<PAGE>   1


================================================================================

                                  UNITED STATES

                       SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D.C. 20549

                                    FORM 10-Q

(Mark One)

[X]      Quarterly report pursuant to Section 13 or 15(d) of the Securities
         Exchange Act of 1934 FOR THE QUARTERLY PERIOD ENDED JULY 3, 1999.

                                       OR

[ ]      Transition report pursuant to Section 13 or 15(d) of the Securities
         Exchange Act of 1934

                       Commission file number 333 - 56551

                        EYE CARE CENTERS OF AMERICA, INC.
             (Exact name of registrant as specified in its charter)

              TEXAS                                          74-2337775
(State or other jurisdiction of                           (I.R.S. Employer
 incorporation or organization)                        Identification number)

                                11103 WEST AVENUE
                            SAN ANTONIO, TEXAS 78213
          (Address of principal executive offices, including zip code)

                                 (210) 340-3531
              (Registrant's telephone number, including area code)

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

Indicate by check mark whether the registrant has (1) 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
                  ---                                ---

Indicate the number of shares outstanding of each of the issuer's classes of
common stock as of the latest practicable date:

             Class                               Outstanding at August 9, 1999
             -----                               -----------------------------
   Common Stock, $.01 par value                       7,408,764  shares


================================================================================


<PAGE>   2

                        EYE CARE CENTERS OF AMERICA, INC.

                                      INDEX

<TABLE>
<CAPTION>
                                                                                                       PAGE
                                                                                                      NUMBER
                                                                                                      ------
<S>                                                                                                   <C>
PART I - FINANCIAL INFORMATION

Item 1.  Financial Statements

         Condensed Consolidated Balance Sheets at January 2, 1999
                  and July 3, 1999 (Unaudited)...........................................................2

         Condensed Consolidated Statements of Operations for the
                  Thirteen Weeks and Twenty-Six Weeks Ended July 4, 1998
                   (Unaudited) and July 3, 1999 (Unaudited)..............................................3

         Condensed Consolidated Statements of Cash Flows for the
                  Twenty-Six Weeks Ended July 4, 1998 (Unaudited)
                  and July 3, 1999 (Unaudited)...........................................................4

         Notes to Condensed Consolidated Financial Statements.........................................5-10

Item 2.  Management's Discussion and Analysis of Financial Condition
         and Results of Operations...................................................................11-19

Item 3.  Quantitative and Qualitative Disclosures About Market Risk.....................................19

PART II - OTHER INFORMATION

Item 1.  Legal Proceedings..............................................................................19

Item 6.  Exhibits and Reports on Form 8-K............................................................20-21
</TABLE>


                                       1
<PAGE>   3



                          PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

                        EYE CARE CENTERS OF AMERICA, INC.

                      CONDENSED CONSOLIDATED BALANCE SHEETS

                             (dollars in thousands)

<TABLE>
<CAPTION>
                                                        JANUARY 2,     JULY 3,
                                                           1999         1999
                                                        ---------     ---------
ASSETS                                                               (Unaudited)
<S>                                                     <C>           <C>
CURRENT ASSETS:
      Cash and cash equivalents ....................    $   5,127     $   1,575
      Accounts and notes receivable, net ...........        6,453         8,823
      Inventory ....................................       26,977        24,527
      Prepaid expenses and other ...................        2,286         1,692
      Deferred income taxes ........................          391           391
                                                        ---------     ---------
Total current assets ...............................       41,234        37,008

PROPERTY & EQUIPMENT, net ..........................       68,118        65,568
INTANGIBLE ASSETS, net .............................      102,459       100,716
OTHER ASSETS .......................................       11,096        11,348
                                                        ---------     ---------
Total assets .......................................    $ 222,907     $ 214,640
                                                        =========     =========

LIABILITIES AND SHAREHOLDERS' DEFICIT
CURRENT LIABILITIES:
      Accounts payable .............................    $  20,921     $  16,838
      Deferred revenue .............................        5,331         5,873
      Current maturities of long-term debt .........        3,578         6,849
      Accrued payroll expense ......................        2,788         3,666
      Accrued interest .............................        3,347         3,052
      Other accrued expenses .......................        8,186         7,311
                                                        ---------     ---------
Total current liabilities ..........................       44,151        43,589

LONG-TERM DEBT, less current maturities ............      242,945       232,686
DEFERRED INCOME TAXES ..............................          391           391
DEFERRED RENT ......................................        3,246         3,235
DEFERRED GAIN ......................................        2,175         2,826
                                                        ---------     ---------
Total liabilities ..................................      292,908       282,727
                                                        ---------     ---------
SHAREHOLDERS' DEFICIT:
      Common stock .................................           75            74
      Preferred stock ..............................       32,793        34,959
      Additional paid-in capital ...................       60,958        58,305
      Accumulated deficit ..........................     (163,827)     (161,425)
                                                        ---------     ---------
Total shareholders' deficit ........................      (70,001)      (68,087)
                                                        ---------     ---------
                                                        $ 222,907     $ 214,640
                                                        =========     =========
</TABLE>


            See Notes to Condensed Consolidated Financial Statements.

                                       2
<PAGE>   4



                        EYE CARE CENTERS OF AMERICA, INC.

                 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

                             (dollars in thousands)

<TABLE>
<CAPTION>
                                                              THIRTEEN WEEKS          TWENTY-SIX WEEKS
                                                                  ENDED                    ENDED
                                                          ----------------------   ----------------------
                                                           JULY 4,       JULY 3,    JULY 4,      JULY 3,
                                                            1998          1999       1998         1999
                                                          ---------    ---------   ---------    ---------
                                                         (Unaudited)  (Unaudited) (Unaudited)  (Unaudited)
<S>                                                       <C>          <C>         <C>          <C>
NET REVENUES:
      Optical sales ...................................   $  57,717    $  68,960   $ 119,075    $ 143,324
      Management fee ..................................         523          813       1,184        1,523
                                                          ---------    ---------   ---------    ---------
Total net revenues ....................................      58,240       69,773     120,259      144,847

OPERATING COSTS AND EXPENSES:
      Cost of goods sold ..............................      19,989       22,845      40,488       47,723
      Selling, general and administrative  expenses ...      32,126       39,442      65,342       79,575
      Recapitalization and other expenses .............      25,216           --      25,263           --
      Amortization of intangibles .....................         746        1,206       1,660        2,381
                                                          ---------    ---------   ---------    ---------
Total operating costs and expenses ....................      78,077       63,493     132,753      129,679
                                                          ---------    ---------   ---------    ---------

INCOME/(LOSS) FROM OPERATIONS .........................     (19,837)       6,280     (12,494)      15,168

INTEREST EXPENSE, NET .................................       4,868        5,885       8,262       11,883

IN-SUBSTANCE DEFEASED BONDS INTEREST EXPENSE, NET .....       1,460           --       1,460           --

INCOME TAX EXPENSE/(BENEFIT) ..........................         (54)         317          13          392
                                                          ---------    ---------   ---------    ---------

NET INCOME/(LOSS) BEFORE CUMULATIVE EFFECT OF CHANGE IN
ACCOUNTING PRINCIPLE AND EXTRAORDINARY ITEM ...........     (26,111)          78     (22,229)       2,893

CUMULATIVE EFFECT OF CHANGE IN ACCOUNTING PRINCIPLE ...          --           --          --          491

EXTRAORDINARY LOSS ON EARLY EXTINGUISHMENT OF LONG-TERM
DEBT ..................................................       4,155           --       4,155           --
                                                          ---------    ---------   ---------    ---------

NET INCOME/(LOSS) .....................................   $ (30,266)   $      78   $ (26,384)   $   2,402
                                                          =========    =========   =========    =========
</TABLE>


            See Notes to Condensed Consolidated Financial Statements


                                       3
<PAGE>   5



                        EYE CARE CENTERS OF AMERICA, INC.

