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

                                    FORM 10-K
MARK  ONE
---------

 X     ANNUAL  REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE
--
ACT  OF  1934  FOR  THE  FISCAL  YEAR  ENDED  DECEMBER  28,  2002.

     TRANSITION  REPORT  PURSUANT  TO  SECTION  13  OR  15(D)  OF THE SECURITIES
EXCHANGE  ACT  OF  1934.

                        COMMISSION FILE NUMBER  033-70572

                        EYE CARE CENTERS OF AMERICA, INC.
             (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
        TEXAS                                     74-2337775
  (STATE OR OTHER JURISDICTION            (IRS EMPLOYER  IDENTIFICATION  NO.)
OF INCORPORATION OR ORGANIZATION)
                                11103 WEST AVENUE
                          SAN ANTONIO, TEXAS 78213-1392
          (ADDRESS OF PRINCIPAL EXECUTIVE OFFICES, INCLUDING ZIP CODE)
                                 (210) 340-3531
              (REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE)

        SECURITIES REGISTERED PURSUANT TO SECTION 12(B) OF THE ACT: NONE
        SECURITIES REGISTERED PURSUANT TO SECTION 12(G) OF THE ACT: NONE

     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__
                                                         -

     INDICATE  BY CHECK MARK IF DISCLOSURE OF DELINQUENT FILERS PURSUANT TO ITEM
405 OF REGULATION S-K IS NOT CONTAINED HEREIN, AND WILL NOT BE CONTAINED, TO THE
BEST  OF  REGISTRANT'S  KNOWLEDGE, IN DEFINITIVE PROXY OR INFORMATION STATEMENTS
INCORPORATED BY REFERENCE IN PART III OF THIS FORM 10-K OR ANY AMENDMENT TO THIS
FORM  10-K.  N/A
             ---

     INDICATE  BY  CHECK MARK WHETHER THE REGISTRANT IS AN ACCELERATED FILER (as
defined  in  Rule  12b-2  of  the  Act).  YES  __  NO  X
                                                       -

     AGGREGATE  MARKET  VALUE  OF  COMMON  STOCK  HELD  BY NON-AFFILIATES OF THE
REGISTRANT  IS  $6,325,550.  AS  THE  REGISTRANT'S  COMMON  STOCK  IS NOT TRADED
PUBLICLY, THE PER SHARE PRICE USED IN THIS CALCULATION IS BASED ON THE PER SHARE
PRICE  AS  DESIGNATED  BY  THE  BOARD  OF  DIRECTORS  ($15.13  PER  SHARE).

     INDICATE  THE  NUMBER  OF  SHARES  OUTSTANDING  OF EACH OF THE REGISTRANT'S
CLASSES  OF  COMMON STOCK AS OF THE LATEST PRACTICABLE DATE: 7,388,088 SHARES OF
COMMON  STOCK  AS  OF  MARCH  15,  2003.

     DOCUMENTS  INCORPORATED  BY  REFERENCE:  NONE

                                        1
<PAGE>

<TABLE>
<CAPTION>

                                 FORM 10-K INDEX

                                     PART I


<S>       <C>                                                  <C>
ITEM 1.   BUSINESS                                              4

ITEM 2.   PROPERTIES                                           20

ITEM 3.   LEGAL PROCEEDINGS                                    20

ITEM 4.   SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS  20

                                    PART II

ITEM 5.   MARKET FOR REGISTRANT'S COMMON STOCK AND RELATED
          SHAREHOLDER MATTERS                                  21

ITEM 6.   SELECTED CONSOLIDATED FINANCIAL DATA.                22

ITEM 7.   MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
          CONDITION AND RESULTS OF OPERATIONS                  24

ITEM 7A.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT
          MARKET RISK                                          41

ITEM 8.   FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA          42

ITEM 9.   CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
          ACCOUNTING AND FINANCIAL DISCLOSURE                  42

                                    PART III

ITEM 10.  DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT   43

ITEM 11.  EXECUTIVE COMPENSATION                               46

ITEM 12.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
          MANAGEMENT                                           51

ITEM 13.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS       52

ITEM 14.  CONTROLS AND PROCEDURES                              52

                                    PART IV

ITEM 15.  EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS
          ON FORM 8-K                                          54
</TABLE>

                                        2
<PAGE>

FORWARD-LOOKING  STATEMENTS

     CERTAIN STATEMENTS CONTAINED HEREIN CONSTITUTE "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. ALL STATEMENTS
OTHER  THAN STATEMENTS OF HISTORICAL FACTS INCLUDED IN THIS REPORT REGARDING THE
COMPANY'S  FINANCIAL  POSITION,  BUSINESS  STRATEGY,  BUDGETS  AND  PLANS  AND
OBJECTIVES  OF  MANAGEMENT FOR FUTURE OPERATIONS ARE FORWARD-LOOKING STATEMENTS.
ALTHOUGH  THE MANAGEMENT OF THE COMPANY BELIEVES THAT THE EXPECTATIONS REFLECTED
IN SUCH FORWARD-LOOKING STATEMENTS ARE REASONABLE, IT CAN GIVE NO ASSURANCE THAT
SUCH  EXPECTATIONS  WILL  PROVE  TO  HAVE  BEEN  CORRECT.  SUCH  FORWARD-LOOKING
STATEMENTS INVOLVE KNOWN AND UNKNOWN RISKS, UNCERTAINTIES AND OTHER FACTORS THAT
MAY  CAUSE  THE  ACTUAL  RESULTS, PERFORMANCE OR ACHIEVEMENTS OF THE COMPANY, OR
INDUSTRY  RESULTS,  TO  BE  MATERIALLY  DIFFERENT  FROM  THOSE  CONTEMPLATED  OR
PROJECTED,  FORECASTED, ESTIMATED OR BUDGETED IN OR EXPRESSED OR IMPLIED BY SUCH
FORWARD-LOOKING  STATEMENTS.  SUCH  FACTORS  INCLUDE, AMONG OTHERS, THE RISK AND
OTHER  FACTORS  SET  FORTH  UNDER  "RISK  FACTORS" IN THE COMPANY'S REGISTRATION
STATEMENT  ON  FORM  S-4  FILED  WITH THE SECURITIES AND EXCHANGE COMMISSION AND
UNDER  THE  HEADING  "GOVERNMENT  REGULATION"  HEREIN  AS WELL AS THE FOLLOWING:
GENERAL  ECONOMIC  AND  BUSINESS  CONDITIONS; INDUSTRY TRENDS; THE LOSS OF MAJOR
CUSTOMERS  OR  SUPPLIERS;  COST  AND  AVAILABILITY  OF RAW MATERIALS; CHANGES IN
BUSINESS  STRATEGY OR DEVELOPMENT PLANS; AVAILABILITY AND QUALITY OF MANAGEMENT;
AND  AVAILABILITY,  TERMS AND DEPLOYMENT OF CAPITAL. SPECIAL ATTENTION SHOULD BE
PAID  TO  THE  FACT THAT CERTAIN STATEMENTS CONTAINED HEREIN ARE FORWARD-LOOKING
INCLUDING,  BUT NOT LIMITED TO, STATEMENTS RELATING TO (I) THE COMPANY'S ABILITY
TO EXECUTE ITS BUSINESS STRATEGY (INCLUDING, WITHOUT LIMITATION, WITH RESPECT TO
NEW  STORE OPENINGS AND INCREASING THE COMPANY'S PARTICIPATION IN MANAGED VISION
CARE  PROGRAMS;  (II)  THE  COMPANY'S  ABILITY TO OBTAIN SUFFICIENT RESOURCES TO
FINANCE  ITS  WORKING  CAPITAL AND CAPITAL EXPENDITURE NEEDS AND PROVIDE FOR ITS
OBLIGATIONS; (III) THE CONTINUING SHIFT IN THE OPTICAL RETAIL INDUSTRY OF MARKET
SHARE FROM INDEPENDENT PRACTITIONERS AND SMALL REGIONAL CHAINS TO LARGER OPTICAL
RETAIL  CHAINS; (IV) INDUSTRY SALES GROWTH; (V) IMPACT OF REFRACTIVE SURGERY AND
OTHER CORRECTIVE VISION TECHNIQUES; (VI) DEMOGRAPHIC TRENDS; (VII) THE COMPANY'S
MANAGEMENT  ARRANGEMENTS  WITH  PROFESSIONAL  CORPORATIONS; (VIII) THE COMPANY'S
ABILITY  TO OBTAIN ADDITIONAL FINANCING TO REPAY THE CREDIT FACILITY OR NOTES AT
MATURITY; AND (IX) THE CONTINUED MEDICAL INDUSTRY EFFORT TO REDUCE MEDICAL COSTS
AND  THIRD  PARTY  REIMBURSEMENTS.

                                        3
<PAGE>

                                     PART I

ITEM  1.  BUSINESS
------------------

GENERAL

     EYE  CARE  CENTERS  OF  AMERICA,  INC. (THE "COMPANY") IS THE THIRD LARGEST
RETAIL OPTICAL CHAIN IN THE UNITED STATES AS MEASURED BY NET REVENUES, OPERATING
OR  MANAGING  362 STORES, OF WHICH293 ARE OPTICAL SUPERSTORES WITH IN-HOUSE LENS
PROCESSING  CAPABILITIES.   298  OF  THE  COMPANY'S  OPTICAL  STORES  ARE  OWNED
DIRECTLY  BY  THE  COMPANY  AND  THE  REMAINING  64  STORES  ARE  OWNED  BY  AN
OPTOMETRIST'S  PROFESSIONAL  ENTITY  AND  MANAGED BY A SUBSIDIARY OF THE COMPANY
UNDER  MANAGEMENT  AGREEMENTS.  FOR PURPOSES OF THIS REPORT, ALL OF SUCH OPTICAL
STORES  OWNED  OR  MANAGED BY THE COMPANY (AND ITS SUBSIDIARIES) ARE REFERRED TO
HEREIN  AS  THE COMPANY'S STORES.  THE COMPANY STORES ARE PREDOMINATELY OPERATED
UNDER THE TRADE NAME "EYEMASTERS," AND IN CERTAIN GEOGRAPHICAL REGIONS UNDER THE
TRADE  NAMES "VISIONWORKS," "HOUR EYES," "DR. BIZER'S VISIONWORLD," "DR. BIZER'S
VALUVISION,"  "DOCTOR'S VALUVISION," "STEIN OPTICAL," "EYE DRX," "VISION WORLD,"
"DOCTOR'S  VISIONWORKS"  AND  "BINYON'S"  THE  COMPANY  UTILIZES  A STRATEGY OF
CLUSTERING ITS STORES WITHIN ITS TARGETED MARKETS IN ORDER TO BUILD LOCAL MARKET
LEADERSHIP  AND STRONG CONSUMER BRAND AWARENESS, AS WELL AS TO ACHIEVE ECONOMIES
OF SCALE IN ADVERTISING, MANAGEMENT AND FIELD OVERHEAD. MANAGEMENT BELIEVES THAT
THE COMPANY HAS EITHER THE NUMBER ONE OR TWO SUPERSTORE MARKET SHARE POSITION IN
FOURTEEN  OF  ITS  TOP FIFTEEN MARKETS, INCLUDING WASHINGTON, D.C., MINNEAPOLIS,
DALLAS,  HOUSTON,  TAMPA/ST. PETERSBURG, PHOENIX, MIAMI/FT. LAUDERDALE, PORTLAND
AND  SAN  ANTONIO.  THE  COMPANY  GENERATED  NET REVENUES AND EBITDA (AS DEFINED
WITHIN  THE  HEADING  "ITEM  6. SELECTED CONSOLIDATED FINANCIAL DATA") OF $363.7
MILLION  AND $56.8 MILLION, RESPECTIVELY, FOR THE FISCAL YEAR ENDED DECEMBER 28,
2002  ("FISCAL  2002").

     THE  COMPANY'S STORES, WHICH AVERAGE APPROXIMATELY 4,200 SQUARE FEET, CARRY
A  BROAD  SELECTION  OF BRANDED FRAMES AT COMPETITIVE PRICES, INCLUDING DESIGNER
EYEWEAR,  AS  WELL  AS  ITS  OWN  PROPRIETARY  BRANDS  AND  NON-BRANDED PRODUCT.
NON-BRANDED  PRODUCT  CONSISTED OF APPROXIMATELY 75% AND 65% OF FRAME UNITS SOLD
IN  2002  AND  2001, RESPECTIVELY.  IN ADDITION, THE COMPANY'S SUPERSTORES OFFER
CUSTOMERS  "ONE-HOUR  SERVICE"  ON  MOST  PRESCRIPTIONS  BY  UTILIZING  ON-SITE
PROCESSING  LABORATORIES  TO GRIND, COAT AND EDGE LENSES. MOREOVER, OPTOMETRISTS
("ODS")  LOCATED  WITHIN  OR  ADJACENT  TO  ALL  OF  THE  COMPANY'S STORES OFFER
CUSTOMERS CONVENIENT EYE EXAMS AND PROVIDE A CONSISTENT SOURCE OF OPTICAL RETAIL
CUSTOMERS.  IN  THE COMPANY'S EXPERIENCE, OVER 80% OF SUCH ODS' REGULAR EYE EXAM
PATIENTS  PURCHASE  EYEWEAR  FROM  THE COMPANY'S ADJACENT OPTICAL RETAIL STORES.

     THE  COMPANY'S  MANAGEMENT  TEAM  HAS  FOCUSED  ON  IMPROVING  OPERATING
EFFICIENCIES  AND  GROWING  THE BUSINESS THROUGH BOTH STRATEGIC ACQUISITIONS AND
NEW  STORE OPENINGS. THE COMPANY'S NET REVENUES INCREASED FROM $140.2 MILLION IN
FISCAL  1995  TO  $363.7  MILLION IN FISCAL 2002, WHILE THE COMPANY'S STORE BASE
INCREASED  FROM  152  TO 363 OVER THE SAME PERIOD, PRIMARILY AS A RESULT OF FOUR
ACQUISITIONS.  THE  COMPANY'S  SENIOR  MANAGEMENT  TEAM OWNS OR HAS THE RIGHT TO
ACQUIRE  APPROXIMATELY  8.6%  OF  THE  COMPANY'S COMMON STOCK ON A FULLY DILUTED
BASIS,  THROUGH  DIRECT  OWNERSHIP  AND  STOCK  OPTIONS.

                                        4
<PAGE>

BUSINESS  STRATEGY

     THE  COMPANY  PLANS  TO  CAPITALIZE ON THE INDUSTRY TRENDS DISCUSSED HEREIN
UNDER  THE  HEADING  "INDUSTRY"  BY BUILDING LOCAL MARKET LEADERSHIP THROUGH THE
IMPLEMENTATION  OF  THE  FOLLOWING  KEY  ELEMENTS  OF  ITS  BUSINESS  STRATEGY:

     MAXIMIZE  STORE  PROFITABILITY. MANAGEMENT PLANS TO CONTINUE TO IMPROVE THE
COMPANY'S  OPERATING  MARGINS  THROUGH  ENHANCED  DAY-TO-DAY  STORE  EXECUTION,
CUSTOMER  SERVICE  AND  INVENTORY  ASSET MANAGEMENT. THE COMPANY HAS IMPLEMENTED
VARIOUS  PROGRAMS  FOCUSED ON (I) INCREASING SALES OF HIGHER MARGIN, VALUE-ADDED
AND  NON-BRANDED  PRODUCTS,  (II)  CONTINUING STORE EXPENSE REDUCTIONS AND (III)
OFFERING EXTENSIVE PRODUCTIVITY-ENHANCING EMPLOYEE TRAINING. MANAGEMENT BELIEVES
ITS  STORE  CLUSTERING  STRATEGY WILL ENABLE THE COMPANY TO CONTINUE TO LEVERAGE
LOCAL  ADVERTISING  AND FIELD MANAGEMENT COSTS TO IMPROVE ITS OPERATING MARGINS.
IN THE FOURTH QUARTER OF 2001, MANAGEMENT IMPLEMENTED A VALUE-ORIENTED FORMAT IN
CERTAIN  MARKETS  BASED  UPON  LOCAL  MARKET  DEMOGRAPHICS.  THIS  VALUE  FORMAT
INVOLVES  LOWER  RETAIL  PRICE,  HIGHER  MARGIN  PRODUCTS  AND  AN  INCREASE  TO
APPROXIMATELY  500  VALUE  FRAMES  FROM  APPROXIMATELY  250  VALUE FRAMES IN THE
COMPANY'S  OTHER  STORES.  THE  COMPANY ANTICIPATES CONTINUING TO IMPLEMENT THIS
STRATEGY  DURING 2003.  ALSO, THE COMPANY CONTINUED TO INCREASE THE AVAILABILITY
OF ITS PROMOTIONAL DISCOUNT OFFERS, MOST NOTABLY THE TWO COMPLETE PAIR OF SINGLE
VISION  EYEGLASSES  FOR  $99  VALUE  PROMOTION.

     REDUCTION  OF DEBT.  IN ORDER TO IMPROVE THE COMPANY'S EBITDA TO TOTAL DEBT
RATIO  AND  REDUCE  THE  AMOUNT  OF  OUTSTANDING  DEBT, MANAGEMENT HAS INITIATED
STRATEGIES  TO  GENERATE  CASH.  DURING  2001  AND  2002,  THE NEW STORE OPENING
PROGRAM  WAS REDUCED TO APPROXIMATELY SEVEN TO TEN STORES EACH YEAR.  MANAGEMENT
HAS  ALSO  FOCUSED  ON PROCESS IMPROVEMENT INITIATIVES THAT HAVE RESULTED IN THE
REDUCTION  IN  HEAD  COUNTS  AND  CORPORATE  OVERHEAD  EXPENSES.  MANAGEMENT  IS
CONTINUALLY EVALUATING METHODS TO INCREASE STORE PROFITABILITY AND INCREASE CASH
FLOW.  TOTAL DEBT HAS BEEN REDUCED FROM $291.4 MILLION AT THE END OF FISCAL 2000
TO  $254.6  MILLION  AT  THE  END  OF  FISCAL  2002.

     CAPITALIZE  ON  MANAGED  VISION  CARE. WHILE MANAGEMENT CONTINUES TO PURSUE
MANAGED  VISION  CARE  RELATIONSHIPS, REVENUES FROM MANAGED VISION CARE REMAINED
CONSISTENT  FROM  FISCAL  2001  TO FISCAL 2002 (AND DECREASED AS A PERCENTAGE OF
REVENUES),  MOSTLY  DUE TO THE COMPANY'S AGGRESSIVE IN-STORE PROMOTIONAL OFFERS.
AS  OF  DECEMBER  28,  2002, RETAIL SALES ARISING FROM MANAGED VISION CARE PLANS
TOTALED  39.4%  OF  OPTICAL  SALES FOR FISCAL 2002, COMPARED TO 42.4% OF OPTICAL
SALES  FOR  FISCAL  2001.  MANAGEMENT  HAS  MADE  A STRATEGIC DECISION TO PURSUE
FUNDED  MANAGED  VISION CARE RELATIONSHIPS IN ORDER TO HELP THE COMPANY'S RETAIL
BUSINESS GROW.  DISCOUNT MANAGED CARE PROGRAMS WILL PLAY A LESS SIGNIFICANT ROLE
AS  THE  VALUE  RETAIL  OFFER  BECOMES  MORE  DEVELOPED THROUGHOUT THE COMPANY'S
STORES.  THE PERCENT OF PENETRATION SHOULD NORMALIZE AT 35% AS THE TRANSITION TO
THE  FUNDED  PROGRAMS  MATERIALIZES  AND  THE  RETAIL  OFFER  REPLACES  DISCOUNT
ACTIVITY.  AS  PART  OF  ITS  ONGOING  EFFORT TO DEVELOP ITS MANAGED VISION CARE
BUSINESS,  THE  COMPANY  HAS  (I)  IMPLEMENTED  DIRECT  MARKETING  PROGRAMS  AND
INFORMATION  SYSTEMS  NECESSARY TO COMPETE FOR MANAGED VISION CARE RELATIONSHIPS
PRIMARILY  WITH  FUNDED  PLANS  AND  OTHER  THIRD  PARTY  PAYORS, (II) DEVELOPED
SIGNIFICANT  RELATIONSHIPS WITH INSURANCE COMPANIES, WHICH HAVE STRENGTHENED THE
COMPANY'S  ABILITY  TO  SECURE MANAGED VISION CARE RELATIONSHIPS, AND (III) BEEN
ASKED  TO  PARTICIPATE  ON  NUMEROUS  REGIONAL  AND NATIONAL MANAGED VISION CARE
PANELS.  WHILE  THE  AVERAGE  TICKET  PRICE  ON

                                        5
<PAGE>

PRODUCTS  PURCHASED  UNDER  MANAGED VISION CARE REIMBURSEMENT PLANS IS TYPICALLY
LOWER,  MANAGED  VISION  CARE  TRANSACTIONS  GENERALLY EARN COMPARABLE OPERATING
PROFIT  MARGINS  AS  THEY  REQUIRE  LESS  PROMOTIONAL  SPENDING  AND ADVERTISING
SUPPORT.  THE  COMPANY BELIEVES THAT THE INCREASED VOLUME RESULTING FROM MANAGED
VISION  CARE  RELATIONSHIPS ALSO COMPENSATES FOR THE LOWER AVERAGE TICKET PRICE.
MANAGEMENT  BELIEVES  THAT  THE  ROLE  OF  MANAGED  VISION CARE WILL CONTINUE TO
BENEFIT  THE  COMPANY  AND  OTHER  LARGE RETAIL OPTICAL CHAINS WITH STRONG LOCAL
MARKET  SHARES,  BROAD  GEOGRAPHIC  COVERAGE  AND  SOPHISTICATED  INFORMATION
MANAGEMENT  AND  BILLING  SYSTEMS.

     EXPAND STORE BASE. IN ORDER TO CONTINUE TO BUILD LEADERSHIP IN ITS TARGETED
MARKETS,  THE  COMPANY PLANS TO TAKE ADVANTAGE OF "FILL-IN" OPPORTUNITIES IN ITS
EXISTING  MARKETS,  AS WELL AS TO ENTER ATTRACTIVE NEW MARKETS WHERE IT BELIEVES
IT  CAN  ACHIEVE  A  NUMBER  ONE OR TWO MARKET SHARE POSITION. CONSEQUENTLY, THE
COMPANY  CURRENTLY  PLANS TO OPEN TWO STORES IN EXISTING MARKETS AND NINE STORES
IN  ATLANTA,  GEORGIA  DURING 2003. THE COMPANY HAS MADE A STRATEGIC DECISION TO
AGGRESSIVELY  INTRODUCE ITS STORES TO THE ATLANTA MARKET IN 2003 WITH CONTINUING
GROWTH  PLANNED  BEYOND  2003. MANAGEMENT BELIEVES THAT THE COMPANY HAS IN PLACE
THE  SYSTEMS  AND  INFRASTRUCTURE  TO EXECUTE ITS NEW STORE OPENING PLAN AND HAS
DEVOTED  SIGNIFICANT  MANAGEMENT  RESOURCES  TO  THE  DEVELOPMENT OF THE ATLANTA
MARKET.  THE  COMPANY USES A SITE SELECTION MODEL UTILIZING PROPRIETARY SOFTWARE
WHICH  INCORPORATES  INDUSTRY AND INTERNALLY GENERATED DATA (SUCH AS COMPETITIVE
MARKET  FACTORS, DEMOGRAPHICS AND CUSTOMER SPECIFIC INFORMATION) TO EVALUATE THE
ATTRACTIVENESS  OF  NEW STORE OPENINGS. IN 2002, THE COMPANY SPENT APPROXIMATELY
$450,000  PER  NEW  STORE,  USING  A  STORE FORMAT AVERAGING APPROXIMATELY 3,800
SQUARE  FEET  AND  EQUIPPING  EACH  NEW  STORE  WITH  STANDARDIZED  FIXTURES AND
EQUIPMENT. IN ADDITION, PRE-OPENING COSTS AVERAGED $15,000 AND INITIAL INVENTORY
REQUIREMENTS  FOR  NEW  STORES AVERAGED $50,000. NEW STORES OPENING IN 2003 WILL
UTILIZE  A  SMALLER  AND  MORE EFFICIENT FORMAT, WITH APPROXIMATELY 2,800 SQUARE
FEET  AND  LOWER  CONSTRUCTION  COSTS.

                                        6
<PAGE>

THE FOLLOWING TABLE SETS FORTH A SUMMARY OF THE COMPANY'S STORES OPERATING UNDER
EACH  TRADE  NAME,  AS  OF  MARCH  15,  2003,  RANKED  BY  NUMBER  OF  STORES:

<TABLE>
<CAPTION>


<S>                              <C>            <C>             <C>
                                 NUMBER OF      GEOGRAPHIC      AVERAGE STORE
TRADE NAME. . . . . . . . . . .  STORES         FOCUS           FORMAT
-------------------------------  -------------  --------------  --------------

EYEMASTERS. . . . . . . . . . .            164  SOUTHWEST,      SUPERSTORES
    . . . . . . . . . . . . . .                 MIDWEST,        SQ. FT. 4,000
    . . . . . . . . . . . . . .                 SOUTHEAST       LAB
    . . . . . . . . . . . . . .              .                  OD SUBLEASES

VISIONWORKS . . . . . . . . . .             53  SOUTHEAST       SUPERSTORES
    . . . . . . . . . . . . . .                              .  SQ. FT. 6,100
    . . . . . . . . . . . . . .                              .  LAB
    . . . . . . . . . . . . . .                              .  OD SUBLEASES

VISION WORLD. . . . . . . . . .             36  MIDWEST         CONVENTIONAL
    . . . . . . . . . . . . . .              .                  SQ. FT. 2,300

DR. BIZER'S VISIONWORLD, DR. BIZER'S        24  SOUTHEAST &     SUPERSTORES
   VALUVISION, DOCTOR'S VALUVISION              CENTRAL         SQ. FT.  5,800
                                                                LAB

HOUR EYES . . . . . . . . . . .             22  MID ATLANTIC    CONVENTIONAL
    . . . . . . . . . . . . . .                              .  SQ. FT. 2,600
    . . . . . . . . . . . . . .                              .  LAB

DOCTOR'S VISIONWORKS  . . . . .             19  MARYLAND &      SUPERSTORES
    . . . . . . . . . . . . . .                 COLORADO        SQ. FT.  3,900
    . . . . . . . . . . . . . .              .                  LAB

STEIN OPTICAL . . . . . . . . .             15  MIDWEST         SUPERSTORES
    . . . . . . . . . . . . . .                              .  SQ. FT. 3,400
    . . . . . . . . . . . . . .                              .  LAB

EYE DRX . . . . . . . . . . . .             15  NORTHEAST       CONVENTIONAL
    . . . . . . . . . . . . . .              .                  SQ. FT. 3,200

BINYON'S. . . . . . . . . . . .             14  PACIFIC         SUPERSTORES
                                                NORTHWEST . ..  SQ. FT. 4,600
    . . . . . . . . . . . . . .                              .  LAB
    . . . . . . . . . . . . . .                              .  OD SUBLEASES
                                 -------------
TOTAL . . . . . . . . . . . . .       362
                                 =============
</TABLE>

STORE OPERATIONS

     OVERVIEW.  THE  COMPANY  BELIEVES  THAT  THE  LOCATION  OF ITS STORES IS AN
ESSENTIAL  ELEMENT  OF ITS STRATEGY TO COMPETE EFFECTIVELY IN THE OPTICAL RETAIL
MARKET.  THE  COMPANY EMPHASIZES LOCATIONS WITHIN REGIONAL SHOPPING MALLS, POWER
CENTERS,  STRIP  SHOPPING  CENTERS  AND  FREESTANDING  LOCATIONS.  THE  COMPANY
GENERALLY TARGETS RETAIL SPACE THAT IS CLOSE TO HIGH VOLUME RETAIL ANCHOR STORES
FREQUENTED BY MIDDLE TO HIGH-INCOME CLIENTELE. IN ORDER TO GENERATE ECONOMIES OF
SCALE  IN  ADVERTISING,  MANAGEMENT  AND  FIELD  OVERHEAD  EXPENSES, THE COMPANY
ATTEMPTS  TO  CLUSTER  ITS  STORES  WITHIN  A  DIRECT  MARKETING  AREA.

                                        7
<PAGE>

     THE  FOLLOWING  TABLE  SETS FORTH AS OF DECEMBER 28, 2002 THE COMPANY'S TOP
FIFTEEN MARKETS AS MEASURED BY THE COMPANY'S SALES. MANAGEMENT'S ESTIMATE OF THE
COMPANY'S  SUPERSTORE  MARKET  SHARE RANKING IS NUMBER ONE OR TWO IN FOURTEEN OF
THESE  MARKETS.

<TABLE>
<CAPTION>


<S>                             <C>
DESIGNATED MARKET AREA . . .    NUMBER OF SUPERSTORES
----------------------------    ---------------------
WASHINGTON, D.C. . . . . . .                       21
DALLAS . . . . . . . . . . .                       22
HOUSTON. . . . . . . . . . .                       19
LOUISVILLE . . . . . . . . .                        7
TAMPA/ST. PETERSBURG . . . .                       13
MINNEAPOLIS/ST. PAUL . . . .                       21
PHOENIX. . . . . . . . . . .                       13
MILWAUKEE. . . . . . . . . .                       15
MIAMI/FT. LAUDERDALE . . . .                        9
NASHVILLE. . . . . . . . . .                       11
NEW YORK . . . . . . . . . .                       14
PORTLAND . . . . . . . . . .                       12
SAN ANTONIO. . . . . . . . .                        8
KANSAS CITY. . . . . . . . .                        7
AUSTIN . . . . . . . . . . .                        6
                                               ------
TOTAL OF TOP FIFTEEN MARKETS                      198
                                               ======
</TABLE>

     LOCATIONS.  THE  COMPANY  OPERATES  OR MANAGES 362 STORES, 293 OF WHICH ARE
SUPERSTORES,  LOCATED  PRIMARILY  IN THE SOUTHWEST, MIDWEST AND SOUTHEAST, ALONG
THE  GULF  COAST  AND ATLANTIC COAST AND IN THE PACIFIC NORTHWEST REGIONS OF THE
UNITED  STATES.  OF  THE  COMPANY'S STORES, 175 ARE LOCATED IN ENCLOSED REGIONAL
MALLS,  126  ARE  IN  STRIP  SHOPPING CENTERS AND 61 ARE FREESTANDING LOCATIONS.

                                        8
<PAGE>

     THE FOLLOWING TABLE SETS FORTH BY LOCATION, RANKED BY NUMBER OF STORES, THE
COMPANY'S  STORE BASE  AS  OF  MARCH  15,  2003.

<TABLE>
<CAPTION>



<S>              <C>         <C>          <C>           <C>    <C>          <C>        <C>    <C>      <C>     <C>
                                                                   DR.
LOCATION         EYEMASTERS  VISIONWORKS  VISION WORLD  BIZER  VISIONWORKS  HOUR EYES  STEIN  EYE DRX  BINYON  TOTAL
---------------  ----------  -----------  ------------  -----  -----------  ---------  -----  -------  ------  -----

TEXAS                    78            -             -      -            -          -      -        -       -     78
FLORIDA                   3           38             -      -            -          -      -        -       -     41
MINNESOTA                 -            -            30      -            -          -      -        -       -     30
TENNESSEE                 7            -             -     12            -          -      -        -       -     19
WISCONSIN                 -            -             2      -            -          -     15        -       -     17
ARIZONA                  15            -             -      -            -          -      -        -       -     15
NEW JERSEY                -            -             -      -            -          -      -       15       -     15
VIRGINIA                  -            1             -      -            -         13      -        -       -     14
MARYLAND                  -            -             -      -            7          6      -        -       -     13
OREGON                    -            -             -      -            -          -      -        -      13     13
COLORADO                  -            -             -      -           12          -      -        -       -     12
LOUISIANA                12            -             -      -            -          -      -        -       -     12
NORTH CAROLINA            -           12             -      -            -          -      -        -       -     12
KENTUCKY                  -            -             -     10            -          -      -        -       -     10
OHIO                      9            -             -      -            -          -      -        -       -      9
MISSOURI                  6            -             -      1            -          -      -        -       -      7
OKLAHOMA                  5            -             -      -            -          -      -        -       -      5
KANSAS                    4            -             -      -            -          -      -        -       -      4
NEBRASKA                  4            -             -      -            -          -      -        -       -      4
NEVADA                    4            -             -      -            -          -      -        -       -      4
NEW MEXICO                4            -             -      -            -          -      -        -       -      4
UTAH                      4            -             -      -            -          -      -        -       -      4
IOWA                      1            -             2      -            -          -      -        -       -      3
MISSISSIPPI               3            -             -      -            -          -      -        -       -      3
WASHINGTON, D.C           -            -             -      -            -          3      -        -       -      3
ALABAMA                   2            -             -      -            -          -      -        -       -      2
IDAHO                     2            -             -      -            -          -      -        -       -      2
SOUTH CAROLINA            -            2             -      -            -          -      -        -       -      2
WASHINGTON                1            -             -      -            -          -      -        -       1      2
INDIANA                   -            -             -      1            -          -      -        -       -      1
NORTH DAKOTA              -            -             1      -            -          -      -        -       -      1
SOUTH DAKOTA              -            -             1      -            -          -      -        -       -      1
                 ----------  -----------  ------------  -----  -----------  ---------  -----  -------  ------  -----
TOTAL                   164           53            36     24           19         22     15       15      14    362
                 ==========  ===========  ============  =====  ===========  =========  =====  =======  ======  =====
</TABLE>

     STORE  LAYOUT  AND  DESIGN.  THE  AVERAGE  SIZE  OF THE COMPANY'S STORES IS
APPROXIMATELY  4,200  SQUARE  FEET.  THE COMPANY HAS DEVELOPED AND IMPLEMENTED A
SMALLER  AND  MORE  EFFICIENT  NEW STORE PROTOTYPE, WHICH IS APPROXIMATELY 2,800
SQUARE  FEET  IN  SIZE. THIS NEW STORE PROTOTYPE TYPICALLY HAS APPROXIMATELY 450
SQUARE FEET DEDICATED TO THE IN-HOUSE LENS PROCESSING AREA AND 1,750 SQUARE FEET
DEVOTED TO PRODUCT DISPLAY AND FITTING AREAS. THE OD'S OFFICE IS GENERALLY 1,300
SQUARE  FEET AND IS, DEPENDING ON STATE REGULATION, EITHER WITHIN OR ADJACENT TO
THE  STORE.  EACH  STORE  FOLLOWS  A  UNIFORM  MERCHANDISE LAYOUT PLAN, WHICH IS
DESIGNED  TO  EMPHASIZE  FASHION,  INVITE  CUSTOMER  BROWSING  AND  ENHANCE  THE
CUSTOMER'S  SHOPPING  EXPERIENCE. FRAMES ARE DISPLAYED IN SELF-SERVE CASES ALONG
THE  WALLS  AND  ON  TABLETOPS  LOCATED  THROUGHOUT  THE STORE AND ARE ORGANIZED

                                        9
<PAGE>

BY  GENDER  SUITABILITY  AND  FRAME  STYLE.  THE COMPANY BELIEVES ITS SELF-SERVE
DISPLAYS  ARE  MORE EFFECTIVE THAN THE LESS CUSTOMER FRIENDLY LOCKED GLASS CASES
OR  "UNDER  THE  SHELF" TRAYS USED BY SOME OF ITS COMPETITORS. ABOVE THE DISPLAY
RACKS  ARE  PHOTOGRAPHS  OF  MEN  AND WOMEN WHICH ARE DESIGNED TO HELP CUSTOMERS
COORDINATE  FRAME  SHAPE AND COLOR WITH THEIR FACIAL FEATURES. IN-STORE DISPLAYS
AND  SIGNS  ARE  ROTATED  PERIODICALLY  TO EMPHASIZE KEY VENDORS AND NEW STYLES.

     IN-HOUSE  LENS  PROCESSING.  THE  COMPANY'S  SUPERSTORES  HAVE  AN  ON-SITE
LENS-PROCESSING  LABORATORY  OF  APPROXIMATELY  450  SQUARE  FEET  IN WHICH MOST
PRESCRIPTIONS  CAN  BE  PREPARED  IN  ONE HOUR OR LESS. LENS PROCESSING INVOLVES
GRINDING,  COATING  AND  EDGING  LENSES.  SOME STORES UTILIZE THE COMPANY'S MAIN
LABORATORY  IN SAN ANTONIO, TEXAS, WHICH HAS A TYPICAL TURNAROUND OF TWO TO FOUR
DAYS  AND  ALSO  HANDLES  UNUSUAL  OR  DIFFICULT  PRESCRIPTIONS.

     ON-SITE  OPTOMETRIST. ADJACENT TO OR WITHIN MOST OF THE STORES IS AN OD WHO
PERFORMS  EYE  EXAMINATIONS  AND IN SOME CASES DISPENSES CONTACT LENSES. THE ODS
GENERALLY  HAVE  THE  SAME OPERATING HOURS AS THE COMPANY'S ADJACENT STORES. THE
ODS  OFFER  CUSTOMERS  CONVENIENT  EYE  EXAMS AND PROVIDE A CONSISTENT SOURCE OF
OPTICAL  RETAIL  CUSTOMERS.  IN  THE COMPANY'S EXPERIENCE, OVER 80% OF SUCH ODS'
REGULAR  EYE  EXAM  PATIENTS  PURCHASE  EYEWEAR FROM THE ADJACENT OPTICAL RETAIL
STORE.  IN ADDITION, THE COMPANY BELIEVES PROFICIENT ODS HELP TO GENERATE REPEAT
CUSTOMERS  AND  REINFORCE  THE QUALITY AND PROFESSIONALISM OF EACH STORE. DUE TO
THE VARIOUS APPLICABLE STATE REGULATIONS, THE COMPANY HAS A VARIETY OF OPERATING
STRUCTURES.

