to the registrant,
                    including its consolidated subsidiaries, is made known to us
                    by others within those entities, particularly during the
                    period in which this quarterly report is being prepared;

               b)   evaluated the effectiveness of the registrant's disclosure
                    controls and procedures as of a date within 90 days prior to
                    the filing date of this quarterly report (the "Evaluation
                    Date"); and

               c)   presented in this quarterly report our conclusions about the
                    effectiveness of the disclosure controls and procedures
                    based on our evaluation as of the Evaluation Date;

     5.  The registrant's other certifying officer and I have disclosed, based
         on our most recent evaluation, to the registrant's auditors and the
         audit committee of the registrant's board of directors;

               a)   all significant deficiencies in the design or operation of
                    internal controls which could adversely affect the
                    registrant's ability to record, process, summarize and
                    report financial data and have identified for the
                    registrant's auditors any material weaknesses in internal
                    controls; and

               b)   any fraud, whether or not material, that involves management
                    or other employees who have a significant role in the
                    registrant's internal controls; and

     6.  The registrant's other certifying officer and I have indicated in this
         quarterly report whether or not there were significant changes in
         internal controls or in other factors that could significantly affect
         internal controls subsequent to the date of our most recent evaluation,
         including any corrective actions with regard to significant
         deficiencies and material weaknesses.



Date:    November 18, 2002                    By: /S/    Duane D. Kimble, Jr.
         -----------------                    -------    --------------------

                                              Duane D. Kimble, Jr.
                                              Chief Financial Officer


<PAGE>

EXHIBIT INDEX

EXHIBIT
NUMBER                     DESCRIPTION
-------                    -----------
10.36    Fleet Fourth Modification Agreement

99.2     Certification by Carene S. Kunkler pursuant to 18 U.S.C. Section 1350,
         as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

99.3     Certification by Duane D. Kimble, Jr., pursuant to 18 U.S.C. Section
         1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of
         2002