                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

                             (dollars in thousands)

<TABLE>
<CAPTION>
                                                                       TWENTY-SIX    TWENTY-SIX
                                                                       WEEKS ENDED  WEEKS ENDED
                                                                         JULY 4,      JULY 3,
                                                                          1998         1999
                                                                        ---------    ---------
                                                                       (Unaudited)  (Unaudited)
<S>                                                                     <C>          <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
      Net income/(loss) .............................................   $ (26,384)   $   2,402
      Adjustments to reconcile net income to net cash provided by
               operating activities:
         Depreciation and amortization ..............................       7,663        9,699
         Other amortization .........................................         556          725
         Cumulative effect of change in accounting principle ........          --          491
         Deferred liabilities and other .............................         280          362
         Expenses to affect capital lease retirement ................          --         (431)
         Loss on disposition of property and equipment ..............          55          348
         Extraordinary loss on early extinguishment of
               long-term debt........................................       4,155           --
      Increase/(decrease) in operating assets and liabilities .......       3,759       (4,621)
                                                                        ---------    ---------
Net cash provided by (used for) operating activities ................      (9,916)       8,975
                                                                        ---------    ---------

CASH FLOWS FROM INVESTING ACTIVITIES:
      Acquisition of property and equipment .........................      (8,632)     (10,472)
      Proceeds from sale of property and equipment ..................         763           17
      Purchase of retail outlet .....................................          --         (368)
      Payments received on notes receivable .........................          85           97
                                                                        ---------    ---------
Net cash used for investing activities ..............................      (7,784)     (10,726)
                                                                        ---------    ---------

CASH FLOWS FROM FINANCING ACTIVITIES:
      Payments on debt and capital leases ...........................     (42,780)      (1,361)
      Payments related to deferred compensation .....................         (10)          --
      Proceeds from issuance of long-term debt ......................     204,511           --
      Proceeds from the issuance of common stock ....................      71,689           --
      Proceeds from the issuance of preferred stock .................      27,750           --
      Payments to retire redeemable preferred stock .................     (12,385)          --
      Purchase of investment securities-restricted ..................     (76,618)          --
      Expenses to affect recapitalization ...........................     (23,849)          --
      Redemption of common stock ....................................    (128,365)        (440)
                                                                        ---------    ---------
Net cash provided by (used for) financing activities ................      19,324       (1,801)
                                                                        ---------    ---------

NET INCREASE/(DECREASE) IN CASH .....................................       1,624       (3,552)
CASH AND CASH EQUIVALENTS, beginning of period ......................       7,172        5,127
                                                                        ---------    ---------
CASH AND CASH EQUIVALENTS, end of period ............................   $   8,796    $   1,575
                                                                        =========    =========
</TABLE>

            See Notes to Condensed Consolidated Financial Statements.



                                       4
<PAGE>   6



                        EYE CARE CENTERS OF AMERICA, INC.

              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

1. BASIS OF PRESENTATION

         The consolidated financial statements include the accounts of Eye Care
Centers of America, Inc., its wholly owned subsidiaries (collectively, unless
the context otherwise requires, the "Company") and optometrists to whom the
Company performs management services. All significant intercompany balances and
transactions have been eliminated.

         The accompanying unaudited Condensed Consolidated Financial Statements
have been prepared in accordance with generally accepted accounting principles
for interim financial information and with the instructions to Form 10-Q and
Article 10 of Regulation S-X. Accordingly, they do not include all of the
information and footnotes required by generally accepted accounting principles
for complete financial statements. In the opinion of management, all adjustments
considered necessary for a fair presentation have been included and are of a
normal, recurring nature. Operating results for the thirteen week and twenty-six
week periods ended July 3, 1999 are not necessarily indicative of the results
that may be expected for the fiscal year ended January 1, 2000. For further
information, refer to the consolidated financial statements and footnotes
thereto included in the Eye Care Centers of America, Inc.'s Annual Report on
Form 10-K for the year ended January 2, 1999.

2. RELATED PARTY TRANSACTIONS

         Prior to the Recapitalization (defined herein) of the Company, the
Company was party to an agreement with Desai Capital Management, Inc. ("DCMI"),
a majority shareholder, whereby the Company paid DCMI $144,000 per year as an
advisory fee for consulting and strategic advice and $56,000 per year for the
consulting services of certain Board of Directors members who are also employees
and/or officers of DCMI. For the thirteen week and twenty-six week periods ended
July 4, 1998, the Company incurred $11,000 and $61,000, respectively, related to
these agreements. As a result of the Recapitalization, the agreement with DCMI
has been canceled, and DCMI is no longer a majority shareholder of the Company.

         The Company and Thomas H. Lee Company ("THL Co.") entered into a
management agreement as of the closing date of the Company's Recapitalization
(the "Management Agreement"), pursuant to which THL Co. received a financial
advisory fee of $6.0 million in connection with structuring, negotiating and
arranging the Recapitalization of the Company and related debt financing. In
addition, pursuant to the Management Agreement, THL Co. will initially receive
$500,000 per year plus expenses for management and other consulting services
provided to the Company. After a term of ten years from the closing date, the
Management Agreement is automatically renewable on an annual basis unless either
party serves notice of termination at least ninety days prior to the renewal
date. For the thirteen week and twenty-six week periods ended July 3, 1999, the
Company incurred $125,000 and $250,000, respectively, related to the agreement.

3. INCOME TAXES

         Deferred tax assets and liabilities are determined based on differences
between financial reporting and tax basis of assets and liabilities and are
measured using the enacted tax rates and laws that will be in effect when the
differences are expected to reverse. The Company currently has a net deferred
tax asset related to its temporary differences. Based upon the weight of
available evidence allowed under the


                                       5
<PAGE>   7



criteria set forth under FAS Statement No. 109, including the lack of carryback
potential, uncertainties exist as to the future realization of the deferred tax
asset. These uncertainties include lack of carryback potential as the Company
has incurred taxable losses in past years. The Company has established a full
valuation allowance for its deferred tax assets.

4. SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION (DOLLARS IN THOUSANDS)

<TABLE>
<CAPTION>
                                                TWENTY-SIX   TWENTY-SIX
                                                WEEKS ENDED  WEEKS ENDED
                                                  JULY 4,      JULY 3,
                                                   1998         1999
                                                -----------  -----------
                                                (UNAUDITED)  (UNAUDITED)
<S>                                               <C>          <C>
Cash paid for interest ........................   $ 6,994      $11,445
Dividends accrued on redeemable
  preferred stock..............................   $   268      $    --
Rollover of preferred stock by management .....   $ 2,250      $    --
Rollover of common stock by management ........   $ 5,625      $    --
Dividends accrued on preferred stock ..........   $   761      $ 2,166
Retirement of capital lease obligation ........   $    --      $ 5,652
</TABLE>


5. INTEREST RATE SWAPS

         The Company does not hold or issue financial instruments for trading
purposes nor is it a party to leveraged derivatives. The Company uses interest
rate swaps that are "vanilla" and involve little complexity as hedge instruments
to manage interest rate risk.

         The counter parties to the Company's derivatives consist of major
international financial institutions. Because of the number of these
institutions and their high credit ratings, management believes these
derivatives do not present significant credit risk to the Company.