-     AT 234 OF THE COMPANY'S STORES, THE ODS ARE INDEPENDENT OPTOMETRISTS (THE
"INDEPENDENT  ODS"),  WHO  LEASE  SPACE  WITHIN  OR  ADJACENT  TO EACH STORE. AT
EIGHTEEN  OF  THE COMPANY'S STORES, THE INDEPENDENT OD OWNS THE PROFESSIONAL EYE
EXAM  PRACTICE  AND THE COMPANY PROVIDES MANAGEMENT SERVICES TO THE STORES UNDER
BUSINESS MANAGEMENT AGREEMENTS. THESE ODS ARE INDEPENDENT AND THE COMPANY CANNOT
EXERCISE  ANY  CONTROL  OVER  SUCH  INDEPENDENT  ODS.  MOST OF THESE ODS PAY THE
COMPANY  MONTHLY  RENT CONSISTING OF A PERCENTAGE OF GROSS RECEIPTS, BASE RENTAL
OR  A  COMBINATION  OF  BOTH.

-     AT  FORTY-SIX  OF  THE  COMPANY'S  STORES,  THE  ODS  ARE EMPLOYEES OF THE
COMPANY.

-     SIXTY-FOUR  OF  THE  COMPANY'S  STORES  ARE  OWNED  BY  A  PROFESSIONAL
CORPORATION  OR  OTHER  ENTITY CONTROLLED BY AN OD (THE "OD PC"). THE OD PC OWNS
BOTH  THE  OPTICAL DISPENSARY AND THE PROFESSIONAL EYE EXAMINATION PRACTICE. THE
OD  PC  EMPLOYS  THE  ODS  AND  THE  COMPANY (THROUGH ITS SUBSIDIARIES) PROVIDES
MANAGEMENT  SERVICES  TO  THESE  STORES  (INCLUDING  THE  DISPENSARY  AND  THE
PROFESSIONAL  PRACTICE)  UNDER  BUSINESS MANAGEMENT AGREEMENTS. AT MOST OF THESE
LOCATIONS,  THE COMPANY (THROUGH ITS SUBSIDIARIES) PROVIDES A TURNKEY OPERATION,
PROVIDING  THE  LEASED  PREMISES,  EMPLOYEES  (OTHER  THAN  THE ODS), FURNITURE,
FIXTURES  AND  EQUIPMENT.  IN  ADDITION,  THE COMPANY HAS AN OPTION TO DESIGNATE
ANOTHER  OD  TO PURCHASE THE OD PC (OR ITS ASSETS) AT AN AGREED UPON CALCULATION
TO  DETERMINE  THE PURCHASE PRICE. AT DECEMBER 28, 2002, THESE PRICES RANGE FROM
$3.0  MILLION  TO $5.0 MILLION IN THE AGGREGATE. UNDER THE APPLICABLE OPTOMETRIC
AND  OTHER  LAWS  AND  REGULATIONS,  THE COMPANY IS NOT PERMITTED TO CONTROL THE
PROFESSIONAL  PRACTICE  OF  THE  OD  PC  (E.G.,  SCHEDULING,  EMPLOYMENT  OF
OPTOMETRISTS,  PROTOCOLS,  EXAMINATION  FEES  AND  OTHER  MATTERS  REQUIRING THE
PROFESSIONAL  JUDGMENT  OF  THE  OD).  THE  MANAGEMENT  AGREEMENTS  SPECIFICALLY
PROHIBIT  THE  COMPANY  FROM

                                       10
<PAGE>

ENGAGING  IN  ACTIVITIES  THAT WOULD CONSTITUTE CONTROLLING THE OD PC'S PRACTICE
AND  RESERVE  SUCH  RIGHTS  AND  DUTIES  FOR  THE  OD  PC.

     INDEPENDENT ODS WHO LEASE SPACE ADJACENT TO OR WITHIN A COMPANY-OWNED STORE
REPRESENT  APPROXIMATELY  62%  OF  THE  ODS,  APPROXIMATELY  24%  OF THE ODS ARE
EMPLOYED  BY  THE  OD  PCS  AND  THE REMAINING 14% ARE EMPLOYEES OF THE COMPANY.

     STORE  MANAGEMENT.  EACH  STORE  HAS  AN  OPERATING  PLAN,  WHICH  MAPS OUT
APPROPRIATE  STAFFING  LEVELS  TO  MAXIMIZE  STORE PROFITABILITY. IN ADDITION, A
GENERAL  MANAGER  IS RESPONSIBLE FOR THE DAY-TO-DAY OPERATIONS OF EACH STORE. IN
HIGHER  VOLUME LOCATIONS, A RETAIL MANAGER SUPERVISES THE MERCHANDISING AREA AND
THE EYEWEAR SPECIALISTS. CUSTOMER SERVICE IS HIGHLY VALUED BY THE COMPANY AND IS
MONITORED  BY  LOCATION AND ASSOCIATE.  A LAB MANAGER TRAINS THE LAB TECHNICIANS
AND  SUPERVISES  EYEWEAR  MANUFACTURING.  SALES  PERSONNEL ARE TRAINED TO ASSIST
CUSTOMERS EFFECTIVELY IN MAKING PURCHASE DECISIONS. A PORTION OF STORE MANAGERS'
AND  TERRITORY  DIRECTORS'  COMPENSATION  IS  BASED  ON SALES, PROFITABILITY AND
CUSTOMER  SERVICE  SCORES AT THEIR PARTICULAR STORES. THE STORES ARE OPEN DURING
NORMAL RETAIL HOURS, TYPICALLY 10 A.M. TO 9 P.M., SIX DAYS A WEEK, AND TYPICALLY
12:00  P.M.  TO  6:00  P.M.  ON  SUNDAYS.

MERCHANDISING

     THE  COMPANY'S  MERCHANDISING  STRATEGY  IS  TO  OFFER ITS CUSTOMERS A WIDE
SELECTION  OF  HIGH QUALITY AND FASHIONABLE FRAMES AT VARIOUS PRICE POINTS, WITH
PARTICULAR  EMPHASIS  ON  OFFERING  A  BROAD  SELECTION  OF COMPETITIVELY PRICED
DESIGNER  AND  PROPRIETARY  BRANDED  FRAMES.  THE  COMPANY'S PRODUCT OFFERING IS
SUPPORTED  BY  STRONG  CUSTOMER SERVICE AND ADVERTISING. THE KEY ELEMENTS OF THE
COMPANY'S  MERCHANDISING  STRATEGY  ARE  DESCRIBED  BELOW.

     BREADTH  AND  DEPTH  OF SELECTION. THE COMPANY'S STORES OFFER THE CUSTOMERS
HIGH  QUALITY FRAMES, LENSES, ACCESSORIES AND SUNGLASSES, INCLUDING DESIGNER AND
PROPRIETARY  BRAND  FRAMES.  FRAME  ASSORTMENTS  ARE  TAILORED  TO  MATCH  THE
DEMOGRAPHIC  COMPOSITION  OF  EACH  STORE'S  MARKET AREA. ON AVERAGE, EACH STORE
FEATURES  BETWEEN  1,500  AND  2,000  FRAME  STOCK  KEEPING  UNITS IN 350 TO 400
DIFFERENT  STYLES  OF  FRAMES,  REPRESENTING  TWO  TO THREE TIMES THE ASSORTMENT
PROVIDED BY CONVENTIONAL OPTICAL RETAIL CHAINS OR INDEPENDENT OPTICAL RETAILERS.
APPROXIMATELY  25%  OF  THE  FRAMES  CARRY  DESIGNER  NAMES SUCH AS EDDIE BAUER,
POLO/RALPH  LAUREN,  LAURA  ASHLEY,  GUESS  AND  CHAPS.  IN  FISCAL  2002, OTHER
WELL-KNOWN  FRAME  MANUFACTURERS  SUPPLIED  OVER 10% OF THE COMPANY'S FRAMES AND
ABOUT 25% OF THE COMPANY'S FRAMES WERE MANUFACTURED SPECIFICALLY FOR THE COMPANY
UNDER  PROPRIETARY  BRANDS.  THE  COMPANY  BELIEVES  THAT A BROADER SELECTION OF
HIGH-QUALITY, LOWER-PRICED PROPRIETARY BRAND FRAMES ALLOW IT TO OFFER MORE VALUE
TO  CUSTOMERS  WHILE  IMPROVING  THE COMPANY'S GROSS MARGIN. IN 2002, MANAGEMENT
IMPLEMENTED  A  VALUE-ORIENTED FORMAT IN VARIOUS MARKETS BASED UPON LOCAL MARKET
DEMOGRAPHICS.  THIS  VALUE  FORMAT  INVOLVES  LOWER  RETAIL PRICE, HIGHER MARGIN
PRODUCTS  AND  AN  INCREASE TO APPROXIMATELY 500 VALUE FRAMES FROM APPROXIMATELY
250  VALUE  FRAMES  IN OTHER STORES.  THE COMPANY PLANS TO CONTINUE IMPLEMENTING
THIS  STRATEGY  DURING  2003.  IN  ADDITION, THE COMPANY ALSO OFFERS CUSTOMERS A
WIDE VARIETY OF VALUE-ADDED EYEWEAR FEATURES AND SERVICES ON WHICH IT REALIZES A
HIGHER  GROSS  MARGIN.  THESE  INCLUDE  THINNER  AND LIGHTER LENSES, PROGRESSIVE
LENSES  AND  CUSTOM  LENS  FEATURES,  SUCH AS

                                       11
<PAGE>

TINTING,  ANTI-REFLECTING  COATINGS,  SCRATCH-RESISTANT  COATINGS,  ULTRA-VIOLET
PROTECTION  AND  EDGE  POLISHING.

     PROMOTIONAL  STRATEGY.  THE  COMPANY'S  FRAMES  AND  LENSES  ARE  GENERALLY
COMPARABLY  PRICED  OR PRICED LOWER THAN ITS DIRECT SUPERSTORE COMPETITORS, WITH
PRICES  VARYING  BASED ON GEOGRAPHIC REGION. THE COMPANY EMPLOYS A COMPREHENSIVE
PROMOTIONAL  STRATEGY  ON  A  WIDE  SELECTION  OF FRAMES AND/OR LENSES, OFFERING
DISCOUNTS AND "TWO FOR ONE" PROMOTIONS. WHILE THE PROMOTIONAL STRATEGY IS FAIRLY
COMMON  FOR  OPTICAL RETAIL CHAINS, INDEPENDENT OPTOMETRIC PRACTITIONERS TEND TO
OFFER  FEWER  PROMOTIONS IN ORDER TO GUARD THEIR MARGINS, AND MASS MERCHANDISERS
TEND  TO  GENERALLY  ADHERE  TO  AN  "EVERY  DAY  LOW  PRICING"  STRATEGY.

     PRODUCT  DISPLAY.  THE  COMPANY  EMPLOYS  AN  "EASY-TO-SHOP"  STORE LAYOUT.
MERCHANDISE  IN  EACH  STORE IS ORGANIZED BY GENDER SUITABILITY, FRAME STYLE AND
BRAND. SALES PERSONNEL ARE TRAINED TO ASSIST CUSTOMERS IN SELECTING FRAMES WHICH
COMPLEMENT  AN  INDIVIDUAL'S  ATTRIBUTES SUCH AS FACIAL FEATURES, FACE SHAPE AND
SKIN  TONE.  SEE  "STORE  LAYOUT  AND  DESIGN." IN-STORE DISPLAYS FOCUS CUSTOMER
ATTENTION  ON  PREMIUM  PRICED PRODUCTS, SUCH AS DESIGNER FRAMES AND THINNER AND
LIGHTER  LENSES.

MARKETING

     THE COMPANY ACTIVELY SUPPORTS ITS STORES BY AGGRESSIVE LOCAL ADVERTISING IN
INDIVIDUAL GEOGRAPHICAL MARKETS. ADVERTISING EXPENDITURES TOTALED $30.6 MILLION,
OR  8.4%  OF  NET  REVENUES,  IN  FISCAL 2002. THE COMPANY UTILIZES A VARIETY OF
ADVERTISING  MEDIA AND PROMOTIONS IN ORDER TO ESTABLISH THE COMPANY'S IMAGE AS A
HIGH  QUALITY,  COST COMPETITIVE EYEWEAR PROVIDER WITH A BROAD PRODUCT OFFERING.
THE  COMPANY'S  BRAND  POSITIONING  IS  SUPPORTED  BY A MARKETING CAMPAIGN WHICH
FEATURES THE PHRASE "SEE BETTER, LOOK BETTER." IN ADDITION, THE COMPANY BELIEVES
THAT  ITS  STRATEGY  OF CLUSTERING STORES IN EACH TARGETED MARKET AREA MAXIMIZES
THE  BENEFIT  OF  ITS ADVERTISING EXPENDITURES. AS MANAGED VISION CARE BECOMES A
LARGER  PART  OF  THE  COMPANY'S  BUSINESS IN CERTAIN LOCAL MARKETS, ADVERTISING
EXPENDITURES  AS  A PERCENTAGE OF SALES ARE LIKELY TO DECREASE IN THOSE MARKETS,
SINCE  MANAGED  VISION  CARE  PROGRAMS  TEND  TO  REDUCE  THE NEED FOR MARKETING
EXPENDITURES  TO  ATTRACT  CUSTOMERS  TO  THE  COMPANY'S  STORES.

COMPETITION

     THE  RETAIL  OPTICAL  INDUSTRY  IS  FRAGMENTED  AND HIGHLY COMPETITIVE. THE
COMPANY  COMPETES  WITH  (I)  INDEPENDENT  PRACTITIONERS  (INCLUDING  OPTICIANS,
OPTOMETRISTS AND OPHTHALMOLOGISTS WHO OPERATE AN OPTICAL DISPENSARY WITHIN THEIR
PRACTICE)  (II)  OPTICAL  RETAIL  CHAINS  (INCLUDING SUPERSTORES) AND (III) MASS
MERCHANDISERS  AND  WAREHOUSE  CLUBS. THE COMPANY'S LARGEST OPTICAL RETAIL CHAIN
COMPETITORS  ARE  LENSCRAFTERS  AND  COLE  NATIONAL CORPORATION (PEARLE AND COLE
VISION  LICENSED  BRANDS).  FROM  TIME  TO  TIME,  COMPETITORS  HAVE  LAUNCHED
AGGRESSIVE  PROMOTIONAL  PROGRAMS, WHICH HAVE TEMPORARILY IMPACTED THE COMPANY'S
ABILITY  TO  ACHIEVE  COMPARABLE STORES' SALES GROWTH AND MAINTAIN GROSS MARGIN.
SOME  OF  THE COMPANY'S COMPETITORS ARE LARGER, HAVE LONGER OPERATING HISTORIES,
GREATER  FINANCIAL  RESOURCES  AND  GREATER MARKET RECOGNITION THAN THE COMPANY.

                                       12
<PAGE>

VENDORS

     THE COMPANY PURCHASES A MAJORITY OF ITS LENSES FROM THREE PRINCIPAL VENDORS
AND  PURCHASES  FRAMES  FROM OVER TWENTY DIFFERENT VENDORS. IN FISCAL 2002, FOUR
VENDORS COLLECTIVELY SUPPLIED APPROXIMATELY 60.5% OF THE FRAMES PURCHASED BY THE
COMPANY.  ONE  VENDOR SUPPLIED OVER 46.8% OF THE COMPANY'S LENS MATERIALS DURING
THE  SAME  PERIOD. THE COMPANY HAS CONSOLIDATED ITS VENDORS TO DEVELOP STRATEGIC
RELATIONSHIPS  RESULTING  IN  IMPROVED  SERVICE  AND  PAYMENT TERMS.  WHILE SUCH
VENDORS  SUPPLIED  A SIGNIFICANT SHARE OF THE LENSES USED BY THE COMPANY, LENSES
ARE  A  GENERIC  PRODUCT  AND CAN BE PURCHASED FROM A NUMBER OF OTHER VENDORS ON
COMPARABLE  TERMS.  MANAGEMENT OF THE COMPANY THEREFORE DOES NOT BELIEVE THAT IT
IS  DEPENDENT  ON  SUCH VENDORS OR ANY OTHER SINGLE VENDOR FOR FRAMES OR LENSES.
MANAGEMENT  OF  THE  COMPANY  BELIEVES  THAT ITS RELATIONSHIPS WITH ITS EXISTING
VENDORS  ARE  SATISFACTORY.  MANAGEMENT OF THE COMPANY BELIEVES THAT SIGNIFICANT
DISRUPTION  IN  THE  DELIVERY  OF  MERCHANDISE  FROM  ONE OR MORE OF ITS CURRENT
PRINCIPAL  VENDORS  WOULD  NOT  HAVE  A MATERIAL ADVERSE EFFECT ON THE COMPANY'S
OPERATIONS  BECAUSE  MULTIPLE  VENDORS  EXIST FOR ALL OF THE COMPANY'S PRODUCTS.

MANAGED  VISION  CARE

     MANAGED VISION CARE HAS GROWN IN IMPORTANCE IN THE OPTICAL RETAIL INDUSTRY.
HEALTH  INSURERS HAVE SOUGHT A COMPETITIVE ADVANTAGE BY OFFERING A FULL RANGE OF
HEALTH INSURANCE OPTIONS, INCLUDING COVERAGE OF PRIMARY EYE CARE. MANAGED VISION
CARE,  INCLUDING  THE  BENEFITS  OF  ROUTINE ANNUAL EYE EXAMINATIONS AND EYEWEAR
DISCOUNTS,  IS  BEING  UTILIZED  BY  A  GROWING  NUMBER  OF  MANAGED VISION CARE
PARTICIPANTS.  SINCE  REGULAR  EYE EXAMINATIONS MAY ASSIST IN THE IDENTIFICATION
AND  PREVENTION  OF  MORE  SERIOUS  CONDITIONS,  MANAGED  VISION  CARE  PROGRAMS
ENCOURAGE  MEMBERS  TO  HAVE  THEIR  EYES EXAMINED MORE REGULARLY, WHICH IN TURN
TYPICALLY  RESULTS  IN  MORE  FREQUENT  EYEWEAR  REPLACEMENT.

     WHILE  THE  AVERAGE TICKET PRICE ON PRODUCTS PURCHASED UNDER MANAGED VISION
CARE  REIMBURSEMENT  PLANS  IS TYPICALLY LOWER, MANAGED VISION CARE TRANSACTIONS
GENERALLY  EARN  COMPARABLE  OPERATING  PROFIT  MARGINS  AS  THEY  REQUIRE  LESS
PROMOTIONAL SPENDING AND ADVERTISING SUPPORT. MANAGEMENT OF THE COMPANY BELIEVES
THAT  THE INCREASED VOLUME RESULTING FROM MANAGED VISION CARE RELATIONSHIPS ALSO
COMPENSATES  FOR  THE  LOWER  AVERAGE  TICKET  PRICE.

     WHILE  MANAGED  VISION CARE ENCOMPASSES MANY OF THE CONVENTIONAL ATTRIBUTES
OF  MANAGED  CARE,  THERE  ARE SIGNIFICANT DIFFERENCES. FOR EXAMPLE, THE TYPICAL
MANAGED  VISION  CARE  BENEFIT COVERS AN ANNUAL WELLNESS EXAM AND EYEGLASSES AND
TREATMENT  OF  EYE  DISEASES WOULD NOT BE COVERED. MOREOVER, LESS THAN 1% OF THE
COMPANY'S  TOTAL  REVENUES ARE DERIVED FROM TRADITIONAL CAPITATED MANAGED VISION
CARE  PROGRAMS.  IN  CAPITATED  PROGRAMS,  THE COMPANY IS COMPENSATED BY A THIRD
PARTY ON A PER MEMBER PER MONTH FLAT FEE BASIS. SINCE THE NUMBER OF VISITS TO AN
OD  IS  LIMITED  TO  ANNUAL  OR BI-ANNUAL APPOINTMENTS, EXAM UTILIZATION IS MORE
PREDICTABLE.  AS  A  RESULT, COSTS TO INSURERS ARE EASIER TO QUANTIFY, GENERALLY
RESULTING  IN  LOWER  CAPITATION  RISK. EVEN THOUGH MANAGED VISION CARE PROGRAMS
TYPICALLY  LIMIT  COVERAGE TO A CERTAIN DOLLAR AMOUNT OR DISCOUNT FOR AN EYEWEAR
PURCHASE,  THE  MEMBER'S  EYEWEAR  BENEFIT GENERALLY ALLOWS THE MEMBER TO "TRADE
UP."  MANAGEMENT  BELIEVES  THAT THE GROWING CONSUMER PERCEPTION OF EYEWEAR AS A
FASHION  ACCESSORY  AS  WELL AS THE CONSUMER'S HISTORICAL PRACTICE OF PAYING FOR
EYEWEAR  PURCHASES  OUT-OF-POCKET

                                       13
<PAGE>

CONTRIBUTES TO THE FREQUENCY OF "TRADING-UP." THE COMPANY HAS HISTORICALLY FOUND
THAT MANAGED VISION CARE PARTICIPANTS WHO TAKE ADVANTAGE OF THE EYE EXAM BENEFIT
UNDER  THE  MANAGED  VISION  CARE  PROGRAM  IN  TURN  HAVE  TYPICALLY  HAD THEIR
PRESCRIPTIONS  FILLED  AT  ADJACENT  OPTICAL  STORES.

     WHILE  MANAGEMENT  CONTINUES  TO  PURSUE MANAGED VISION CARE RELATIONSHIPS,
REVENUES FROM MANAGED VISION CARE REMAINED CONSISTENT FROM FISCAL 2001 TO FISCAL
2002  (AND  DECREASED  AS A PERCENTAGE OF REVENUES), MOSTLY DUE TO THE COMPANY'S
AGGRESSIVE  IN-STORE  PROMOTIONAL  OFFERS. AS OF DECEMBER 28, 2002, RETAIL SALES
ARISING FROM MANAGED VISION CARE PLANS TOTALED 39.4% OF OPTICAL SALES FOR FISCAL
2002,  COMPARED TO 42.4% OF OPTICAL SALES FOR FISCAL 2001. MANAGEMENT HAS MADE A
STRATEGIC  DECISION  TO PURSUE FUNDED MANAGED VISION CARE RELATIONSHIPS IN ORDER
TO  HELP THE COMPANY'S RETAIL BUSINESS GROW. DISCOUNT MANAGED CARE PROGRAMS WILL
PLAY  A  LESS  SIGNIFICANT ROLE AS THE VALUE RETAIL OFFER BECOMES MORE DEVELOPED
THROUGHOUT  THE COMPANY'S STORES. THE PERCENT OF PENETRATION SHOULD NORMALIZE AT
35%  AS  THE  TRANSITION  TO  FUNDED  PROGRAMS MATERIALIZES AND THE RETAIL OFFER
REPLACES DISCOUNT ACTIVITY. AS PART OF ITS ONGOING EFFORT TO DEVELOP ITS MANAGED
VISION  CARE BUSINESS, THE COMPANY HAS (I) IMPLEMENTED DIRECT MARKETING PROGRAMS
AND  INFORMATION  SYSTEMS  NECESSARY  TO  COMPETE  FOR  MANAGED  VISION  CARE
RELATIONSHIPS  WITH  LARGE  EMPLOYERS, GROUPS OF EMPLOYERS AND OTHER THIRD PARTY
PAYORS, (II) DEVELOPED SIGNIFICANT RELATIONSHIPS WITH INSURANCE COMPANIES, WHICH
HAVE  STRENGTHENED  THE  COMPANY'S  ABILITY  TO  SECURE  MANAGED  VISION  CARE
RELATIONSHIPS,  AND  (III)  BEEN  ASKED  TO PARTICIPATE ON NUMEROUS REGIONAL AND
NATIONAL  MANAGED  VISION  CARE  PANELS.

     MANAGEMENT  BELIEVES  THAT THE ROLE OF MANAGED VISION CARE WILL CONTINUE TO
BENEFIT  THE  COMPANY AND OTHER LARGE RETAIL OPTICAL CHAINS. MANAGED VISION CARE
IS  LIKELY  TO ACCELERATE INDUSTRY CONSOLIDATION AS PAYORS LOOK TO CONTRACT WITH
LARGE  RETAIL OPTICAL CHAINS THAT DELIVER SUPERIOR CUSTOMER SERVICE, HAVE STRONG
LOCAL  BRAND  AWARENESS,  OFFER  COMPETITIVE PRICES, PROVIDE MULTIPLE CONVENIENT
LOCATIONS  AND  CONVENIENT  HOURS  OF  OPERATION,  AND  POSSESS  SOPHISTICATED
INFORMATION  MANAGEMENT  AND  BILLING  SYSTEMS.  LARGE OPTICAL RETAIL CHAINS ARE
LIKELY  TO  BE  THE  GREATEST  BENEFICIARIES  OF  THIS  TREND  AS  INDEPENDENT
PRACTITIONERS  DO  NOT  SATISFY  THE  SCALE  REQUIREMENTS OF MANAGED VISION CARE
PROGRAMS  AND  MASS  MERCHANDISERS'  "EVERY DAY LOW PRICE" STRATEGY IS GENERALLY
INCOMPATIBLE WITH THE PRICE STRUCTURE REQUIRED BY THE MANAGED VISION CARE MODEL.
MOST  MANAGED VISION CARE CONTRACTS RENEW ANNUALLY AND CERTAIN RELATIONSHIPS ARE
NOT  EVIDENCED  BY  CONTRACTS.  THE  NON-RENEWAL  OR  TERMINATION  OF A MATERIAL
CONTRACT  OR  RELATIONSHIP  COULD HAVE A MATERIAL ADVERSE EFFECT ON THE COMPANY.

GOVERNMENT  REGULATION

     THE  COMPANY HAS SEVERAL OPERATING STRUCTURES TO ADDRESS REGULATORY ISSUES.
AT  252 OF THE COMPANY'S STORES, THE COMPANY OR ITS LANDLORD LEASES A PORTION OF
THE  STORE OR ADJACENT SPACE TO INDEPENDENT ODS. AT FORTY-SIX OF THE STORES, THE
COMPANY EMPLOYS THE OPTOMETRIST.  THE AVAILABILITY OF SUCH PROFESSIONAL SERVICES
INSIDE  OR  ADJACENT  TO  THE  COMPANY'S  STORES  IS  CRITICAL  TO THE COMPANY'S
MARKETING  STRATEGY.  AT  SIXTY-FOUR  OF  THE STORES, TO ADDRESS AND COMPLY WITH
CERTAIN  REGULATORY  RESTRICTIONS,  THE  OD  PCS  OWN  THE STORES (INCLUDING THE
PRACTICE  AND THE OPTICAL DISPENSARY) AND THE COMPANY (THROUGH ITS SUBSIDIARIES)
PROVIDES  CERTAIN  MANAGEMENT  SERVICES  SUCH  AS  ACCOUNTING,  HUMAN RESOURCES,
MARKETING  AND INFORMATION SERVICES FOR AN AGREED UPON FEE

                                       14
<PAGE>

PURSUANT  TO  LONG-TERM  MANAGEMENT  AGREEMENTS.  THE OD PCS EMPLOY THE ODS. SEE
"-GENERAL  -  ON-SITE  OPTOMETRIST."

     THE  DELIVERY OF HEALTH CARE, INCLUDING THE RELATIONSHIPS AMONG HEALTH CARE
PROVIDERS  SUCH  AS  OPTOMETRISTS AND SUPPLIERS (E.G., PROVIDERS OF EYEWEAR), IS
SUBJECT  TO  EXTENSIVE  FEDERAL  AND  STATE  REGULATION. THE LAWS OF MOST STATES
PROHIBIT  BUSINESS CORPORATIONS SUCH AS THE COMPANY FROM PRACTICING OPTOMETRY OR
EXERCISING  CONTROL  OVER THE MEDICAL JUDGMENTS OR DECISIONS OF OPTOMETRISTS AND
FROM  ENGAGING  IN  CERTAIN  FINANCIAL  ARRANGEMENTS,  SUCH  AS REFERRAL FEES OR
FEE-SPLITTING  WITH  OPTOMETRISTS.

     MANAGEMENT  OF  THE  COMPANY  BELIEVES THE OPERATIONS OF THE COMPANY ARE IN
MATERIAL  COMPLIANCE WITH FEDERAL AND STATE LAWS AND REGULATIONS; HOWEVER, THESE
LAWS  AND  REGULATIONS  ARE  SUBJECT  TO  INTERPRETATION, AND A FINDING THAT THE
COMPANY  IS NOT IN SUCH COMPLIANCE COULD HAVE A MATERIAL ADVERSE EFFECT UPON THE
COMPANY.

     THE  COMPANY  CURRENTLY  IS  REQUIRED  TO MAINTAIN LOCAL AND STATE BUSINESS
LICENSES  TO  OPERATE. HOWEVER, AS A RESULT OF THE CAPITATION ELEMENT OF SOME OF
ITS  MANAGED  VISION  CARE  RELATIONSHIPS,  THE  COMPANY  IS  REQUIRED TO OBTAIN
INSURANCE  LICENSES  AND  TO  COMPLY  WITH  CERTAIN  ROUTINE  INSURANCE LAWS AND
REGULATIONS  AS  AN  INSURER  IN  ORDER  TO  OFFER  MANAGED VISION CARE PROGRAMS
DIRECTLY  TO  VARIOUS  EMPLOYEE  GROUPS.  THESE  INSURANCE LAWS REQUIRE THAT THE
COMPANY  MAKE  CERTAIN  MANDATORY  FILINGS  WITH THE STATE RELATING TO PERTINENT
FINANCIAL  INFORMATION  AND QUALITY OF CARE STANDARDS. VIOLATION OF ANY OF THESE
LAWS  OR  REGULATIONS  COULD  POSSIBLY  RESULT IN THE COMPANY INCURRING MONETARY
FINES  AND/OR OTHER PENALTIES. MANAGEMENT OF THE COMPANY BELIEVES THE COMPANY IS
CURRENTLY  IN  MATERIAL  COMPLIANCE  WITH  THESE  LAWS  AND  REGULATIONS.

     THE FRAUD AND ABUSE PROVISIONS OF THE SOCIAL SECURITY ACT AND ANTI-KICKBACK
LAWS  AND REGULATIONS ADOPTED IN MANY STATES PROHIBIT THE SOLICITATION, PAYMENT,
RECEIPT, OR OFFERING OF ANY DIRECT OR INDIRECT REMUNERATION IN RETURN FOR, OR AS
AN  INDUCEMENT  TO, CERTAIN REFERRALS OF PATIENTS, ITEMS OR SERVICES. PROVISIONS
OF  THE  SOCIAL  SECURITY  ACT  ALSO  IMPOSE  SIGNIFICANT PENALTIES FOR FALSE OR
IMPROPER BILLINGS TO MEDICARE AND MEDICAID, AND MANY STATES HAVE ADOPTED SIMILAR
LAWS  APPLICABLE  TO  ANY  PAYOR OF HEALTH CARE SERVICES. IN ADDITION, THE STARK
SELF-REFERRAL  LAW  IMPOSES RESTRICTIONS ON PHYSICIANS' REFERRALS FOR DESIGNATED
HEALTH  SERVICES REIMBURSABLE BY MEDICARE OR MEDICAID TO ENTITIES WITH WHICH THE
PHYSICIANS  HAVE  FINANCIAL  RELATIONSHIPS,  INCLUDING  THE  RENTAL  OF SPACE IF
CERTAIN  REQUIREMENTS  HAVE NOT BEEN SATISFIED. MANY STATES HAVE ADOPTED SIMILAR
SELF-REFERRAL  LAWS  WHICH  ARE  NOT  LIMITED TO MEDICARE OR MEDICAID REIMBURSED
SERVICES.  VIOLATIONS  OF  ANY  OF THESE LAWS MAY RESULT IN SUBSTANTIAL CIVIL OR
CRIMINAL  PENALTIES,  INCLUDING DOUBLE AND TREBLE CIVIL MONETARY PENALTIES, AND,
IN  THE  CASE OF VIOLATIONS OF FEDERAL LAWS, EXCLUSION FROM PARTICIPATION IN THE
MEDICARE  AND  MEDICAID  PROGRAMS.

     THE  HEALTH  INSURANCE PORTABILITY AND ACCOUNTABILITY ACT OF 1996 ("HIPAA")
COVERS  A VARIETY OF SUBJECTS WHICH WILL IMPACT THE COMPANY'S BUSINESSES AND THE
BUSINESS  OF THE ODS.  SOME OF THOSE AREAS INCLUDE THE PRIVACY OF PATIENT HEALTH
CARE  INFORMATION,  THE  SECURITY OF SUCH INFORMATION AND THE STANDARDIZATION OF
ELECTRONIC DATA TRANSACTIONS FOR PURPOSES OF MEDICAL BILLING.  THE DEPARTMENT OF
HEALTH  AND  HUMAN  SERVICES HAS PROMULGATED HIPAA REGULATIONS WHICH WILL BECOME
EFFECTIVE DURING 2003.  THE COMPANY HAS DEVOTED RESOURCES TO IMPLEMENT

                                       15
<PAGE>

OPERATING  PROCEDURES  WITHIN  THE  STORES  AND  THE  CORPORATE OFFICE TO ENSURE
COMPLIANCE  WITH  THE  HIPAA  REGULATIONS.

     MANAGEMENT  OF  THE  COMPANY  BELIEVES THE COMPANY IS CURRENTLY IN MATERIAL
COMPLIANCE  WITH ALL OF THE FOREGOING LAWS AND NO DETERMINATION OF ANY VIOLATION
IN  ANY  STATE HAS BEEN MADE WITH RESPECT TO THE FOREGOING LAWS. SUCH EXCLUSIONS
AND PENALTIES, IF APPLIED TO THE COMPANY, OR A DETERMINATION THAT THE COMPANY OR
ANY  OF  THE ODS OR THE OD PCS IS NOT IN COMPLIANCE WITH SUCH LAWS, COULD HAVE A
MATERIAL  ADVERSE  EFFECT  ON  THE  COMPANY.


TRADEMARK  AND  TRADE  NAMES

     THE  COMPANY'S  STORES  OPERATE  UNDER  THE  TRADE  NAMES  "EYEMASTERS,"
"BINYON'S," "VISIONWORKS,"  "HOUR EYES," "DR. BIZER'S VISIONWORLD", "DR. BIZER'S
VALUVISION,"  "DOCTOR'S  VALUVISION," "STEIN OPTICAL," "VISION WORLD," "DOCTOR'S
VISIONWORKS"  AND  "EYE DRX." IN ADDITION, "SLIMLITE" IS THE COMPANY'S TRADEMARK
FOR  ITS  LINE  OF  LIGHTWEIGHT  PLASTIC  LENSES.

EMPLOYEES

     AS  OF  DECEMBER  28,  2002,  THE  COMPANY  EMPLOYED  APPROXIMATELY  4,100
EMPLOYEES.  APPROXIMATELY  58  HOURLY  PAID  WORKERS  IN  THE EYE DRX STORES ARE
AFFILIATED  WITH  THE  INTERNATIONAL  UNION,  UNITED  AUTOMOBILE,  AEROSPACE AND
AGRICULTURAL IMPLEMENT WORKERS OF AMERICA, WITH WHICH THE COMPANY HAS A CONTRACT
EXTENDING  THROUGH  NOVEMBER 30, 2003.  THE COMPANY CONSIDERS ITS RELATIONS WITH
ITS  EMPLOYEES  TO  BE  GOOD.

THE  RECAPITALIZATION

     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,  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.

INDUSTRY

     OVERVIEW.  OPTICAL  RETAIL SALES IN THE UNITED STATES TOTALED $16.2 BILLION
IN 2002, ACCORDING TO INDUSTRY SOURCES. THE OPTICAL RETAIL MARKET HAS GROWN EACH
YEAR  AT  AN  AVERAGE  ANNUAL  RATE  OF

                                       16
<PAGE>

APPROXIMATELY 5% FROM 1991 TO 1997. DURING 1998 THROUGH 2000, THE AVERAGE ANNUAL
GROWTH  RATE  DECREASED  TO APPROXIMATELY 2%. IN 2001, THE OPTICAL RETAIL MARKET
DECLINED  4%  AND  THE  2%  GROWTH  RATE  RETURNED  IN  2002. A LEADING INDUSTRY
PUBLICATION  PROJECTS  OPTICAL  RETAIL  CHAINS WILL HAVE ONLY A 1.7% INCREASE IN
GROWTH  AND  A  2.5%  OVERALL  GROWTH  RATE  IN  THE  OPTICAL  INDUSTRY IN 2003.

THE  FOLLOWING  CHART  SETS FORTH EXPENDITURES (BASED UPON PRODUCTS SOLD) IN THE
OPTICAL  RETAIL  MARKET OVER THE PAST NINE YEARS ACCORDING TO A LEADING INDUSTRY
PUBLICATION.

<TABLE>

<CAPTION>

                         U.S. OPTICAL RETAIL SALES BY SECTOR 1993 2002
                                     (DOLLARS IN BILLIONS)

<S>                <C>    <C>    <C>    <C>    <C>    <C>    <C>    <C>    <C>    <C>    <C>
                                                                                         2002
                    1993   1994   1995   1996   1997   1998   1999   2000   2001   2002  SHARE
                   -----  -----  -----  -----  -----  -----  -----  -----  -----  -----  ------

LENSES/TREATMENTS  $ 6.0  $ 6.5  $ 6.8  $ 7.2  $ 7.6  $ 7.9  $ 8.0  $ 8.3  $ 8.1  $ 8.5   52.5%
FRAMES. . . . . .    4.1    4.1    4.4    4.6    5.0    5.2    5.3    5.5    5.2    5.2   32.1%
SUNGLASSES. . . .    0.5    0.5    0.7    0.8    0.9    0.8    0.7    0.7    0.6    0.6    3.7%
CONTACT LENSES. .    1.7    1.8    1.9    1.9    1.9    1.9    2.0    2.0    2.0    1.9   11.7%
                   -----  -----  -----  -----  -----  -----  -----  -----  -----  -----  ------
                   $12.3  $12.9  $13.8  $14.5  $15.4  $15.8  $16.0  $16.5  $15.9  $16.2  100.0%
                   =====  =====  =====  =====  =====  =====  =====  =====  =====  =====  ======
</TABLE>

     DISTRIBUTION. EYE CARE SERVICES IN THE UNITED STATES ARE DELIVERED BY LOCAL
PROVIDERS  CONSISTING OF APPROXIMATELY 65,000 OPTICIANS, 31,000 OPTOMETRISTS AND
16,500  OPHTHALMOLOGISTS.  THE  OPTICAL  RETAIL INDUSTRY IN THE UNITED STATES IS
HIGHLY  FRAGMENTED  AND  CONSISTS  OF  (I)  INDEPENDENT PRACTITIONERS (INCLUDING
OPTICIANS,  OPTOMETRISTS AND OPHTHALMOLOGISTS) WHO OPERATE AN OPTICAL DISPENSARY
WITHIN  THEIR PRACTICE, (II) OPTICAL RETAIL CHAINS AND (III) WAREHOUSE CLUBS AND
MASS  MERCHANDISERS.  IN 2002, OPTICAL RETAIL CHAINS ACCOUNTED FOR APPROXIMATELY
40.1%  OF  THE  TOTAL  MARKET,  WHILE  INDEPENDENT  PRACTITIONERS  COMPRISED
APPROXIMATELY  57.3%  AND  OTHER DISTRIBUTION CHANNELS REPRESENTED APPROXIMATELY
2.6%.  OPTICAL RETAIL CHAINS HAVE BEGUN CONSOLIDATING THE OPTICAL RETAIL MARKET,
RESULTING IN A DECREASED MARKET SHARE FOR INDEPENDENT PRACTITIONERS. INDEPENDENT
PRACTITIONERS'  MARKET  SHARE DROPPED FROM 63.0% TO 57.3% BETWEEN 1996 AND 2002,
WHILE  OPTICAL  RETAIL  CHAINS' MARKET SHARE INCREASED OVER THE SAME PERIOD FROM
31.3%  TO  40.1%.