<TABLE>
<CAPTION>
                                                                               Weighted        Weighted
                                                                                Average         Average
                        Notional Amounts                Maturity               Fixed Pay    Floating Receive
                          July 3, 1999                    Date                    Rate            Rate
                        ----------------                --------               ---------    ----------------
                        <S>                               <C>                     <C>             <C>
                        $ 33.3 million                    2000                    5.9%            5.0%
                        $ 33.3 million                    2001                    5.9%            5.0%
</TABLE>

         Interest rate swap agreements effectively convert floating rates on
long-term debt to fixed rates. The Company's intent is to reduce overall
interest expense while maintaining an acceptable level of risk to interest rate
fluctuations. The swap agreements specifically hedge a portion of both $50.0
million aggregate principle amount of the Company's Floating Interest Rate
Subordinated Term Securities due 2008 and $50.0 million of the Company's Credit
Facility, which consists of (i) the $55.0 million term loan facility; (ii) the
$35.0 million revolving credit facility; and (iii) the $100.0 million
acquisition facility. As market interest rates fluctuate, the unrealized gain or
loss on the swap portfolio moves in relationship to the fair value of the
underlying debt. The Company had an unrealized loss on the interest rate swap
portfolio of $0.2 million as of July 3, 1999. The change in the market value of
these interest rate swaps is not recorded in the financial position or
operations of the Company. Interest to be paid or received is accrued as an
adjustment to interest expense. Upon termination of interest rate swaps, the
fair


                                       6
<PAGE>   8


value of the swaps is recorded through operations. If the hedged item is repaid
early, the Company will evaluate if the swap agreement is to be redesignated or
exited.

6. NEW ACCOUNTING PRONOUNCEMENTS

         Derivatives. In June 1998, the Financial Accounting Standards Board
issued SFAS No. 133, Accounting for Derivative Instruments and Hedging
Activities, which is required to be adopted in years beginning after June 15,
1999. In June 1999, SFAS No. 137 was issued, which delays the required adoption
of SFAS No. 133 by one year. The statement permits early adoption as of the
beginning of any fiscal quarter after its issuance. The statement will require
the Company to recognize all derivatives on the balance sheet at fair value.
Derivatives that are not hedges must be adjusted to fair value through income.
If the derivative is a hedge, depending on the nature of the hedge, changes in
the fair value of derivatives will either be offset against the change in fair
value of the hedged assets, liabilities, or firm commitments through earnings or
recognized in other comprehensive income until the hedged item is recognized in
earnings. The ineffective portion of a derivative's change in fair value will be
immediately recognized in earnings. The Company has not yet determined what the
effect of SFAS No. 133 will be on the earnings and financial position of the
Company.

7. CONDENSED CONSOLIDATING INFORMATION

     The $100,000,000 in principal amount of 9 1/8% Senior Subordinated Notes
due 2008 and $50,000,000 in principal amount of Floating Interest Rate
Subordinated Term Securities due 2008 were issued by the Company and are
guaranteed by all of the Company's subsidiaries (the "Guarantor Subsidiaries")
but are not guaranteed by certain private optometrists ("ODs") to whom the
Company provides management services. The guarantor subsidiaries are
wholly-owned by the Company and the guarantees are full, unconditional and joint
and several. The following condensed consolidating financial information
presents the financial position, results of operations and cash flows of (i) the
Company, as parent, as if it accounted for its subsidiaries on the equity
method, (ii) the Guarantor Subsidiaries, and (iii) ODs. Separate financial
statements of the Guarantor Subsidiaries are not presented herein as management
does not believe that such statements would be material to investors. Previous
fiscal years are not presented herein as the non-guarantor OD was consolidated
starting in the fourth quarter of fiscal 1998 and prior to this date all
subsidiaries were guarantors.



                                        7
<PAGE>   9



                           CONSOLIDATING BALANCE SHEET
                                  JULY 3, 1999

<TABLE>
<CAPTION>
                                                                         Guarantor                            Consolidated
ASSETS                                                       Parent     Subsidiaries    ODs      Eliminations   Company
                                                            ---------   ------------ ---------   ------------ ------------
<S>                                                         <C>          <C>         <C>          <C>          <C>
Current assets:
   Cash and cash equivalents ............................   $  (3,606)   $   5,181   $       -    $       -    $   1,575
   Accounts and notes receivable ........................      63,112       22,576         743      (77,608)       8,823
   Inventory ............................................      14,557        9,970          --           --       24,527
   Prepaid expenses and other ...........................       1,392          300          --           --        1,692
  Deferred income taxes .................................         391           --          --           --          391
                                                            ---------    ---------   ---------    ---------    ---------
Total current assets ....................................      75,846       38,027         743      (77,608)      37,008

Property and equipment ..................................      42,013       23,555          --           --       65,568
Intangibles .............................................      19,333       81,286          97           --      100,716
Other assets ............................................      10,961          387          --           --       11,348
Investment in subsidiaries ..............................      16,058           --          --      (16,058)          --
                                                            ---------    ---------   ---------    ---------    ---------
                                                            $ 164,211    $ 143,255   $     840    $ (93,666)   $ 214,640
                                                            =========    =========   =========    =========    =========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
   Accounts payable .....................................   $  13,449    $  80,997          $-    $ (77,608)   $  16,838
   Deferred revenue .....................................       4,008        1,865          --           --        5,873
   Current maturities of long-term debt .................       6,000          849          --           --        6,849
   Accrued payroll expense ..............................       1,899        1,767          --           --        3,666
   Accrued interest .....................................       2,302          750          --           --        3,052
   Other accrued expenses ...............................       3,073        3,971         267           --        7,311
                                                            ---------    ---------   ---------    ---------    ---------
Total current liabilities ...............................      30,731       90,199         267      (77,608)      43,589
Long-term debt, less current maturities .................     197,564       35,022         100           --      232,686
Deferred income taxes ...................................         391           --          --           --          391
Deferred rent ...........................................       2,338          897          --           --        3,235
Deferred gain ...........................................       2,096          730          --           --        2,826
                                                            ---------    ---------   ---------    ---------    ---------
Total liabilities .......................................     233,120      126,848         367      (77,608)     282,727
                                                            ---------    ---------   ---------    ---------    ---------
Shareholders' equity/(deficit):
   Common stock .........................................          74           --          --           --           74
   Preferred stock ......................................      34,959           --          --           --       34,959
   Additional paid-in capital ...........................      57,216        1,089          --           --       58,305
   Accumulated deficit ..................................    (161,158)      15,318         473      (16,058)    (161,425)
                                                            ---------    ---------   ---------    ---------    ---------
Total shareholders' equity/(deficit) ....................     (68,909)      16,407         473      (16,058)     (68,087)
                                                            ---------    ---------   ---------    ---------    ---------
                                                            $ 164,211    $ 143,255   $     840    $ (93,666)   $ 214,640
                                                            =========    =========   =========    =========    =========
</TABLE>


                         CONSOLIDATING INCOME STATEMENT
                   FOR THE TWENTY-SIX WEEKS ENDED JULY 3, 1999

<TABLE>
<CAPTION>
                                                            Guarantor                         Consolidated
                                                   Parent  Subsidiaries    ODs   Eliminations   Company
                                                  -------- ------------ -------- ------------ ------------
<S>                                               <C>        <C>        <C>        <C>          <C>
Optical sales .................................   $ 81,788   $ 42,845   $ 18,691   $      -     $143,324
Management fees ...............................      3,508      1,523         --     (3,508)       1,523
Investment earnings in subsidiaries ...........      5,606         --         --     (5,606)
                                                  --------   --------   --------   --------     --------
Net revenues ..................................     90,902     44,368     18,691     (9,114)     144,847
Operating costs and expenses:
   Cost of goods sold .........................     26,719     16,559      4,445         --       47,723
   Selling, general and administrative
     expenses..................................     49,966     19,554     13,563     (3,508)      79,575
   Amortization of intangibles ................        522      1,857          2         --        2,381
                                                  --------   --------   --------   --------     --------
Total operating costs and expenses ............     77,207     37,970     18,010     (3,508)     129,679
                                                  --------   --------   --------   --------     --------
Income (loss) from operations .................     13,695      6,398        681     (5,606)      15,168
Interest expense, net .........................     10,536      1,343          4         --       11,883
Income tax expense ............................        125         --        267         --          392
                                                  --------   --------   --------   --------     --------
Net income (loss) before extraordinary item ...      3,034      5,055        410     (5,606)       2,893
Cumulative effect of change in accounting
  principle....................................        365        126         --         --          491
                                                  --------   --------   --------   --------     --------
Net income (loss) .............................   $  2,669   $  4,929   $    410   $ (5,606)    $  2,402
                                                  ========   ========   ========   ========     ========
</TABLE>