     INDEPENDENT  PRACTITIONERS.  IN 2002, INDEPENDENT PRACTITIONERS REPRESENTED
$9.3  BILLION  OF EYEWEAR RETAIL SALES, OR 57.3% OF THE INDUSTRY'S TOTAL OPTICAL
RETAIL SALES VOLUME OF $16.2 BILLION. INDEPENDENT PRACTITIONERS TYPICALLY CANNOT
PROVIDE  QUICK TURNAROUND OF EYEGLASSES BECAUSE THEY DO NOT HAVE LABORATORIES ON
SITE  AND GENERALLY CHARGE HIGHER PRICES THAN OTHER COMPETITORS. MOREOVER, THEIR
EYEWEAR  PRODUCT  ASSORTMENT  IS  USUALLY  NARROW,  ALTHOUGH  A  GROWING PORTION
INCLUDES  SOME  DESIGNER  OR  BRANDED  PRODUCTS.  PRIOR  TO  1974,  INDEPENDENT
PRACTITIONERS  BENEFITED  FROM  REGULATORY  AND  OTHER  FACTORS  WHICH INHIBITED
COMMERCIAL  RETAILING  OF  PRESCRIPTION  EYEWEAR.  IN  1974,  THE  FEDERAL TRADE
COMMISSION  BEGAN  REQUIRING  DOCTORS  TO  PROVIDE THEIR PATIENTS WITH COPIES OF
THEIR  PRESCRIPTIONS,  ENABLING  SOPHISTICATED  RETAILERS  TO  IMPLEMENT  RETAIL
MARKETING CONCEPTS WHICH RESULTED IN A MORE COMPETITIVE MARKETPLACE. INDEPENDENT
PRACTITIONERS'  MARKET  SHARE  HAS  DECLINED  FROM APPROXIMATELY 100% IN 1974 TO
57.3%  IN  2002, DROPPING 8% FROM 1996 TO 2002. FOR THE REASONS SET FORTH ABOVE,
MANAGEMENT  BELIEVES  THAT  INDEPENDENT  PRACTITIONERS

                                       17
<PAGE>

WILL  CONTINUE  TO  LOSE  MARKET  SHARE  OVER  THE  NEXT  SEVERAL  YEARS.

     CHAINS.  OPTICAL  RETAIL  CHAINS,  WAREHOUSE  CLUBS  AND MASS MERCHANDISERS
REPRESENTED  40.1%  OF  THE  TOTAL  OPTICAL  RETAIL  MARKET  IN  2002.

     OPTICAL  RETAIL  CHAINS.  OVER  THE  PAST  FOUR  YEARS, THE TOP ONE HUNDRED
OPTICAL  RETAIL  CHAINS  (IN  TERMS OF NET REVENUES) HAVE GROWN AT A RATE FASTER
THAN  THE  OVERALL  MARKET.  OPTICAL  RETAIL CHAINS INCLUDE BOTH SUPERSTORES AND
CONVENTIONAL  OPTICAL  STORES.  OPTICAL  RETAIL  CHAINS  OFFER  QUALITY  SERVICE
PROVIDED BY ON-SITE OPTOMETRISTS AND ALSO CARRY A WIDE PRODUCT LINE, EMPHASIZING
THE FASHION ELEMENT OF EYEWEAR, ALTHOUGH LOWER-PRICED LENSES AND FRAMES ARE ALSO
AVAILABLE. IN ADDITION, THE OPTICAL RETAIL CHAINS, PARTICULARLY THE SUPERSTORES,
ARE  GENERALLY  ABLE  TO  OFFER  BETTER VALUE AND SERVICE THROUGH A REDUCED COST
STRUCTURE,  SOPHISTICATED  MERCHANDISING  AND  DISPLAYS,  ECONOMIES OF SCALE AND
GREATER VOLUME. FURTHERMORE, THEY CAN GENERATE GREATER MARKET AWARENESS THAN THE
FRAGMENTED  INDEPENDENT  PRACTITIONERS  BECAUSE  OPTICAL  RETAIL  CHAINS USUALLY
INVEST  MORE  IN  ADVERTISING  AND  PROMOTIONS.  MANAGEMENT  BELIEVES THAT LARGE
OPTICAL CHAINS ARE BEST POSITIONED TO BENEFIT FROM INDUSTRY CONSOLIDATION TRENDS
INCLUDING  THE  GROWTH  IN  MANAGED  VISION  CARE. SEE DISCUSSION UNDER "MANAGED
VISION  CARE."

     WAREHOUSE  CLUBS  AND  MASS  MERCHANDISERS.  WAREHOUSE  CLUBS  AND  MASS
MERCHANDISERS USUALLY PROVIDE EYEWEAR IN A HOST ENVIRONMENT WHICH IS TYPICALLY A
LARGER  GENERAL  MERCHANDISE  STORE. THIS SEGMENT TYPICALLY PROVIDES SOME OF THE
SERVICE ELEMENTS OF RETAIL OPTICAL CHAINS, BUT COMPETES PRIMARILY ON PRICE. AS A
RESULT,  ITS  EYEWEAR SELECTION TENDS TO FOCUS ON LOWER-PRICED OPTICAL PRODUCTS.
MOREOVER,  THIS  SEGMENT'S LOW MARGIN PRICING STRATEGY IS GENERALLY INCOMPATIBLE
WITH  THE  PRICING  STRUCTURE  REQUIRED  BY  THE  MANAGED  VISION  CARE  MODEL.

     OTHER.  OTHER  PARTICIPANTS  IN  THE OPTICAL RETAIL MARKET INCLUDE HMOS AND
SCHOOL-CONTROLLED  DISPENSARIES.  IN  2002,  OTHER  PARTICIPANTS  REPRESENTED
APPROXIMATELY  2.6%  OF  THE  TOTAL  OPTICAL  RETAIL  MARKET.

     TRENDS.  MANAGEMENT BELIEVES THAT THE OPTICAL RETAIL MARKET IS BEING DRIVEN
BY  THE  FOLLOWING  TRENDS:

-     DEMOGRAPHICS.  APPROXIMATELY  60%  OF  THE U.S. POPULATION, OR 160 MILLION
INDIVIDUALS,  AND  NEARLY 95% OF PEOPLE OVER THE AGE OF FORTY-FIVE, REQUIRE SOME
FORM  OF  CORRECTIVE  EYEWEAR.  IN  ADDITION  TO  THEIR  HIGHER  UTILIZATION  OF
CORRECTIVE  EYEWEAR, THE OVER FORTY-FIVE SEGMENT SPENDS MORE PER PAIR OF GLASSES
PURCHASED  DUE  TO  THEIR  NEED  FOR  PREMIUM  PRICED PRODUCTS LIKE BIFOCALS AND
PROGRESSIVE LENSES AND THEIR GENERALLY HIGHER LEVELS OF DISCRETIONARY INCOME. IN
1996,  THE  OVER  FORTY-FIVE  SEGMENT REPRESENTED 58% OF RETAIL OPTICAL SPENDING
DESPITE  REPRESENTING  JUST  33%  OF  THE  U.S.  POPULATION.  AS THE "BABY BOOM"
GENERATION  AGES  AND  LIFE EXPECTANCIES INCREASE, MANAGEMENT BELIEVES THAT THIS
DEMOGRAPHIC  TREND IS LIKELY TO INCREASE THE NUMBER OF EYEWEAR CUSTOMERS AND THE
AVERAGE  PRICE  PER  PURCHASE.

     -  INCREASING ROLE OF MANAGED VISION CARE. MANAGEMENT BELIEVES THAT OPTICAL
RETAIL SALES THROUGH MANAGED VISION CARE PROGRAMS, WHICH WERE APPROXIMATELY $5.8
BILLION

                                       18
<PAGE>

(OR APPROXIMATELY 35% OF THE MARKET) IN 2000, WILL CONTINUE TO INCREASE OVER THE
NEXT  SEVERAL  YEARS.  MANAGED  VISION  CARE,  INCLUDING THE BENEFITS OF ROUTINE
ANNUAL  EYE  EXAMINATIONS  AND EYEWEAR DISCOUNTS, IS BEING UTILIZED BY A GROWING
NUMBER  OF  MANAGED VISION CARE PARTICIPANTS. SINCE REGULAR EYE EXAMINATIONS MAY
ASSIST  IN THE IDENTIFICATION AND PREVENTION OF MORE SERIOUS CONDITIONS, MANAGED
VISION  CARE  PROGRAMS  ENCOURAGE  MEMBERS  TO  HAVE  THEIR  EYES  EXAMINED MORE
REGULARLY, WHICH IN TURN TYPICALLY RESULTS IN MORE FREQUENT EYEWEAR REPLACEMENT.
MANAGEMENT  BELIEVES  THAT  LARGE  OPTICAL  RETAIL  CHAINS  ARE LIKELY TO BE THE
GREATEST BENEFICIARIES OF THIS TREND AS PAYORS LOOK TO CONTRACT WITH CHAINS THAT
DELIVER  SUPERIOR  CUSTOMER  SERVICE,  HAVE  STRONG LOCAL BRAND AWARENESS, OFFER
COMPETITIVE  PRICES, PROVIDE MULTIPLE CONVENIENT LOCATIONS AND FLEXIBLE HOURS OF
OPERATION, AND POSSESS SOPHISTICATED INFORMATION MANAGEMENT AND BILLING SYSTEMS.

-     CONSOLIDATION.  ALTHOUGH THE OPTICAL RETAIL MARKET IN THE UNITED STATES IS
HIGHLY  FRAGMENTED,  THE  INDUSTRY HAS EXPERIENCED CONSOLIDATION THROUGH MERGERS
AND  ACQUISITIONS AS WELL AS SHIFTING MARKET SHARE. IN 2000, THE TOP TEN OPTICAL
RETAIL  CHAINS  REPRESENTED  APPROXIMATELY  24.5% OF THE TOTAL OPTICAL MARKET AS
COMPARED  TO  18.0%  IN  1998.  THE REMAINDER OF THE MARKET INCLUDED INDEPENDENT
PRACTITIONERS,  SMALLER  CHAINS,  WAREHOUSE  CLUBS  AND  MASS  MERCHANDISERS.
INDEPENDENT PRACTITIONERS' MARKET SHARE DROPPED FROM 63.0% TO 57.3% BETWEEN 1996
AND  2002,  WHILE  OPTICAL  RETAIL  CHAINS' MARKET SHARE INCREASED OVER THE SAME
PERIOD  FROM  31.3%  TO 40.1%. MANAGEMENT BELIEVES THAT THE LARGE OPTICAL RETAIL
CHAINS  ARE  BETTER  POSITIONED  THAN  MASS MERCHANDISERS AND WAREHOUSE CLUBS TO
BENEFIT FROM THIS CONSOLIDATION TREND AND THAT SUCH CHAINS WILL CONTINUE TO GAIN
MARKET  SHARE  FROM  THE  INDEPENDENT PRACTITIONERS OVER THE NEXT SEVERAL YEARS.

-     NEW  PRODUCT  INNOVATIONS.  SINCE  THE  LATE 1980'S, SEVERAL TECHNOLOGICAL
INNOVATIONS  HAVE  LED  TO  THE  INTRODUCTION  OF  NEW  OPTICAL  LENSES AND LENS
TREATMENTS, INCLUDING PROGRESSIVE ADDITION LENSES (NO-LINE BIFOCALS), HIGH-INDEX
AND  ASPHERIC LENSES (THINNER AND LIGHTER LENSES), POLYCARBONATE LENSES (SHATTER
RESISTANT)  AND  ANTI-REFLECTIVE COATINGS. THESE INNOVATIVE PRODUCTS ARE POPULAR
AMONG CONSUMERS, GENERALLY COMMAND PREMIUM PRICES, AND YIELD HIGHER MARGINS THAN
TRADITIONAL  LENSES. THE AVERAGE RETAIL PRICE FOR ALL LENSES AND LENS TREATMENTS
HAS  INCREASED  FROM $88 TO $106 BETWEEN 1995 AND 2001, REFLECTING, IN PART, THE
RISING  POPULARITY  OF  THESE  PRODUCTS.  SIMILARLY, DURING THE SAME PERIOD, THE
AVERAGE  RETAIL  PRICE FOR EYEGLASS FRAMES HAS INCREASED FROM $57 TO $82, DUE IN
LARGE  PART TO BOTH TECHNOLOGICAL INNOVATION AND AN EVOLVING CUSTOMER PREFERENCE
FOR  HIGHER  PRICED, BRANDED FRAMES.  THE 1995 TO 2000 HISTORICAL AVERAGE GROWTH
RATES  FOR  LENSES  AND  FRAMES  WERE  5%  AND 12%, RESPECTIVELY, WHILE THE 2001
AVERAGE  GROWTH RATES WERE 1%.  THE 2002 AVERAGE GROWTH RATE FOR LENSES RETURNED
TO  5%  WHILE FRAMES EXPERIENCED NO GROWTH.  MANAGEMENT BELIEVES THIS DECLINE IN
THE  GROWTH  RATE  IS  MORE  RELATED TO THE STATE OF THE ECONOMY THAN CHANGES IN
CONSUMER  PURCHASES.

     -  LASIK SURGERY. LASER IN-SITU KERATOMILEUSIS, OR LASIK, WAS INTRODUCED IN
1996,  LEADING  TO  A  DRAMATIC  INCREASE  IN  THE  POPULARITY  OF  LASER VISION
CORRECTION  SURGERY.  IN

                                       19
<PAGE>

2000,  EYE  CARE  PROFESSIONALS  PERFORMED AN ESTIMATED 1.4 MILLION LASER VISION
CORRECTION  SURGERY PROCEDURES IN THE U.S., REPRESENTING AN INCREASE OF 50% OVER
THE  APPROXIMATELY  950,000  PROCEDURES  PERFORMED  IN  1999. INDUSTRY FORECASTS
ESTIMATE  1.1 MILLION LASER VISION CORRECTION SURGERY PROCEDURES BEING PERFORMED
IN  2002.  DESPITE  THIS  RAPID  GROWTH, THE NUMBER OF VISION CORRECTION SURGERY
PATIENTS  IN  1999  REPRESENTED  0.3%  OF THE 161 MILLION PEOPLE WITH REFRACTIVE
VISION CONDITIONS IN THE U.S. THE CONSUMER'S EVALUATION PROCESS OF LASIK SURGERY
CREATES OPTIONS OTHER THAN EYEGLASSES AND CONTACTS. MANAGEMENT BELIEVES THAT THE
INCREASE  IN LASIK PROCEDURES, AND THE EVALUATION PROCESS BY POTENTIAL CUSTOMERS
(INCLUDING  BOTH  INDIVIDUALS WHO UNDERGO LASIK SURGERY AND THOSE WHO DECIDE NOT
TO  UNDERGO  LASIK  SURGERY)  HAS  CONTRIBUTED TO THE SLOWER GROWTH RATES IN THE
OPTICAL  INDUSTRY  SINCE  1998.

ITEM  2.  PROPERTIES

     AS  OF MARCH 15, 2003, THE COMPANY OPERATED OR MANAGED 362 RETAIL LOCATIONS
IN  THE  UNITED  STATES.  THE  COMPANY  BELIEVES ITS PROPERTIES ARE ADEQUATE AND
SUITABLE  FOR  ITS PURPOSES. THE COMPANY LEASES ALL OF ITS RETAIL LOCATIONS, THE
MAJORITY  OF  WHICH  ARE  UNDER  TRIPLE  NET  LEASES THAT REQUIRE PAYMENT BY THE
COMPANY  OF  ITS PRO RATA SHARE OF REAL ESTATE TAXES, UTILITIES, AND COMMON AREA
MAINTENANCE  CHARGES.  THESE  LEASES  RANGE  IN TERMS OF UP TO 15 YEARS. CERTAIN
LEASES REQUIRE PERCENTAGE RENT BASED ON GROSS RECEIPTS IN EXCESS OF A BASE RENT.
IN  SUBSTANTIALLY  ALL OF THE STORES THAT IT OWNS, THE COMPANY SUBLEASES (OR THE
LANDLORD LEASES) A PORTION OF SUCH STORES OR AN ADJACENT SPACE TO AN INDEPENDENT
OD  (OR  ITS  WHOLLY-OWNED  OPERATING  ENTITY).  WITH RESPECT TO THE OD PCS, THE
COMPANY  SUBLEASES  THE  ENTIRE PREMISES OF THE STORE TO THE OD PC. THE TERMS OF
THESE  LEASES  OR  SUBLEASES  RANGE  FROM  ONE  TO  FIFTEEN  YEARS, WITH RENTALS
CONSISTING OF A PERCENTAGE OF GROSS RECEIPTS, A BASE RENTAL, OR A COMBINATION OF
BOTH.  THE  GENERAL LOCATION AND CHARACTER OF THE COMPANY'S STORES ARE DESCRIBED
IN  ITEM  1  OF  THIS  ANNUAL  REPORT.

THE  COMPANY  LEASES  COMBINED  CORPORATE  OFFICES  AND A RETAIL LOCATION IN SAN
ANTONIO,  TEXAS,  PURSUANT  TO  A FIFTEEN-YEAR LEASE STARTING IN AUGUST 1997. IN
ADDITION,  THE  COMPANY  LEASES  A  COMBINED  DISTRIBUTION  CENTER  AND  CENTRAL
LABORATORY IN SAN ANTONIO, PURSUANT TO A SEVEN-YEAR LEASE COMMENCING IN FEBRUARY
1997.  THE  COMPANY  BELIEVES  CENTRAL  DISTRIBUTION IMPROVES EFFICIENCY THROUGH
BETTER  INVENTORY  MANAGEMENT  AND  STREAMLINED  PURCHASING.

ITEM  3.  LEGAL  PROCEEDINGS

     THE  COMPANY IS A PARTY TO ROUTINE LITIGATION IN THE ORDINARY COURSE OF ITS
BUSINESS.  NO SUCH PENDING MATTERS, INDIVIDUALLY OR IN THE AGGREGATE, ARE DEEMED
TO  BE  MATERIAL  TO  THE  BUSINESS  OR  FINANCIAL  CONDITION  OF  THE  COMPANY.

ITEM  4.  SUBMISSION  OF  MATTERS  TO  A  VOTE  OF  SECURITY  HOLDERS

     NONE.

                                       20
<PAGE>
                                     PART II

ITEM 5.     MARKET FOR REGISTRANT'S COMMON STOCK AND RELATED SHAREHOLDER MATTERS

     The Common Stock, par value $.01 per share, of the Company is not traded on
any established public trading market. There are 48 holders of the Common Stock.
With  the  exception  of  one  holder, all holders are parties to a shareholders
agreement.  See  the  discussion  under  the  heading  "Stockholders' Agreement"
within  "ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS."  No dividends
were  paid  in fiscal 2001 or 2002 and payment of dividends is restricted by the
Indenture  governing the Exchange Notes (as defined in Management Discussion and
Analysis  -  Liquidity  and  Capital  Resources).

<TABLE>
<CAPTION>

                                         (a)                  (b)                   (c)
<S>                               <C>                 <C>                  <C>
... . . . . . . . . . . . . . . .                   .                    .  Number of
... . . . . . . . . . . . . . . .                   .                    .  securities remaining
... . . . . . . . . . . . . . . .  Number of                             .  available for
... . . . . . . . . . . . . . . .  securities to be    Weighted-            future issuance
... . . . . . . . . . . . . . . .  issued upon         average exercise     under equity
... . . . . . . . . . . . . . . .  exercise of         price of             compensation
... . . . . . . . . . . . . . . .  outstanding         outstanding          plans (excluding
... . . . . . . . . . . . . . . .  options, warrants   options, warrants    securities reflected
... . . . . . . . . . . . . . . .  and rights          and rights           in column (a))
                                  ------------------  -------------------  ---------------------
PLAN CATEGORY

Equity compensation plans
approved by security holders . .             947,775  $              5.54                 65,065

Equity compensation plans
not approved by security holders                   -  $                 -                      -
                                  ------------------  -------------------  ---------------------

Total. . . . . . . . . . . . . .             947,775  $              5.54                 65,065
</TABLE>

                                       21
<PAGE>

ITEM  6.  SELECTED  CONSOLIDATED  FINANCIAL  DATA

THE  FOLLOWING  TABLE  SETS  FORTH  SELECTED  FINANCIAL DATA AND OTHER OPERATING
INFORMATION OF THE COMPANY. THE SELECTED FINANCIAL DATA IN THE TABLE ARE DERIVED
FROM  THE  CONSOLIDATED  FINANCIAL  STATEMENTS  OF  THE  COMPANY.  THE FOLLOWING
SELECTED  FINANCIAL  DATA  SHOULD  BE  READ IN CONJUNCTION WITH THE CONSOLIDATED
FINANCIAL  STATEMENTS, THE RELATED NOTES THERETO AND OTHER FINANCIAL INFORMATION
INCLUDED  ELSEWHERE  IN  THIS ANNUAL REPORT ON FORM 10-K. ALL REFERENCES IN THIS
ANNUAL  REPORT ON FORM 10-K TO 1998 OR FISCAL 1998, 1999 OR FISCAL 1999, 2000 OR
FISCAL  2000,  2001  OR FISCAL 2001 AND 2002 OR FISCAL 2002 RELATE TO THE FISCAL
YEARS  ENDED  JANUARY  2, 1999, JANUARY 1, 2000, DECEMBER 30, 2000, DECEMBER 29,
2001  AND  DECEMBER  28,  2002  RESPECTIVELY.

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

<TABLE>
<CAPTION>



                                                     JANUARY 2,    JANUARY 1,    DECEMBER 30,    DECEMBER 29,    DECEMBER 28,
                                                        1999          2000           2000            2001            2002
                                                    ------------  ------------  --------------  --------------  --------------
<S>                                                 <C>           <C>           <C>             <C>             <C>
STATEMENT OF OPERATIONS DATA:
NET REVENUES . . . . . . . . . . . . . . . . . . .  $   237,851   $   293,795   $     338,457   $     336,034   $     363,667
OPERATING COSTS AND EXPENSES:
   COST OF GOODS SOLD. . . . . . . . . . . . . . .       80,636        98,184         107,449         104,446         112,471
   SELLING, GENERAL AND ADMINISTRATIVE . . . . . .      132,390       170,146         204,365         203,187         213,683
   RECAPITALIZATION AND OTHER EXPENSES . . . . . .       25,803             -               -               -               -
   STORE CLOSURE EXPENSE . . . . . . . . . . . . .            -             -           3,580               -               -
   AMORTIZATION OF INTANGIBLE ASSETS . . . . . . .        3,705         5,653           9,137           8,697           1,865
                                                    ------------  ------------  --------------  --------------  --------------
   TOTAL COSTS AND EXPENSES. . . . . . . . . . . .      242,534       273,983         324,531         316,330         328,019
                                                    ------------  ------------  --------------  --------------  --------------
OPERATING INCOME (LOSS). . . . . . . . . . . . . .       (4,683)       19,812          13,926          19,704          35,648
INTEREST EXPENSE, NET. . . . . . . . . . . . . . .       19,159        24,685          28,694          27,537          21,051
IN-SUBSTANCE DEFEASED BONDS INTEREST EXPENSE, NET.        2,418             -               -               -               -
                                                    ------------  ------------  --------------  --------------  --------------
INCOME (LOSS) BEFORE INCOME TAXES. . . . . . . . .      (26,260)       (4,873)        (14,768)         (7,833)         14,597
INCOME TAX EXPENSE . . . . . . . . . . . . . . . .           13           384             766           1,239           1,258
                                                    ------------  ------------  --------------  --------------  --------------
NET INCOME (LOSS) BEFORE EXTRAORDINARY ITEM. . . .      (26,273)       (5,257)        (15,534)         (9,072)         13,339
CUMULATIVE EFFECT OF CHANGE IN ACCT PRINCIPLE. . .            -           491               -               -               -
EXTRAORDINARY GAIN (LOSS). . . . . . . . . . . . .       (8,355)            -               -               -             904
                                                    ------------  ------------  --------------  --------------  --------------
NET INCOME (LOSS). . . . . . . . . . . . . . . . .  $   (34,628)  $    (5,748)  $     (15,534)  $      (9,072)  $      14,243
                                                    ============  ============  ==============  ==============  ==============
OTHER FINANCIAL DATA:
DEPRECIATION AND AMORTIZATION. . . . . . . . . . .  $    16,050   $    22,754   $      29,600   $      29,047   $      20,626
CAPITAL EXPENDITURES . . . . . . . . . . . . . . .       20,656        19,920          18,932          10,559          10,668
GROSS MARGIN % . . . . . . . . . . . . . . . . . .         66.1%         66.6%           68.3%           68.9%           69.1%
TOTAL ASSETS . . . . . . . . . . . . . . . . . . .  $   222,907   $   261,678   $     250,920   $     225,013   $     218,942
LONG TERM OBLIGATIONS. . . . . . . . . . . . . . .  $   248,757   $   279,480   $     285,607   $     267,903   $     254,633
RATIO OF EARNINGS TO FIXED CHARGES(B). . . . . . .        0.14X         0.85X           0.62X           0.79X           1.49X
MISCELLANEOUS DATA:
EBITDA - SEE BELOW . . . . . . . . . . . . . . . .  $    37,170   $    42,386   $      47,107   $      48,751   $      56,774
EBITDA MARGIN %. . . . . . . . . . . . . . . . . .        15.60%        14.40%          13.90%          14.51%          15.61%
COMPARABLE STORE SALES GROWTH (C). . . . . . . . .         1.10%         1.10%           0.90%          -1.40%           5.60%
END OF PERIOD STORES . . . . . . . . . . . . . . .          270           361             361             359             363
SALES PER STORE (D). . . . . . . . . . . . . . . .  $     1,007   $       987   $         940   $         935   $       1,009
</TABLE>

                                       22
<PAGE>

EBITDA REPRESENTS CONSOLIDATED NET INCOME (LOSS) BEFORE INTEREST EXPENSE, INCOME
TAXES,  DEPRECIATION  AND  AMORTIZATION  (OTHER  THAN  AMORTIZATION  OF  STORE
PRE-OPENING  COSTS),  RECAPITALIZATION  AND  OTHER  EXPENSES, EXTRAORDINARY LOSS
(GAIN)  AND  STORE  CLOSURE  EXPENSE.  THE  COMPANY  HAS  INCLUDED  INFORMATION
CONCERNING  EBITDA  BECAUSE IT BELIEVES THAT EBITDA IS USED BY CERTAIN INVESTORS
AS ONE MEASURE OF A COMPANY'S HISTORICAL ABILITY TO FUND OPERATIONS AND MEET ITS
FINANCIAL  OBLIGATIONS. EBITDA SHOULD NOT BE CONSIDERED AS AN ALTERNATIVE TO, OR
MORE MEANINGFUL THAN, OPERATING INCOME (LOSS) OR NET INCOME (LOSS) IN ACCORDANCE
WITH  GENERALLY  ACCEPTED ACCOUNTING PRINCIPLES AS AN INDICATOR OF THE COMPANY'S
OPERATING  PERFORMANCE  OR  CASH  FLOW  AS A MEASURE OF LIQUIDITY. ADDITIONALLY,
EBITDA  PRESENTED MAY NOT BE COMPARABLE TO SIMILARLY TITLED MEASURES REPORTED BY
OTHER  COMPANIES.  THE  FOLLOWING  TABLE IS A RECONCILIATION OF OPERATING INCOME
(LOSS)  TO  EBITDA  FOR  EACH  OF  THE  FISCAL  PERIODS  PRESENTED:

<TABLE>
<CAPTION>


                                                        JANUARY 2,    JANUARY 1,   DECEMBER 30,   DECEMBER 29,   DECEMBER 28,
                                                           1999          2000          2000           2001           2002
                                                       ------------  ------------  -------------  -------------  -------------
<S>                                                    <C>           <C>           <C>            <C>            <C>
RECONCILIATION OF EBITDA TO OPERATING INCOME (LOSS):
OPERATING INCOME (LOSS) . . . . . . . . . . . . . . .  $    (4,683)  $    19,812   $      13,926  $      19,704  $      35,648
RECONCILING ITEMS:
   DEPRECIATION AND AMORTIZATION. . . . . . . . . . .       16,050        22,754          29,600         29,047         20,626
   RECAPITALIZATION AND OTHER EXPENSES. . . . . . . .       25,803             -               -              -              -
   STORE CLOSURE EXPENSE. . . . . . . . . . . . . . .            -             -           3,580              -              -
   OTHER. . . . . . . . . . . . . . . . . . . . . . .            -          (180)              -              -            500
                                                       ------------  ------------  -------------  -------------  -------------
   EBITDA . . . . . . . . . . . . . . . . . . . . . .  $    37,170   $    42,386   $      47,106  $      48,751  $      56,774
                                                       ============  ============  =============  =============  =============
</TABLE>

(A)     ALL  DOLLARS  ARE  IN  THOUSANDS.

(B)     IN  COMPUTING  THE  RATIO  OF  EARNINGS  TO  FIXED  CHARGES,  "EARNINGS"
REPRESENTS  INCOME  (LOSS)  BEFORE INCOME TAX EXPENSE PLUS FIXED CHARGES. "FIXED
CHARGES" CONSISTS OF INTEREST, AMORTIZATION OF DEBT ISSUANCE COSTS AND A PORTION
OF  RENT, WHICH IS REPRESENTATIVE OF INTEREST FACTOR (APPROXIMATELY ONE-THIRD OF
RENT  EXPENSE).

(C)     COMPARABLE  STORE  SALES  GROWTH  INCREASE  IS  CALCULATED COMPARING NET
REVENUES  FOR THE PERIOD TO NET REVENUES OF THE PRIOR PERIOD FOR ALL STORES OPEN
AT  LEAST  TWELVE  MONTHS  PRIOR  TO  EACH  SUCH  PERIOD.

(D)     SALES  PER  STORE IS CALCULATED ON A MONTHLY BASIS BY DIVIDING TOTAL NET
REVENUES  BY THE TOTAL NUMBER OF STORES OPEN DURING THE PERIOD. ANNUAL SALES PER
STORE  IS  THE  SUM  OF  THE  MONTHLY  CALCULATIONS.

                                       23
<PAGE>

ITEM  7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF  OPERATIONS

INTRODUCTION

     THE  COMPANY IS THE THIRD LARGEST RETAIL OPTICAL CHAIN IN THE UNITED STATES
AS  MEASURED BY NET REVENUES, OPERATING OR MANAGING 362 STORES, 293 OF WHICH ARE
OPTICAL  SUPERSTORES.  THE  COMPANY  OPERATES IN THE $6.5 BILLION RETAIL OPTICAL
CHAIN  SECTOR  OF  THE  $16.2 BILLION OPTICAL RETAIL MARKET. MANAGEMENT BELIEVES
THAT  KEY  DRIVERS  OF  GROWTH  FOR  THE  COMPANY INCLUDE (I) THE SUCCESS OF THE
COMPANY'S  PROMOTIONAL  ACTIVITIES,  (II)  THE CONTINUING ROLE OF MANAGED VISION
CARE  AND  (III)  NEW  PRODUCT  INNOVATIONS.

     DURING  FISCAL  2002, THE COMPANY EXPERIENCED A 5.6% INCREASE IN COMPARABLE
STORE  SALES PRIMARILY DUE TO ITS TWO COMPLETE PAIR OF SINGLE VISION EYEWEAR FOR
$99  VALUE  PROMOTION.  MANAGEMENT  BELIEVES  THAT THIS PROMOTION WAS SUCCESSFUL
BECAUSE  IT  DIFFERENTIATES  THE  COMPANY'S  STORES  FROM INDEPENDENT OPTOMETRIC
PRACTITIONERS WHO TEND TO OFFER FEWER PROMOTIONS IN ORDER TO GUARD THEIR MARGINS
WHILE  ALSO  LEVERAGING  THE  COMPANY'S  STRENGTH  AS THE LEADER IN ITS MARKETS.
BECAUSE  THE  AVERAGE  TICKET PRICE IS TYPICALLY LESS FOR GLASSES SOLD UNDER THE
PROMOTION,  IN  ORDER  FOR  THE  COMPANY TO CONTINUE TO BE SUCCESSFUL USING THIS
STRATEGY,  THE  COMPANY MUST CONTINUE TO INCREASE THE NUMBER OF TRANSACTIONS AND
MUST  ALSO BE SUCCESSFUL IN CONTROLLING COSTS. IN ADDITION, IT WILL BE INCUMBENT
UPON  THE  COMPANY  TO  BE ABLE TO MAINTAIN ITS BROAD SELECTION OF HIGH QUALITY,
LOWER  PRICED  NON-BRANDED FRAMES SO THAT IT CAN CONTINUE TO OFFER MORE VALUE TO
CUSTOMERS  WHILE  IMPROVING  GROSS  MARGINS.

     MANAGEMENT  BELIEVES  THAT OPTICAL RETAIL SALES THROUGH MANAGED VISION CARE
PROGRAMS  WILL  CONTINUE  TO  INCREASE OVER THE NEXT SEVERAL YEARS. AS A RESULT,
MANAGEMENT  HAS  MADE  A STRATEGIC DECISION TO PURSUE FUNDED MANAGED VISION CARE
RELATIONSHIPS  IN  ORDER  TO  HELP  THE COMPANY'S RETAIL BUSINESS GROW. DISCOUNT
MANAGED  CARE  PROGRAMS  WILL  PLAY  A LESS SIGNIFICANT ROLE AS THE VALUE RETAIL
OFFER  BECOMES MORE DEVELOPED THROUGHOUT THE COMPANY'S STORES. WHILE THE AVERAGE
TICKET PRICE ON PRODUCTS PURCHASED UNDER MANAGED VISION CARE REIMBURSEMENT PLANS
IS  TYPICALLY  LOWER,  MANAGED  VISION  CARE TRANSACTIONS GENERALLY REQUIRE LESS
PROMOTIONAL  SPENDING  AND  ADVERTISING  SUPPORT.  THE COMPANY BELIEVES THAT THE
INCREASED  VOLUME  RESULTING  FROM  MANAGED  VISION  CARE  RELATIONSHIPS  ALSO
COMPENSATES  FOR  THE  LOWER  AVERAGE  TICKET  PRICE.  DURING  FISCAL  2002,
APPROXIMATELY  39.4% OF THE COMPANY'S OPTICAL REVENUES WERE DERIVED FROM MANAGED
VISION  CARE  PROGRAMS,  ALTHOUGH THE PERCENT OF PENETRATION SHOULD NORMALIZE AT
35%  AS  THE  TRANSITION  TO  FUNDED  PROGRAMS MATERIALIZES AND THE RETAIL OFFER
REPLACES  DISCOUNT ACTIVITY. MANAGEMENT BELIEVES THAT THE ROLE OF MANAGED VISION
CARE  WILL CONTINUE TO BENEFIT THE COMPANY AND OTHER LARGE RETAIL OPTICAL CHAINS
WITH  STRONG  LOCAL  MARKET  SHARES, BROAD GEOGRAPHIC COVERAGE AND SOPHISTICATED
INFORMATION  MANAGEMENT  AND  BILLING  SYSTEMS.

     THE  COMPANY  ENTERED  INTO A RECAPITALIZATION AGREEMENT WITH THOMAS H. LEE
COMPANY  IN 1998. SEE THE DISCUSSION UNDER THE HEADING "RECAPITALIZATION" WITHIN
"ITEM  1.  BUSINESS."

     IN FISCAL 2002, THE COMPANY ADOPTED A NEW ACCOUNTING STANDARD, SFAS NO. 142
"GOODWILL  AND  OTHER  INTANGIBLES,"  IN  WHICH GOODWILL IS NO LONGER SUBJECT TO
AMORTIZATION  OVER  ITS  ESTIMATED

                                       24
<PAGE>

USEFUL  LIFE.  RATHER,  GOODWILL IS SUBJECT TO AT LEAST AN ANNUAL ASSESSMENT FOR
IMPAIRMENT  APPLYING  A  FAIR-VALUE  BASED TEST. THE COMPANY'S FUTURE RESULTS OF
OPERATIONS  WILL  BE  POSITIVELY  IMPACTED  AS  ITS  AMORTIZATION  EXPENSE  IS
SIGNIFICANTLY  REDUCED; HOWEVER, EBITDA WILL NOT BE IMPACTED AS THE AMORTIZATION
CHARGES  WERE  NOT PREVIOUSLY INCLUDED IN THE CALCULATION. THE COMPANY PERFORMED
THE  REQUIRED  IMPAIRMENT  TESTS  OF GOODWILL AS OF DECEMBER 28, 2002, AND BASED
UPON  ITS  ANALYSIS, THE COMPANY BELIEVES THAT NO IMPAIRMENT OF GOODWILL EXISTS.