                                       8
<PAGE>   10


                         CONSOLIDATING INCOME STATEMENT
                    FOR THE THIRTEEN WEEKS ENDED JULY 3, 1999

<TABLE>
<CAPTION>
                                                           Guarantor                         Consolidated
                                                  Parent  Subsidiaries   ODs    Eliminations   Company
                                                  ------- ------------ -------  ------------ ------------
<S>                                               <C>       <C>        <C>        <C>          <C>
Optical sales .................................   $39,696   $20,809    $ 8,455    $     -      $68,960
Management fees ...............................     1,499       813         --     (1,499)         813
Investment earnings in subsidiaries ...........     3,119        --         --     (3,119)
                                                  -------   -------    -------    -------      -------
Net revenues ..................................    44,314    21,622      8,455     (4,618)      69,773
Operating costs and expenses:
   Cost of goods sold .........................    12,995     8,195      1,655         --       22,845
   Selling, general and administrative
     expenses..................................    25,231     8,852      6,858     (1,499)      39,442
   Amortization of intangibles ................       274       931          1         --        1,206
                                                  -------   -------    -------    -------      -------
Total operating costs and expenses ............    38,500    17,978      8,514     (1,499)      63,493
                                                  -------   -------    -------    -------      -------
Income (loss) from operations .................     5,814     3,644        (59)    (3,119)       6,280
Interest expense, net .........................     5,419       464          2         --        5,885
Income tax expense ............................        50        --        267         --          317
                                                  -------   -------    -------    -------      -------
Net income (loss) before extraordinary item ...       345     3,180       (328)    (3,119)          78
Cumulative effect of change in accounting
  principle ...................................        --        --         --         --           --
                                                  -------   -------    -------    -------      -------
Net income (loss) .............................   $   345   $ 3,180    $  (328)   $(3,119)     $    78
                                                  =======   =======    =======    =======      =======
</TABLE>



                      CONSOLIDATING STATEMENT OF CASH FLOWS

                   FOR THE TWENTY-SIX WEEKS ENDED JULY 3, 1999

<TABLE>
<CAPTION>
                                                         Guarantor                           Consolidated
                                               Parent   Subsidiaries    ODs     Eliminations   Company
                                              --------  ------------  --------  ------------ ------------
<S>                                           <C>         <C>         <C>         <C>          <C>
Cash flows from operating activities:
Net income (loss) .........................   $  2,669    $  4,929    $    410    $ (5,606)    $  2,402
Adjustments to reconcile net income (loss)
     to net
Cash provided by operating activities:
    Depreciation and amortization .........      5,629       4,068           2          --        9,699
    Other amortization ....................        742         (17)         --         725
    Cumulative effect of change in
        accounting principle ..............        365         126          --          --          491
    Deferred liabilities and other ........        577        (215)         --          --          362
    Expenses to affect capital lease
        retirement ........................         --        (431)         --          --         (431)
    (Gain) loss on disposition of property
        and equipment .....................        348          --          --          --          348
    Increase/(decrease) in operating assets
        and liabilities ...................       (524)     (3,685)       (412)         --       (4,621)
                                              --------    --------    --------    --------     --------

Net cash provided by (used in) operating
     activities ...........................      9,806       4,775          --      (5,606)       8,975
                                              --------    --------    --------    --------     --------

Cash flows from investing activities:
    Acquisition of property and equipment .     (9,157)     (1,315)         --          --      (10,472)
    Proceeds from sale of property and
        equipment .........................         17          --          --          --           17
    Purchase of retail outlet .............       (368)         --          --          --         (368)
    Payment received on notes receivable ..         23          74          --          --           97
    Investment in subsidiaries ............     (5,606)         --          --       5,606           --
                                              --------    --------    --------    --------     --------

Net cash provided by (used in) investing
     activities ...........................    (15,091)     (1,241)         --       5,606      (10,726)
                                              --------    --------    --------    --------     --------

Cash flows from financing activities:
    Payments on debt and capital leases ...     (1,000)       (361)         --          --       (1,361)
    Repurchase of common stock ............       (440)         --          --          --         (440)
                                              --------    --------    --------    --------     --------

Net cash provided by (used in) financing
     activities ...........................     (1,440)       (361)         --          --       (1,801)
                                              --------    --------    --------    --------     --------

Net decrease in cash and cash equivalents .     (6,725)      3,173          --          --       (3,552)

Cash and cash equivalents at beginning of
     period ...............................      3,119       2,008          --          --        5,127
                                              --------    --------    --------    --------     --------

Cash and cash equivalents at end
     of period ............................   $ (3,606)   $  5,181    $     --    $     --     $  1,575
                                              ========    ========    ========    ========     ========
</TABLE>


                                       9
<PAGE>   11

8. CAPITAL LEASE OBLIGATION

         During the second quarter of 1999, a third party paid $8.4 million of
the Company's $10.0 million capital lease obligations to the Eckerd Corporation.
The Company simultaneously leased these same properties under seven lease
agreements, accounting for these transactions as sales leaseback transactions. A
gain of $0.5 million has been deferred related to these sales leaseback
transactions. Four of the new lease agreements are being accounted for as
capital leases and three are being accounted for as operating leases. The
remaining capital lease obligation of $1.4 million under the original $10.0
million capital lease obligation was renewed as an operating lease.

9. SUBSEQUENT EVENT

         On July 7, 1999, the Company entered into an asset purchase agreement
with Vision Twenty-One, Inc. and its subsidiary, The Complete Optical
Laboratory, Ltd., Corp., relating to the purchase of substantially all of the
assets used to operate 76 retail eyewear outlets. The purchase price for the
assets is $42.0 million, less certain purchase price adjustments which the
Company believes will be approximately $5.0 million. The Company plans to
utilize existing facilities to finance the transaction. As a result of this
acquisition, the Company (through its subsidiaries), will (i) own and operate 39
stores under the name "Vision World" in Minnesota, North Dakota, Iowa, South
Dakota, and Wisconsin and 18 stores under the name "Stein Optical" in Wisconsin,
and (ii) assume a business management agreement with a private optometrist to
manage 19 stores under the name "Eye Drx" in New Jersey. The Company believes
the closing will occur on or about August 31, 1999, but is subject to certain
pre-closing conditions, including third-party consents and governmental
authorizations. Concurrent with the closing, the Company will enter into a
strategic alliance agreement with Vision Twenty-One, Inc. involving their
respective managed care programs and the co-marketing of Vision Twenty-One's
refractive surgery program.




                                       10
<PAGE>   12


            ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL

                       CONDITION AND RESULTS OF OPERATIONS

INTRODUCTION

         Eye Care Centers of America, Inc. is the fourth largest retail optical
chain in the United States as measured by net revenues, operating 277 stores,
253 of which are optical superstores. The Company operates predominately under
the trade name "EyeMasters," and in certain geographical regions under the trade
names "Binyon's," "Visionworks", "Hour Eyes", "Dr. Bizer's VisionWorld", "Dr.
Bizer's ValuVision" and "Doctor's ValuVision". The Company operates in the $15.8
billion optical retail market. Management believes that key drivers of growth
for retail optical chains include (i) the aging of the United States population,
(ii) the increased role of managed vision care, (iii) the consolidation of the
industry and (iv) new product innovations.

         The industry is highly fragmented and is undergoing significant
consolidation. Since 1996, the Company has acquired and integrated three
acquisitions. In September 1996, the Company acquired all of the outstanding
shares of the capital stock of Visionworks Holdings, Inc. and its subsidiaries
(collectively, "Visionworks") for $61.5 million (the "Visionworks Acquisition").
At the time of the Visionworks Acquisition, Visionworks was a sixty store
optical retailer located along the Atlantic Coast from Florida to Washington, D.
C. with forty-nine superstores and eleven optical stores located near Eckerd
Corporation stores. In September 1997, the Company acquired The Samit Group,
Inc. and its subsidiaries ("TSGI"), a ten store optical retailer located in the
Washington, D.C. area and certain assets related to twelve additional stores in
Virginia for $22.3 million less acquisition date liabilities. Simultaneously
with the acquisition of TSGI, the Company entered into long-term business
management agreements with Hour Eyes Doctors of Optometry, P.C. ("PC"), a
Virginia professional corporation, to manage the additional twelve Hour Eyes
optical stores in Virginia (collectively, the "Hour Eyes Acquisition"). As a
result of the long-term business management agreements with PC, the Company
records a management fee but does not include the results of operations from the
twelve Virginia stores in the Company's consolidated results of operations. In
September 1998, the Company acquired certain assets of Dr. Bizer's VisionWorld,
PLLC and related entities (the "Bizer Entities"), a nineteen store optical
retailer located primarily in Kentucky and Tennessee, and simultaneously entered
into long-term management agreements with a private optometrist to manage such
nineteen stores (collectively, the "Bizer Acquisition"). The results of
operations from the date of acquisition from these nineteen stores are included
in the Company's consolidated results of operations.

         On March 6, 1998, ECCA Merger Corp. ("Merger Corp."), a Delaware
corporation formed by Thomas H. Lee Company ("THL Co."), and the Company entered
into a recapitalization agreement (the "Recapitalization Agreement") providing
for, among other things, the merger of such corporation with and into the
Company (the "Merger" and, together with the financing of the recapitalization
and related transactions described below, the "Recapitalization"). Upon
consummation of the Recapitalization on April 24, 1998, Thomas H. Lee Equity
Fund IV, L.P. ("THL Fund IV") and other affiliates of THL Co. (collectively with
THL Fund IV and THL Co., "THL") owned approximately 89.7% of the issued and
outstanding shares of common stock of the Company ("Common Stock"), existing
shareholders (including management) of the Company retained approximately 7.3%
of the issued and outstanding Common Stock and management purchased additional
shares representing approximately 3.0% of the issued and outstanding Common
Stock. The total transaction value of the Recapitalization was approximately
$323.8 million, including related fees and expenses, and the implied total
equity value of the Company following the Recapitalization was approximately
$107.3 million.



                                       11
<PAGE>   13


         Certain of the funds needed to consummate the Recapitalization were
obtained through the sale, pursuant to Rule 144A promulgated under the
Securities Act of 1933, as amended (the "Securities Act"), of $100,000,000 in
principal amount of 9 1/8% Senior Subordinated Notes due 2008 (the "Fixed Rate
Notes") and $50,000,000 in principal amount of Floating Interest Rate
Subordinated Term Securities due 2008 (the "Floating Rate Notes" and, together
with the Fixed Rate Notes, the "Initial Notes"). The Initial Notes were issued
by the Company and guaranteed by the Company's subsidiaries (the "Subsidiary
Guarantors"). Under that certain Indenture, dated April 24, 1998 (the
"Indenture"), by and among the Company, the Subsidiary Guarantors, and the
United States Trust Company of New York as Trustee governing the Initial Notes,
the Company and the Subsidiary Guarantors are jointly and severally liable for
payment of the Initial Notes. The Company filed a registration statement with
the Securities and Exchange Commission with respect to an offer to exchange the
Initial Notes for notes which have terms substantially identical in all material
respects to the Initial Notes, except such notes are freely transferable by the
holders thereof and are issued without any covenant regarding registration (the
"Exchange Notes"). The registration statement was declared effective on January
28, 1999. The exchange period ended March 4, 1999. The Exchange Notes are the
only notes of the Company which are currently outstanding. In addition to the
net proceeds from the sale of the Exchange Notes, the Recapitalization was
financed with (a) approximately $55.0 million of borrowings under the Credit
Facility (defined herein) and (b) approximately $99.4 million from the sale of
capital stock to THL, Bernard W. Andrews and other members of management (the
"Equity Contribution") consisting of (i) approximately $71.6 million from the
sale of Common Stock and (ii) approximately $27.8 million from the sale of
shares of a newly created series of preferred stock of the Company ("New
Preferred Stock"). The Company used the proceeds from such bank borrowings, the
sale of the Exchange Notes, and the Equity Contribution principally to finance
the conversion into cash of the shares of Common Stock which were not retained
by existing stockholders, to refinance certain existing indebtedness of the
Company, to redeem certain outstanding preferred stock of the Company and to pay
related fees and expenses of the Recapitalization. In connection with the
Recapitalization, the Company in-substance defeased its previously issued 12%
Senior Notes due 2003 (the "Senior Notes") by depositing with the trustee for
the Senior Notes (i) an irrevocable notice of redemption of the Senior Notes on
October 1, 1998 and (ii) United States government securities in an amount
necessary to yield on October 1, 1998, $78.4 million, which constituted the
principal amount, premium and interest payable on the Senior Notes on the
October 1, 1998 redemption date. The Senior Notes were defeased as scheduled on
October 1, 1998.



                                       12

<PAGE>   14



RESULTS OF OPERATIONS

The following table sets forth for the periods indicated certain statement of
income data as a percentage of net revenues.

<TABLE>
<CAPTION>
                                                             THIRTEEN          TWENTY-SIX
                                                            WEEKS ENDED       WEEKS ENDED
                                                         -----------------  -----------------
                                                         JULY 4,   JULY 3,  JULY 4,   JULY 3,
                                                          1998      1999     1998      1999
                                                         -------   -------  -------   -------
<S>                                                       <C>       <C>      <C>       <C>
STATEMENT OF INCOME DATA:
NET REVENUES:
      Optical sales ...................................    99.1 %    98.8%    99.0%     98.9%
      Management fee ..................................     0.9       1.2      1.0       1.1
                                                          -----     -----    -----     -----
Total net revenues ....................................   100.0     100.0    100.0     100.0

OPERATING COSTS AND EXPENSES:
      Cost of goods sold ..............................    34.6 *    33.1*    34.0*     33.3*
      Selling, general and administrative expenses ....    55.7 *    57.2*    54.9*     55.5*
      Recapitalization and other expenses .............    43.3        --     21.0        --
      Amortization of intangibles .....................     1.3       1.7      1.4       1.7
                                                          -----     -----    -----     -----

Total operating costs and expenses ....................   134.1      91.0    110.4      89.5
                                                          -----     -----    -----     -----

INCOME/(LOSS) FROM OPERATIONS .........................   (34.1)      9.0    (10.4)     10.5

INTEREST EXPENSE, NET .................................     8.4       8.4      6.9       8.2


IN-SUBSTANCE DEFEASED BONDS INTEREST EXPENSE, NET .....     2.5        --      1.2        --

INCOME TAX EXPENSE/(BENEFIT) ..........................    (0.1)      0.5      0.0       0.3
                                                          -----     -----    -----     -----

NET INCOME/(LOSS) BEFORE CHANGE IN ACCOUNTING PRINCIPLE
  AND EXTRAORDINARY LOSS ..............................   (44.9)      0.1    (18.5)      2.0

CHANGE IN ACCOUNTING PRINCIPLE ........................      --        --       --       0.3

EXTRAORDINARY LOSS ON EARLY EXTINGUISHMENT OF LONG-TERM
  DEBT ................................................     7.1        --      3.5       --
                                                          -----     -----    -----     -----

NET INCOME/(LOSS) .....................................   (52.0)%     0.1%   (22.0)%     1.7%
                                                          =====     =====    =====     =====
</TABLE>

*  Percentages based on optical sales only

THE THIRTEEN WEEKS ENDED JULY 3, 1999 COMPARED TO THE THIRTEEN WEEKS ENDED JULY
4, 1998.