RESULTS  OF  OPERATIONS

     THE  FOLLOWING  IS  A DISCUSSION OF CERTAIN FACTORS AFFECTING THE COMPANY'S
RESULTS  OF  OPERATIONS  FROM  FISCAL  2000 TO FISCAL 2002 AND ITS LIQUIDITY AND
CAPITAL  RESOURCES.  THIS  DISCUSSION  SHOULD  BE  READ  IN CONJUNCTION WITH THE
CONSOLIDATED  FINANCIAL  STATEMENTS AND NOTES THERETO INCLUDED ELSEWHERE IN THIS
DOCUMENT.

<TABLE>

<CAPTION>

     THE  FOLLOWING TABLE SETS FORTH THE PERCENTAGE RELATIONSHIP TO NET REVENUES
OF  CERTAIN  INCOME  STATEMENT  DATA.


<S>                                               <C>                 <C>     <C>
                                                                 FISCAL YEAR ENDED
                                                                ------------------
                                                               2000    2001    2002
                                                              ------  ------  ------
NET REVENUES:
OPTICAL SALES. . . . . . . . . . . . . . . . . .               99.2%   99.0%   99.1%
MANAGEMENT FEE . . . . . . . . . . . . . . . . .                0.8     1.0     0.9
                                                              ------  ------  ------
TOTAL NET REVENUES . . . . . . . . . . . . . . .              100.0   100.0   100.0

OPERATING COSTS AND EXPENSES:
COST OF GOODS SOLD (A) . . . . . . . . . . . . .               32.0    31.4    31.2
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES (A)               60.9    61.1    59.3
STORE CLOSURE EXPENSES . . . . . . . . . . . . .                1.1       -       -
AMORTIZATION OF INTANGIBLES. . . . . . . . . . .                2.7     2.6     0.5

                                                              ------  ------  ------
TOTAL OPERATING COSTS AND EXPENSES . . . . . . .               96.7    94.1    90.2
                                                              ------  ------  ------
INCOME FROM OPERATIONS . . . . . . . . . . . . .                3.3     5.9     9.8
INTEREST EXPENSE, NET. . . . . . . . . . . . . .                8.5     8.2     5.8
                                                              ------  ------  ------
INCOME/(LOSS) BEFORE INCOME TAXES. . . . . . . .               (5.2)   (2.3)    4.0
INCOME TAX EXPENSE . . . . . . . . . . . . . . .                0.2     0.4     0.3
                                                              ------  ------  ------
INCOME/(LOSS) BEFORE EXTRAORDINARY ITEM. . . . .               (5.4)   (2.7)    3.7
EXTRAORDINARY GAIN . . . . . . . . . . . . . . .                  -       -     0.2
                                                              ------  ------  ------
NET INCOME/(LOSS). . . . . . . . . . . . . . . .               (5.4)   (2.7)    3.9
                                                              ======  ======  ======

</TABLE>

(A)  PERCENTAGES  BASED  ON  OPTICAL  SALES  ONLY

FISCAL  2002  COMPARED  TO  FISCAL  2001

     NET  REVENUES.  THE INCREASE IN NET REVENUES TO $363.7 MILLION IN 2002 FROM
$336.0  MILLION  IN  FISCAL  2001  WAS  LARGELY  THE  RESULT  OF  AN INCREASE IN
COMPARABLE  STORE  SALES  OF  5.6%  PRIMARILY DUE TO THE CONTINUATION OF THE TWO
COMPLETE PAIR OF SINGLE VISION EYEGLASSES FOR $99 VALUE PROMOTION STARTED IN THE
FOURTH  QUARTER  OF  2001.  ADDITIONALLY,  THE  IMPROVEMENT OF PRODUCT DEPTH AND

                                       25
<PAGE>

SELECTION,  IMPROVED  IN-STOCK  POSITIONS AND OVERALL OPTICAL MARKET IMPROVEMENT
CONTRIBUTED  TO  THE  INCREASE IN SALES. THE NUMBER OF TRANSACTIONS INCREASED BY
13.7%  COMPARED TO FISCAL 2001, WHICH WAS OFFSET BY A DECREASE IN AVERAGE TICKET
PRICES  OF  4.7%  COMPARED TO FISCAL 2001. BOTH THE INCREASE IN TRANSACTIONS AND
DECREASE IN AVERAGE TICKET PRICES WERE DUE PRIMARILY TO THE TWO COMPLETE PAIR OF
SINGLE  VISION  EYEGLASSES  FOR  $99  VALUE PROMOTION. MANAGED VISION CARE SALES
DECREASED  1.5%  FOR  FISCAL 2002 AS COMPARED TO FISCAL 2001. THE COMPANY OPENED
EIGHT  STORES  AND  CLOSED  FOUR  STORES  IN  FISCAL  2002.

     GROSS  PROFIT. GROSS PROFIT INCREASED TO $251.2 MILLION IN FISCAL 2002 FROM
$231.6  MILLION  IN  FISCAL  2001,  PRIMARILY  AS  A  RESULT  OF  AN INCREASE IN
COMPARABLE  STORE  SALES AND AN INCREASE IN THE SALES OF HIGHER MARGIN PRODUCTS.
GROSS  PROFIT  AS  A  PERCENTAGE  OF  OPTICAL  SALES  INCREASED TO 68.8% ($247.8
MILLION)  IN  FISCAL  2002 AS COMPARED TO 68.6% ($228.1 MILLION) IN FISCAL 2001.
THIS PERCENTAGE INCREASE WAS LARGELY DUE TO AN INCREASE AS A PERCENTAGE OF SALES
IN FISCAL 2002 VERSUS FISCAL 2001 OF NON-BRANDED FRAMES WITH HIGHER MARGINS THAN
BRANDED  FRAMES.  NON-BRANDED  FRAMES  HAVE LOWER ACQUISITION COSTS THAN BRANDED
FRAMES  RESULTING  IN  HIGHER  MARGINS.

     SELLING  GENERAL & ADMINISTRATIVE EXPENSES (SG&A). SG&A INCREASED TO $213.7
MILLION  IN  FISCAL  2002  FROM  $203.2  IN FISCAL 2001. SG&A AS A PERCENTAGE OF
OPTICAL  SALES DECREASED TO 59.3% IN FISCAL 2002 FROM 61.1% IN FISCAL 2001. THIS
PERCENTAGE  DECREASE  WAS  PRIMARILY  DUE TO INCREASED SALES FROM MORE EFFECTIVE
ADVERTISING  PROMOTIONS  IN  FISCAL  2002  VERSUS  FISCAL  2001 WITH ADVERTISING
EXPENDITURES RISING SLIGHTLY OVER THE TWO YEARS BUT DECLINING AS A PERCENTAGE OF
SALES.  IN ADDITION, WHILE DEPRECIATION DECLINED SLIGHTLY AND OCCUPANCY EXPENSES
ROSE  SLIGHTLY  IN FISCAL 2002 VERSUS FISCAL 2001, THEY DECLINED AS A PERCENTAGE
OF  SALES  WHICH  WAS  OFFSET  BY  INCREASES  IN  RETAIL  AND  DOCTOR  PAYROLL.

     AMORTIZATION  EXPENSE.  AMORTIZATION  EXPENSE DECREASED TO $1.9 MILLION FOR
FISCAL  2002  FROM  $8.7  MILLION  IN FISCAL 2001 DUE TO THE ADOPTION OF FAS 142
WHICH  DISALLOWS  THE  AMORTIZATION OF GOODWILL OVER ITS USEFUL LIFE AND INSTEAD
REQUIRES  AN  ANNUAL  ASSESSMENT  FOR  IMPAIRMENT.

     NET  INTEREST  EXPENSE. NET INTEREST EXPENSE DECREASED TO $21.1 MILLION FOR
FISCAL  2002 FROM $27.5 MILLION FOR FISCAL 2001. THIS DECREASE WAS PRIMARILY DUE
TO  THE  OVERALL DECLINE IN MARKET INTEREST RATES IN 2002 AND RE-PAYMENT OF DEBT
DURING  2002.

FISCAL  2001  COMPARED  TO  FISCAL  2000

     NET  REVENUES.  THE DECREASE IN NET REVENUES TO $336.0 MILLION IN 2001 FROM
$338.5 MILLION IN FISCAL 2000 WAS LARGELY THE RESULT OF A DECREASE IN COMPARABLE
STORE  SALES  OF  1.4%. COMPARABLE TRANSACTIONS WERE RELATIVELY FLAT AND AVERAGE
TICKET PRICES DECREASED COMPARED TO THE PRIOR YEAR.  IN ADDITION, MANAGED VISION
CARE  SALES  INCREASED  IN  FISCAL  2001 AS COMPARED TO FISCAL 2000. THE COMPANY
OPENED  EIGHT  STORES  AND  CLOSED  TEN  STORES  IN  FISCAL  2001.

     GROSS  PROFIT. GROSS PROFIT INCREASED TO $231.6 MILLION IN FISCAL 2001 FROM
$231.0  MILLION  IN  FISCAL  2000. GROSS PROFIT AS A PERCENTAGE OF OPTICAL SALES
INCREASED  TO 68.6% ($228.1 MILLION) IN FISCAL 2001 AS COMPARED TO 68.0% ($228.2
MILLION)  IN FISCAL 2000. THIS PERCENTAGE INCREASE WAS PRIMARILY DUE TO IMPROVED
BUYING  EFFICIENCIES,  PRIMARILY  IN  FRAMES  AND  CONTACT  LENSES.

                                       26
<PAGE>

     SELLING  GENERAL & ADMINISTRATIVE EXPENSES (SG&A). SG&A DECREASED TO $203.2
MILLION  IN  FISCAL  2001  FROM  $204.4  IN FISCAL 2000. SG&A AS A PERCENTAGE OF
OPTICAL  SALES INCREASED TO 61.1% IN FISCAL 2001 FROM 60.9% IN FISCAL 2000. THIS
PERCENTAGE  INCREASE WAS DUE PRIMARILY TO AN INCREASE IN DOCTOR PAYROLL EXPENSES
AND  OCCUPANCY  EXPENSES  OFFSET  BY  ADVERTISING  BUYING  EFFICIENCIES.  THE
ADVERTISING SAVINGS WERE RELATED TO A CHANGE IN MEDIA BUYING WHICH PRODUCED MORE
MEDIA  COVERAGE  AT  A  LOWER  COST.

     AMORTIZATION  EXPENSE.  AMORTIZATION  EXPENSE DECREASED TO $8.7 MILLION FOR
FISCAL  2001  FROM  $9.1  MILLION  IN  FISCAL  2000.

     NET  INTEREST  EXPENSE. NET INTEREST EXPENSE DECREASED TO $27.5 MILLION FOR
FISCAL  2001 FROM $28.7 MILLION FOR FISCAL 2000. THIS DECREASE WAS PRIMARILY DUE
TO  THE  OVERALL  DECLINE  IN  MARKET  INTEREST  RATES  IN  2001.

LIQUIDITY  AND  CAPITAL  RESOURCES

THE  COMPANY'S CAPITAL REQUIREMENTS ARE DRIVEN PRINCIPALLY BY ITS OBLIGATIONS TO
SERVICE  DEBT  AND  TO  FUND  THE  FOLLOWING  COSTS:

-     CONSTRUCTION  OF  NEW  STORES
-     REPOSITIONING  OF  EXISTING  STORES
-     PURCHASING  INVENTORY  AND  EQUIPMENT
-     LEASEHOLD  IMPROVEMENTS

     THE  AMOUNT  OF CAPITAL AVAILABLE TO THE COMPANY WILL AFFECT ITS ABILITY TO
SERVICE  ITS  DEBT  OBLIGATIONS  AND  TO  CONTINUE  TO GROW ITS BUSINESS THROUGH
EXPANDING  THE  NUMBER  OF  STORES  AND  INCREASING  COMPARABLE  STORE  SALES.

SOURCES  OF  CAPITAL

     THE COMPANY'S PRINCIPAL SOURCES OF CAPITAL ARE FROM CASH ON HAND, CASH FLOW
FROM OPERATING ACTIVITIES AND FUNDING FROM ITS CREDIT FACILITY.  CASH FLOWS FROM
OPERATING ACTIVITIES PROVIDED NET CASH FOR 2002, 2001 AND 2000 OF $34.4 MILLION,
$27.4  MILLION  AND  $11.2  MILLION, RESPECTIVELY.  AS OF DECEMBER 28, 2002, THE
COMPANY  HAD  $3.5  MILLION OF CASH AVAILABLE TO MEET THE COMPANY'S OBLIGATIONS.

     PAYMENTS  ON  DEBT  AND  ISSUANCE OF DEBT HAVE BEEN THE COMPANY'S PRINCIPAL
FINANCING ACTIVITIES.  CASH FLOWS USED IN FINANCING ACTIVITIES FOR 2002 AND 2001
WERE  $23.6  MILLION  AND  $17.5  MILLION  AND  CASH FLOWS PROVIDED BY FINANCING
ACTIVITIES  FOR  2000  WERE  $8.7  MILLION.

     WORKING  CAPITAL  OF  THE  COMPANY  PRIMARILY  CONSISTS  OF  CASH  AND CASH
EQUIVALENTS,  ACCOUNTS  RECEIVABLE,  INVENTORY,  ACCOUNTS  PAYABLE  AND  ACCRUED
EXPENSES.  THE  LEVEL  OF  WORKING CAPITAL HAS REMAINED RELATIVELY CONSISTENT TO
THE PERIOD ENDED DECEMBER 2001.  THE LARGEST WORKING CAPITAL

                                       27
<PAGE>

USAGE  OCCURS  ON  MAY 1 AND NOVEMBER 1 OF EACH YEAR WHEN THE COMPANY'S INTEREST
PAYMENTS  UNDER  ITS NOTES RANGING FROM $6.0 TO $7.0 MILLION ARE PAID.

     CAPITAL  EXPENDITURES  FOR  2002,  2001  AND 2000 WERE $10.7 MILLION, $10.6
MILLION AND $18.9 MILLION, RESPECTIVELY, AND ARE THE COMPANY'S PRINCIPAL USES OF
CASH  FOR  INVESTING  ACTIVITIES.  THE  TABLE BELOW SETS FORTH THE COMPONENTS OF
THESE  CAPITAL  EXPENDITURES  FOR  2002,  2001  AND  2000.

<TABLE>

<CAPTION>


<S>                          <C>                 <C>      <C>
                                              FISCAL YEAR ENDED
                                             ------------------
                                           2000     2001     2002
                                        -------  -------  -------
EXPENDITURE CATEGORY:
NEW STORES. . . . . . . . .  $            7,200  $ 3,800  $ 2,900
INFORMATION SYSTEMS . . . .               2,100    1,500    1,800
LAB EQUIPMENT . . . . . . .               3,600    1,000    1,400
STORE MAINTENANCE . . . . .               3,100    2,900    4,400
OTHER . . . . . . . . . . .               2,900    1,400      200

 TOTAL CAPITAL EXPENDITURES  $           18,900  $10,600  $10,700
                                        =======  =======  =======
</TABLE>

CAPITAL  EXPENDITURES  FOR 2003 ARE PROJECTED TO BE APPROXIMATELY $12.0 MILLION.

LONG  TERM  DEBT

     CREDIT  FACILITY.  ON  DECEMBER 23, 2002, THE COMPANY ENTERED INTO A CREDIT
AGREEMENT  WITH  FLEET  NATIONAL  BANK,  AS  ADMINISTRATIVE  AGENT,  AND BANK OF
AMERICA,  N.A.,  ACTING  AS  SYNDICATION  AGENT,  WHICH  CONSISTS OF (I) A $55.0
MILLION  TERM  LOAN FACILITY (THE "TERM LOAN A"); (II) A $62.0 MILLION TERM LOAN
FACILITY  (THE  "TERM  LOAN  B");  AND  (III)  A  $25.0 MILLION REVOLVING CREDIT
FACILITY  (THE  "REVOLVER"  AND,  TOGETHER WITH TERM LOAN A AND TERM LOAN B, THE
"NEW  FACILITIES").  THE  PROCEEDS  OF  THE  NEW FACILITIES WERE USED TO (I) PAY
LONG-TERM  DEBT  OUTSTANDING  UNDER THE COMPANY'S PREVIOUS CREDIT FACILITY, (II)
REDEEM  $20.0  MILLION  FACE  VALUE OF THE NOTES AT A COST OF $17.0 MILLION, AND
(III)  PAY FEES AND EXPENSES INCURRED IN CONNECTION WITH THE NEW FACILITIES. THE
NEW FACILITIES ARE AVAILABLE TO FINANCE WORKING CAPITAL REQUIREMENTS AND GENERAL
CORPORATE  PURPOSES.  AT  DECEMBER 28, 2002, THE COMPANY HAD APPROXIMATELY $20.0
MILLION  AVAILABLE  UNDER  THE  REVOLVER.

     BORROWINGS  MADE  UNDER THE NEW FACILITIES ACCRUE INTEREST AT THE COMPANY'S
OPTION  AT THE BASE RATE OR THE LIBOR RATE, PLUS THE APPLICABLE MARGIN. THE BASE
RATE IS A FLOATING RATE EQUAL TO THE HIGHER OF (I) THE FLEET PRIME RATE AND (II)
THE  OVERNIGHT  FEDERAL  FUNDS  RATE  PLUS 1/2%.  THE APPLICABLE MARGINS FOR THE
REVOLVER ARE LIBOR PLUS 4.50% (BASE RATE PLUS 3.50%), TERM LOAN A ARE LIBOR PLUS
4.25%  (BASE  RATE  PLUS 3.25%), AND TERM LOAN B ARE LIBOR PLUS 4.75% (BASE RATE
PLUS  3.75%).  PRINCIPAL  UNDER  TERM  LOAN  A SHALL AMORTIZE IN ANNUAL PAYMENTS
COMMENCING  ON  MARCH 31, 2003 IN ANNUAL AMOUNTS OF $15.0 MILLION, $20.0 MILLION
AND $20.0 MILLION, RESPECTIVELY, FOR FISCAL YEARS 2003 THROUGH 2005. TERM LOAN B
HAS  NO  PRINCIPAL  PAYMENTS  UNTIL  2006  WHEN ANNUAL PAYMENTS WILL COMMENCE IN
ANNUAL  AMOUNTS  OF  $20.0  MILLION  AND $42.0 MILLION, RESPECTIVELY, FOR FISCAL
YEARS  2006  AND  2007.

     THE  NEW  FACILITIES  ARE  COLLATERALIZED  BY  ALL  TANGIBLE AND INTANGIBLE
ASSETS,  INCLUDING  THE  STOCK

                                       28
<PAGE>

OF  THE  COMPANY'S  SUBSIDIARIES.  IN  ADDITION,  THE  COMPANY MUST MEET CERTAIN
FINANCIAL  COVENANTS INCLUDING MINIMUM EBITDA, INTEREST COVERAGE, LEVERAGE RATIO
AND CAPITAL EXPENDITURES. AS OF DECEMBER 28, 2002, THE COMPANY WAS IN COMPLIANCE
WITH  THE  FINANCIAL  REPORTING  COVENANTS.

     NOTES.  ON  APRIL 24, 1998, THE COMPANY COMPLETED A DEBT OFFERING OF $100.0
MILLION  9/18%  SENIOR  SUBORDINATED  NOTES  DUE 2008 AND $50.0 MILLION FLOATING
INTEREST SUBORDINATED TERM SECURITIES DUE 2008 (COLLECTIVELY, THE "NOTES" OR THE
"EXCHANGE  NOTES").  IN CONNECTION WITH THE NEW FACILITIES, THE COMPANY REDEEMED
$20.0  MILLION  OF THE FLOATING RATE NOTES ON DECEMBER 23, 2002. INTEREST ON THE
NOTES  IS  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,  EQUAL  TO  LIBOR  PLUS  3.98%.  THE NOTES ARE NOT ENTITLED TO THE
BENEFIT  OF  ANY  MANDATORY  SINKING  FUND.

     THE  NOTES  ARE  GUARANTEED  ON  A  SENIOR SUBORDINATED BASIS BY ALL OF THE
COMPANY'S  SUBSIDIARIES.  THE  NOTES  AND  RELATED  GUARANTEES:

-    ARE  GENERAL  UNSECURED  OBLIGATIONS  OF  THE  COMPANY AND THE GUARANTORS;
-    ARE  SUBORDINATED  IN  RIGHT  OF  PAYMENT TO ALL CURRENT AND FUTURE SENIOR
     INDEBTEDNESS  INCLUDING  INDEBTEDNESS  UNDER  THE  NEW  FACILITIES;  AND
-    RANK  PARI  PASSU  IN  RIGHT OF PAYMENT WITH ANY FUTURE SENIOR SUBORDINATED
     INDEBTEDNESS  OF  THE  COMPANY  AND  THE  GUARANTORS AND SENIOR IN RIGHT OF
     PAYMENT  WITH  ANY  FUTURE  SUBORDINATED OBLIGATIONS OF THE COMPANY AND THE
     GUARANTORS.

     THE COMPANY MAY REDEEM THE NOTES, AT ITS OPTION, IN WHOLE AT ANY TIME OR IN
PART  FROM TIME TO TIME.  THE REDEMPTION PRICES FOR THE FIXED RATE NOTES ARE SET
FORTH  BELOW  FOR  THE  12-MONTH  PERIODS  BEGINNING MAY 1 OF THE YEAR SET FORTH
BELOW,  PLUS  IN  EACH  CASE,  ACCRUED  INTEREST  TO  THE  DATE  OF  REDEMPTION:

<TABLE>

<CAPTION>

<S>                  <C>
YEAR. . . . . . . .  REDEMPTION PRICE
-------------------  -----------------

2003. . . . . . . .           104.563%
2004. . . . . . . .           103.042%
2005. . . . . . . .           101.521%
2006 AND THEREAFTER           100.000%
</TABLE>

BEGINNING ON MAY 1, 2003, THE FLOATING RATE NOTES MAY BE REDEEMED AT 100% OF THE
PRINCIPAL  AMOUNT  THEREOF  PLUS  ACCRUED  AND  UNPAID  INTEREST  TO THE DATE OF
REDEMPTION.

     THE  INDENTURE  GOVERNING  THE NOTES CONTAINS CERTAIN COVENANTS THAT, AMONG
OTHER  THINGS,  LIMIT  THE  COMPANY  AND  THE  GUARANTORS'  ABILITY  TO:

-     INCUR  ADDITIONAL  INDEBTEDNESS;
-     PAY DIVIDENDS OR MAKE OTHER DISTRIBUTIONS IN RESPECT OF ITS CAPITAL STOCK;
-     PURCHASE  EQUITY  INTERESTS  OR  SUBORDINATED  INDEBTEDNESS;
-     CREATE  CERTAIN  LIENS;

                                       29
<PAGE>

-     ENTER  INTO  CERTAIN  TRANSACTIONS  WITH  AFFILIATES;
-     CONSUMMATE  CERTAIN  ASSET  SALES;  AND
-     MERGE  OR  CONSOLIDATE.

     PREFERRED  STOCK.  DURING  1998, THE COMPANY ISSUED 300,000 SHARES OF A NEW
SERIES  OF  PREFERRED  STOCK  (THE "PREFERRED STOCK"), PAR VALUE $.01 PER SHARE.
DIVIDENDS ON SHARES OF THE 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  ANNUALLY.  THE  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.

     CONTRACTUAL  OBLIGATIONS. THE COMPANY IS COMMITTED TO MAKE CASH PAYMENTS IN
THE  FUTURE  ON  THE  FOLLOWING  TYPES  OF  AGREEMENTS:

-     LONG  TERM  DEBT
-     OPERATING  LEASES  FOR  STORES  AND  OFFICE  FACILITIES

     THE  FOLLOWING TABLE REFLECTS A SUMMARY OF ITS CONTRACTUAL CASH OBLIGATIONS
AS  OF  DECEMBER  28,  2002:

<TABLE>

<CAPTION>



<S>                                      <C>        <C>          <C>          <C>               <C>
                                                              Payments due by period
                                         ---------------------------------------------------------------------
  Total . . . . . . . . . . . . . . . .   Total      Less than 1 yr   1 to 3 yrs   3 to 5 yrs   More than 5 yrs
---------------------------------------  -------    ---------------- -----------  -----------   ---------------

Long Term Debt. . . . . . . . . . . . .  $ 251,739  $    15,000  $    40,000  $         67,000       $129,739
Capital Lease Obligations . . . . . . .      2,894          524          578             1,792              -
Operating Leases. . . . . . . . . . . .    168,644       29,657       53,905            40,503         44,579
Purchase Obligations. . . . . . . . . .          -            -            -                 -              -

Total future principal payments on debt  $ 423,277  $    45,181  $    94,483  $        109,295       $174,318
                                         ==========  ============  ===========      ===========     =========
</TABLE>




     THE COMPANY HAS NO OFF-BALANCE SHEET DEBT OR UNRECORDED OBLIGATIONS AND HAS
NOT  GUARANTEED THE DEBT OF ANY OTHER PARTY WITH THE EXCEPTION OF A $1.0 MILLION
LOAN  THAT IS RELATED TO THE LONG-TERM BUSINESS AGREEMENT WITH THE RELATED OD PC
ENTERED  INTO  AT  THE  TIME  OF  THE  ACQUISITION  OF  HOUR  EYES.

     FUTURE  CAPITAL RESOURCES. BASED UPON CURRENT OPERATIONS AND FUTURE GROWTH,
THE  COMPANY  BELIEVES  THAT  ITS  CASH  FLOW  FROM  OPERATIONS,  TOGETHER  WITH
BORROWINGS  CURRENTLY  AVAILABLE  UNDER  THE  REVOLVER, ARE ADEQUATE TO MEET ITS
ANTICIPATED REQUIREMENTS FOR WORKING CAPITAL, CAPITAL EXPENDITURES AND SCHEDULED
PRINCIPAL  AND  INTEREST PAYMENTS THROUGH THE NEXT TWELVE MONTHS. THE ABILITY OF
THE  COMPANY  TO SATISFY ITS FINANCIAL COVENANTS WITHIN ITS NEW FACILITIES, MEET
ITS DEBT SERVICE OBLIGATIONS AND REDUCE ITS DEBT WILL BE DEPENDENT ON THE FUTURE
PERFORMANCE  OF  THE

                                       30
<PAGE>

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.  THE  COMPANY  BELIEVES THAT ITS ABILITY TO REPAY THE NOTES AND AMOUNTS
OUTSTANDING  UNDER THE NEW FACILITIES AT MATURITY WILL LIKELY REQUIRE ADDITIONAL
FINANCING. THE COMPANY CANNOT ASSUME THAT ADDITIONAL FINANCING WILL BE AVAILABLE
TO  IT.  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.

CRITICAL  ACCOUNTING  POLICIES

     CRITICAL  ACCOUNTING  POLICIES  ARE  THOSE  THAT REQUIRE MANAGEMENT TO MAKE
ASSUMPTIONS  THAT  ARE DIFFICULT OR COMPLEX ABOUT MATTERS THAT ARE UNCERTAIN AND
MAY  CHANGE  IN  SUBSEQUENT  PERIODS,  RESULTING IN CHANGES TO REPORTED RESULTS.

     THE  COMPANY'S  SIGNIFICANT  ACCOUNTING POLICIES ARE DESCRIBED IN NOTE 2 IN
THE  NOTES  TO  CONSOLIDATED  FINANCIALS  STATEMENTS.  THE  MAJORITY  OF  THESE
ACCOUNTING  POLICIES  DO NOT REQUIRE MANAGEMENT TO MAKE DIFFICULT, SUBJECTIVE OR
COMPLEX  JUDGMENTS  OR  ESTIMATES  OR  THE  VARIABILITY  OF THE ESTIMATES IS NOT
MATERIAL.  HOWEVER,  THE  FOLLOWING  POLICIES  COULD  BE  DEEMED  CRITICAL.  THE
COMPANY'S  MANAGEMENT  HAS DISCUSSED THESE CRITICAL ACCOUNTING POLICIES WITH THE
AUDIT  COMMITTEE  OF  THE  BOARD  OF  DIRECTORS.

-    ACCOUNTS  RECEIVABLE  ARE  PRIMARILY FROM THIRD PARTY PAYORS RELATED TO THE
     SALE  OF  EYEWEAR AND INCLUDE RECEIVABLES FROM INSURANCE REIMBURSEMENTS, OD
     MANAGEMENT  FEES,  CREDIT CARD COMPANIES, MERCHANDISE, RENT AND LICENSE FEE
     RECEIVABLES.  THE  COMPANY'S  ALLOWANCE  FOR  DOUBTFUL  ACCOUNTS  PRIMARILY
     CONSISTS  OF  AMOUNTS  OWED TO THE COMPANY BY THIRD PARTY INSURANCE PAYORS.
     THIS  ESTIMATE IS BASED ON THE HISTORICAL RATIO OF COLLECTIONS TO BILLINGS.

-    INVENTORY  CONSISTS  PRINCIPALLY  OF EYEGLASS FRAMES, OPHTHALMIC LENSES AND
     CONTACT  LENSES  AND  IS  STATED  AT  THE  LOWER OF COST OR MARKET. COST IS
     DETERMINED  USING  THE  WEIGHTED  AVERAGE  METHOD  WHICH  APPROXIMATES  THE
     FIRST-IN,  FIRST-OUT (FIFO) METHOD. THE COMPANY'S INVENTORY RESERVES ARE AN
     ESTIMATE  BASED  ON PRODUCT WITH LOW TURNOVER OR DEEMED BY MANAGEMENT TO BE
     UNSALEABLE.

-    GOODWILL  CONSISTS  OF  THE AMOUNTS BY WHICH THE PURCHASE PRICE EXCEEDS THE
     MARKET  VALUE  OF ACQUIRED NET ASSETS, MANAGEMENT AGREEMENTS AND NONCOMPETE
     AGREEMENTS.  GOODWILL MUST BE TESTED FOR IMPAIRMENT AT LEAST ANNUALLY USING
     A  "TWO-STEP"  APPROACH THAT INVOLVES THE IDENTIFICATION OF REPORTING UNITS
     AND  THE  ESTIMATION  OF  FAIR  VALUES.

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.

                                       31
<PAGE>

SEASONALITY  AND  ANNUAL  RESULTS

     THE  COMPANY'S  SALES  FLUCTUATE  SEASONALLY.  HISTORICALLY,  THE COMPANY'S
HIGHEST  SALES  AND EARNINGS OCCUR IN THE FIRST AND THIRD QUARTERS. IN ADDITION,
ANNUAL  RESULTS  ARE  AFFECTED  BY  THE  COMPANY'S  GROWTH.

RISK  FACTORS

THE  COMPANY OFTEN OFFERS INCENTIVES TO CUSTOMERS WHICH LOWER PROFIT MARGINS. AT
TIMES  WHEN THE COMPANY'S MAJOR COMPETITORS OFFER SIGNIFICANTLY LOWER PRICES FOR
THEIR  PRODUCTS,  IT  IS  OFTEN  REQUIRED  TO  DO THE SAME. CERTAIN OF ITS MAJOR
COMPETITORS  OFFER  PROMOTIONAL INCENTIVES TO THEIR CUSTOMERS INCLUDING FREE EYE
EXAMS,  "50%  OFF"  ON  DESIGNER  FRAMES  AND  "BUY  ONE, GET ONE FREE" EYE CARE
PROMOTIONS. IN RESPONSE TO THESE PROMOTIONS, THE COMPANY HAS OFFERED THE SAME OR
SIMILAR  INCENTIVES TO ITS CUSTOMERS. THIS PRACTICE HAS RESULTED IN LOWER PROFIT
MARGINS  AND  THESE  COMPETITIVE  PROMOTIONAL  INCENTIVES  MAY  FURTHER  REDUCE
REVENUES,  GROSS  MARGINS  AND CASH FLOWS. ALTHOUGH THE COMPANY BELIEVES THAT IT
PROVIDES  QUALITY  SERVICE  AND  PRODUCTS  AT COMPETITIVE PRICES, SEVERAL OF THE
OTHER  LARGE  RETAIL  OPTICAL  CHAINS  HAVE GREATER FINANCIAL RESOURCES THAN THE
COMPANY.  THEREFORE,  THE  COMPANY  MAY  NOT BE ABLE TO CONTINUE TO DELIVER COST
EFFICIENT  PRODUCTS IN THE EVENT OF AGGRESSIVE PRICING BY ITS COMPETITORS, WHICH
WOULD  REDUCE  PROFIT  MARGINS,  NET  INCOME  AND  CASH  FLOW.

AS REFRACTIVE LASER SURGERY AND OTHER ADVANCES IN MEDICAL TECHNOLOGY GAIN MARKET
ACCEPTANCE,  THE  COMPANY  MAY  LOSE REVENUE FROM TRADITIONAL EYEWEAR CUSTOMERS.
CORNEAL  REFRACTIVE  SURGERY  PROCEDURES  SUCH  AS  RADIAL-KERATOTOMY,
PHOTO-REFRACTIVE  KERATECTOMY,  LASER IN-SITU KERATOMILEUSIS OR LASIK AND FUTURE
DRUG  DEVELOPMENT,  MAY  CHANGE  THE  DEMAND  FOR  THE  COMPANY'S  PRODUCTS.  AS
TRADITIONAL  EYEWEAR  USERS  UNDERGO LASER VISION CORRECTION PROCEDURES OR OTHER
VISION  CORRECTION  TECHNIQUES,  THE  DEMAND  FOR  CERTAIN  CONTACT  LENSES  AND
EYEGLASSES  WILL  DECREASE.  TECHNOLOGICAL DEVELOPMENTS SUCH AS WAFER TECHNOLOGY
AND  LENS  CASTING  MAY  RENDER  THE COMPANY'S CURRENT LENS MANUFACTURING METHOD
UNCOMPETITIVE  OR  OBSOLETE.  DUE  TO  THE  FACT  THAT THE MARKETING AND SALE OF
EYEGLASSES AND CONTACT LENSES IS A SIGNIFICANT PART OF THE COMPANY'S BUSINESS, A
DECREASE  IN  CUSTOMER  DEMAND  FOR THESE PRODUCTS COULD HAVE A MATERIAL ADVERSE
EFFECT ON SALES OF PRESCRIPTION EYEWEAR.  THERE CAN BE NO ASSURANCE THAT MEDICAL
ADVANCES  AND TECHNOLOGICAL DEVELOPMENTS WILL NOT HAVE A MATERIAL ADVERSE EFFECT
ON  THE  COMPANY'S  OPERATIONS.

THE  COMPANY  MAY  BE  UNABLE TO SERVICE ITS INDEBTEDNESS. THE COMPANY IS HIGHLY
LEVERAGED,  WITH  INDEBTEDNESS  THAT  IS  SUBSTANTIAL  IN  RELATION  TO  ITS
SHAREHOLDERS'  EQUITY.  AS  OF  DECEMBER  28,  2002,  THE  COMPANY'S  AGGREGATE
OUTSTANDING  INDEBTEDNESS  WAS  APPROXIMATELY  $254.6  MILLION AND THE COMPANY'S
SHAREHOLDERS'  EQUITY  WAS  A  DEFICIT OF $89.1 MILLION. IN ADDITION, SUBJECT TO
CERTAIN LIMITATIONS, THE NEW FACILITIES AND THE INDENTURE GOVERNING THE EXCHANGE
NOTES  (THE  INDENTURE)  PERMIT  THE  COMPANY  TO  INCUR  OR  GUARANTEE  CERTAIN
ADDITIONAL  INDEBTEDNESS.  SEE  "CONSOLIDATED  FINANCIAL  STATEMENTS"  AND
"MANAGEMENT'S  DISCUSSION  AND  ANALYSIS  OF  FINANCIAL CONDITION AND RESULTS OF
OPERATIONS  -  LIQUIDITY  AND  CAPITAL  RESOURCES."

     THE  COMPANY'S HIGH DEGREE OF LEVERAGE COULD HAVE IMPORTANT CONSEQUENCES TO
HOLDERS OF THE

                                       32
<PAGE>

EXCHANGE  NOTES, INCLUDING, BUT NOT LIMITED TO, THE FOLLOWING: (I) THE COMPANY'S
ABILITY  TO  OBTAIN  ADDITIONAL  FINANCING  FOR  WORKING  CAPITAL,  CAPITAL
EXPENDITURES,  ACQUISITIONS OR GENERAL CORPORATE PURPOSES MAY BE IMPAIRED IN THE
FUTURE;  (II)  A  SUBSTANTIAL PORTION OF THE COMPANY'S CASH FLOW FROM OPERATIONS
MUST  BE  DEDICATED TO THE PAYMENT OF PRINCIPAL AND INTEREST ON ITS INDEBTEDNESS
(INCLUDING  THE  EXCHANGE  NOTES),  THEREBY  REDUCING THE FUNDS AVAILABLE TO THE
COMPANY  FOR  ITS  OPERATIONS  AND OTHER PURPOSES INCLUDING ACQUISITIONS AND NEW
STORE  OPENINGS;  (III)  THE  COMPANY  MAY  BE SUBSTANTIALLY MORE LEVERAGED THAN
CERTAIN  OF  ITS  COMPETITORS,  WHICH  MAY  PLACE  THE  COMPANY AT A COMPETITIVE
DISADVANTAGE;  (IV) THE COMPANY MAY BE HINDERED IN ITS ABILITY TO ADJUST RAPIDLY
TO  CHANGING  MARKET CONDITIONS; (V) THE COMPANY'S HIGH DEGREE OF LEVERAGE COULD
MAKE  IT  MORE  VULNERABLE  IN  THE  EVENT  OF  A  DOWNTURN  IN GENERAL ECONOMIC
CONDITIONS  OR  ITS  BUSINESS OR CHANGING MARKET CONDITIONS AND REGULATIONS; AND
(VI)  TO THE EXTENT THAT THE COMPANY'S OBLIGATIONS UNDER THE FLOATING RATE NOTES
AND THE NEW FACILITIES BEARS INTEREST AT FLOATING RATES, AN INCREASE IN INTEREST
RATES  COULD ADVERSELY AFFECT, AMONG OTHER THINGS, THE COMPANY'S ABILITY TO MEET
ITS  FINANCING  OBLIGATIONS.