Net Revenues. The increase in net revenues to $69.8 million for the thirteen
weeks ended July 3, 1999 from $58.2 million for the thirteen weeks ended July 4,
1998 was largely the result of the Bizer



                                       13
<PAGE>   15


Acquisition and an increase in comparable store sales of 1.5%. The Bizer
Acquisition resulted in an increase in net revenues of $8.5 million during the
second thirteen weeks of fiscal 1999.

Gross Profit. Gross profit increased to $46.1 million for the thirteen weeks
ended July 3, 1999 from $37.7 million for the thirteen weeks ended July 4, 1998.
Gross profit as a percentage of optical sales increased to 66.9% for the
thirteen weeks ended July 3, 1999 as compared to 65.4% for the thirteen weeks
ended July 4, 1998. This percentage increase was primarily due to increased
productivity within the store labs and an increase in the mix of anti-reflective
and polycarbonate lens sales.

Selling General & Administrative Expenses (SG&A). SG&A increased to $39.4
million for the thirteen weeks ended July 3, 1999 from $32.1 million for the
thirteen weeks ended July 4, 1998. SG&A as a percentage of optical sales
increased to 57.2% for the thirteen weeks ended July 3,1999 from 55.7% for the
thirteen weeks ended July 4, 1998. This percentage increase was primarily due to
the inclusion of doctor payroll expenses for the stores acquired through the
Bizer Acquisition, which were not included in the second quarter of 1998
results, and increased overhead costs. This increase was partially offset by a
decrease in advertising.

Amortization Expense. Amortization expense (excluding the amortization of store
pre-opening costs) increased to $1.2 million for the thirteen weeks ended July
3, 1999 from $0.7 million for the thirteen weeks ended July 4, 1998. This
increase was due to amortization of the goodwill related to the Bizer
Acquisition, which was recorded during the fourth quarter of 1998, and
amortization of the debt issuance costs related to the Recapitalization.

Net Interest Expense. Net interest expense increased to $5.9 million for the
thirteen weeks ended July 3, 1999 from $4.9 million for the thirteen weeks ended
July 4, 1998. This increase was due to the increased borrowings related to the
Recapitalization and the Bizer Acquisition.

Net Income. Net income increased to $0.1 million for the thirteen weeks ended
July 3, 1999 from a net loss of $30.3 million for the thirteen weeks ended July
4, 1998.

THE TWENTY-SIX WEEKS ENDED JULY 3, 1999 COMPARED TO THE TWENTY-SIX WEEKS ENDED
JULY 4, 1998.

Net Revenues. The increase in net revenues to $144.8 million for the twenty-six
weeks ended July 3, 1999 from $120.3 million for the twenty-six weeks ended July
4, 1998 was largely the result of the Bizer Acquisition and an increase in
comparable store sales of 1.6%. The Bizer Acquisition resulted in an increase in
net revenues of $18.7 million during the second twenty-six weeks of fiscal 1999.

Gross Profit. Gross profit increased to $95.6 million for the twenty-six weeks
ended July 3, 1999 from $78.6 million for the twenty-six weeks ended July 4,
1998. Gross profit as a percentage of optical sales increased to 66.7% for the
twenty-six weeks ended July 3, 1999 as compared to 66.0% for the twenty-six
weeks ended July 4, 1998. This percentage increase was primarily due to
increased productivity within the store labs.

Selling General & Administrative Expenses (SG&A). SG&A increased to $79.6
million for the twenty-six weeks ended July 3, 1999 from $65.3 million for the
twenty-six weeks ended July 4, 1998. SG&A as a percentage of optical sales
increased to 55.5% for the twenty-six weeks ended July 3,1999 from 54.9% for the
twenty-six weeks ended July 4, 1998. This percentage increase was primarily due
to the inclusion of doctor payroll expenses for the stores acquired through the
Bizer Acquisition, which were not included in the second quarter of 1998
results.


                                       14
<PAGE>   16


Amortization Expense. Amortization expense (excluding the amortization of store
pre-opening costs) increased to $2.4 million for the twenty-six weeks ended July
3, 1999 from $1.7 million for the twenty-six weeks ended July 4, 1998. This
increase was due to amortization of the goodwill related to the Bizer
Acquisition, which was recorded during the fourth quarter of 1998, and
amortization of the debt issuance costs related to the Recapitalization.

Net Interest Expense. Net interest expense increased to $11.9 million for the
twenty-six weeks ended July 3, 1999 from $8.3 million for the twenty-six weeks
ended July 4, 1998. This increase was due to the increased borrowings related to
the Recapitalization and the Bizer Acquisition.

Net Income. Net income increased to $2.4 million for the twenty-six weeks ended
July 3, 1999 from a net loss of $26.4 million for the twenty-six weeks ended
July 4, 1998.

LIQUIDITY AND CAPITAL RESOURCES

         Cash flows from operating activities have provided net cash of $9.0
million for the twenty-six weeks ended July 3, 1999 as compared to a use of $9.9
million for the twenty-six weeks ended July 4, 1998. As of July 3, 1999, the
Company had $1.6 million of cash available to meet the Company's obligations.

         Capital expenditures are related to the construction of new stores,
repositioning of existing stores in some markets, new computer systems for the
stores and maintenance of existing facilities. Capital expenditures for the
twenty-six weeks ended July 3, 1999 were $10.5 million. Capital expenditures for
1999 are anticipated to be approximately $18.0 million. Of the 1999 capital
expenditures, approximately $10.0 million are expected to be related to new
stores, approximately $4.0 million are expected to be for maintenance of
existing facilities and the remaining approximately $4.0 million represents the
funds necessary to complete the Company's point-of-sale and equipment upgrade
programs, which management believes are non-recurring in nature.

         In connection with the Recapitalization, the Company entered into a
credit agreement (the "Credit Facility") which consists of (i) the $55.0 million
term loan facility (the "Term Loan Facility"); (ii) the $35.0 million revolving
credit facility (the "Revolving Credit Facility"); and (iii) the $100.0 million
acquisition facility (the "Acquisition Facility"), of which $50.0 million was
committed at April 24, 1998. At July 3, 1999, the Company had $54.0 million in
term loans outstanding under this facility and $30.1 million outstanding under
the Acquisition Facility, which funded the Bizer Acquisition. Borrowings made
under the Credit Facility bear interest at a rate equal to, at the Company's
option, LIBOR plus 2.25% or the Base Rate (as defined in the Credit Facility)
plus 1.25%. The Term Loan Facility matures five years from the closing date of
the Credit Facility and will amortize quarterly in aggregate annual principal
amounts of approximately $0.0 million, $4.0 million, $12.0 million, $18.0
million, and $21.0 million, respectively, for years one through five after the
closing of the Credit Facility.

         In connection with the Recapitalization, the Company completed a debt
offering of the Initial Notes, which were subsequently exchanged for the
Exchange Notes. Interest on the Exchange Notes will be payable semiannually on
each May 1 and November 1, commencing on November 1, 1998. Interest on the Fixed
Rate Notes accrues at the rate of 9 1/8% per annum. The Floating Rate Notes bear
interest at a rate per annum, reset semiannually, and equal to LIBOR (as
defined) plus 3.98%. The Exchange Notes will not be entitled to the benefit of
any mandatory sinking fund. On April 24, 1998, the Company entered into an
interest rate swap agreement which converts a portion of the Floating Rate Notes
to a fixed rate.


                                       15
<PAGE>   17


         During 1996, the Company issued 110,000 shares of Series A Cumulative
Mandatorily Redeemable Exchangeable Pay-in-Kind Preferred Stock ("Preferred
Stock"). In conjunction with the Recapitalization, the Company repurchased the
Preferred Stock, canceled it and issued 300,000 shares of a new series of
preferred stock (the "New Preferred Stock"), par value $ .01 per share.
Dividends on shares of New Preferred Stock are cumulative from the date of issue
(whether or not declared) and will be payable when and as may be declared from
time to time by the Board of Directors of the Company. Such dividends accrue on
a daily basis from the original date of issue at an annual rate per share equal
to 13% of the original purchase price per share, with such amount to be
compounded quarterly. The New Preferred Stock will be redeemable at the option
of the Company, in whole or in part, at $100 per share plus (i) the per share
dividend rate and (ii) all accumulated and unpaid dividends, if any, to the date
of redemption, upon occurrence of an offering of equity securities, a change of
control or certain sales of assets.

         Based upon current operations, anticipated cost savings and future
growth, the Company believes that its cash flow from operations, together with
available borrowings under the Revolving Credit Facility, will be adequate to
meet its anticipated requirements for working capital, capital expenditures and
scheduled principal and interest payments. However, the Company believes that
its ability to repay the Exchange Notes and amounts outstanding under the
Revolving Credit Facility and the Acquisition Facility at maturity may require
additional financing. The ability of the Company to meet its debt service
obligations and reduce its debt will be dependent on the future performance of
the Company, which in turn, will be subject to general economic conditions and
to financial, business, and other factors, including factors beyond the
Company's control. A portion of the Company's debt bears interest at floating
rates; therefore, its financial condition is and will continue to be affected by
changes in prevailing interest rates.

SYSTEMS CONVERSION; YEAR 2000 ISSUE

         The Company is aware of the potential for industry wide business
disruption which could occur due to problems related to the "Year 2000" issue.
It is the belief of the Company's management that it has a prudent plan in place
to address these issues within the Company and with its suppliers. The
components of the Company's plan include: an assessment of internal systems for
modification and/or replacement; communication with external vendors to
determine their state of readiness to maintain an uninterrupted supply of goods
and services to the Company; an evaluation of the Company's production equipment
as to its ability to function properly after the turn of the century; an
evaluation of facility- related issues; the retention of technical and advisory
expertise to ensure that the Company is taking prudent action steps; and the
development of a contingency plan.

State of Readiness

         The Company has developed a comprehensive plan to reduce the
probability of operational difficulties due to Year 2000 related failures. While
there is still a significant amount of work to do, the Company believes that it
is on track towards a timely completion in the fall of 1999. Overall the Company
estimates that it has completed approximately 90% of the Year 2000 issue
identification process, and approximately 65% of the process of remediating Year
2000 issues that have been identified to date.

Internal Systems (Information Technology)

         To date, the Company has fully completed its assessment of all
information technology systems that could be significantly affected by the Year
2000 issue. The completed assessment indicated that certain systems are already
Year 2000 compliant while others are still in the process of being remediated.



                                       16
<PAGE>   18


Compliant systems include the Company's general ledger system, the managed
vision care system, and the merchandising system. Systems that are in the
process of being remediated are the payroll/human resources system and the
point-of-sale system, both of which should be compliant by the end of the summer
of 1999.

Suppliers

         The Company is in the process of communicating with its external
vendors to gain an understanding of their state of readiness to maintain an
uninterrupted supply of goods and services to the Company. Although the Company
believes that its products may be purchased from a number of vendors on
comparable terms and that therefore it is not dependent on any vendors or any
other single vendor for frames or lenses, the Company has identified vendors
that may otherwise be viewed as critical to its business. The Company is
defining a critical vendor as one whose inability to continue to provide goods
and services could have a serious adverse impact on the Company's ability to
produce, deliver, and collect payment for eyewear and/or services. To date the
Company is not aware of any supplier with a Year 2000 issue that would
materially impact the results of operations, liquidity or capital resources.
However, the Company has no means of ensuring that suppliers will be Year 2000
ready. Although the Company believes it does not have any critical vendors, the
inability of suppliers to complete their Year 2000 resolution process in a
timely fashion could materially impact the Company.

Production Equipment

         The Company has completed an inventory of production equipment
currently used at the Company. The Company has determined the Year 2000
readiness of this equipment through communication with the equipment
manufacturers and testing where appropriate. The Company is not aware of any
production equipment that is affected by the Year 2000 issue.

Facility-Related Issues

         The Company is in the process of evaluating facilities-related
equipment with the potential for Year 2000 related failures. The Company will
determine the Year 2000 readiness of this equipment through communication with
the equipment manufacturers and testing where appropriate. It is the Company's
intention to repair or replace non-compliant equipment prior to operating
difficulties. The Company, as in most companies, remains aware of the potential
for imbedded logic within microchips to cause equipment failure. The Company
believes that it has a prudent approach towards evaluating facilities equipment,
however, it may be impracticable or impossible to test certain items of
equipment for Year 2000 readiness. To the extent such untested equipment is not
Year 2000 ready, it may fail to operate on or after January 1, 2000, resulting
in possible interruptions of security, heating, elevator, telephone and other
services.

Technical and Advisory Expertise

         The Company has engaged outside consultants to assist it in project
planning, testing methodologies, and evaluating our Year 2000 remediation
activities.


                                       17
<PAGE>   19


Costs

         The Company is evaluating the total cost of Year 2000 compliance. At
this time, the Company estimates the total cost of Year 2000 related activities
to be approximately $650,000, with $100,000 of that amount yet to be incurred.
This amount is incremental spending and has been budgeted within the normal
magnitude of Information Technology spending. This amount includes the
replacement of hardware and applications that are outdated and were due for
replacement regardless of Year 2000 issues.

Contingency Plan

         Although the Company believes that it is taking prudent action related
to the identification and resolution of issues related to the Year 2000, its
assessment is still in progress. The Company may never be able to know with
certainty whether certain key vendors are compliant. Failure of key vendors to
make their computer systems Year 2000 compliant could result in delayed
deliveries of products to the Company. If such delays are extended they could
have a material adverse effect on the Company's business, financial condition,
and results of operations. There are also technical vagaries to logic imbedded
within microchips, which may prove impracticable or impossible to test. To the
extent such microchips are not Year 2000 compliant, this could have a material
adverse effect on the Company's business, financial condition, and results of
operations.

Risks

     The failure to correct a material Year 2000 problem could result in an
interruption in, or a failure of, certain normal business activities or
operations. Such failures could materially and adversely affect the Company's
results of operations, liquidity and financial condition. Due to the general
uncertainty inherent in the Year 2000 problem, resulting in part from the
uncertainty of the Year 2000 readiness of third-party suppliers, the Company is
unable to determine at this time whether the consequences of Year 2000 failures
will have a material impact on the Company's results of operations, liquidity or
financial condition. The Company's efforts related to the Year 2000 issue are
expected to significantly reduce the Company's level of uncertainty about the
Year 2000 problem and, in particular, about the Year 2000 compliance and
readiness of its critical vendors. The Company believes that, with the
implementation of new business systems and completion of the plans set in place
related to the Year 2000 issue, the possibility of significant interruptions of
normal operations should be reduced.

INFLATION

         The impact of inflation on the Company's operations has not been
significant to date. While the Company does not believe its business is highly
sensitive to inflation, there can be no assurance that a high rate of inflation
would not have an adverse impact on the Company's operations.

SEASONALITY AND QUARTERLY RESULTS

         The Company's sales fluctuate seasonally. Historically, the Company's
highest sales and earnings occur in the first and third fiscal quarters;
however, the opening of new stores and the Bizer Acquisition may affect seasonal
fluctuations. Hence, quarterly results are not necessarily indicative of results
for the entire year.