     THE COMPANY'S ABILITY TO REPAY OR TO REFINANCE ITS OBLIGATIONS WITH RESPECT
TO  ITS  INDEBTEDNESS  (INCLUDING  THE EXCHANGE NOTES) WILL DEPEND ON ITS FUTURE
FINANCIAL  AND  OPERATING  PERFORMANCE,  WHICH,  IN  TURN,  WILL  BE  SUBJECT TO
PREVAILING  ECONOMIC  AND  COMPETITIVE  CONDITIONS  AND  TO  CERTAIN  FINANCIAL,
BUSINESS,  LEGISLATIVE,  REGULATORY  AND OTHER FACTORS, MANY OF WHICH ARE BEYOND
THE  COMPANY'S  CONTROL, AS WELL AS THE AVAILABILITY OF BORROWINGS UNDER THE NEW
FACILITIES.  THESE FACTORS COULD INCLUDE OPERATING DIFFICULTIES, DIFFICULTIES IN
IDENTIFYING  AND  INTEGRATING  ACQUISITIONS,  INCREASED OPERATING COSTS, PRODUCT
PRICING  PRESSURES,  THE  RESPONSE  OF  COMPETITORS, REGULATORY DEVELOPMENTS AND
DELAYS  IN  IMPLEMENTING  STRATEGIC  PROJECTS,  INCLUDING  STORE  OPENINGS.  THE
COMPANY'S  ABILITY  TO MEET ITS DEBT SERVICE AND OTHER OBLIGATIONS MAY DEPEND IN
SIGNIFICANT  PART  ON THE EXTENT TO WHICH THE COMPANY CAN IMPLEMENT SUCCESSFULLY
ITS  BUSINESS  STRATEGY. THERE CAN BE NO ASSURANCE THAT THE COMPANY WILL BE ABLE
TO  IMPLEMENT ITS STRATEGY FULLY OR THAT THE ANTICIPATED RESULTS OF ITS STRATEGY
WILL  BE  REALIZED.

     IF  THE COMPANY IS UNABLE TO FUND ITS DEBT SERVICE OBLIGATIONS, THE COMPANY
MAY  BE  FORCED TO REDUCE OR DELAY CAPITAL EXPENDITURES, SELL ASSETS, OR SEEK TO
OBTAIN  ADDITIONAL  DEBT  OR  EQUITY CAPITAL, OR TO REFINANCE OR RESTRUCTURE ITS
DEBT  (INCLUDING  THE EXCHANGE NOTES). THE COMPANY MAY NEED ADDITIONAL FINANCING
TO  REPAY  THE EXCHANGE NOTES AT MATURITY. THERE CAN BE NO ASSURANCE THAT ANY OF
THESE  REMEDIES  CAN BE AFFECTED ON SATISFACTORY TERMS, IF AT ALL. FACTORS WHICH
COULD  AFFECT  THE COMPANY'S OR ITS SUBSIDIARIES' ACCESS TO THE CAPITAL MARKETS,
OR THE COST OF SUCH CAPITAL, INCLUDE CHANGES IN INTEREST RATES, GENERAL ECONOMIC
CONDITIONS  AND THE PERCEPTION IN THE CAPITAL MARKETS OF THE COMPANY'S BUSINESS,
RESULTS  OF  OPERATIONS,  LEVERAGE,  FINANCIAL CONDITION AND BUSINESS PROSPECTS.

THE  EXCHANGE  NOTES  ARE  SUBORDINATED  IN  RIGHT  OF PAYMENT TO ALL FUTURE AND
EXISTING  SENIOR  INDEBTEDNESS  OF  THE  COMPANY.  THE  EXCHANGE  NOTES  AND THE
GUARANTEES  ARE  SUBORDINATED  IN  RIGHT  OF  PAYMENT TO ALL EXISTING AND FUTURE
SENIOR  INDEBTEDNESS OF THE COMPANY, INCLUDING INDEBTEDNESS OF THE COMPANY UNDER
THE NEW FACILITIES, AND TO ALL EXISTING AND FUTURE GUARANTOR SENIOR INDEBTEDNESS
OF  THE  GUARANTORS,  INCLUDING  THE  GUARANTEES OF THE GUARANTORS UNDER THE NEW
FACILITIES,  RESPECTIVELY,  AND  THE  EXCHANGE  NOTES  ARE  ALSO  EFFECTIVELY
SUBORDINATED  TO  ALL  SECURED  INDEBTEDNESS  OF THE COMPANY AND THE GUARANTORS,
RESPECTIVELY,  TO  THE  EXTENT  OF  THE  VALUE OF THE
                                       33
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ASSETS  SECURING SUCH INDEBTEDNESS. THE OBLIGATIONS UNDER THE NEW FACILITIES ARE
GUARANTEED  BY THE GUARANTORS AND ARE SECURED BY SUBSTANTIALLY ALL OF THE ASSETS
OF  THE  COMPANY  AND  ALL DIRECT AND INDIRECT SUBSIDIARIES OF THE COMPANY AND A
PLEDGE  OF  THE  CAPITAL STOCK OF EACH SUCH SUBSIDIARY (BUT NOT TO EXCEED 65% OF
THE  VOTING  STOCK  OF  FOREIGN  SUBSIDIARIES).  AS  OF  DECEMBER  28, 2002, THE
AGGREGATE  AMOUNT OF SENIOR INDEBTEDNESS OF THE COMPANY WAS APPROXIMATELY $251.7
MILLION  (INCLUDING  A  $1.0  MILLION GUARANTEE BY THE COMPANY, BUT EXCLUSIVE OF
UNUSED  COMMITMENTS  UNDER  THE  NEW FACILITIES OF APPROXIMATELY $20.0 MILLION),
$130.0  MILLION  OF  WHICH  IS  GUARANTEED  BY  THE  GUARANTORS  UNDER  THE  NEW
FACILITIES.

     IN  THE  EVENT  OF  BANKRUPTCY,  LIQUIDATION, REORGANIZATION OR ANY SIMILAR
PROCEEDING  REGARDING  THE COMPANY, OR ANY GUARANTOR, OR ANY DEFAULT IN PAYMENT,
THE ASSETS OF THE COMPANY OR SUCH GUARANTOR, AS APPLICABLE, WILL BE AVAILABLE TO
PAY  OBLIGATIONS ON THE EXCHANGE NOTES ONLY AFTER THE SENIOR INDEBTEDNESS OF THE
COMPANY  OR  THE GUARANTOR SENIOR INDEBTEDNESS OF SUCH GUARANTOR, AS APPLICABLE,
HAS  BEEN  PAID IN FULL, AND THERE MAY NOT BE SUFFICIENT ASSETS REMAINING TO PAY
AMOUNTS  DUE  ON  ALL  OR  ANY  OF  THE  EXCHANGE NOTES. MOREOVER, UNDER CERTAIN
CIRCUMSTANCES,  IF  ANY  NONPAYMENT  DEFAULT  EXISTS  WITH RESPECT TO DESIGNATED
SENIOR  INDEBTEDNESS  WHICH  WOULD  PERMIT THE HOLDERS OF SUCH DESIGNATED SENIOR
INDEBTEDNESS  TO  ACCELERATE  THE MATURITY THEREOF, THE COMPANY MAY NOT MAKE ANY
PAYMENTS ON THE EXCHANGE NOTES FOR A SPECIFIC TIME, UNLESS SUCH DEFAULT IS CURED
OR  WAIVED,  OR SUCH DESIGNATED SENIOR INDEBTEDNESS IS PAID IN FULL. THE HOLDERS
OF  THE  EXCHANGE  NOTES  WILL HAVE NO DIRECT CLAIM AGAINST THE GUARANTORS OTHER
THAN  THE CLAIM CREATED BY THE GUARANTEES. THE RIGHTS OF HOLDERS OF THE EXCHANGE
NOTES  TO  PARTICIPATE  IN  ANY  DISTRIBUTION  OF  ASSETS  OF ANY GUARANTOR UPON
LIQUIDATION,  BANKRUPTCY  OR  REORGANIZATION  MAY,  AS  IS  THE  CASE WITH OTHER
UNSECURED  CREDITORS  OF  THE  COMPANY,  BE SUBJECT TO PRIOR CLAIMS AGAINST SUCH
GUARANTOR.  THE  GUARANTEES  MAY THEMSELVES BE SUBJECT TO LEGAL CHALLENGE IN THE
EVENT  OF  THE  BANKRUPTCY  OR  INSOLVENCY  OF  A GUARANTOR, OR IN CERTAIN OTHER
CIRCUMSTANCES.  IF  SUCH  A  CHALLENGE  WERE  UPHELD,  THE  GUARANTEES  WOULD BE
INVALIDATED  AND  UNENFORCEABLE.

THE  COMPANY  IS  RESTRICTED  BY  THE TERMS OF ITS INDEBTEDNESS FROM TAKING MANY
CORPORATE  ACTIONS  THAT  MAY  BE IMPORTANT TO ITS FUTURE SUCCESS. THE INDENTURE
RESTRICTS,  AMONG  OTHER THINGS, THE COMPANY'S AND ITS SUBSIDIARIES' ABILITY TO:
INCUR  ADDITIONAL INDEBTEDNESS; INCUR LIENS; PAY DIVIDENDS OR MAKE CERTAIN OTHER
RESTRICTED  PAYMENTS;  CONSUMMATE  CERTAIN  ASSET  SALES;  ENTER  INTO  CERTAIN
TRANSACTIONS WITH AFFILIATES; INCUR INDEBTEDNESS THAT IS SUBORDINATE IN RIGHT OF
PAYMENT  TO  ANY  SENIOR  INDEBTEDNESS  AND  SENIOR  IN  RIGHT OF PAYMENT TO THE
EXCHANGE  NOTES;  CREATE  OR  CAUSE  TO  EXIST  RESTRICTIONS ON THE ABILITY OF A
SUBSIDIARY  TO  PAY  DIVIDENDS OR MAKE CERTAIN PAYMENTS TO THE COMPANY; MERGE OR
CONSOLIDATE  WITH  ANY  OTHER PERSON OR SELL, ASSIGN, TRANSFER, LEASE, CONVEY OR
OTHERWISE  DISPOSE  OF ALL OR SUBSTANTIALLY ALL OF THE ASSETS OF THE COMPANY. IN
ADDITION,  THE  NEW  FACILITIES CONTAIN OTHER AND MORE RESTRICTIVE COVENANTS AND
PROHIBITS  THE  COMPANY  IN  ALL  CIRCUMSTANCES  FROM  PREPAYING  CERTAIN OF ITS
INDEBTEDNESS (INCLUDING THE EXCHANGE NOTES). THE NEW FACILITIES ALSO REQUIRE THE
COMPANY  TO  MAINTAIN  SPECIFIED FINANCIAL RATIOS. THE COMPANY'S ABILITY TO MEET
THOSE  FINANCIAL  RATIOS CAN BE AFFECTED BY EVENTS BEYOND ITS CONTROL, AND THERE
CAN  BE  NO ASSURANCE THAT THE COMPANY WILL MEET THOSE TESTS. A BREACH OF ANY OF
THESE  COVENANTS  COULD  RESULT IN A DEFAULT UNDER THE NEW FACILITIES AND/OR THE
INDENTURE.  UPON THE OCCURRENCE OF AN EVENT OF DEFAULT UNDER THE NEW FACILITIES,
THE  LENDERS  COULD  ALSO ELECT TO DECLARE ALL AMOUNTS OUTSTANDING UNDER THE NEW
FACILITIES,  TOGETHER  WITH  ACCRUED  INTEREST,  TO  BE  IMMEDIATELY  DUE  AND

                                       34
<PAGE>

PAYABLE. IF THE COMPANY WERE UNABLE TO REPAY THOSE AMOUNTS, THE LENDERS COULD
PROCEED  AGAINST  THE  COLLATERAL GRANTED TO THEM TO SECURE THAT INDEBTEDNESS OR
AGAINST  THE  GUARANTEES  OF  THE  GUARANTORS OF THE NEW FACILITIES. IF THE DEBT
OUTSTANDING  UNDER  THE  NEW  FACILITIES WERE TO BE ACCELERATED, THERE CAN BE NO
ASSURANCE  THAT  THE  ASSETS  OF  THE  COMPANY  AND  ITS  SUBSIDIARIES  WOULD BE
SUFFICIENT  TO  REPAY  THE  OBLIGATIONS  UNDER  THE NEW FACILITIES, OTHER SENIOR
INDEBTEDNESS, GUARANTOR SENIOR INDEBTEDNESS OR THE EXCHANGE NOTES. SUBSTANTIALLY
ALL  THE  ASSETS  OF THE COMPANY AND ITS SUBSIDIARIES SECURE THE NEW FACILITIES.
SEE  "LIQUIDITY  AND  CAPITAL  RESOURCES."

THE COMPANY IS SUBJECT TO A VARIETY OF STATE, LOCAL AND FEDERAL REGULATIONS THAT
AFFECT  THE  HEALTH  CARE  INDUSTRY,  WHICH  MAY  AFFECT ITS ABILITY TO GENERATE
REVENUE OR SUBJECT IT TO ADDITIONAL EXPENSES. THE COMPANY OR ITS LANDLORD LEASES
A  PORTION  OF  EACH OF THE COMPANY'S STORES OR ADJACENT SPACE TO AN INDEPENDENT
OPTOMETRIST.  THE  AVAILABILITY OF SUCH PROFESSIONAL SERVICES WITHIN OR ADJACENT
TO  THE  COMPANY'S  STORES  IS CRITICAL TO THE COMPANY'S MARKETING STRATEGY. THE
DELIVERY OF HEALTH CARE, INCLUDING THE RELATIONSHIPS AMONG HEALTH CARE PROVIDERS
SUCH  AS  OPTOMETRISTS AND SUPPLIERS (E.G., PROVIDERS OF EYEWEAR), IS SUBJECT TO
EXTENSIVE  FEDERAL  AND  STATE  REGULATION.  THE  LAWS  OF  MANY STATES PROHIBIT
BUSINESS CORPORATIONS SUCH AS THE COMPANY FROM PRACTICING MEDICINE OR EXERCISING
CONTROL  OVER THE MEDICAL JUDGMENTS OR DECISIONS OF PHYSICIANS AND FROM ENGAGING
IN CERTAIN FINANCIAL ARRANGEMENTS, SUCH AS SPLITTING FEES WITH PHYSICIANS. THESE
LAWS AND THEIR INTERPRETATIONS VARY FROM STATE TO STATE AND ARE ENFORCED BY BOTH
COURTS  AND  REGULATORY AUTHORITIES, EACH WITH BROAD DISCRETION. THE COMPANY HAS
ADDRESSED  THESE  PROHIBITIONS  WITH  THREE  DISTINCT OPERATING STRUCTURES. WITH
RESPECT  TO  198  OF  ITS  STORES,  THE COMPANY SUBLEASES A PORTION OF THE SPACE
WITHIN  OR  ADJACENT  TO  ITS  STORE  TO  AN INDEPENDENT OD. IN FORTY-SIX OF THE
STORES,  THE  COMPANY  DIRECTLY  EMPLOYS  THE  OPTOMETRIST. IN SIXTY-FOUR OF THE
COMPANY'S  STORES,  THE  COMPANY  HAS STRUCTURED ITS BUSINESS RELATIONSHIPS WITH
INDEPENDENT  OPTOMETRISTS  BY  SUBLEASING  THE  ENTIRE PREMISES TO THE OD PC AND
ENTERING  INTO  A  LONG-TERM  MANAGEMENT  AGREEMENT  TO MANAGE THE OPTOMETRIST'S
ENTIRE  PRACTICE  (WHICH  INCLUDES  THE  OPTICAL  DISPENSARY  AS  WELL  AS  THE
PROFESSIONAL EYE EXAMINATION PRACTICE). VIOLATIONS OF THESE LAWS COULD RESULT IN
CENSURE  OR  DELICENSING OF OPTOMETRISTS, CIVIL OR CRIMINAL PENALTIES, INCLUDING
LARGE CIVIL MONETARY PENALTIES, OR OTHER SANCTIONS. IN ADDITION, A DETERMINATION
IN  ANY  STATE THAT THE COMPANY IS ENGAGED IN THE CORPORATE PRACTICE OF MEDICINE
OR  ANY  UNLAWFUL  FEE-SPLITTING  ARRANGEMENT COULD RENDER ANY SERVICE AGREEMENT
BETWEEN  THE  COMPANY  AND  OPTOMETRISTS  LOCATED IN SUCH STATE UNENFORCEABLE OR
SUBJECT  TO  MODIFICATION,  WHICH  COULD  HAVE  A MATERIAL ADVERSE EFFECT ON THE
COMPANY.  THE  COMPANY BELIEVES IT IS CURRENTLY IN MATERIAL COMPLIANCE WITH EACH
OF  THESE  LAWS;  HOWEVER, COURTS AND REGULATORY AUTHORITIES WILL DETERMINE THAT
THESE  OPERATING  STRUCTURES  COMPLY  WITH  APPLICABLE LAWS AND REGULATIONS. SEE
"BUSINESS  -  GOVERNMENT  REGULATION."

     THE FRAUD AND ABUSE PROVISIONS OF THE SOCIAL SECURITY ACT AND ANTI-KICKBACK
LAWS  AND REGULATIONS ADOPTED IN MANY STATES PROHIBIT THE SOLICITATION, PAYMENT,
RECEIPT, OR OFFERING OF ANY DIRECT OR INDIRECT REMUNERATION IN RETURN FOR, OR AS
AN  INDUCEMENT  TO, CERTAIN REFERRALS OF PATIENTS, ITEMS OR SERVICES. PROVISIONS
OF  THE  SOCIAL  SECURITY  ACT  ALSO  IMPOSE  SIGNIFICANT PENALTIES FOR FALSE OR
IMPROPER BILLINGS TO MEDICARE AND MEDICAID, AND MANY STATES HAVE ADOPTED SIMILAR
LAWS  APPLICABLE  TO  ANY  PAYOR OF HEALTH CARE SERVICES. IN ADDITION, THE STARK
SELF-REFERRAL  LAW  IMPOSES RESTRICTIONS ON PHYSICIANS' REFERRALS FOR DESIGNATED
HEALTH  SERVICES REIMBURSABLE BY MEDICARE OR MEDICAID TO ENTITIES WITH WHICH THE
PHYSICIANS  HAVE  FINANCIAL  RELATIONSHIPS,  INCLUDING  THE  RENTAL  OF SPACE IF
CERTAIN  REQUIREMENTS  HAVE NOT BEEN SATISFIED. MANY STATES HAVE ADOPTED SIMILAR
SELF-

                                       35
<PAGE>

REFERRAL LAWS WHICH ARE NOT LIMITED TO MEDICARE OR MEDICAID REIMBURSED SERVICES.
VIOLATIONS  OF  ANY  OF  THESE  LAWS MAY RESULT IN SUBSTANTIAL CIVIL OR CRIMINAL
PENALTIES,  INCLUDING  DOUBLE  AND  TREBLE CIVIL MONETARY PENALTIES, AND, IN THE
CASE OF VIOLATIONS OF FEDERAL LAWS, EXCLUSION FROM PARTICIPATION IN THE MEDICARE
AND MEDICAID PROGRAMS. SUCH EXCLUSIONS AND PENALTIES, IF APPLIED TO THE COMPANY,
COULD HAVE A MATERIAL ADVERSE EFFECT ON THE COMPANY. THE COMPANY IS CURRENTLY IN
MATERIAL  COMPLIANCE  WITH ALL OF THE FOREGOING LAWS AND NO DETERMINATION OF ANY
VIOLATION  IN  ANY  STATE  HAS  BEEN  MADE  WITH  RESPECT TO THE FOREGOING LAWS.

THE  COMPANY'S  FUTURE  SUCCESS WILL DEPEND ON ITS ABILITY TO ENTER INTO MANAGED
CARE  CONTRACTS.  AS AN INCREASING PERCENTAGE OF PATIENTS ENTER INTO HEALTH CARE
COVERAGE  ARRANGEMENTS  WITH  MANAGED CARE PAYORS, THE COMPANY BELIEVES THAT ITS
SUCCESS  WILL  BE,  IN  PART,  DEPENDENT UPON THE COMPANY'S ABILITY TO NEGOTIATE
CONTRACTS WITH EMPLOYER GROUPS AND OTHER PRIVATE THIRD PARTY PAYORS. MANY OF THE
EXISTING  MANAGED  CARE  CONTRACTS  MAY  BE TERMINATED WITH LITTLE OR NO NOTICE.
THERE  IS  NO  CERTAINTY  THAT THE COMPANY WILL BE ABLE TO ESTABLISH OR MAINTAIN
SATISFACTORY  RELATIONSHIPS WITH MANAGED CARE AND OTHER THIRD PARTY PAYORS, MANY
OF  WHICH ALREADY HAVE EXISTING PROVIDER STRUCTURES IN PLACE AND MAY NOT BE ABLE
OR  WILLING  TO  CHANGE THEIR PROVIDER NETWORKS. THE INABILITY OF THE COMPANY TO
MAINTAIN ITS CURRENT RELATIONSHIPS OR ENTER INTO SUCH ARRANGEMENTS IN THE FUTURE
COULD  HAVE  A  MATERIAL  ADVERSE  EFFECT  ON  THE  COMPANY.

     THE  COMPANY'S  CONTRACTUAL ARRANGEMENTS WITH MANAGED CARE COMPANIES ON THE
ONE HAND, AND THE NETWORKS OF OPTOMETRISTS AND OTHER PROVIDERS ON THE OTHER, ARE
SUBJECT  TO  FEDERAL  AND  STATE  REGULATIONS,  INCLUDING BUT NOT LIMITED TO THE
FOLLOWING:

INSURANCE LICENSURE.  MOST STATES IMPOSE STRICT LICENSURE REQUIREMENTS ON HEALTH
INSURANCE  COMPANIES,  HMOS  AND  OTHER COMPANIES THAT ENGAGE IN THE BUSINESS OF
INSURANCE.  IN  MOST  STATES,  THESE  LAWS  DO  NOT  APPLY TO NETWORKS PAID ON A
DISCOUNTED  FEE-FOR-SERVICE  ARRANGEMENTS  OR ON A CAPITATED BASIS. IN THE EVENT
THAT  THE COMPANY IS REQUIRED TO BECOME LICENSED UNDER THESE LAWS, THE LICENSURE
PROCESS  CAN  BE  LENGTHY AND TIME CONSUMING. IN ADDITION, MANY OF THE LICENSING
REQUIREMENTS  MANDATE  STRICT FINANCIAL AND OTHER REQUIREMENTS WHICH THE COMPANY
MAY  NOT  BE  ABLE  TO  MEET.

ANY  WILLING  PROVIDER  LAWS.  SOME  STATES  HAVE  ADOPTED,  AND  OTHERS  ARE
CONSIDERING,  LEGISLATION  THAT  REQUIRES  MANAGED  CARE  PAYORS  TO INCLUDE ANY
PROVIDER  WHO  IS  WILLING  TO  ABIDE  BY  THE TERMS OF THE MANAGED CARE PAYOR'S
CONTRACTS  AND/OR  PROHIBIT  TERMINATION  OF  PROVIDERS WITHOUT CAUSE. SUCH LAWS
WOULD  LIMIT  THE  ABILITY  OF  THE  COMPANY  TO  DEVELOP EFFECTIVE MANAGED CARE
PROVIDER  NETWORKS  IN  SUCH  STATES.

ANTITRUST  LAWS.  THE  COMPANY  AND  ITS  NETWORKS OF PROVIDERS ARE SUBJECT TO A
RANGE  OF  ANTITRUST  LAWS  THAT  PROHIBIT  ANTI-COMPETITIVE  CONDUCT, INCLUDING
PRICE-FIXING,  CONCERTED REFUSALS TO DEAL AND DIVISIONS OF MARKETS. THERE CAN BE
NO  ASSURANCE  THAT THERE WILL NOT BE A CHALLENGE TO THE COMPANY'S OPERATIONS ON
THE  BASIS  OF  AN  ANTITRUST  VIOLATION  IN  THE  FUTURE.

ANY  TERMINATION  OF THE COMPANY'S LONG TERM PROFESSIONAL CORPORATION MANAGEMENT
AGREEMENTS  OR A DISPUTE WITH THE OD PCS WOULD HARM ITS BUSINESS.  SIXTY-FOUR OF
THE  STORES  ARE  SUBLEASED  TO  AN  OD PC THAT EMPLOYS THE ODS, AND THE COMPANY
(THROUGH  ITS  SUBSIDIARIES)

                                       36
<PAGE>

OPERATES  THE  STORE  THROUGH  THE PROVISION OF MANAGEMENT SERVICES TO THE OD PC
(INCLUDING MANAGEMENT OF THE PROFESSIONAL PRACTICE AND OPTICAL RETAIL BUSINESS).
EACH  OF  THE  OD  PCS  OWN BETWEEN TWELVE AND TWENTY-FOUR STORES. EACH OF THESE
RELATIONSHIPS  IS  MATERIAL TO THE COMPANY. IN ADDITION, THE COMPANY HAS A RIGHT
TO,  AND  WITH  RESPECT  TO  THE HOUR EYE'S LOCATIONS THE OD PC HAS THE RIGHT TO
CAUSE  THE  COMPANY  TO,  DESIGNATE ANOTHER OPTOMETRIST TO PURCHASE THE STOCK OR
ASSETS  OF  THE  OD  PC  AT AN AGREED UPON CALCULATION TO DETERMINE THE PURCHASE
PRICE.  AT  DECEMBER  28,  2002,  THESE  PRICES  RANGE FROM $3.0 MILLION TO $5.0
MILLION  IN  THE  AGGREGATE. WHILE THESE CONTRACTS ARE LONG-TERM COMMITMENTS, NO
ASSURANCES CAN BE GIVEN AS TO THE LIKELIHOOD OF AN AGREEMENT BEING TERMINATED BY
AN  OD  OR A DISPUTE ARISING BETWEEN THE COMPANY AND THE OD AND TO THE RESULTING
IMPACT  ON  THE  COMPANY'S REVENUES AND CASHFLOWS. A FINDING THAT THE OD PC DOES
NOT COMPLY WITH APPLICABLE LAWS, A DISPUTE WITH AN OD PC OR THE TERMINATION OF A
MANAGEMENT  RELATIONSHIP  COULD  HAVE  A MATERIAL ADVERSE EFFECT ON THE COMPANY.

PROPOSED  AND  FUTURE  HEALTH  CARE  REFORM  INITIATIVES COULD HARM THE COMPANY.
THERE  HAVE  BEEN  NUMEROUS  INITIATIVES  AT  THE  FEDERAL  AND STATE LEVELS FOR
COMPREHENSIVE  REFORMS  AFFECTING THE PAYMENT FOR AND AVAILABILITY OF HEALTHCARE
SERVICES.  THE  COMPANY  BELIEVES THAT SUCH INITIATIVES WILL CONTINUE DURING THE
FORESEEABLE  FUTURE. ASPECTS OF CERTAIN OF THESE REFORMS AS PROPOSED IN THE PAST
OR  OTHERS  THAT  MAY  BE  INTRODUCED  COULD,  IF  ADOPTED, ADVERSELY AFFECT THE
COMPANY.

     THE  FOLLOWING,  AMONG OTHERS, ARE POTENTIAL GOVERNMENTAL INITIATIVES WHICH
MAY  HAVE  AN  ADVERSE  EFFECT  ON  THE  COMPANY.

LICENSURE.  THE  COMPANY  MUST  OBTAIN LICENSES OR CERTIFICATIONS TO OPERATE ITS
BUSINESS  IN  CERTAIN  STATES. TO OBTAIN AND MAINTAIN SUCH LICENSES, THE COMPANY
MUST  SATISFY  CERTAIN LICENSURE STANDARDS. CHANGES IN LICENSURE STANDARDS COULD
INCREASE  THE  COMPANY'S  COSTS  OR  PREVENT  THE COMPANY FROM PROVIDING CERTAIN
SERVICES, BOTH OF WHICH COULD HAVE A MATERIAL ADVERSE EFFECT ON THE COMPANY. SEE
"BUSINESS."

FRAUD  AND  ABUSE  AND STARK LAWS. THERE ARE A VARIETY OF FEDERAL AND STATE LAWS
THAT  AFFECT  FINANCIAL  AND SERVICE ARRANGEMENTS BETWEEN HEALTH CARE PROVIDERS.
THE  MEDICARE  AND  MEDICAID  ANTI-FRAUD  AND ABUSE LAWS, AS WELL AS THE LAWS OF
CERTAIN STATES, PROHIBIT HEALTH CARE PROVIDERS FROM OFFERING, PAYING, SOLICITING
OR RECEIVING ANY PAYMENTS, DIRECTLY OR INDIRECTLY, IN CASH OR IN KIND, WHICH ARE
DESIGNED  TO  INDUCE  OR  ENCOURAGE  THE  REFERRAL  OF  PATIENTS  TO,  OR  THE
RECOMMENDATION  OF,  A  PARTICULAR  PROVIDER  FOR MEDICAL PRODUCTS AND SERVICES.

     IN ADDITION, FEDERAL LAW, AS WELL AS THE LAWS OF CERTAIN STATES, PROHIBIT A
PHYSICIAN,  INCLUDING  AN  OPTOMETRIST  OR  OPHTHALMOLOGIST, WHO HAS A FINANCIAL
RELATIONSHIP  THROUGH  AN  INVESTMENT  INTEREST  OR COMPENSATION ARRANGEMENT (OR
WHOSE IMMEDIATE FAMILY MEMBER HAS SUCH A FINANCIAL RELATIONSHIP) WITH A PROVIDER
OF  DESIGNATED  HEALTH  SERVICES FROM MAKING REFERRALS TO THAT PROVIDER FOR SUCH
SERVICES, UNLESS THE FINANCIAL RELATIONSHIP QUALIFIES FOR AN EXCEPTION UNDER THE
APPLICABLE  LAW.  THE  FEDERAL  LAW, AS WELL AS THE LAWS OF CERTAIN STATES, ALSO
PROHIBIT THE PROVIDER OF SUCH SERVICES FROM BILLING FOR SERVICES PROVIDED AS THE
RESULT  OF  A  PROHIBITED  REFERRAL.  UNDER  THE  FEDERAL LAW, DESIGNATED HEALTH
SERVICES  IN  CERTAIN  INSTANCES  INCLUDE  EYE  GLASSES  AND LENSES. THE FEDERAL
GOVERNMENT  HAS  ISSUED  PROPOSED  REGULATIONS WHICH FURTHER DESCRIBE PROHIBITED
REFERRALS,  THE  NATURE OF FINANCIAL RELATIONSHIPS AND PERMITTED EXCEPTIONS. THE
COMPANY  BELIEVES  THAT  IT  IS IN

                                       37
<PAGE>

MATERIAL  COMPLIANCE  WITH THESE REGULATIONS AS PROPOSED. THE FEDERAL GOVERNMENT
HAS  NOT  YET  ISSUED  FINAL  REGULATIONS.

     THE  COMPANY  HAS FINANCIAL RELATIONSHIPS WITH NUMEROUS PHYSICIANS TO WHICH
THESE  LAWS  AND  REGULATIONS APPLY. WHILE THE COMPANY REVIEWS SUCH ARRANGEMENTS
FOR  COMPLIANCE  WITH  APPLICABLE  LAWS  AND  REGULATIONS,  THE  COMPANY HAS NOT
REQUESTED,  AND  HAS  NOT  RECEIVED,  FROM  ANY  GOVERNMENTAL AGENCY AN ADVISORY
OPINION  FINDING  THAT SUCH RELATIONSHIPS ARE IN COMPLIANCE WITH APPLICABLE LAWS
AND REGULATIONS, AND ALL SUCH FINANCIAL RELATIONSHIPS MAY NOT BE FOUND TO COMPLY
WITH  SUCH LAWS AND REGULATIONS. IT IS ALSO POSSIBLE THAT FUTURE INTERPRETATIONS
OF  SUCH  LAWS  AND  REGULATIONS  WILL  REQUIRE  MODIFICATIONS  TO THE COMPANY'S
BUSINESS  ARRANGEMENTS.

     VIOLATIONS OF THESE LAWS AND REGULATIONS MAY RESULT IN SUBSTANTIAL CIVIL OR
CRIMINAL  PENALTIES, INCLUDING DOUBLE AND TREBLE MONETARY PENALTIES, AND, IN THE
CASE  OF VIOLATIONS OF FEDERAL LAWS AND REGULATIONS, EXCLUSION FROM THE MEDICARE
AND MEDICAID PROGRAMS. SUCH EXCLUSIONS AND PENALTIES, IF APPLIED TO THE COMPANY,
COULD  HAVE  A  MATERIAL  ADVERSE  EFFECT  ON  THE  COMPANY.

CHANGES  IN  REIMBURSEMENT.  GOVERNMENT REVENUE SOURCES ARE SUBJECT TO STATUTORY
AND  REGULATORY  CHANGES,  ADMINISTRATIVE  RULINGS,  INTERPRETATIONS  OF POLICY,
DETERMINATIONS  BY  FISCAL  INTERMEDIARIES  AND CARRIERS, AND GOVERNMENT FUNDING
LIMITATIONS,  ALL  OF  WHICH  MAY  MATERIALLY  INCREASE OR DECREASE THE RATES OF
PAYMENT  AND  CASH FLOW TO THE COMPANY. THERE IS NO ASSURANCE THAT PAYMENTS MADE
UNDER SUCH PROGRAMS WILL REMAIN AT LEVELS COMPARABLE TO THE PRESENT LEVELS OR BE
SUFFICIENT  TO  COVER  ALL  OPERATING AND FIXED COSTS. GOVERNMENT OR THIRD PARTY
PAYORS  MAY RETROSPECTIVELY AND/OR PROSPECTIVELY ADJUST PREVIOUS PAYMENTS TO THE
COMPANY  IN  AMOUNTS  WHICH WOULD HAVE A MATERIAL ADVERSE EFFECT ON THE COMPANY.

THE  COMPANY  IS  VULNERABLE  TO  POSSIBLE  FRANCHISE  CLAIMS.  TWO OPTOMETRISTS
ASSERTED CLAIMS ARISING OUT OF THE NONRENEWAL OF THEIR SUBLEASES OF OFFICE SPACE
WITH THE COMPANY AND THEIR TRADEMARK LICENSE AGREEMENTS WITH ENCLAVE ADVANCEMENT
GROUP,  INC.,  A  SUBSIDIARY  OF  THE  COMPANY  ("ENCLAVE").  SUCH  OPTOMETRISTS
CONTENDED  THAT  THE LEASING OF SPACE FROM THE COMPANY, COUPLED WITH THE LICENSE
FROM  ENCLAVE  OF  CERTAIN  TRADEMARKS,  CONSTITUTED  A  FRANCHISE,  AND  SUCH
OPTOMETRISTS  HAVE  ALLEGED  VARIOUS CLAIMS ARISING OUT OF THIS CONTENTION. THIS
CLAIM WAS SETTLED IN MAY, 1998. WHILE THE COMPANY BELIEVES THAT THE STRUCTURE OF
THE RELATIONSHIPS AMONG THE COMPANY, ENCLAVE AND THE OPTOMETRISTS WERE OPERATING
NEAR  THE  COMPANY'S RETAIL STORES DOES NOT CONSTITUTE A FRANCHISE, NO ASSURANCE
CAN  BE GIVEN THAT A CLAIM, ACTION OR PROCEEDING WILL NOT BE BROUGHT AGAINST THE
COMPANY  OR  ENCLAVE  ASSERTING  THAT  A  FRANCHISE  EXISTS.

THE  COMPANY  RELIES ON THIRD-PARTY REIMBURSEMENT, THE FUTURE REDUCTION OF WHICH
WOULD  HARM  ITS BUSINESS.  THE COST OF A SIGNIFICANT PORTION OF MEDICAL CARE IN
THE  UNITED  STATES IS FUNDED BY GOVERNMENT AND PRIVATE INSURANCE PROGRAMS, SUCH
AS  MEDICARE,  MEDICAID  AND  CORPORATE  HEALTH  INSURANCE  PLANS.  ACCORDING TO
GOVERNMENTAL PROJECTIONS, IT IS EXPECTED THAT MORE MEDICAL BENEFICIARIES WHO ARE
SIGNIFICANT  CONSUMERS  OF  EYE  CARE  SERVICES  WILL  ENROLL IN MANAGEMENT CARE
ORGANIZATIONS.  THE  HEALTH  CARE  INDUSTRY  IS  EXPERIENCING  A  TREND  TOWARD
COST-CONTAINMENT  WITH  GOVERNMENTAL  AND  PRIVATE THIRD PARTY PAYORS SEEKING TO
IMPOSE LOWER REIMBURSEMENT, UTILIZATION RESTRICTIONS AND RISK-BASED COMPENSATION
ARRANGEMENTS.  PRIVATE  THIRD-PARTY  REIMBURSEMENT  PLANS  ARE  ALSO  DEVELOPING
INCREASINGLY  SOPHISTICATED  METHODS  OF  CONTROLLING  HEALTH CARE COSTS THROUGH

                                       38
<PAGE>

REDESIGN  OF  BENEFITS  AND  EXPLORATIONS  OF  MORE  COST-EFFECTIVE  METHODS  OF
DELIVERING  HEALTH  CARE.  ACCORDINGLY,  THERE  CAN  BE  NO  ASSURANCE  THAT
REIMBURSEMENT  FOR  PURCHASE AND USE OF EYE CARE SERVICES WILL NOT BE LIMITED OR
REDUCED  AND  THEREBY  ADVERSELY  AFFECT  FUTURE  SALES  BY  THE  COMPANY.

THE  COMPANY MAY BE EXPOSED TO A SIGNIFICANT RISK FROM LIABILITY CLAIMS IF IT IS
UNABLE TO OBTAIN INSURANCE, AT ACCEPTABLE COSTS, TO PROTECT IT AGAINST POTENTIAL
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 OPTOMETRY BY THE OPTOMETRISTS THAT
IT  EMPLOYS  OR  AFFILIATES  WITH,  NOR  DOES  IT  HAVE RESPONSIBILITY FOR THEIR
COMPLIANCE WITH CERTAIN REGULATORY AND OTHER REQUIREMENTS DIRECTLY APPLICABLE TO
THESE  INDIVIDUAL  PROFESSIONALS.  AS  A  RESULT OF THE RELATIONSHIP BETWEEN THE
EMPLOYED  AND  AFFILIATED OPTOMETRISTS AND THE COMPANY, HOWEVER, THE COMPANY MAY
BECOME  SUBJECT  TO  PROFESSIONAL  MALPRACTICE  ACTIONS  OR CLAIMS UNDER VARIOUS
THEORIES  RELATING  TO  THE PROFESSIONAL SERVICES PROVIDED BY THESE INDIVIDUALS.
THE  COMPANY  MAY NOT BE ABLE TO CONTINUE TO OBTAIN ADEQUATE LIABILITY INSURANCE
AT  REASONABLE RATES, IN WHICH EVENT, ITS INSURANCE MAY NOT BE ADEQUATE TO COVER
CLAIMS  ASSERTED  AGAINST  IT, IN WHICH EVENT, ITS FUTURE CASH POSITION COULD BE
REDUCED  AND  ITS  ABILITY  TO  CONTINUE  OPERATIONS  COULD  BE  JEOPARDIZED.