                                       18
<PAGE>   20


FORWARD LOOKING STATEMENTS

         The foregoing Form 10-Q contains various "forward-looking statements"
within the meaning of Section 27A of the Securities Act of 1933, as amended, and
Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking
statements represent the Company's expectations or belief concerning future
events, including the following: any statements regarding future sales and gross
profit percentages, any statements regarding the continuation of historical
trends, and any statements regarding the sufficiency of the Company's cash
balances and cash generated from operating and financing activities for the
Company's future liquidity and capital resource needs. Without limiting the
foregoing, the words "believes," "anticipates," "plans," "expects," and similar
expressions are intended to identify forward-looking statements. The Company
cautions that these statements are further qualified by important economic and
competitive factors that could cause actual results to differ materially from
those in the forward-looking statements, including, without limitation, risks of
the eye care industry, including a highly competitive industry with many
well-established competitors with greater financial and other resources than the
Company, and the impact of changes in consumer tastes, local, regional and
national economic conditions, demographic trends, traffic patterns, employee
availability and cost increases. In addition, the Company's ability to expand is
dependent upon various factors, such as the availability of attractive sites for
new stores, the ability to negotiate suitable lease terms, the ability to
generate or borrow funds to develop new stores and obtain various government
permits and licenses and the recruitment and training of skilled management and
employees. Accordingly, such forward-looking statements do not purport to be
predictions of future events or circumstances and may not be realized.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

         The Company is exposed to various market risks. Market risk is the
potential loss arising from adverse changes in market prices and rates. The
Company does not enter into derivative or other financial instruments for
trading or speculative purposes. There have been no material changes in the
Company's market risk during the second quarter of fiscal 1999. For further
discussion, refer to the Eye Care Centers of America, Inc.'s annual report on
Form 10-K for the year ended January 2, 1999.

PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

     The Company is a party to routine litigation in the ordinary course of its
business. There have been no such pending matters, individually or in the
aggregate, that are deemed to be material to the business or financial condition
of the Company that have arisen during the second quarter of fiscal 1999. For
further discussion, refer to the Eye Care Centers of America, Inc.'s annual
report on Form 10-K for the year ended January 2, 1999.


                                       19

<PAGE>   21



ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K

(a) The following documents are filed as part of this report.

<TABLE>
              <S>         <C>
              2.1         Stock Purchase Agreement dated August 15, 1996 by and between Eye Care
                          Centers of America, Inc., Visionworks Holdings, Inc. and the Sellers
                          listed therein. (a)

              2.2         Stock Purchase Agreement, dated September 30, 1997, by
                          and among Eye Care Centers of America, Inc., a Texas
                          corporation, Robert A. Samit, O. D. and Michael Davidson, O. D. (a)

              2.3         Recapitalization Agreement dated as of March 6, 1998 among ECCA Merger
                          Corp., Eye Care Centers of America, Inc. and the sellers Listed
                          therein. (a)

              2.4         Amendment No. 1 to the Recapitalization Agreement dated as of April 23,
                          1998 among ECCA Merger Corp., Eye Care Centers of America, Inc., and
                          the sellers listed therein. (a)

              2.5         Amendment No. 2 to the Recapitalization Agreement dated as of April 24,
                          1998 among ECCA Merger Corp., Eye Care Centers of America, Inc. and the
                          sellers listed therein. (a)

              2.6         Articles of Merger of ECCA Merger Corp. with and into Eye Care Centers
                          of America, Inc. dated April 24, 1998. (a)

              2.7         Master Asset Purchase Agreement, dated as of August 22, 1998, by and
                          among Eye Care Centers of America, Inc., Mark E. Lynn, Dr. Mark Lynn &
                          Associates, PLLC; Dr. Bizer's Vision World, PLLC and its affiliates. (a)

              2.8         Letter Agreement, dated October 1, 1998, amending and
                          modifying that certain Master Asset Purchase
                          Agreement, dated as of August 22, 1998, by and among
                          Eye Care Centers of America, Inc.; Mark E. Lynn; Dr.
                          Mark Lynn & Associates, PLLC; Dr. Bizer's VisionWorld,
                          PLLC and its affiliates. (a)

              2.9         Asset Purchase Agreement, dated July 7, 1999 by and among Eye Care
                          Centers of America, Inc., Vision Twenty-One, Inc.,  and The Complete
                          Optical Laboratory, Ltd., Corp. (c) (*)

              3.1         Restated Articles of Incorporation of Eye Care Centers of America Inc.
                          (a)

              3.2         Statement of Resolution of the Board of Directors of Eye Care Centers
                          of America, Inc. designating a series of Preferred Stock. (a)

              3.3         Amended and Restated By-laws of Eye Care Centers of America, Inc. (a)

              3.4         Certificate of Incorporation of Eye Drx Retail Management, Inc. (c)
</TABLE>


                                       20
<PAGE>   22

<TABLE>
              <S>         <C>
              3.5         Certificate of Incorporation of Stein Optical, Inc. (c)

              3.6         Certificate of Incorporation of Vision World, Inc. (c)

              4.1         Indenture dated as of April 24, 1998 among Eye Care
                          Centers of America, Inc., the Guarantors named therein
                          and United States Trust Company of New York, as
                          Trustee for the 9 1/8% Senior Subordinated Notes Due
                          2008 and Floating Interest Rate Subordinated Term
                          Securities. (a)

              4.2         Form of Fixed Rate Exchange Note (included in Exhibit 4.1 Hereto). (a)

              4.3         Form of Floating Rate Exchange Note (included in Exhibit 4.1 Hereto).
                          (a)

              4.4         Form of Guarantee (included in Exhibit 4.1 hereto). (a)

              4.5         Registration Rights Agreement dated April 24, 1998
                          between Eye Care Centers of America, Inc., the
                          subsidiaries of the Company named as guarantors
                          therein, BT Alex. Brown Incorporated and Merrill
                          Lynch, Pierce, Fenner & Smith Incorporated. (a)

             27.1         Financial Data Schedule. (c)
</TABLE>


----------

        +  Portions of this Exhibit have been omitted pursuant to an application
           for an order declaring confidential treatment filed with the
           Securities and Exchange Commission.

        *  Portions of this Exhibit have been omitted pursuant to Rule 601 of
           the Securities Act and a copy will be furnished supplementally upon
           request.

       (a) Incorporated by reference from the Registration Statement on Form S-4
           (File No. 333 - 56551).

       (b) Incorporated by reference from the Company's Annual Report on Form
           10-K for the year ended January 2, 1999.

       (c) Filed herewith.

(b) The Company filed no current reports on Form 8-K with the Securities and
    Exchange Commission during the thirteen weeks ended July 3, 1999.


                                       21
<PAGE>   23



                                   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.

                                               EYE CARE CENTERS OF AMERICA, INC.

August 13, 1999                                /s/ Alan E. Wiley
--------------------------------               ---------------------------------
Dated                                          Alan E. Wiley
                                               Executive Vice President and
                                               Chief Financial Officer



                                       22

<PAGE>   24
                                 EXHIBIT INDEX

<TABLE>
<CAPTION>
         Exhibit Index            Description
         -------------            -----------
              <S>         <C>
              2.9         Asset Purchase Agreement, dated July 7, 1999 by and among Eye Care
                          Centers of America, Inc., Vision Twenty-One, Inc.,  and The Complete
                          Optical Laboratory, Ltd., Corp.

              3.4         Certificate of Incorporation of Eye Drx Retail Management, Inc.

              3.5         Certificate of Incorporation of Stein Optical, Inc.

              3.6         Certificate of Incorporation of Vision World, Inc.

             27.1         Financial Data Schedule.
</TABLE>