IF  THE  COMPANY  IS  UNABLE  TO MAKE A CHANGE OF CONTROL PAYMENT, IT WILL BE IN
DEFAULT  UNDER  THE  INDENTURE.  UPON  THE  OCCURRENCE  OF  A CHANGE OF CONTROL,
SUBJECT  TO CERTAIN CONDITIONS, THE COMPANY WILL BE REQUIRED TO MAKE AN OFFER TO
PURCHASE  ALL  OF THE OUTSTANDING EXCHANGE NOTES AT A PRICE EQUAL TO 101% OF THE
PRINCIPAL  AMOUNT  THEREOF  AT  THE  DATE  OF  PURCHASE  PLUS ACCRUED AND UNPAID
INTEREST, IF ANY, TO THE DATE OF PURCHASE. IF A CHANGE OF CONTROL WERE TO OCCUR,
THERE  CAN  BE  NO ASSURANCE THAT THE COMPANY WOULD HAVE SUFFICIENT FUNDS TO PAY
THE  REPURCHASE  PRICE  FOR  ALL EXCHANGE NOTES TENDERED BY THE HOLDERS THEREOF;
SUCH  FAILURE  WOULD  RESULT  IN  AN  EVENT  OF DEFAULT UNDER THE INDENTURE. THE
OCCURRENCE  OF  A  CHANGE  OF  CONTROL  WOULD CONSTITUTE A DEFAULT UNDER THE NEW
FACILITIES  AND  MIGHT CONSTITUTE A DEFAULT UNDER THE OTHER AGREEMENTS GOVERNING
INDEBTEDNESS  THAT  THE  COMPANY OR ITS SUBSIDIARIES MAY ENTER INTO FROM TIME TO
TIME. IN ADDITION, THE NEW FACILITIES PROHIBITS THE PURCHASE OF THE NOTES BY THE
COMPANY  IN  THE EVENT OF A CHANGE OF CONTROL, UNLESS AND UNTIL SUCH TIME AS THE
INDEBTEDNESS  UNDER  THE NEW FACILITIES IS REPAID IN FULL. THE COMPANY'S FAILURE
TO  PURCHASE  THE NOTES IN SUCH INSTANCE WOULD RESULT IN A DEFAULT UNDER EACH OF
THE  INDENTURE  AND  THE NEW FACILITIES. THE INABILITY TO REPAY THE INDEBTEDNESS
UNDER  THE  NEW  FACILITIES,  IF  ACCELERATED,  COULD  HAVE  A  MATERIAL ADVERSE
CONSEQUENCES  TO  THE  COMPANY  AND  TO  HOLDERS  OF  THE EXCHANGE NOTES. FUTURE
INDEBTEDNESS  OF  THE COMPANY MAY ALSO CONTAIN PROHIBITIONS OF CERTAIN EVENTS OR
TRANSACTIONS  THAT  COULD  CONSTITUTE  A  CHANGE  OF  CONTROL  OR  REQUIRE  SUCH
INDEBTEDNESS  TO  BE  REPURCHASED  UPON  A CHANGE OF CONTROL. SEE "LIQUIDITY AND
CAPITAL  RESOURCES."

IF  THE  COMPANY  FAILS  TO  MAKE TIMELY PAYMENTS ON ANY OF ITS INDEBTEDNESS, AN
EVENT  OF  DEFAULT  UNDER  THE  INDENTURE  WOULD BE TRIGGERED THE FAILURE TO PAY
PRINCIPAL  AT  MATURITY UNDER THE TERMS OF ANY INDEBTEDNESS, AFTER GIVING EFFECT
TO  ANY APPLICABLE GRACE PERIOD OR EXTENSIONS THEREOF, BY THE COMPANY, RESULTING
IN  A DEFAULT UNDER SUCH INDEBTEDNESS, WOULD RESULT IN AN EVENT OF DEFAULT UNDER
THE  EXCHANGE  NOTES. IF SUCH AN EVENT OF DEFAULT WERE TO OCCUR, THERE CAN BE NO
ASSURANCE  THAT  THE  COMPANY  WOULD HAVE SUFFICIENT FUNDS TO PAY THE REPURCHASE
PRICE  FOR  ALL  EXCHANGE  NOTES  TENDERED  BY  THE  HOLDERS  THEREOF.  FUTURE
INDEBTEDNESS  OF  THE  COMPANY  MAY  ALSO  CONTAIN

                                       39
<PAGE>

PROHIBITIONS OF CERTAIN EVENTS OR TRANSACTIONS THAT WOULD CONSTITUTE A CHANGE OF
CONTROL OR REQUIRE SUCH INDEBTEDNESS TO BE REPURCHASED UPON A CHANGE OF CONTROL.

IN  BANKRUPTCY,  THE  EXCHANGE NOTES MAY BE INVALIDATED OR SUBORDINATED TO OTHER
DEBTS  OF THE COMPANY.  UNDER APPLICABLE PROVISIONS OF FEDERAL BANKRUPTCY LAW OR
COMPARABLE  PROVISIONS  OF  STATE  FRAUDULENT  CONVEYANCE  LAW,  IF, AMONG OTHER
THINGS,  THE COMPANY OR THE GUARANTORS, AT THE TIME IT INCURRED THE INDEBTEDNESS
EVIDENCE  BY  THE  EXCHANGE NOTES OR THE GUARANTEES, AS THE CASE MAY BE, (I) (A)
WAS  OR  IS  INSOLVENT OR RENDERED INSOLVENT BY REASON OF SUCH OCCURRENCE OF (B)
WAS  OR  IS  ENGAGED  IN A BUSINESS OR TRANSACTION OF WHICH THE ASSETS REMAINING
WITH  THE  COMPANY  OR  THE  GUARANTORS  WERE  UNREASONABLY  SMALL OR CONSTITUTE
UNREASONABLY  SMALL  CAPITAL  OR  (C) INTENDED OR INTENDS TO INCUR, OR BELIEVED,
BELIEVES  OR  SHOULD HAVE BELIEVED THAT IT WOULD INCUR, DEBTS BEYOND ITS ABILITY
TO  REPAY  SUCH  DEBTS  AS  THEY  MATURE  AND  (II) THE COMPANY OR THE GUARANTOR
RECEIVED  OR  RECEIVES  LESS  THAN  THE  REASONABLY  EQUIVALENT  VALUE  OR  FAIR
CONSIDERATION  FOR  THE  INCURRENCE OF SUCH INDEBTEDNESS, THE EXCHANGE NOTES AND
THE  GUARANTEES  COULD  BE INVALIDATED OR SUBORDINATED TO ALL OTHER DEBTS OF THE
COMPANY  OR THE GUARANTORS, AS THE CASE MAY BE. THE EXCHANGE NOTES OR GUARANTEES
COULD  ALSO  BE INVALIDATED OR SUBORDINATED IF IT WERE FOUND THAT THE COMPANY OR
THE  GUARANTOR, AS THE CASE MAY BE, INCURRED INDEBTEDNESS IN CONNECTION WITH THE
EXCHANGE  NOTES  OR  THE  GUARANTEES  WITH  THE INTENT OF HINDERING, DELAYING OR
DEFRAUDING  CURRENT OR FUTURE CREDITORS OF THE COMPANY OR THE GUARANTORS, AS THE
CASE  MAY  BE. IN ADDITION, THE PAYMENT OF INTEREST AND PRINCIPAL BY THE COMPANY
PURSUANT  TO  THE  EXCHANGE  NOTES  OR  THE PAYMENT OF AMOUNTS BY THE GUARANTORS
PURSUANT  TO  THE  GUARANTEES COULD BE VOIDED AND REQUIRED TO BE RETURNED TO THE
PERSON MAKING SUCH PAYMENT, OR TO A FUND FOR THE BENEFIT OF THE CREDITORS OF THE
COMPANY  OR  THE  GUARANTORS,  AS  THE  CASE  MAY  BE.

     THE  MEASURES  OF  INSOLVENCY  FOR PURPOSES OF THE FOREGOING CONSIDERATIONS
WILL  VARY  DEPENDING UPON THE LAW APPLIED IN ANY PROCEEDING WITH RESPECT TO THE
FOREGOING. GENERALLY, HOWEVER, THE COMPANY OR THE GUARANTORS WOULD BE CONSIDERED
INSOLVENT  IF  (I)  THE SUM OF ITS DEBTS, INCLUDING CONTINGENT LIABILITIES, WERE
GREATER  THAN THE SUM OF ALL OF ITS ASSETS AT A FAIR VALUATION OR IF THE PRESENT
FAIR  SALEABLE  VALUE  OF  ITS  ASSETS  WERE  LESS THAN THE AMOUNT THAT WOULD BE
REQUIRED  TO  PAY  ITS  PROBABLE  LIABILITY  ON  ITS  EXISTING  DEBTS, INCLUDING
CONTINGENT  LIABILITIES, AS THEY BECOME ABSOLUTE AND MATURE OR (II) IT COULD NOT
PAY  ITS  DEBTS  AS  THEY  BECOME  DUE.

     TO THE EXTENT THE GUARANTEES WERE VOIDED AS A FRAUDULENT CONVEYANCE OR HELD
UNENFORCEABLE  FOR  ANY  OTHER  REASON, HOLDERS OF EXCHANGE NOTES WOULD CEASE TO
HAVE ANY CLAIM IN RESPECT OF THE GUARANTORS AND WOULD BE CREDITORS SOLELY OF THE
COMPANY.  IN  SUCH  EVENT,  THE  CLAIMS OF HOLDERS OF EXCHANGE NOTES AGAINST THE
GUARANTORS  WOULD  BE  SUBJECT  TO  THE  PRIOR  PAYMENT  OF  ALL LIABILITIES AND
PREFERRED  STOCK CLAIMS OF THE GUARANTORS. THERE CAN BE NO ASSURANCE THAT, AFTER
PROVIDING  FOR  ALL  PRIOR  CLAIMS  AND PREFERRED STOCK INTERESTS, IF ANY, THERE
WOULD  BE  SUFFICIENT  ASSETS TO SATISFY THE CLAIMS OF HOLDERS OF EXCHANGE NOTES
RELATING  TO  ANY  VOIDED  PORTIONS  OF  THE  GUARANTEES.


THL  CONTROLS  THE COMPANY AND MAY HAVE INTERESTS THAT DIVERGE FROM THOSE OF THE
HOLDERS  OF  THE EXCHANGE NOTES.  THL OWNS APPROXIMATELY 90.2% OF THE ISSUED AND
OUTSTANDING  COMMON STOCK. ACCORDINGLY, THL CONTROLS THE COMPANY AND HAS ELECTED
A  MAJORITY  OF  ITS DIRECTORS, APPOINTED NEW MANAGEMENT AND APPROVED ANY ACTION
REQUIRING  THE  APPROVAL  OF  THE  HOLDERS  OF

                                       40
<PAGE>

COMMON  STOCK,  INCLUDING  ADOPTING  AMENDMENTS  TO  THE  COMPANY'S  CHARTER AND
APPROVING  MERGERS  OR  SALES  OF SUBSTANTIALLY ALL OF THE COMPANY'S ASSETS. THE
DIRECTORS  ELECTED  BY  THL  HAVE  THE AUTHORITY TO MAKE DECISIONS AFFECTING THE
CAPITAL  STRUCTURE  OF THE COMPANY, INCLUDING THE ISSUANCE OF ADDITIONAL CAPITAL
STOCK,  THE  IMPLEMENTATION  OF STOCK REPURCHASE PROGRAMS AND THE DECLARATION OF
DIVIDENDS.  THERE CAN BE NO ASSURANCE THAT THE INTERESTS OF THL DOES OR WILL NOT
CONFLICT  WITH  THE INTERESTS OF THE HOLDERS OF THE EXCHANGE NOTES. SEE "CERTAIN
RELATIONSHIPS  AND  RELATED  TRANSACTIONS."

THE  COMPANY  DEPENDS  ON  THE  ABILITY AND EXPERIENCE OF CERTAIN MEMBERS OF ITS
MANAGEMENT  TEAM  AND  THEIR  DEPARTURE MAY HURT ITS FINANCIAL PERFORMANCE.  THE
COMPANY RELIES ON THE SKILLS OF CERTAIN MEMBERS OF ITS SENIOR MANAGEMENT TEAM TO
GUIDE  OPERATIONS,  THE  LOSS  OF  WHICH  COULD  HAVE  AN  ADVERSE EFFECT ON ITS
OPERATIONS.  FURTHERMORE,  THE MEMBERS OF ITS SENIOR MANAGEMENT TEAM, OTHER THAN
MR.  MCCOMAS,  HAVE  ANNUAL  EMPLOYMENT  AGREEMENTS  WITH  THE  COMPANY  THAT
AUTOMATICALLY  RENEW  UNLESS EITHER PARTY GIVES THIRTY DAY NOTICE.  ACCORDINGLY,
KEY  EXECUTIVES  MAY  NOT  CONTINUE TO WORK FOR THE COMPANY, AND IT MAY NOT HAVE
ADEQUATE TIME TO HIRE QUALIFIED REPLACEMENTS WHICH COULD HAVE A MATERIAL ADVERSE
EFFECT  ON  THE  COMPANY.

THE  EXCHANGE  NOTES  ARE  NOT PUBLICLY TRADED AND THEREFORE MAY NOT BE A LIQUID
INVESTMENT.  THERE IS NO EXISTING MARKET FOR THE EXCHANGE NOTES AND THERE CAN BE
NO  ASSURANCES  AS  TO  THE  LIQUIDITY  OF  ANY MARKETS THAT MAY DEVELOP FOR THE
EXCHANGE  NOTES,  THE  ABILITY  OF  HOLDERS  OF THE EXCHANGE NOTES TO SELL THEIR
EXCHANGE  NOTES,  OR  THE  PRICE  AT  WHICH  HOLDERS WOULD BE ABLE TO SELL THEIR
EXCHANGE  NOTES. FUTURE TRADING PRICES OF THE EXCHANGE NOTES WILL DEPEND ON MANY
FACTORS,  INCLUDING AMONG OTHER THINGS, PREVAILING INTEREST RATES, THE COMPANY'S
OPERATING  RESULTS  AND  THE  MARKET  FOR  SIMILAR  SECURITIES.

ITEM  7A.     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.

INTEREST  RATE  RISK

     THE  COMPANY'S  PRIMARY  MARKET  RISK  EXPOSURE IS INTEREST RATE RISK, WITH
SPECIFIC  VULNERABILITY  TO  CHANGES  IN  LIBOR. AS OF DECEMBER 28, 2002, $152.1
MILLION  OF  THE  COMPANY'S  LONG-TERM  DEBT  BORE  INTEREST  AT VARIABLE RATES.
ACCORDINGLY,  THE COMPANY'S NET INCOME IS AFFECTED BY CHANGES IN INTEREST RATES.
ASSUMING  A  TWO  HUNDRED  BASIS  POINT CHANGE IN THE 2002 AVERAGE INTEREST RATE
UNDER  THE  $152.1  MILLION  IN  BORROWINGS, THE COMPANY'S 2002 INTEREST EXPENSE
WOULD  HAVE  CHANGED  APPROXIMATELY  $3.0  MILLION.

     IN  THE EVENT OF AN ADVERSE CHANGE IN INTEREST RATES, MANAGEMENT COULD TAKE
ACTIONS TO MITIGATE ITS EXPOSURE. HOWEVER, DUE TO THE UNCERTAINTY OF THE ACTIONS
THAT  WOULD  BE  TAKEN AND THEIR POSSIBLE EFFECTS, THIS ANALYSIS ASSUMES NO SUCH
ACTIONS.  FURTHER,  THIS ANALYSIS DOES NOT CONSIDER

                                       41
<PAGE>

THE  EFFECTS  OF THE CHANGE IN THE LEVEL OF OVERALL ECONOMIC ACTIVITY THAT COULD
EXIST  IN  SUCH  AN  ENVIRONMENT.

ITEM  8.  FINANCIAL  STATEMENTS  AND  SUPPLEMENTARY  DATA

     THE  FINANCIAL  STATEMENTS  AND  SUPPLEMENTARY  DATA  ARE SET FORTH IN THIS
ANNUAL  REPORT  ON  FORM  10-K  COMMENCING  ON  PAGE  F-1.

ITEM  9.  CHANGES  IN  AND  DISAGREEMENTS  WITH ACCOUNTANTS ON ACCOUNTING AND
          FINANCIAL  DISCLOSURE

     NONE.

                                       42
<PAGE>

                                    PART III

ITEM  10.  DIRECTORS  AND  EXECUTIVE  OFFICERS  OF  THE  REGISTRANT

     THE  TABLE  BELOW SETS FORTH THE NAMES, AGES AND POSITIONS OF THE EXECUTIVE
OFFICERS  AND  DIRECTORS  OF  THE  COMPANY.

<TABLE>
<CAPTION>


<S>                                         <C>  <C>
NAME . . . . . . . . . . . . . . . . . . .  AGE  POSITION
------                                      ---  --------

DAVID E. MCCOMAS . . . . . . . . . . . . .   60  PRESIDENT AND CHIEF EXECUTIVE OFFICER
ALAN E. WILEY. . . . . . . . . . . . . . .   55  EXECUTIVE VICE PRESIDENT, CHIEF FINANCIAL OFFICER,
                                                 PRESIDENT OF MANAGED VISION CARE, SECRETARY AND TREASURER
GEORGE E. GEBHARDT . . . . . . . . . . . .   52  EXECUTIVE VICE PRESIDENT OF MERCHANDISING, MARKETING AND
                                                 REAL ESTATE/CONSTRUCTION
ROBERT T. COX. . . . . . . . . . . . . . .   37  VICE PRESIDENT OF HUMAN RESOURCES
BERNARD W. ANDREWS . . . . . . . . . . . .   61  CHAIRMAN
NORMAN S. MATTHEWS . . . . . . . . . . . .   69  DIRECTOR
ANTOINE G. TREUILLE. . . . . . . . . . . .   53  DIRECTOR
ANTHONY J. DINOVI. . . . . . . . . . . . .   40  DIRECTOR
WARREN C. SMITH, JR. . . . . . . . . . . .   46  DIRECTOR
CHARLES A. BRIZIUS . . . . . . . . . . . .   34  DIRECTOR
</TABLE>

     DIRECTORS  OF  THE  COMPANY ARE ELECTED AT THE ANNUAL SHAREHOLDERS' MEETING
AND  HOLD  OFFICE  UNTIL  THEIR  SUCCESSORS HAVE BEEN ELECTED AND QUALIFIED. THE
OFFICERS  OF  THE  COMPANY  ARE CHOSEN BY THE BOARD OF DIRECTORS AND HOLD OFFICE
UNTIL  THEY  RESIGN  OR  ARE  REMOVED  BY  THE  BOARD  OF  DIRECTORS.

     DAVID E. MCCOMAS HAS SERVED AS THE PRESIDENT AND CHIEF EXECUTIVE OFFICER OF
THE  COMPANY SINCE JULY 2001. FROM JULY 1998 TO JULY 2001, MR. MCCOMAS SERVED AS
THE  PRESIDENT  AND CHIEF OPERATING OFFICER OF THE COMPANY. PRIOR TO JOINING THE
COMPANY  IN  JULY  1998,  MR. MCCOMAS WAS WESTERN REGION PRESIDENT AND CORPORATE
VICE  PRESIDENT,  CIRCUIT CITY STORES, INC., AND WAS RESPONSIBLE FOR TEN WESTERN
STATES  AND HAWAII SINCE 1994. PRIOR TO 1994, MR. MCCOMAS WAS GENERAL MANAGER OF
CIRCUIT  CITY STORES, INC. MR. MCCOMAS HAS OVER THIRTY YEARS OF STORE MANAGEMENT
EXPERIENCE  INCLUDING  POSITIONS  WITH  MONTGOMERY  WARD HOLDING CORPORATION AND
SEARS,  ROEBUCK  &  CO. SINCE 1996, MR. MCCOMAS HAS SERVED AS A DIRECTOR OF WEST
MARINE,  INC.

     ALAN  E.  WILEY  HAS SERVED AS EXECUTIVE VICE PRESIDENT AND CHIEF FINANCIAL
OFFICER  OF  THE  COMPANY SINCE NOVEMBER 1998 AND AS PRESIDENT OF MANAGED VISION
CARE,  INC.  SINCE JULY 2001. FROM 1992 UNTIL NOVEMBER 1998, MR. WILEY SERVED AS
THE  SENIOR  EXECUTIVE  VICE  PRESIDENT,  SECRETARY,  CHIEF  FINANCIAL  AND
ADMINISTRATIVE OFFICER AND A DIRECTOR OF THE CATO CORPORATION. FROM 1981 THROUGH
1990,  MR. WILEY HELD SENIOR ADMINISTRATIVE AND FINANCIAL POSITIONS WITH BRITISH
AMERICAN  TOBACCO,  U.S., IN VARIOUS COMPANIES OF THE SPECIALTY RETAIL DIVISION.

     GEORGE  E. GEBHARDT HAS SERVED AS THE COMPANY'S EXECUTIVE VICE PRESIDENT OF
MERCHANDISING,  SINCE  SEPTEMBER  1996  WHEN  THE  COMPANY  PURCHASED HIS FORMER
EMPLOYER,  VISIONWORKS.  HE  ASSUMED  THE  RESPONSIBILITIES  OF  THE  COMPANY'S
MARKETING  IN JUNE 1998 AND

                                       43
<PAGE>

REAL  ESTATE/CONSTRUCTION  IN APRIL 2002. MR. GEBHARDT WAS WITH VISIONWORKS FROM
FEBRUARY  1994  TO  SEPTEMBER  1996  SERVING IN VARIOUS POSITIONS, MOST RECENTLY
SENIOR  VICE  PRESIDENT  OF  MERCHANDISING  AND  MARKETING.  PRIOR  TO THAT, MR.
GEBHARDT  SPENT  OVER  THIRTEEN  YEARS  WITH  ECKERD  CORPORATION  IN  VARIOUS
OPERATIONAL POSITIONS INCLUDING SENIOR VICE PRESIDENT, GENERAL MANAGER OF ECKERD
VISION  GROUP.  MR. GEBHARDT ALSO SPENT SEVEN YEARS WORKING FOR PROCTER & GAMBLE
SERVING  IN VARIOUS POSITIONS INCLUDING UNIT SALES MANAGER OF PROCTER & GAMBLE'S
HEALTH  AND  BEAUTY  CARE  DIVISION.

     ROBERT  T.  COX  HAS  SERVED AS THE VICE PRESIDENT OF HUMAN RESOURCES SINCE
APRIL 2002. FROM JANUARY 1999 THROUGH APRIL 2002, MR. COX SERVED AS THE DIVISION
HUMAN  RESOURCE  MANAGER  FOR  THE  HOME  DEPOT  IN  THE  PHOENIX,  ARIZONA  AND
SURROUNDING  MARKETS.  FROM  DECEMBER  1987  THROUGH DECEMBER 1998, MR. COX HELD
SEVERAL  HUMAN  RESOURCES  POSITIONS  TO INCLUDE REGIONAL HUMAN RESOURCE MANAGER
WITH  WESTERN  AUTO  SUPPLY CO. (A DIVISION OF SEARS ROEBUCK & CO.). MR. COX HAS
OVER  TWENTY  YEARS  OF  RETAIL  EXPERIENCE.

     BERNARD  W. ANDREWS RETIRED AS CHIEF EXECUTIVE OFFICER IN JULY 2001 AND NOW
SERVES  AS THE COMPANY'S CHAIRMAN OF THE BOARD, A POSITION HE HAS HELD SINCE THE
CONSUMMATION OF THE RECAPITALIZATION. MR. ANDREWS JOINED THE COMPANY AS DIRECTOR
AND  CHIEF EXECUTIVE OFFICER IN MARCH 1996. FROM JANUARY 1994 TO APRIL 1995, MR.
ANDREWS  WAS  PRESIDENT  AND  CHIEF  OPERATING  OFFICER AS WELL AS A DIRECTOR OF
MONTGOMERY  WARD-RETAIL.  HE  WAS  AN EXECUTIVE VICE PRESIDENT AND A DIRECTOR OF
CIRCUIT  CITY  STORES,  INC., FROM OCTOBER 1990 TO JANUARY 1994. MR. ANDREWS WAS
WITH  MONTGOMERY  WARD-RETAIL  FROM  OCTOBER  1983  TO  MAY  1990,  SERVING  AS
PRESIDENT-HARDLINES,  EXECUTIVE VICE PRESIDENT-MARKETING AND VICE PRESIDENT-HOME
FASHIONS.  PRIOR  TO  1983, MR. ANDREWS SPENT TWENTY YEARS WITH SEARS, ROEBUCK &
CO.  IN  A  NUMBER  OF  MERCHANDISING,  MARKETING  AND  OPERATING  POSITIONS.

     NORMAN  S.  MATTHEWS  HAS SERVED AS A DIRECTOR OF THE COMPANY SINCE OCTOBER
1993  AND  SERVED  AS CHAIRMAN FROM DECEMBER 1996 TO APRIL 1998. MR. MATTHEWS IS
CHAIRMAN  OF  THE  EXECUTIVE COMMITTEE OF THE COMPANY'S BOARD OF DIRECTORS. FROM
1988  TO THE PRESENT, MR. MATTHEWS HAS BEEN AN INDEPENDENT RETAIL CONSULTANT AND
VENTURE  CAPITALIST.  MR.  MATTHEWS WAS PRESIDENT OF FEDERATED DEPARTMENT STORES
FROM  1987  TO  1988,  AND  SERVED AS VICE CHAIRMAN FROM 1983 TO 1987. HE IS THE
CHAIRMAN  OF  GALYAN'S  TRADING  COMPANY  AND  IS  ALSO  A  DIRECTOR  OF  FINLAY
ENTERPRISES,  INC., TOYS "R" US, INC., THE PROGRESSIVE CORPORATION, SUNOCO, INC.
AND  LECHTERS,  INC.

     ANTOINE  G.  TREUILLE HAS SERVED AS A DIRECTOR OF THE COMPANY SINCE OCTOBER
1993.  IN  1999,  MR.  TREUILLE  BECAME  MANAGING DIRECTOR OF MERCANTILE CAPITAL
PARTNERS, A PRIVATE EQUITY INVESTMENT FUND. MR. TREUILLE HAS SERVED AS PRESIDENT
OF  CHARTER PACIFIC CORP. SINCE MAY 1996. HE WAS PREVIOUSLY MANAGING DIRECTOR OF
FINANCO,  INC.,  AN  INVESTMENT  BANK,  FROM MARCH 1998 UNTIL 1999. PRIOR TO HIS
CURRENT  POSITION, MR. TREUILLE SERVED AS SENIOR VICE PRESIDENT OF DESAI CAPITAL
MANAGEMENT  INC.  FROM SEPTEMBER 1985 TO APRIL 1992, HE SERVED AS EXECUTIVE VICE
PRESIDENT  WITH  THE  INVESTMENT  FIRM  OF  ENTRECANALES, INC. MR. TREUILLE ALSO
SERVES  AS  A  DIRECTOR  OF  ERAMET  AND  SPECIAL  METALS  CORP.

     ANTHONY  J.  DINOVI  HAS  SERVED  AS  A  DIRECTOR  OF THE COMPANY SINCE THE
CONSUMMATION  OF THE RECAPITALIZATION. MR. DINOVI HAS BEEN EMPLOYED BY THOMAS H.
LEE  COMPANY  SINCE  1988  AND

                                       44
<PAGE>

CURRENTLY  SERVES  AS A MANAGING DIRECTOR. MR. DINOVI IS A MANAGING DIRECTOR AND
MEMBER  OF  THL  EQUITY  ADVISORS  IV, LLC, THE GENERAL PARTNER OF THOMAS H. LEE
EQUITY  FUND  IV,  LP. MR. DINOVI ALSO SERVES AS A DIRECTOR OF FISHER SCIENTIFIC
INTERNATIONAL,  INC.,  FAIR  POINT  COMMUNICATIONS,  INC.,  US  LEC CORPORATION,
VERTIS,  INC.  AND  VARIOUS  PRIVATE  COMPANIES.

     WARREN  C.  SMITH,  JR.,  HAS SERVED AS A DIRECTOR OF THE COMPANY SINCE THE
CONSUMMATION  OF  THE RECAPITALIZATION. MR. SMITH HAS BEEN EMPLOYED BY THOMAS H.
LEE COMPANY SINCE 1990 AND CURRENTLY SERVES AS A MANAGING DIRECTOR. MR. SMITH IS
A  MANAGING  DIRECTOR  AND  MEMBER  OF  THL EQUITY ADVISORS IV, LLC, THE GENERAL
PARTNER OF THOMAS H. LEE EQUITY FUND IV, LP. MR. SMITH ALSO SERVES AS A DIRECTOR
OF  RAYOVAC  CORPORATION  AND  FINLAY  ENTERPRISES,  INC.

     CHARLES  A.  BRIZIUS  HAS  SERVED  AS  A  DIRECTOR OF THE COMPANY SINCE THE
consummation  of  the  Recapitalization.  Mr.  Brizius  worked  at Thomas H. Lee
Company  from  1993  to  1995,  rejoined  in 1997 and currently serves as a Vice
President.  Mr.  Brizius is a Member of THL Equity Advisors IV, LLC, the general
partner  of  Thomas  H.  Lee  Equity Fund IV, LP. From 1991 to 1993, Mr. Brizius
worked at Morgan Stanley & Co. Incorporated in the Corporate Finance Department.
Mr.  Brizius  also serves as a Director of TransWestern Publishing, L.P., United
Industries  Corporation  and  Big  V  Supermarkets,  Inc.

                                       45
<PAGE>

ITEM  11.  EXECUTIVE  COMPENSATION

     The  following  table  sets  forth  certain  information  concerning  the
compensation  paid  during the last three years to the Company's Chief Executive
Officer and the four other most highly compensated executive officers serving as
executive  officers  at the end of fiscal 2002 (the "Named Executive Officers").

<TABLE>

<CAPTION>

                                          SUMMARY COMPENSATION TABLE

<S>                                    <C>           <C>            <C>            <C>      <C>         <C>
                                                                                         LONG-TERM
                                                                                        COMPENSATION
                                                                 ANNUAL                -------------
                                                              COMPENSATION                 AWARDS
                                                ----------------------------------------------------
                                                                         OTHER ANNUAL  SECURITIES   ALL OTHER
                                                                         COMPENSATION  UNDERLYING COMPENSATION
NAME AND PRINCIPAL POSITION . . . .   .  YEAR     SALARY($)(A)  BONUS($)(B)      ($)(C) OPTIONS(#)      ($)(D)
-------------------------------------  ------------  -------------  -------------  -------  ----------  ------

David E. McComas. . . . . . . . . . .          2002        474,038        650,000        -     233,000       -
   President and Chief. . . . . . . .          2001        399,109        112,500        -           -       -
   Executive Officer. . . . . . . . .          2000        349,836              -        -           -       -

Alan E. Wiley . . . . . . . . . . . .          2002        287,692        319,000        -      71,500       -
   Executive Vice President,. . . . .          2001        258,038         68,750        -           -       -
   Chief Financial Officer, . . . . .          2000        241,982              -        -           -       -
   President of Managed Vision Care,
   Secretary and Treasurer

George E. Gebhardt. . . . . . . . . .          2002        237,692        264,000        -      56,500       -
   Executive Vice President of. . . .          2001        223,692         25,000        -           -       -
   Merchandising, Marketing and . . .          2000        215,192              -        -           -       -
   Construction/Real Estate

Bernard W. Andrews. . . . . . . . . .          2002        132,308              -        -     281,275
   Chairman of the Board. . . . . . .          2001        359,616              -        -           -   6,236
                                               2000        582,695              -        -           -   5,654

Robert T. Cox (e) . . . . . . . . . .          2002         86,538         98,214   42,701       17,000       -
   Vice President of Human. . . . . .          2001              -              -        -           -       -
   Resources. . . . . . . . . . . . .          2000              -              -        -           -       -

____________
<FN>

(a)  Represents  annual salary, including any compensation deferred by the Named
     Executive  Officer  pursuant  to  the  Company 401(k)  defined contribution
     plan.
(b)  Represents  annual  bonus  earned  by the Named Executive Officer  for  the
     relevant  fiscal  year.
(c)  Except  with respect to Mr. Robert T. Cox for 2002, the dollar value of the
     perquisites  and  other  personal  benefits, securities or property paid to
     each Named Executive Officer did not exceed the lesser of $50,000 or 10% of
     reported  annual  salary and bonus received by the Named Executive Officer.
     of the total other annual compensation received by Mr. Cox in 2002, $42,701
     related  to  relocation  expenses paid by the Company on behalf of Mr. Cox.
(d)  During 2001 and 2000, the Company paid $6,236 and $5,654, respectively, for
     premiums  for  term  life  insurance  for  Mr.  Andrews.
(e)  Represents  partial  year  compensation  as  Mr. Cox's employment commenced
     on  4/15/02.

</TABLE>

                                       46
<PAGE>

STOCK  OPTION  GRANTS.  On  June  15,  2001,  the  Company  entered  into Option
Cancellation  Agreements  (the "Cancellation Agreements") with certain employees
and  directors  (the  "Optionees")  to cancel all outstanding options which were
granted  under  the Company's 1998 Stock Option Plan (the "Plan") due to changes
in  the  fair  market  value  of  the  Company's  common stock. The Cancellation
Agreements  provided  that  a new grant would be made no earlier than six months
and  a  day  after  the  cancellation  of the options and such grant was made on
January  8, 2002. The following table sets forth information with respect to the
Named  Executive  Officers  concerning  options  granted during fiscal 2002. The
Named  Executive  Offices  have  not  been  granted  any  SARs  in  fiscal 2002.

<TABLE>

<CAPTION>
                                                                                           POTENTIAL REALIZED
                                 INDIVIDUAL GRANTS                                          VALUE AT ASSUMED
                                                                                              ANNUAL RATES
                                                                                                OF STOCK
                                                                                                  PRICE
                                                                                               APPRECIATION
                                                                                              -------------
<S>                                   <C>            <C>           <C>       <C>           <C>           <C>
                                       NUMBER OF     %OF TOTAL
                                       SECURITIES     OPTIONS      EXERCISE
                                       UNDERLYING    GRANTED TO    OR BASE
                                        OPTIONS     EMPLOYEES IN    PRICE     EXPIRATION
NAME . . . . . .                     .  GRANTED(#)   FISCAL YEAR    ($/SH)      DATE         5%               10%
----------                              -------       ----------   --------   ----------   -------         ------

David E. McComas                        220,000       22.2%        $5.00         1/12      $1,706,461   $2,593,742
                                         13,000        1.3%        $15.13       12/12      $  305,131     $463,785

Alan E. Wiley                            65,000        6.6%        $5.00         1/12      $  504,182     $766,333
                                          6,500        0.7%        $15.13       12/12      $  152,565     $231,892

George E. Gebhardt                       50,000        5.1%        $5.00         1/12      $  387,832     $589,487
                                          6,500        0.7%        $15.13       12/12      $  152,565     $231,892

Bernard W. Andrews                      281,275       29.8%        $5.00         1/12      $2,181,749   $3,316,159

Robert T. Cox                            15,000        1.5%        $5.00         1/12      $  116,350     $176,846
                                          2,000        0.2%        $15.13       12/12      $   46,943      $71,351
____________
</TABLE>

     STOCK  OPTION  EXERCISES AND HOLDINGS TABLE. The following table sets forth
information  with respect to the Named Executive Officers concerning unexercised
options  held  as  of  December 28, 2002.  The Named Executive Officers have not
been  granted  any  SARs.

<TABLE>

<CAPTION>

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

<S>                 <C>           <C>        <C>                      <C>
... . . . . . . . .             .          .  NUMBER OF
... . . . . . . . .             .          .  SECURITIES                 VALUE OF
... . . . . . . . .             .          .  UNDERLYING                UNEXERCISED
... . . . . . . . .             .          .  UNEXERCISED              IN-THE-MONEY
... . . . . . . . .             .          .  OPTIONS AT                OPTIONS AT
... . . . . . . . .                            FY-END (#)                 FY-END ($)
                    SHARES          VALUE  -----------------  ----------------------
... . . . . . . . .  ACQUIRED ON   REALIZED   EXERCISABLE/              EXERCISABLE/
NAME . . . . . . .  EXERCISE (#)    ($)      UNEXERCISABLE            UNEXERCISABLE
------------------  ------------  ---------  ------------------  ----------------------

David E. McComas .             .          .    88,000 / 145,000     891,440 / $1,337,160

Alan E. Wiley. . .             .          .     26,000 / 45,500      $263,380 / $395,070

George E. Gebhardt             .          .     14,000 / 42,500      $141,820 / $364,680

Bernard W. Andrews             .          .   112,510 / 168,765    $1,139,726 / $1,709,589

Robert T. Cox. . .             .          .      - / 17,000            - / $151,950
____________

</TABLE>

                                       47
<PAGE>

COMMITTEES  OF  THE  BOARD  OF  DIRECTORS

     The  Board  of  Directors  has  an  Executive  Committee of which Norman S.
Matthews  is  chairman  and  Anthony  DiNovi  and  Warren  Smith  are  members.

     The Board of Directors has a Compensation Committee currently consisting of
Messrs.  Matthews,  DiNovi  and  Smith.  The  Compensation  Committee  makes
recommendations  concerning the salaries and incentive compensation of employees
of  and  consultants  to  the  Company.

     The  Board  of  Directors  has  an  Audit Committee currently consisting of
Messrs.  DiNovi, Smith, Treuille and Brizius. The Audit Committee is responsible
for reviewing the results and scope of audits and other services provided by the
Company's independent auditors.

DIRECTOR  COMPENSATION

     The  Company  and  THL  Co.  entered  into a management agreement as of the
closing  date  of the Recapitalization pursuant to which THL Co. receives, among
other  things,  $500,000  per  year,  plus  expenses  for  management  and other
consulting  services  provided  to  the  Company.  See  "Item  13.  CERTAIN
RELATIONSHIPS  AND  RELATED  TRANSACTIONS."

     The  Company  has  entered  into  a  consulting  agreement  with  Norman S.
Matthews, which provides for the payment of an annual consulting fee of $50,000.
The  consulting  agreement  provides for the grant to Mr. Matthews, concurrently
with  the  closing  of  the  Recapitalization,  of an option to purchase 110,000
shares  as of the closing of the Recapitalization, subject to a vesting schedule
which will be one-half time based and one-half performance based, at an exercise
price  equal  to  approximately  $10.41 per share, the same price paid by THL in
connection with the Recapitalization. These options were cancelled in connection
with  the  Cancellation  Agreements in 2001 and 111,412 replacement options were
issued  on  January 8, 2002. The replacement options are at an exercise price of
$5.00  per  share  and vest 50% on the date of grant, and an additional 25% will
vest  on  each  of  the  first  and  second  anniversary  of  the date of grant.

     Antoine  Treuille  receives $10,000 per year for his services. Mr. Treuille
received  5,000  options  in  1998,  1999 and 2000, respectively, at an exercise
price of $10.41, $10.41 and $12.85 per share, respectively, subject to a vesting
schedule  of  equal  amounts  over  four  years. These options were cancelled in
connection  with  the  Cancellation  Agreements  in  2001 and 15,000 replacement
options  were issued in January 2002. The replacement options are at an exercise
price  of  $5.00  per share and vest 50% on the date of grant, and an additional
25%  will vest on each of the first and second anniversary of the date of grant.
Subsequent  to  the  January  8,  2002  reissuance,  Mr.  Treuille  received  an
additional  5,000 options that are also subject to a three year vesting schedule
and  are  at  an  exercise  price  of  $5.00  per  share.

                                       48
<PAGE>

     As  of  the closing of the Recapitalization, Bernard Andrews purchased $1.0
million  of  Common Stock at the same price that THL paid in connection with the
Recapitalization.  Mr.  Andrews paid for these shares by delivering a promissory
note  with  an  original  purchase  amount  of  $1.0 million, which shall accrue
interest  at  a  fixed  rate  equal to the Company's initial borrowing rate. The
repayment  of  such  note is secured by Mr. Andrews' shares of Common Stock. Mr.
Andrews received 281,275 options with the January 8, 2002 option reissuance. The
options  are  subject  to  a  three year vesting schedule and are at an exercise
price  of  $5.00  per  share. Mr. Andrews' employment contract was terminated in
July  2002  and  under  the termination contract he continues to received annual
employment  compensation  of  $100,000.

     Except  with respect to the consulting fee paid to Mr. Matthews, the annual
payments  paid  to  Mr. Treuille and Mr. Andrews, and the management fee paid to
THL  Co.,  during  fiscal 2002 none of the directors of the Company received any
compensation  for  their  services  as  directors  of  the  Company.

EMPLOYMENT  AGREEMENTS

     Mr.  McComas  entered  into  an  employment  agreement  with  the  Company,
effective  July  2, 2001, which provides for his employment with the Company for
an  initial  term  of  two  years and was amended on December 29, 2002 to extend
through fiscal 2004. Mr. McComas is entitled to a base salary of $450,000 during
the first year, $500,000 during the second year, $550,000 during fiscal 2003 and
$600,000  in  fiscal  2004.  Mr.  McComas  will be eligible to receive an annual
performance  bonus upon the achievement by the Company of certain EBITDA targets
as  determined  from  year  to  year  by  the  Board  of  Directors.

     Mr.  McComas  is  entitled  to  receive  severance  of his base salary upon
termination  by  the  Company  without  cause,  as defined within the employment
agreement.  Severance shall be paid over twenty-four months. Mr. McComas is also
subject  to  a  standard  restrictive  covenants  agreement  (including
non-competition, non-solicitation, and non-disclosure covenants) during the term
of  his  employment  and  for a period of one year following termination for any
reason.

     Mr.  McComas  received  non-qualified options to purchase 220,000 shares of
Common  Stock at an exercise price of $5.00 per share on January 8, 2002.  These
options  vest  over  a  three  year  period.  Subsequent  to the January 8, 2002
reissuance,  Mr. McComas received an additional option to purchase 13,000 shares
that are subject to a four year vesting schedule and are at an exercise price of
$15.13  per  share.

     The  remaining  executive  officers  are  each subject to annual employment
agreements  that  automatically  renew  unless  either  party  gives thirty days
notice.  Each  executive  officer  is  eligible  to participate in the Company's
Incentive Plan for Key Management, whereby they may receive a certain percentage
of  their  base  compensation  upon  the achievement of certain EBITDA levels as
determined  by  the  Board  of  Directors.

     Upon termination without cause, as defined in the employment agreement, the
executive  officers  are  eligible  for  a  range  of  nine  to twelve months of
severance.  The  employment

                                       49
<PAGE>

agreements  also contain standard restrictive covenants such as non-competition,
non-solicitation  and  non-disclosure  during  the  term of employment and for a
period  of  two  years  following  termination  for  any  reason.

CODE  OF  ETHICS

     The  Company  requires  all its employees who hold positions of significant
responsibility  to  annually review and agree to uphold its Business Conduct and
Ethics  Policy.  All  executive and financial officers and members of management
are included in this annual update.  The policy states the Company's expectation
that  all  employees  are  required to observe the highest standards of business
ethics  and  strict  adherence to all laws.  It further details codes of conduct
with  respect  to  conflicts  of interest and compliance with generally accepted
accounting  principles  and  controls.  In  addition,  the  Company's  senior
management  and financial management have certified their understanding of their
responsibility  with  regard  to  ensuring  the  Company  is  in compliance with
generally  accepted  accounting  principles.

STOCK  OPTION  PLAN

     The  Company  has  granted  stock  options  to  certain  officers under the
Company's  1998  stock  option  plan. On June 15, 2001, the Company entered into
Option  Cancellation  Agreements  (the  "Cancellation  Agreements") with certain
employees  and  directors  (the  "Optionees")  to cancel all outstanding options
which  were  granted under the Company's 1998 Stock Option Plan (the "Plan") due
to  changes  in  the  fair  market  value  of  the  Company's  common stock. The
Cancellation  Agreements provided that a new grant would be made no earlier than
six  months  and  a day after the cancellation of the options and such grant was
made  on  January  8,  2002.  As  of March 15, 2003, options to purchase 947,775
shares  of  Common  Stock  were outstanding. Of the outstanding options, 816,775
were  options  issued  in  relation  to  the Cancellation Agreements. Subject to
acceleration  under  certain circumstances, these options vest over a three-year
period  with  40%  vesting on the date of grant and an additional 20% vesting on
each  of  the  first,  second  and third anniversaries of the date of grant. The
remaining  131,000  outstanding  options  were  granted  in the normal course of
business  under  the  Company's  1998 stock option plan. Subject to acceleration
under  certain  circumstances,  these  options vest over a four-year period with
10%, 15%, 25% and 50% vesting on each of the anniversaries of the date of grant.
The  per  option  exercise  price  ranges  from  $5.00 to $15.13. Generally, all
unvested  options  will  be  forfeited  upon  termination  of  employment.

     COMPENSATION  COMMITTEE  INTERLOCKS AND INSIDER PARTICIPATION. During 2002,
the Compensation Committee consisted of Messrs. Matthews, DiNovi and Smith, none
of  whom  were an officer or employee of the Company. See discussion under "ITEM
13.  CERTAIN  RELATIONSHIPS  AND  RELATED  TRANSACTIONS."

                                       50
<PAGE>

ITEM  12.     SECURITY  OWNERSHIP  OF  CERTAIN  BENEFICIAL OWNERS AND MANAGEMENT

     The  following table sets forth information with respect to the anticipated
beneficial  ownership  of  shares  of  the  Common Stock as of March 15, 2003 by
persons  who  are beneficial owners of more than 5% of the Common Stock, by each
director,  by  each  executive  officer  of the Company and by all directors and
executive officers as a group, as determined in accordance with Rule 13d-3 under
the Securities Exchange Act of 1934, as amended (the "Exchange Act"). All shares
of  the  Common  Stock  are  voting  stock.

<TABLE>
<CAPTION>

<S>                                                                        <C>           <C>
                                                                           SHARES OF     PERCENTAGE
NAME OF BENEFICIAL OWNER(A) . . . . . . . . . . . . . . . . . . . . . . .  COMMON STOCK  OF CLASS
-------------------------------------------------------------------------  ------------  -----------
Affiliates of THL Co.(b). . . . . . . . . . . . . . . . . . . . . . . . .     6,664,800        90.2%
Equity-Linked Investors-II (c). . . . . . . . . . . . . . . . . . . . . .       383,616         5.2
Bernard W. Andrews (e). . . . . . . . . . . . . . . . . . . . . . . . . .       360,885           *
David E. McComas (f). . . . . . . . . . . . . . . . . . . . . . . . . . .       156,015           *
Norman S. Matthews (g). . . . . . . . . . . . . . . . . . . . . . . . . .       103,251           *
Antoine G. Treuille (h) . . . . . . . . . . . . . . . . . . . . . . . . .        17,778           *
George E. Gebhardt (i). . . . . . . . . . . . . . . . . . . . . . . . . .        57,499           *
Alan E. Wiley(j). . . . . . . . . . . . . . . . . . . . . . . . . . . . .        48,606           *
Anthony J. DiNovi (b) . . . . . . . . . . . . . . . . . . . . . . . . . .     6,664,800        90.2
Warren C. Smith (b) . . . . . . . . . . . . . . . . . . . . . . . . . . .     6,664,800        90.2
Charles A. Brizius (b). . . . . . . . . . . . . . . . . . . . . . . . . .     6,664,800        90.2
All directors and executive officers of the Company as a group (11)(b)(d)     7,408,834        94.4
<FN>

*   Less  than  1%.

(a)  Beneficial  ownership  is  determined  in  accordance with the rules of the
     Securities and Exchange Commission and reflects general voting power and/or
     investment  power  with  respect  to  securities.
(b)  The  business  address  for such person(s) is c/o Thomas H. Lee Company, 75
     State  Street,  Suite  2600, Boston, Massachusetts 02109. Of the securities
     held  by  affiliates  of  Thomas  H. Lee Company, 5,664,330 are held by the
     Thomas  H.  Lee Equity Fund IV, L.P., 195,133 are held by the Thomas H. Lee
     Foreign Fund IV, L.P., 551,323 are held by Thomas H. Lee Foreign Fund IV-B,
     L.P.  and  254,014  are  held  by others. All such voting securities may be
     deemed to be beneficially owned by THL Equity Advisors IV, LLC (the general
     partner  of THL Fund IV, Thomas H. Lee, Messrs. DiNovi, Smith and the other
     managing directors and by Mr. Brizius and the other officers of THL Co., in
     each  case  pursuant  to the definition of beneficial ownership provided in
     footnote  (a).  Each of such persons disclaims beneficial ownership of such
     shares.
(c)  Equity-Linked  Investors-II  is  an investment partnership managed by Desai
     Capital  Management  Incorporated.  The business address for such person is
     c/o  Desai  Capital Management, Incorporated, 540 Madison Avenue, New York,
     New  York  10022.
(d)  Includes  457,074 shares issuable pursuant to presently exercisable options
     (or  those  exercisable  prior  to  May  1,  2003).
(e)  Includes  168,765 shares issuable pursuant to presently exercisable options
     (or  those  exercisable  prior  to  May  1,  2003). Excludes 112,510 shares
     issuable  pursuant  to  options  which  are  not  currently exercisable (or
     exercisable  prior  to  May  1,  2003).
(f)  Includes  132,000 shares issuable pursuant to presently exercisable options
     (or  those  exercisable  prior  to  May  1,  2003). Excludes 101,000 shares
     issuable  pursuant  to  options  which  are  not  currently exercisable (or
     exercisable  prior  to  May  1,  2003).
(g)  Includes  83,559  shares issuable pursuant to presently exercisable options
     (or  those  exercisable  prior  to  May  1,  2003).  Excludes 27,853 shares
     issuable  pursuant  to  options  which  are  not  currently exercisable (or
     exercisable  prior  to  May  1,  2003).
(h)  Includes  11,250  shares issuable pursuant to presently exercisable options
     (or those exercisable prior to May 1, 2003). Excludes 8,750 shares issuable
     pursuant  to  options  which  are not currently exercisable (or exercisable
     prior  to  May  1,  2003).
(i)  Includes  22,500  shares issuable pursuant to presently exercisable options
     (or  those  exercisable  prior  to  May  1,  2003).  Excludes 34,000 shares
     issuable  pursuant  to  options  which  are  not  currently exercisable (or
     exercisable  prior  to  May  1,  2003).
(j)Includes  39,000 shares issuable pursuant to presently exercisable options or
     those  exercisable  prior  to May 1, 2003). Excludes 32,500 shares issuable
     pursuant  to  options  which  are not currently exercisable (or exercisable
     prior  to  May  1,  2003).
</TABLE>

                                       51
<PAGE>

ITEM  13.  CERTAIN  RELATIONSHIPS  AND  RELATED  TRANSACTIONS

MANAGEMENT  AGREEMENT

     The  Company  and  THL  Co.  entered  into a management agreement as of the
closing  date  of the Recapitalization (the "Management Agreement"), pursuant to
which  (i)  THL  Co.  received  a  financial  advisory  fee  of  $6.0 million in
connection  with structuring, negotiating and arranging the Recapitalization and
structuring, negotiating and arranging the debt financing and (ii) THL Co. would
receive  $500,000  per  year  plus  expenses for management and other consulting
services  provided  to  the  Company,  including  one  percent (1%) of the gross
purchase  price  for  acquisitions  for its participation in the negotiation and
consummation  of  any  such acquisition. As of December 31, 2000, the Management
Agreement  was amended to reduce the fees to $250,000 per year plus expenses for
management and other consulting services provided to the Company.  However, such
fee  may  be  increased  dependent  upon  the Company attaining certain leverage
ratios.  The  Management  Agreement  continues  unless  and  until terminated by
mutual  consent  of  the  parties  in  writing,  for so long as THL Co. provides
management  and  other  consulting services to the Company. The Company believes
that  the  terms  of the Management Agreement are comparable to those that would
have  been  obtained  from  unaffiliated  sources.

STOCKHOLDERS'  AGREEMENT

     The  Company  entered  into  a  Stockholders' Agreement (the "Stockholders'
Agreement")  among  THL  and  the  other  shareholders  of  the Company upon the
consummation  of  the Recapitalization. Pursuant to the Stockholders' Agreement,
the  shareholders  are  required  to  vote  their shares of capital stock of the
Company  to  elect  a  Board of Directors of the Company consisting of directors
designated  by  THL.  The  Stockholders'  Agreement also grants THL the right to
require  the Company to effect the registration of shares of Common Stock it (or
its  affiliates) holds for sale to the public, subject to certain conditions and
limitations. If the Company proposes to register any of its securities under the
Securities  Act  of  1933, as amended, whether for its own account or otherwise,
the shareholders are entitled to notice of such registration and are entitled to
include  their  shares  in  such registration, subject to certain conditions and
limitations. All fees, costs and expenses of any registration effected on behalf
of  such shareholders under the Stockholders' Agreement (other than underwriting
discounts  and  commissions)  will  be  paid  by  the  Company.

ITEM  14.  CONTROLS  AND  PROCEDURES

     The  Company  has  established  and  maintains  disclosure  controls  and
procedures that are designed to ensure that material information relating to the
Company  and  its  subsidiaries  required to be disclosed in the reports that it
files  or  submits  under  the  Securities and Exchange Act of 1934 is recorded,
processed,  summarized,  and  reported  within the time periods specified in the
Securities  and Exchange Commission's rules and forms, and that such information
is accumulated and communicated to the Company's management, including its Chief
Executive  Officer  and  Chief Financial Officer, as appropriate to allow timely
decisions regarding required disclosure. Within the 90 days prior to the date of
this  annual  report,  the  Company  carried  out  an

                                       52
<PAGE>

evaluation,  under  the  supervision  and  with the participation of management,
including  the  Chief  Executive  Officer  and  Chief  Financial Officer, of the
effectiveness of the design and operation of disclosure controls and procedures.
Based  on that evaluation of these disclosure controls and procedures, the Chief
Executive  Officer  and  Chief  Financial  Officer  concluded that the Company's
disclosure  controls  and  procedures  were  effective  as  of  the date of such
evaluation.

     The Chief Executive Officer and Chief Financial Officer have also concluded
that  there were no significant changes in the Company's internal controls or in
other  factors  that could significantly affect the internal controls subsequent
to  the date that the Company completed its evaluation, including any corrective
actions  with  regard  to  significant  deficiencies  and  material  weaknesses.

                                       53
<PAGE>

                                     PART IV

ITEM  15.     EXHIBITS,  FINANCIAL  STATEMENT  SCHEDULES AND REPORTS ON FORM 8-K

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

<TABLE>
<CAPTION>


<C>  <S>                                                                                       <C>

                                                                                             Page
                                                                                           of 10-K
                                                                                           -------
 1.    FINANCIAL STATEMENTS

     Report of Independent Auditors . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  F-2

     Consolidated Balance Sheets at December 29, 2001 and December 28, 2002 . . . . . . . . .  F-3

     Consolidated Statements of Operations for the Years Ended December 30, 2000,
     December 29, 2001 and December 28, 2002. . . . . . . . . . . . . . . . . . . . . . . . .  F-4

     Consolidated Statements of Shareholders' Deficit as of December 30, 2000,
     December 29, 2001 and December 28, 2002. . . . . . . . . . . . . . . . . . . . . . . . .  F-5

     Consolidated Statements of Cash Flows for the Years ended December 30, 2000,
     December 29, 2001 and December 28, 2002. . . . . . . . . . . . . . . . . . . . . . . . .  F-6

     Notes to the Consolidated Financial Statements . . . . . . . . . . . . . . . . . . . . .  F-8

2.     FINANCIAL STATEMENT SCHEDULES

     Schedule II Consolidated Valuation and Qualifying Accounts For the Years Ended
     December 30, 2000, December 29, 2001 and December 28, 2002 . . . . . . . . . . . . . . .  F-40

3.     EXHIBITS

2.1  Stock  Purchase  Agreement  dated  August15,  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  September30 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  March6,  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 April23, 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 April24, 1998
     among  ECCA Merger Corp., Eye Care Centers of America, Inc. and the sellers
     listed  therein.  (a)

</TABLE>

                                       54
<PAGE>

<TABLE>
<CAPTION>



<C>   <S>

2.6  Articles  of  Merger of ECCA Merger Corp. with and into Eye Care Centers of
     America,  Inc.  dated  April24,  1998.  (a)

2.7  Master  Asset  Purchase Agreement, dated as of August22, 1998, by and among
     Eye  Care  Centers  of  America,  Inc.,  Mark  E.  Lynn,  Dr.  Mark  Lynn &
     Associates,  PLLC,  Dr.  BizerVision  World,  PLLC  and its affiliates. (a)

2.8  Letter Agreement, dated October1, 1998, amending and modifying that certain
     Master  Asset  Purchase Agreement, dated as of August22, 1998, by and among
     Eye  Care  Centers  of  America,  Inc.;  Mark  E.  Lynn;  Dr.  Mark  Lynn &
     Associates,  PLLC,  Dr.  BizerVisionWorld,  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)
2.10 Letter Agreement, dated August 31,1999, amending and modifying that certain
     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,  Inc.,  Corp.  (d)

2.11 Agreement  Regarding  Strategic  Alliance.  (d)

2.12 Fiscal  2002  Incentive  Plan  for  Key  Management.  (n)

2.13 Fiscal  2003  Incentive  Plan  for  Key  Management.  (p)

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)

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.  (n)

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 April24, 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)

10.1 Form  of  StockholdersAgreement  dated as of April24, 1998 by and among Eye
     Care  of  America,  Inc.  and  the  shareholders  listed  therein.  (a)

10.2 1998  Stock  Option  Plan.  (a)

</TABLE>
                                       55
<PAGE>

<TABLE>
<CAPTION>

<C>    <S>

10.3 Employment  Agreement dated July 2, 2001 by and between Eye Care Centers of
     America,  Inc.  and  David  E.  McComas.  (k)

10.4 Stock  Option  Agreement dated July 2, 2001 by and between Eye Care Centers
     of  America,  Inc  and  Alan  E.  Wiley.  (k)

10.5 Employment  Agreement  dated  January1,  2003  between  Eye Care Centers of
     America,  Inc.  and  George  Gebhardt.  (p)

10.6 Management  Agreement,  dated as of April24, 1998, by and between Thomas H.
     Lee  Company  and  Eye  Care  Centers  of  America,  Inc.  (a)

10.7 Retail  Business  Management  Agreement,  dated  September30,  1997, by and
     between  Dr.  Samit's  Hour Eyes Optometrist, P.C., a Virginia professional
     corporation, and Visionary Retail Management, Inc., a Delaware corporation.
     (a) Amendment No. 1 to the Retail Business Management Agreement, dated June
     2000,  by  and between Hour Eyes Doctors of Optometry, P.C., formerly known
     as  Dr.  Dr.  Samit's  Hour  Eyes  Optometrist,  P.C., and Visionary Retail
     Management,  Inc.  (j)

10.8 Professional  Business Management Agreement dated September30, 1997, by and
     between  Dr.  Dr.  Samit's  Hour  Eyes  Optometrists,  P.C.,  a  Virginia
     professional  corporation, and Visionary MSO, Inc., a Delaware corporation.
     (a)  Amendment  No.  1  to  the Professional Business Management Agreement,
     dated  June  2000,  by  and  between  Hour Eyes Doctors of Optometry, P.C.,
     formerly  known  as  Dr.  Dr.  Samit's  Hour  Eyes  Optometrist,  P.C., and
     Visionary  MSO,  Inc.  (j)

10.9 Contract  for  Purchase  and Sale dated May29, 1997 by and between Eye Care
     Centers  of  America,  Inc.  and  JDB  Real  Properties,  Inc.  (a)

10.10  Contract  for Purchase and Sale dated May29, 1997 by and between Eye Care
     Centers  of  America,  Inc.  and  JDB  Real  Properties,  Inc.  (a)

10.11  Amendment  to  Contract  for  Purchase  and Sale dated July3, 1997 by and
     between Eye Care Centers of America, Inc. and JDB Real Properties, Inc. (a)

10.12  Second  Amendment to Contract for Purchase and Sale dated July10, 1997 by
     and between Eye Care Centers of America, Inc. and JDB Real Properties, Inc.
     (a)

10.13  Third Amendment to Contract for Purchase and Sale by and between Eye Care
     Centers  of America, Inc., John D. Byram, Dallas Mini #262. Ltd. and Dallas
     Mini  #343,  Ltd.  (a)

10.14  Commercial  Lease  Agreement  dated August19, 1997 by and between John D.
     Byram,  Dallas  Mini  #262,  Ltd.  and  Dallas Mini #343, Ltd. and Eye Care
     Centers  of  America,  Inc.  (a)

</TABLE>

                                       56
<PAGE>


<TABLE>
<CAPTION>

<C>           <S>

10.15  Master  Lease  Agreement,  dated  August12,  1997, by and between Pacific
     Financial  Company and Eye Care Centers of America, Inc., together with all
     amendments,  riders  and  schedules  thereto.  (a)

10.16  Credit  Agreement,  dated  as of April23, 1998, among Eye Care Centers of
     America,  Inc.,  Various  Lenders, Bankers Trust Company, as Administrative
     Agent,  and  Merrill  Lynch  Capital Corporation, as Syndication Agent. (a)

10.17 First Amendment to Credit Agreement, dated as of December, 27, 2000, among
     Eye  Care Centers of America, Inc., Various Lenders, Bankers Trust Company,
     as  Administrative  Agent,  and  Merrill  Lynch  Capital  Corporation,  as
     Syndication  Agent.  (i)

10.18  Purchase  Agreement,  dated  as  of  April24, 1998, by and among Eye Care
     Centers  of America, Inc., the subsidiaries of Eye Care Centers of America,
     Inc.  named therein, BT Alex. Brown Incorporated and Merrill Lynch, Pierce,
     Fenner  &  Smith  Incorporated.  (a)

10.19 Secured Promissory Note, dated April24, 1998, issued by Bernard W. Andrews
     in  favor  of  Eye  Care  Centers  of  America,  Inc.  (a)

10.20  Form  of  Stock  Option Cancellation Agreement dated June 15, 2001 by and
     between  Eye  Care  Centers  of  America,  Inc.,  and the employees granted
     options  under  the  Company1998  Stock  Option  Plan.  (k)

10.21  Form  of  Stock  Option Cancellation Agreement dated June 15, 2001 by and
     between  Eye  Care  Centers  of  America,  Inc., and the board of directors
     granted  options  under  the  Company1998  Stock  Option  Plan.  (k)

10.22 Retail Business Management Agreement, dated October1, 1998, by and between
     Visionary  Retail  Management,  Inc.,  a Delaware corporation, and Dr. Mark
     Lynn & Associates, PLLC, a Kentucky professional limited liability company.
     (b)  Amendment  to  Retail  Business  Management  Agreement  by and between
     Visionary  Retail  Management,  Inc.  and  Dr. Mark Lynn & Associates, PLLC
     dated  June  1, 1999. (j) Amendment to Retail Business Management Agreement
     by  and  between  Visionary  Retail  Management,  Inc.  and Dr. Mark Lynn &
     Associates,  PLLC  dated  August  31,  2000.  (j)

10.23  Professional  Business Management Agreement, dated October1, 1998, by and
     between  Visionary  MSO,  Inc., a Delaware Corporation, and Dr. Mark Lynn &
     Associates,  PLLC,  a  Kentucky professional limited liability company. (b)
     Amendment  to  Professional  Business  Management  Agreement by and between
     Visionary  MSO,  Inc.  and  Dr.  Mark Lynn & Associates, PLLC dated June 1,
     1999.  (j)  Amendment  Professional  Business  Management  Agreement by and
     between  Visionary  MSO,  Inc.  and  Dr. Mark Lynn & Associates, PLLC dated
     August  1,  2000.  (j)

</TABLE>

                                       57
<PAGE>

<TABLE>
<CAPTION>

<C>    <S>

10.24    Form of Stock Option Agreement. (l)

10.25 Professional Business Management Agreement dated February 27, 2000, by and
     between  Eye  Care  Centers  of  America, Inc. a Texas corporation and S.L.
     Christensen,  O.D.  and  Associates,  P.C.,  an  Arizona  professional
     corporation.  (f)

10.26  Professional  Business  Management  Agreement dated June 19, 2000, by and
     between  Visionary Retail Management, Inc., a Delaware corporation, and Dr.
     Tom Sowash, O.D. and Associates, LLC, a Colorado limited liability company.
     (g)

10.27  Settlement Agreement dated September 21, 2000 between Eye Care Centers of
     America,  Inc.,  a  Texas  corporation,  and  Vision  Twenty-One,  Inc. (h)

10.28  Stock  Option  Agreement  dated  January  8, 2002 by and between Eye Care
     Centers  of  America,  Inc  and  Norman  Matthews.  (l)

10.29  Stock  Option  Agreement  dated  January  8, 2002 by and between Eye Care
     Centers  of  America,  Inc  and  Antoine  Treuille.  (l)

10.30  Amended  and Restated Credit Agreement among Eye Care Centers of America,
     Inc.,  Various  Lenders, Fleet National Bank, as Administrative Agent, Bank
     of  America, N.A., as Syndication Agent and Fleet Securities, Inc., Bank of
     America  Securities,  LLC,  as  Co-Lead  Arrangers Dated as of December 23,
     2002.  (o)

10.31  Stock  Option  Agreement  dated  October 31, 2002 by and between Eye Care
     Centers  of  America,  Inc  and  Antoine  Treuille.  (p)

10.32  Termination Agreement, dated as of July 1, 2002 among Eye Care Centers of
     America,  Inc.  and  Bernard  W.  Andrews.  (m)

10.33  Business  Management Agreement by and between Vision Twenty-One, Inc. and
     Charles  M.  Cummins, O.D. and Elliot L. Shack, O.D., P.A. dated January 1,
     1998.  (p)Amendment  No.  1 to Business Management Agreement by and between
     Charles  M.  Cummins, O.D., P.A., and Eye Drx Retail Management, Inc. dated
     August  31,  1999.  (p) Amendment No. 2 to Business Management Agreement by
     and  between  Charles M. Cummins, O.D., P.A. and Eye Drx Retail Management,
     Inc.  dated  February  29, 2000. (j) Amendment No. 3 to Business Management
     Agreement  by and between Charles M. Cummins, O.D., P.A. and Eye Drx Retail
     Management,  Inc.  dated  May  1,  2000.  (j)  Amendment  No. 4 to Business
     Management  Agreement by and between Charles M. Cummins, O.D., P.A. and Eye
     Drx  Retail Management, Inc. dated February 1, 2001. (j) Amendment No. 5 to
     Business  Management Agreement by and between Charles M. Cummins, O.D. P.A.
     and  Eye Drx Retail Management, Inc. dated February 28, 2002. (p) Amendment
     No.  6  to  Business Management Agreement by and between Charles M. Cummins
     O.D.,  P.A and Eye Drx Retail Management, Inc. dated February 28, 2003. (p)

</TABLE>

                                       58
<PAGE>


<TABLE>
<CAPTION>

<C>    <S>

10.34  Employment  Agreement  dated  April  15, 2002 between Eye Care Centers of
     America,  Inc.  and  Robert  Cox.  (p)

12.1 Statement  re  Computation  of  Ratios  (p)

21.1 List  of  subsidiaries  of  Eye  Care  Centers  of  America,  Inc.  (p)

24.1 Powers  of  Attorney (contained on the signature pages of this report). (p)

99.1 Business  Conduct  and  Ethics  Policy.  (p)

99.2 Ethics  for  Financial  Management.  (p)

</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.

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

(b)  Previously provided with, and incorporated by reference from, the Company's
     annual  Report  on  Form  10-K  for  the  year  ended  January  2,1999.

(c)  Previously provided with, and incorporated by reference from, the Company's
     annual  Report  on  Form  10-Q  for  the  quarter  ended  July  3,1999.

(d)  Previously provided with, and incorporated by reference from, the Company's
     annual  Report  on  Form  10-Q  for  the  quarter  ended  October  2,1999.

(e)  Previously provided with, and incorporated by reference from, the Company's
     annual  Report  on  Form  10-K  for  the  year  ended  January  1,2000.

(f)  Previously provided with, and incorporated by reference from, the Company's
     annual  Report  on  Form  10-Q  for  the  quarter  ended  April  1,  2000.

(g)  Previously provided with, and incorporated by reference from, the Company's
     annual  Report  on  Form  10-Q  for  the  quarter  ended  July  1,  2000.

(h)  Previously provided with, and incorporated by reference from, the Company's
     annual  Report  on  Form  10-Q  for  the  quarter ended September 30, 2000.

(i)  Previously provided with, and incorporated by reference from, the Company's
     Report  on  Form  8-K  as  of  December  27,  2000.

(j)  Previously provided with, and incorporated by reference from, the Company's
     annual  Report  on  Form  10-  K  for  the  year  ended  December 30, 2000.

(k)  Previously provided with, and incorporated by reference from, the Company's
     annual  Report  on  Form  10-Q  for  the  quarter  ended  June  30,  2001.

(l)  Previously provided with, and incorporated by reference from, the Company's
     annual  Report  on  Form  10-K  for  the  year  ended  December  29,  2001

(m)  Previously provided with, and incorporated by reference from, the Company's
     annual  Report  on  Form  10-Q  for  the  quarter  ended  June  29,  2002.

(n)  Previously provided with, and incorporated by reference from, the Company's
     annual  Report  on  Form  10-Q  for  the  quarter ended September 28, 2002.

(o)  Previously provided with, and incorporated by reference from, the Company's
     Report  on  Form  8-K  as  of  December  31,  2002.

(p)  Filed  herewith.

(B)  The  Company  filed a report on Form 8-K dated December 31, 2002 under Item
     5.  Other  Events that reported the Company has entered into senior secured
     credit  facilities  with  Fleet National Bank, acting as the administrative
     agent,  and  Bank  of  America,  N.A.,  acting  as  the  syndication agent.

                                       59
<PAGE>


SUPPLEMENTAL  INFORMATION TO BE FURNISHED WITH REPORTS FILED PURSUANT TO SECTION
15  (D)  OF THE ACT BY REGISTRANTS WHICH HAVE NOT REGISTERED SECURITIES PURSUANT
TO  SECTION  12  OF  THE  ACT.

No  annual  report  or proxy materials have been sent to security holders of the
Company.

                                       60
<PAGE>

                                   SIGNATURES

     PURSUANT  TO  THE  REQUIREMENTS  OF  SECTION  13 OR 15(D) 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, IN THE CITY OF SAN
ANTONIO,  STATE  OF  TEXAS,  ON  MARCH  27,  2003.

                                               EYE CARE CENTERS OF AMERICA, INC.

                                                        By: /S/ DAVID E. MCCOMAS
                                               ---------------------------------
                                                                DAVID E. MCCOMAS
                                           CHIEF EXECUTIVE OFFICER AND PRESIDENT

                                POWER OF ATTORNEY

     KNOW  ALL  MEN  BY  THESE PRESENTS that each person whose signature appears
below  constitutes and appoints Bernard W. Andrews and Alan E. Wiley and each of
them,  with  the  power  to  act  without  the  other,  his  true  and  lawful
attorney-in-fact  and agent, with full power of substitution and resubstitution,
for  him  or in his name, place and stead, in any and all capacities to sign any
and  all  amendments  to  this  report,  and to file the same, with all exhibits
thereto,  and  other  documents in connection therewith, with the Securities and
Exchange  Commission,  granting unto said attorneys-in-fact and agents, and each
of them, full power and authority to do and perform each and every Act and thing
requisite  or  necessary  to  be done in and about the premises, as fully to all
intents  and  purposes  as  he might or could do in person, hereby ratifying and
confirming  all  that said attorneys-in-fact and agents or any of them, or their
or  his  substitutes,  may  lawfully  do  or  cause to be done by virtue hereof.

     Pursuant  to  the requirements of the Securities Exchange Act of 1934, this
report  has  been  signed  below  by  the  following  persons  on  behalf of the
registrant  and  in  the  capacities  and  on  the  dates  indicated.

<TABLE>
<CAPTION>


<S>                              <C>                            <C>
SIGNATURE . . . . . . . . . . .  TITLE                          DATE

                                 Chief Executive Officer and
/S/     David E. McComas. . . .  President                      March 27, 2003
-------------------------------
DAVID E. MCCOMAS. . . . . . . .  (Principal Executive Officer)

                                 Executive Vice President and
/S/     Alan E. Wiley . . . . .  Chief Financial Officer        March 27, 2003
-------------------------------
ALAN E. WILEY . . . . . . . . .  (Principal Financial and
                                  Accounting Officer)

/S/     Bernard W. Andrews. . .  Chairman of the Board          March 27, 2003
-------------------------------
BERNARD W. ANDREWS

/S/     Norman S. Matthews. . .  Director                       March 27, 2003
-------------------------------
NORMAN S. MATTHEWS

/S/     Antoine G. Treuille . .  Director                       March 27, 2003
-------------------------------
ANTOINE G. TREUILLE

/S/     Anthony J. DiNovi . . .  Director                       March 27, 2003
-------------------------------
ANTHONY J. DINOVI

/S/     Warren C. Smith, Jr.. .  Director                       March 27, 2003
-------------------------------
WARREN C. SMITH, JR.

/S/     Charles A. Brizius. . .  Director                       March 27, 2003
-------------------------------
CHARLES A. BRIZIUS

</TABLE>

                                       61
<PAGE>

I,  David  E.  McComas,  certify  that:

1.   I  have  reviewed  this  annual  report on Form 10-K of Eye Care Centers of
     America,  Inc.;

2.   Based  on  my  knowledge,  this  annual  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  annual  report;

3.   Based  on  my  knowledge,  the  financial  statements,  and other financial
     information  included in this annual 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 annual report;

4.   The  registrant's  other  certifying  officers  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  annual  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  annual  report (the "Evaluation Date"); and c) presented in
     this  annual  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 officers and I have disclosed, based on
     our  most  recent  evaluation,  to  the registrant's auditors and the audit
     committee  of  registrant's  board  of directors (or persons performing the
     equivalent  function):  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  officers and I have indicated in this
     annual  report  whether 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:  March  27,  2003
By: /S/ David E. McComas
_______________________
David  E.  McComas
President  and  Chief  Executive  Officer

                                       62
<PAGE>

I,  Alan  E  Wiley,  certify  that:

1.   I  have  reviewed  this  annual  report on Form 10-K of Eye Care Centers of
     America,  Inc.;

2.   Based  on  my  knowledge,  this  annual  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  annual  report;

3.   Based  on  my  knowledge,  the  financial  statements,  and other financial
     information  included in this annual 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 annual report;

4.   The  registrant's  other  certifying  officers  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  annual  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  annual  report (the "Evaluation Date"); and c) presented in
     this  annual  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 officers and I have disclosed, based on
     our  most  recent  evaluation,  to  the registrant's auditors and the audit
     committee  of  registrant's  board  of directors (or persons performing the
     equivalent  function):  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  officers and I have indicated in this
     annual  report  whether 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:  March  27,  2003
By: /S/ Alan E. Wiley
_______________________
Alan  E.  Wiley
Executive  Vice  President  and  Chief  Financial  Officer

                                       63
<PAGE>


Report  of  Independent  Auditors                                            F-2

Consolidated  Balance  Sheets  at  December  29,  2001  and
December  28,  2002                                                          F-3

Consolidated  Statements  of  Operations  for  the  Years Ended
December  30, 2000, December  29,  2001  and  December  28,  2002            F-4

Consolidated  Statements  of  Shareholders'  Deficit  as  of
December  30, 2000, December  29,  2001  and  December  28,  2002            F-5

Consolidated  Statements  of  Cash  Flows  for  the Years Ended
December  30, 2000, December  29,  2001  and  December  28,  2002            F-6

Notes  to  the  Consolidated  Financial  Statements                          F-8

Schedule  II  -  Consolidated  Valuation  and  Qualifying
Accounts  -  For  the Years  Ended  December  30,  2000,
December  29,  2001  and  December  28,  2002                               F-40

                                       F1
<PAGE>

                         Report of Independent Auditors


Board  of  Directors  and  Shareholders
Eye  Care  Centers  of  America,  Inc.
San  Antonio,  Texas

We have audited the accompanying consolidated balance sheets of Eye Care Centers
of America, Inc. and Subsidiaries as of December 28, 2002 and December 29, 2001,
and  the  related  consolidated statements of operations, shareholders' deficit,
and  cash  flows  for each of the fiscal years ended December 28, 2002, December
29, 2001 and December 30, 2000. Our audits also included the financial statement
schedule listed in the index at Item 14. These financial statements and schedule
are  the  responsibility  of  the Company's management. Our responsibility is to
express  an  opinion  on  these  financial  statements and schedule based on our
audits.

We conducted our audits in accordance with auditing standards generally accepted
in the United States. Those standards require that we plan and perform the audit
to  obtain  reasonable assurance about whether the financial statements are free
of material misstatement. An audit includes examining, on a test basis, evidence
supporting  the  amounts  and  disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant estimates
made  by  management,  as  well  as  evaluating  the overall financial statement
presentation.  We  believe  that  our  audits provide a reasonable basis for our
opinion.

In  our opinion, the consolidated financial statements referred to above present
fairly,  in  all  material  respects, the consolidated financial position of Eye
Care Centers of America, Inc. and Subsidiaries at December 28, 2002 and December
29,  2001, and the consolidated results of their operations and their cash flows
for the fiscal years ended December 28, 2002, December 29, 2001 and December 30,
2000,  in conformity with accounting principles generally accepted in the United
States.  Also,  in  our  opinion, the related financial statement schedule, when
considered  in  relation  to  the  basic  financial statements taken as a whole,
presents  fairly  in  all  material  respects the information set forth therein.

As  discussed  in  Note  2  to  the consolidated financial statements, effective
December  30,  2001,  the  Company  adopted  Statement  of  Financial Accounting
Standards  No.  142,  "Goodwill  and  other  Intangible  Assets."

                                                       By: /S/ ERNST & YOUNG LLP

San Antonio, Texas
February 26, 2003

                    A Member Practice of Ernst & Young Global

                                       F2
<PAGE>

<TABLE>
<CAPTION>

                                      EYE CARE CENTERS OF AMERICA, INC.
                                         CONSOLIDATED BALANCE SHEETS
                          (DOLLAR AMOUNTS IN THOUSANDS UNLESS INDICATED OTHERWISE)


<S>                                                                           <C>             <C>
                                                                                DECEMBER 29,    DECEMBER 28,
                                                                                   2001            2002
                                                                              --------------  --------------
ASSETS
Current assets:
   Cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . . . .  $       3,372   $       3,450
   Accounts receivable, less allowance for doubtful accounts of
      $4,856 in fiscal 2001 and $4,291 in fiscal 2002. . . . . . . . . . . .         10,275          12,084
   Inventory, less reserves of $1,099 in fiscal 2001 and $677 in fiscal 2002         24,665          24,060
   Prepaid expenses and other. . . . . . . . . . . . . . . . . . . . . . . .          3,389           3,573
                                                                              --------------  --------------
     Total current assets. . . . . . . . . . . . . . . . . . . . . . . . . .         41,701          43,167
Property and equipment, net of accumulated depreciation and amortization of
   $106,877 in fiscal 2001 and $125,225 in fiscal 2002 . . . . . . . . . . .         64,518          57,439
Intangibles, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .        109,453         107,588
Other assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .          8,004           8,862
                                                                              --------------  --------------
     Total assets. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  $     223,676   $     217,056
                                                                              ==============  ==============
LIABILITIES AND SHAREHOLDERS' DEFICIT
Current liabilities:
   Accounts payable. . . . . . . . . . . . . . . . . . . . . . . . . . . . .  $      21,749   $      20,256
   Current portion of long-term debt . . . . . . . . . . . . . . . . . . . .         13,786          15,524
   Deferred revenue. . . . . . . . . . . . . . . . . . . . . . . . . . . . .          6,557           6,334
   Accrued payroll expense . . . . . . . . . . . . . . . . . . . . . . . . .          5,733           7,776
   Accrued interest. . . . . . . . . . . . . . . . . . . . . . . . . . . . .          3,284           2,318
   Other accrued expenses. . . . . . . . . . . . . . . . . . . . . . . . . .          8,500           8,523
                                                                              --------------  --------------
     Total current liabilities . . . . . . . . . . . . . . . . . . . . . . .         59,609          60,731
Long-term debt, less current maturities. . . . . . . . . . . . . . . . . . .        260,777         239,109
Deferred rent. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .          3,790           4,571
Deferred gain. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .          1,999           1,766
                                                                              --------------  --------------
     Total liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . .        326,175         306,177
                                                                              --------------  --------------
Commitments and contingencies
Shareholders' deficit:
   Common stock, par value $.01 per share; 20,000,000 shares authorized,
     issued and outstanding 7,407,289 in fiscal 2001 and 7,397,689 in
     fiscal 2002 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .             74              74
   Preferred stock, par value $.01 per share, 300,000 shares authorized,
     issued and outstanding in 2001 and 2002 . . . . . . . . . . . . . . . .         48,134          54,703
   Additional paid-in capital. . . . . . . . . . . . . . . . . . . . . . . .         43,474          36,040
   Accumulated deficit . . . . . . . . . . . . . . . . . . . . . . . . . . .       (194,181)       (179,938)
                                                                              --------------  --------------
     Total shareholders' deficit . . . . . . . . . . . . . . . . . . . . . .       (102,499)        (89,121)
                                                                              --------------  --------------
                                                                              $     223,676   $     217,056
                                                                              ==============  ==============
</TABLE>

The accompanying notes are an integral part
of these consolidated financial statements

                                       F3
<PAGE>

<TABLE>
<CAPTION>

                                  EYE CARE CENTERS OF AMERICA, INC.
                                CONSOLIDATED STATEMENTS OF OPERATIONS
                      (DOLLAR AMOUNTS IN THOUSANDS UNLESS INDICATED OTHERWISE)


<S>                                               <C>                  <C>             <C>
                                                                    FISCAL YEAR ENDED
                                                                   -------------------
                                                    DECEMBER 30,         DECEMBER 29,    DECEMBER 28,
                                                       2000                 2001            2002
                                                  -------------------  --------------  -------------
Revenues:
   Optical sales . . . . . . . . . . . . . . . .  $          335,624   $     332,550   $     360,266
   Management fees . . . . . . . . . . . . . . .               2,833           3,484           3,401
                                                  -------------------  --------------  -------------
     Net revenues. . . . . . . . . . . . . . . .             338,457         336,034         363,667

Operating costs and expenses:
   Cost of goods sold. . . . . . . . . . . . . .             107,449         104,446         112,471
   Selling, general and administrative expenses.             204,365         203,187         213,683
   Store closure expense . . . . . . . . . . . .               3,580               -               -
   Amortization of intangibles:
      Goodwill . . . . . . . . . . . . . . . . .               5,214           5,319               -
      Noncompete and other intangibles . . . . .               3,922           3,378           1,865
                                                  -------------------  --------------  -------------

        Total operating costs and expenses . . .             324,530         316,330         328,019
                                                  -------------------  --------------  -------------

Income from operations . . . . . . . . . . . . .              13,927          19,704          35,648

Interest expense, net. . . . . . . . . . . . . .              28,695          27,537          21,051
                                                  -------------------  --------------  -------------

Net income (loss) before income taxes. . . . . .             (14,768)         (7,833)         14,597

Income tax expense . . . . . . . . . . . . . . .                 766           1,239           1,258
                                                  -------------------  --------------  -------------

Net income (loss) before extraordinary gain. . .             (15,534)         (9,072)         13,339

Extraordinary gain . . . . . . . . . . . . . . .                   -               -             904
                                                  -------------------  --------------  -------------

Net income (loss). . . . . . . . . . . . . . . .  $          (15,534)  $      (9,072)  $      14,243
                                                  ===================  ==============  =============
</TABLE>

The accompanying notes are an integral part
of these consolidated financial statements

                                       F4
<PAGE>

<TABLE>
<CAPTION>

                                              EYE CARE CENTERS OF AMERICA, INC.
                                      CONSOLIDATED STATEMENTS OF SHAREHOLDERS' DEFICIT
                                  (DOLLAR AMOUNTS IN THOUSANDS UNLESS INDICATED OTHERWISE)


<S>                                         <C>             <C>       <C>           <C>         <C>            <C>

                                                                      Additional                               Total
                                            Common  Stock             Paid-In       Preferred   Accumulated    Shareholders'
                                            Shares          Amount    Capital       Stock       Deficit        Deficit
                                            --------------  --------  ------------  ----------  -------------  ---------------
Balance at January 1, 2000 . . . . . . . .      7,426,945   $     74  $   55,738   $     37,268  $     (169,575)  $ (76,495)

Dividends accrued on preferred stock . . .              -          -      (5,086)         5,086               -           -

Interest receivable on loan to shareholder              -          -         (90)             -               -         (90)

Distribution to affiliated OD. . . . . . .              -          -        (365)             -               -        (365)

Stock buyback. . . . . . . . . . . . . . .        (16,812)         -        (234)             -               -        (234)

Net loss . . . . . . . . . . . . . . . . .              -          -           -              -         (15,534)    (15,534)
                                            --------------  --------  -----------  ------------  ---------------  ----------
Balance at December 30, 2000 . . . . . . .      7,410,133   $     74  $   49,963   $     42,354  $     (185,109)  $ (92,718)

Dividends accrued on preferred stock . . .              -          -      (5,780)         5,780               -           -

Interest receivable on loan to shareholder              -          -         (90)             -               -         (90)

Distribution to affiliated OD. . . . . . .              -          -        (603)             -               -        (603)

Stock buyback. . . . . . . . . . . . . . .         (2,844)         -         (16)             -               -         (16)

Net loss . . . . . . . . . . . . . . . . .              -          -           -              -          (9,072)     (9,072)
                                            --------------  --------  -----------  ------------  ---------------  ----------
Balance at December 29, 2001 . . . . . . .      7,407,289   $     74  $   43,474   $     48,134  $     (194,181)  $(102,499)

Dividends accrued on preferred stock . . .              -          -      (6,569)         6,569               -           -
                                                        -
Interest receivable on loan to shareholder              -          -         (90)             -               -         (90)
                                                        -
Distribution to affiliated OD. . . . . . .              -          -        (675)             -               -        (675)
                                                        -
Stock buyback. . . . . . . . . . . . . . .         (9,600)         -        (100)             -               -        (100)

Net income . . . . . . . . . . . . . . . .              -          -           -              -          14,243      14,243
                                            --------------  --------  -----------  ------------  ---------------  ----------
Balance at December 28, 2002 . . . . . . .      7,397,689   $     74  $   36,040   $     54,703  $     (179,938)  $ (89,121)
                                            ==============  ========  ===========  ============  ===============  ==========
</TABLE>

The accompanying notes are an integral part
of these consolidated financial statements

                                       F5
<PAGE>

<TABLE>
<CAPTION>

                                          EYE CARE CENTERS OF AMERICA, INC.
                                        CONSOLIDATED STATEMENTS OF CASH FLOWS
                               (DOLLAR AMOUNTS IN THOUSANDS UNLESS INDICATED OTHERWISE)


<S>                                                               <C>                  <C>             <C>
                                                                                    FISCAL YEAR ENDED
                                                                                   -------------------
                                                                    DECEMBER 30,         DECEMBER 29,    DECEMBER 28,
                                                                       2000                 2001            2002
                                                                  -------------------  --------------  --------------

Cash flows from operating activities:
Net income (loss). . . . . . . . . . . . . . . . . . . . . . . .  $          (15,534)  $      (9,072)  $      14,243
Adjustments to reconcile net income (loss) to net cash provided
   by operating activities:
     Depreciation. . . . . . . . . . . . . . . . . . . . . . . .              20,464          20,350          18,761
     Amortization of intangibles . . . . . . . . . . . . . . . .               9,136           8,697           1,865
     Amortization of debt issue costs. . . . . . . . . . . . . .               1,784           1,956           1,901
     Amortization of deferred gain . . . . . . . . . . . . . . .                (234)           (234)           (233)
     Deferred revenue. . . . . . . . . . . . . . . . . . . . . .                 526            (101)           (223)
     Deferred rent . . . . . . . . . . . . . . . . . . . . . . .                 172              19             781
     Loss on disposition of property and equipment . . . . . . .                 118             268              62
    Extraordinary gain . . . . . . . . . . . . . . . . . . . . .                   -               -            (904)
Changes in operating assets and liabilities:
     Accounts and notes receivable . . . . . . . . . . . . . . .              (4,452)          3,070          (1,899)
     Inventory . . . . . . . . . . . . . . . . . . . . . . . . .               4,457           1,025             605
     Prepaid expenses and other. . . . . . . . . . . . . . . . .              (3,476)           (337)           (203)
     Accounts payable and accrued liabilities. . . . . . . . . .              (1,745)          1,729            (393)
                                                                  -------------------  --------------  --------------
Net cash provided by operating activities. . . . . . . . . . . .              11,216          27,370          34,363
                                                                  -------------------  --------------  --------------

Cash flows from investing activities:
   Acquisition of property and equipment . . . . . . . . . . . .             (18,932)        (10,559)        (10,668)
   Net outflow for the VTO Retail Acquisition. . . . . . . . . .                 (87)              -               -
   Proceeds from sale of property and equipment. . . . . . . . .                  54              68               -
   Payment received on notes receivable. . . . . . . . . . . . .                  33               3               -
                                                                  -------------------  --------------  --------------

Net cash used in investing activities. . . . . . . . . . . . . .             (18,932)        (10,488)        (10,668)
                                                                  -------------------  --------------  --------------
</TABLE>

The accompanying notes are an integral part
of these consolidated financial statements

                                       F6
<PAGE>

<TABLE>
<CAPTION>

                                    EYE CARE CENTERS OF AMERICA, INC.
                                  CONSOLIDATED STATEMENTS OF CASH FLOWS
                         (DOLLAR AMOUNTS IN THOUSANDS UNLESS INDICATED OTHERWISE)


<S>                                                   <C>                  <C>             <C>
                                                                         FISCAL YEAR ENDED
                                                                        -------------------
                                                        DECEMBER 30,         DECEMBER 29,    DECEMBER 28,
                                                           2000                 2001            2002
                                                      -------------------  --------------  --------------

Cash flows from financing activities:
   Payments on debt related to refinancing . . . . .  $           (7,669)  $     (16,928)  $    (118,346)
   Proceeds from issuance of long-term debt. . . . .              17,000              66         124,000
   Payments on debt and capital leases . . . . . . .                   -               -         (23,708)
   Payments for refinancing fees . . . . . . . . . .                   -               -          (4,788)
   Distribution to affiliated OD . . . . . . . . . .                (365)           (603)           (675)
   Stock buyback . . . . . . . . . . . . . . . . . .                (234)            (16)           (100)

Net cash  provided by (used in) financing activities               8,732         (17,481)        (23,617)
                                                      -------------------  --------------  --------------

Net (decrease) increase in cash and cash equivalents               1,016            (599)             78

Cash and cash equivalents at beginning of period . .               2,955           3,971           3,372
                                                      -------------------  --------------  --------------
Cash and cash equivalents at end of period . . . . .  $            3,971   $       3,372   $       3,450
                                                      ===================  ==============  ==============
<FN>

Supplemental  cash  flow  disclosures:
  Cash  paid  during  the  period  for:
               Interest                               $            25,436   $       26,150  $       19,401
               Taxes                                                  304              358             687
  Noncash  investing  and  financing  activities:
               Additions of property and equipment                    665                -           1,076
               Dividends accrued on preferred stock                 5,086            5,780           6,569
               Adjustment of noncompete agreement to goodwill       5,575                -               -
               Store closure expense                                3,580                -               -
</TABLE>

The accompanying notes are an integral part
of these consolidated financial statements

                                       F7
<PAGE>

1.  DESCRIPTION  OF  BUSINESS  AND  ORGANIZATION

     Description  of Business. Eye Care Centers of America, Inc. (the "Company")
operates  optical retail stores which sell prescription eyewear, contact lenses,
sunglasses and ancillary optical products, and feature on-site laboratories. The
Company's  operations  are  located  in  32  states,  primarily  in  the Pacific
Northwest,  Southwest,  Midwest  and  Southeast,  in the Mid-Atlantic States and
along  the  Gulf  and  East  Coasts.

2.  SUMMARY  OF  SIGNIFICANT  ACCOUNTING  POLICIES

     Basis of Presentation. The financial statements include the accounts of the
Company,  its  wholly  owned  subsidiaries and certain private optometrists with
practices  managed  by subsidiaries of the Company (the "ODs").  All significant
intercompany  accounts  and  transactions have been eliminated in consolidation.
Certain  reclassifications  have  been  made  to  the prior period statements to
conform  to  the  current  period  presentation.

Use of Estimates. In preparing financial statements in conformity with generally
accepted  accounting  principles,  management  is required to make estimates and
assumptions.  These  estimates  and  assumptions  affect  the reported amount of
assets  and  liabilities, the disclosure of contingent assets and liabilities at
the  date  of  the  financial  statements  and  revenues and expenses during the
reporting  period.  Actual  results  could  differ  from  these  estimates.

     Reporting  Periods.  The  Company  uses  a 52/53 week reporting format. The
fiscal  years  ended 2000, 2001 and 2002 consisted of 52 weeks. Fiscal year 2000
ended  December  30,  2000  ("fiscal 2000"), fiscal year 2001 ended December 29,
2001  ("fiscal  2001")  and  fiscal  year  2002 ended December 28, 2002 ("fiscal
2002").

     Cash  and  Cash Equivalents. All short-term investments that mature in less
than  90  days  when  purchased  are considered cash equivalents for purposes of
disclosure  in  the  consolidated  balance sheets and consolidated statements of
cash  flows.  Cash  equivalents  are  stated  at cost, which approximates market
value.

     Accounts  Receivable.  Accounts  receivable  are primarily from third party
payors  related  to  the  sale of eyewear and include receivables from insurance
reimbursements,  credit  card  companies, ODs, merchandise, rent and license fee
receivables.  Merchandise  receivables  result  from product returned to vendors
pending credit or exchange for new product. The Company's allowance for doubtful
accounts  primarily  consists  of  amounts  owed  to  the Company by third party
insurance  payors. This estimate is based on the historical ratio of collections
to  billings.

                                       F8
<PAGE>

     Inventory.  Inventory  consists  principally of eyeglass frames, ophthalmic
lenses  and contact lenses and is stated at the lower of cost or market. Cost is
determined  using  the  weighted average method which approximates the first-in,
first-out  (FIFO) method. The Company's inventory reserves are an estimate based
on  product  with  low  turnover  or  deemed  by  management  to  be unsaleable.

     The  Company  currently  uses  four  principal  vendors  to supply its lens
inventory  and more than twenty different vendors to supply its frame inventory.
In  fiscal  2002,  two  of the principal lens vendors supplied over 67.9% of the
Company's  lens  materials  while  four  frame  vendors  collectively  supplied
approximately  60.5%  of  the  frames  purchased  by the Company during the same
period. While such vendors supplied a significant share of the inventory used by
the Company, lenses and frames are a generic product and can be purchased from a
number  of  other  vendors  on  comparable terms. The Company therefore does not
believe  that  it  is  dependent  on such vendors or any other single vendor for
lenses  or frames. The Company believes that its relationships with its existing
vendors  are  satisfactory.  The Company believes that significant disruption in
the  delivery  of  merchandise from one or more of its current principal vendors
would  not  have  a  material adverse effect on the Company's operations because
multiple  vendors  exist  for  all  of  the  Company's  products.

     Property  and  Equipment.  Property  and equipment is recorded at cost. For
financial  statement purposes, depreciation of building, furniture and equipment
is  calculated using the straight-line method over the estimated useful lives of
the  assets. Leasehold improvements are amortized on a straight-line method over
the  shorter  of  the  life  of  the  lease or the estimated useful lives of the
assets.  Depreciation  of  capital  leased  assets  is  included in depreciation
expense  and  is  calculated using the straight-line method over the term of the
lease.


    Estimated  useful  lives  are  as  follows:
    Building                                                           20  years
    Furniture  and  equipment                                      3 to 10 years
    Leasehold  improvements                                        5 to 10 years

     Maintenance  and  repair  costs  are  charged  to  expense  as  incurred.
Expenditures  for  significant  betterments  are  capitalized.

     Intangibles.  Intangibles  principally  consist  of  the  amounts of excess
purchase  price  over  the  market  value  of  acquired net assets ("goodwill"),
noncompete  agreements,  and  a  strategic alliance agreement. In July 2001, the
Financial  Standards  Board  ("FASB")

                                       F9
<PAGE>

issued  SFAS  No.'s 141 and 142, "Business Combinations" and "Goodwill and Other
Intangibles."  FASB  141 requires all business combinations initiated after June
30, 2001 to be accounted for using the purchase method. Under FASB 142, goodwill
is  no  longer  subject  to amortization over its estimated useful life. Rather,
goodwill is subject to an annual assessment for impairment applying a fair-value
based  test.  Any  impairment  resulting  from  the  initial  application of the
statements  is  to be recorded as a cumulative effect of accounting change as of
December  2001.  Additionally, an acquired intangible asset should be separately
recognized  if  the  benefit  of  the  intangible  asset  is  obtained  through
contractual  or  other  legal  rights,  or  if the intangible asset can be sold,
transferred, licensed, rented, or exchanged, regardless of the acquirer's intent
to  do so. The Company adopted both statements on December 30, 2001. The Company
performed  its  annual  assessment  of  goodwill  on  a consolidated basis as of
December  28,  2002,  and  based upon its analysis, the Company believes that no
impairment  of  goodwill  exists. The Company's pro forma net loss with goodwill
excluded  for  fiscal  years  2000  and  2001  are  as  follows:

<TABLE>
<CAPTION>

<S>                            <C>         <C>
                               FISCAL      FISCAL
                                2000        2001
                              ---------   --------
     Pro forma net loss       $(10,320)   $(3,753)
</TABLE>

     Other  Assets.  Other  assets  consist primarily of deferred debt financing
costs.  These  costs  are amortized into expense over the life of the associated
debt.

     Long-Lived Assets. In August 2001, the Financial Accounting Standards Board
(FASB) issued SFAS 144, "Accounting for the Impairment or Disposal of Long-Lived
Assets."  This  Standard  requires  the  recognition  and  measurement  of  the
impairment  of  long-lived  assets  to  be  held and used and the measurement of
long-lived assets to be disposed of by sale. The Company adopted SFAS No. 144 in
the  first quarter of fiscal 2002. Based upon its analysis, the Company believes
there  was  no  impact  on its results of operations or financial condition as a
result  of  the  adoption  of  this  Standard.

     Deferred  Revenue - Replacement Certificates and Warranty Contracts. At the
time  of  a  frame  sale,  some  customers purchase a warranty contract covering
eyewear  defects  or damage during the 12-month period subsequent to the date of
the  sale.  Revenue  relating to these contracts is deferred and recognized on a
straight-line  basis  over  the  life of the warranty contract (one year). Costs
incurred  to  fulfill  the  warranty  are  expensed  when  incurred.

                                      F10
<PAGE>

     Certain  frame  purchases  include  a  one-year  warranty  period  without
requiring the separate purchase of a warranty contract. Reserves are established
for  the  expected  cost  of  repair related to these frame sales. At the end of
fiscal  2001  and 2002 the Company has established a reserve based on historical
experience  of  approximately  $841  and  $861,  respectively,  related to these
warranties,  which  is  included  in  other accrued expenses on the accompanying
balance  sheet.

     Income Taxes. The Company records income taxes under FASB No. 109 using the
liability  method.  Under  this  method, deferred tax assets and liabilities are
determined  based  on  differences  between financial reporting and tax bases 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.

     Revenue  Recognition. Sales and related costs are recognized by the Company
upon  the  sale  of  products  at company-owned retail locations. Licensing fees
collected  from  independent  optometrists  for  using  the Company's trade name
"Master  Eye  Associates," insurance premiums and management fees are recognized
when  earned.  Historically,  the Company's highest sales occur in the first and
third  quarters.

     Advertising  Costs.  Advertising costs of the Company include costs related
to  broadcast  and  print  media  advertising  expenses.  The  Company  expenses
production costs and media advertising costs when incurred. For the fiscal years
ended  2000,  2001 and 2002 advertising costs amounted to approximately $30,880,
$28,988  and  $30,629,  respectively.

     New  Accounting Pronouncements. On April 30, 2002, SFAS 145, "Rescission of
FASB  Statements  No.  4,  44  and  64,  Amendment of FASB Statement No. 13, and
Technical  Corrections"  was approved by the FASB. As a result, gains and losses
from  extinguishment  of debt are classified as extraordinary items only if they
meet  the  criteria in Accounting Principles Board Opinion 30. The provisions of
this  Statement  shall  be applied in fiscal years beginning after May 15, 2002.
While the adoption of SFAS 145 will likely result in certain financial statement
reclassifications,  management  does  not  believe that the adoption of SFAS 145
will  have  a  significant  impact  on  the  Company's  results of operations or
financial  position.

                                      F11
<PAGE>

     On  July  30, 2002, SFAS 146, "Accounting for Costs Associated with Exit or
Disposal Activities" was issued by the FASB. This standard requires companies to
recognize  costs  associated  with  exit  or  disposal  activities when they are
incurred  rather  than  at the date of a commitment to an exit or disposal plan.
Examples  of  costs  covered by the standard include lease termination costs and
certain  employee  severance  costs  that  are  associated with a restructuring,
discontinued  operation,  plant closing or other exit or disposal activity. SFAS
146  is  to  be  applied  prospectively to exit or disposal activities initiated
after  December  31, 2002. The Company adopted SFAS 146 on December 29, 2002 and
the  adoption  of  SFAS  146 did not have a significant impact on its results of
operations or financial position as it currently has no plans to exit or dispose
of  activities.

     In  December  2002,  SFAS  148,  "Accounting for Stock-Based Compensation -
Transition  and  Disclosure"  was  issued  by  the  FASB.  The  FASB has not yet
announced  the  effective date for adoption of SFAS 148, however, the disclosure
requirements  are  required  in  fiscal years beginning after December 15, 2002.
This standard amends SFAS 123 to provide alternative methods of transition for a
voluntary change to the fair value method of accounting for stock-based employee
compensation.  In  addition, this standard amends the disclosure requirements of
SFAS  123  to require prominent disclosures in both annual and interim financial
statements  about the method of accounting for stock-based employee compensation
and  the effect of the method used on reported results. As there were no options
outstanding  as  of December 29, 2001, pro forma disclosures are only applicable
to  fiscal  2000  and 2002. For purposes of pro forma disclosures, the estimated
fair  value  of  the  options  is amortized to expense over the options' vesting
period. The pro forma calculations include only the effects of 1998 through 2002
grants  as  all grants previous to 1998 were exercised. As such, the impacts are
not  necessarily  indicative  of  the  effects  on reported net income of future
years.  The Company's pro forma net income (loss) for fiscal years 2000 and 2002
are  as  follows:

<TABLE>
<CAPTION>

<S>                                     <C>         <C>
                                        FISCAL      FISCAL
                                         2000        2002
                                       ---------   -------
     Pro forma net income (loss)       $(15,801)   $14,122
</TABLE>

                                      F12
<PAGE>

     Stock  Based  Compensation.  The  Company  grants stock options for a fixed
number  of shares to employees with an exercise price equal to the fair value of
the  shares  at  the date of grant. In accordance with FASB No. 123, "Accounting
for  Stock-Based  Compensation,"  the Company has continued to account for stock
option  grants  in  accordance  with  APB  Opinion No. 25, "Accounting for Stock
Issues  to  Employees," and, accordingly, recognized no compensation expense for
the  stock  option  grants.

<TABLE>
<CAPTION>

Interest  Expense,  Net.  Interest  expense,  net  consists  of  the  following:


<S>                       <C>            <C>            <C>
                                           YEAR-ENDED
                                         -------------
                           DECEMBER 30,    DECEMBER 29,    DECEMBER 28,
                              2000           2001             2002
                          -------------  -------------  -------------

   Interest expense. . .  $     29,585   $     28,125   $     21,481
   Interest income . . .          (269)          (268)          (178)
   Interest capitalized.          (621)          (320)          (252)
                          -------------  -------------  -------------
   Interest expense, net  $     28,695   $     27,537   $     21,051
                          =============  =============  =============
</TABLE>

     Derivatives.  The  Company's  swap  agreements  matured on May 1, 2001. The
Company  does  not  currently  hold  any  derivative  instruments.


3.  RELATED  PARTY  TRANSACTIONS

     The Company and Thomas H. Lee Company ("THL Co.") entered into a management
agreement  as  of  April  24, 1998 (as amended, the "Management Agreement"). The
management  agreement  provides  for  fees of $250 or $500 annually based on the
Company  maintaining  certain  leverage  ratios  defined in the Company's credit
agreement.  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  fiscal  years  2000, 2001 and 2002 the Company incurred $500, $250 and
$500,  respectively,  related  to  the  Management  Agreement.

                                      F13
<PAGE>

<TABLE>
<CAPTION>

4.  PREPAID  EXPENSES  AND  OTHER

          Prepaid  expenses  and  other  consists  of  the  following:

<S>                                <C>           <C>
                                   DECEMBER 29,   DECEMBER 28,
                                     2001           2002
                                  ------------  ------------

          Prepaid insurance. . .  $        275  $        568
          Prepaid store supplies           797           843
          Prepaid advertising. .         1,892         1,861
          Other. . . . . . . . .           425           301
                                  ------------  ------------
                                  $      3,389  $      3,573
                                  ============  ============
</TABLE>

<TABLE>
<CAPTION>

5.  PROPERTY  AND  EQUIPMENT

          Property  and  equipment,  net,  consists  of  the  following:

<S>                                                       <C>            <C>
                                                          DECEMBER 29,    DECEMBER 28,
                                                             2001            2002
                                                          -------------  -------------

          Land . . . . . . . . . . . . . . . . . . . . .  $        638   $        638
          Building . . . . . . . . . . . . . . . . . . .         2,240          2,240
          Furniture and equipment. . . . . . . . . . . .       108,471        116,126
          Leasehold improvements . . . . . . . . . . . .        60,046         63,660
                                                          -------------  -------------
                                                               171,395        182,664
          Less accumulated depreciation and amortization      (106,877)      (125,225)
                                                          -------------  -------------
          Property and equipment, net. . . . . . . . . .  $     64,518   $     57,439
                                                          =============  =============
</TABLE>

                                      F14
<PAGE>

<TABLE>
<CAPTION>

6.  INTANGIBLE  ASSETS

          The  following  is  a summary of the components of intangible assets along
with the  related  accumulated  amortization  for  the  fiscal  years  then  ended.

<S>                                                     <C>            <C>
                                                        DECEMBER 29,    DECEMBER 28,
                                                          2001             2002
                                                       -------------  -------------

          Noncompete and strategic alliance agreements  $     10,187   $     10,187
          Less accumulated amortization. . . . . . . .        (8,157)       (10,022)
                                                        -------------  -------------
             Net . . . . . . . . . . . . . . . . . . .         2,030            165
          Goodwill and other . . . . . . . . . . . . .       107,423        107,423
                                                        -------------  -------------
          Intangibles, net . . . . . . . . . . . . . .  $    109,453   $    107,588
                                                        =============  =============
</TABLE>

<TABLE>
<CAPTION>

7.  OTHER  ACCRUED  EXPENSES

          Other  accrued  expenses  consists  of  the  following:

<S>                                <C>           <C>
                                    DECEMBER 29,   DECEMBER 28,
                                       2001           2002
                                   ------------  ------------

          Insurance . . . . . . .  $        835  $      1,654
          Income tax payable. . .           938         1,175
          Store expenses. . . . .         1,240           930
          Warranties. . . . . . .           841           861
          Advertising . . . . . .           634           839
          Payroll & sales/use tax           771           829
          Other . . . . . . . . .         1,022           752
          Professional fees . . .           624           746
          Property taxes. . . . .           546           441
          Third party liability .           414           196
          Severance & legal fees.           350           100
          Construction. . . . . .           156             -
          Store closures. . . . .           129             -
                                   ------------  ------------
                                   $      8,500  $      8,523
                                   ============  ============
</TABLE>

                                      F15
<PAGE>

8.  LONG-TERM  DEBT

     Credit  Facilities.  In  April  1998,  the  Company  entered  into a credit
agreement  which  provided  for  $55.0  million in term loans, $100.0 million in
acquisition  facilities,  and $35.0 million in revolving credit facilities ("Old
Credit  Facility").  On  December  23,  2002,  the Company entered into a credit
agreement  which consists of (i) the $55.0 million term loan facility (the "Term
Loan  A");  (ii)  the  $62.0 million term loan facility (the "Term Loan B"); and
(iii)  the  $25.0 million revolving credit facility (the "Revolver" and together
with the Term Loan A and Term Loan B, the "New Facilities"). The proceeds of the
New  Facilities  were  used  to (i) pay long-term debt outstanding under the Old
Credit  Facility, (ii) redeem $20.0 million face value of subordinated debt at a
cost  of  $17.0  million, and (iii) pay fees and expenses incurred in connection
with the New Facilities. Thereafter, the New Facilities are available to finance
working  capital  requirements  and  general  corporate  purposes.

     Borrowings  made  under  the  New  Facilities  shall accrue interest at the
Company's option at the Base Rate or the LIBOR rate, plus the applicable margin.
Base  Rate shall mean a floating rate equal to the higher of (i) the Fleet prime
rate  and  (ii)  the  overnight  Federal  Funds  Rate plus 1/2%. Pricing for the
Revolver will be at LIBOR plus 4.50% (Base Rate plus 3.50%), Term Loan A will be
at  LIBOR  plus  4.25%  (Base Rate plus 3.25%), and Term Loan B will be at LIBOR
plus  4.75%  (Base Rate plus 3.75%). The Term Loan A shall amortize in quarterly
payments  commencing  on  March  31,  2003  in annual principal amounts of $15.0
million,  $20.0  million  and $20.0 million, respectively, for fiscal years 2003
through  2005.  The Term Loan B shall have no payments until 2006 when quarterly
payments  will  commence  in annual principal amounts of $20.0 million and $42.0
million,  respectively,  for  fiscal  years  2006  and  2007.

     In  connection  with  the  borrowings  made  under  the New Facilities, the
Company  incurred  approximately  $4.8  million  in  debt issuance costs.  These
amounts  are  classified  within other assets in the accompanying balance sheets
and  are  being  amortized over the life of the New Facilities.  The unamortized
amount  of  debt  issuance  costs  as  of  December  28, 2002 related to the New
Facilities  was  $4.8  million.

     At  December  28,  2002, the Company had $55.0 million and $62.0 million in
term loans outstanding under the Term Loan A and Term Loan B, respectively, $5.0
million  outstanding  under  the  Revolver,  $129.7  million  in  notes  payable
outstanding  evidenced  by  the Exchange Notes and $2.9 million in capital lease
and  equipment  obligations.  In addition, the Company has agreed to guarantee a
$1.0  million  loan  that is related to the long-term business agreement entered
into  at  the  time  of  the  acquisition  of  Hour  Eyes.

                                      F16
<PAGE>

     The  New  Facilities  are  collateralized  by  all  tangible and intangible
assets,  including  the  stock  of  the Company's subsidiaries. In addition, the
Company must meet certain financial covenants including minimum EBITDA, interest
coverage,  leverage ratio and capital expenditures. As of December 28, 2002, the
Company  was  in  compliance  with  the  financial  covenants.

     On  April  24,  1998,  the  Company completed a debt offering consisting of
$100.0  million  aggregate  principal  amount  of its 9 1/8% Senior Subordinated
Notes  due  2008  (the "Fixed Rate Notes") and $50.0 million aggregate principal
amount  of its Floating Interest Rate Subordinated Term Securities due 2008 (the
"Floating  Rate  Notes"  and,  together  with the Fixed Rate Notes, the "Initial
Notes").  In  connection  with  the  New  Facilities, the Company redeemed $20.0
million  of  the  Floating  Rate Notes on December 23, 2002. 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.

     The  Exchange  Notes are senior uncollateralized obligations of the Company
and rank pari passu with all other indebtedness of the Company that by its terms
other  indebtedness is not subordinate to the Exchange Notes. In connection with
the  issuance  of  the  Exchange Notes, the Company incurred approximately $11.2
million in debt issuance costs. These amounts are classified within other assets
in  the accompanying balance sheets and are being amortized over the life of the
Exchange Notes. The unamortized amount of debt issuance costs as of December 28,
2002  related  to  the  Exchange  Notes  was  $3.5  million.

     The  Exchange  Notes  contain  various restrictive covenants which apply to
both  the  Company  and  the  Guarantor Subsidiaries (defined herein), including
limitations  on  additional  indebtedness,  restriction on dividends and sale of
assets  other  than  in  the  normal  course  of  business.

     Extraordinary  Gain.  On  December  23,  2002,  the  Company  retired $20.0
million  face  value  of  subordinated  debt at a cost of $17.0 million and $0.5
million  of related capitalized loan costs resulting in an extraordinary gain of
$2.5  million.  In  addition,  the Company wrote-off $1.6 million of capitalized
loan costs related to the Old Credit Facility resulting in an extraordinary loss
of  $1.6  million. As a result, the Company has recognized an extraordinary gain
net  of  tax  of  $0.9  million  in  its  financial  statements.

                                      F17
<PAGE>

     Capital  Leases.  The  Company  has an agreement whereby it leases land and
buildings  at  five  operating  locations.  Additionally, in connection with the
acquisition  of  Bizer,  the Company assumed agreements to sublease equipment at
the  related  operating  locations.  The Company has accounted for the equipment
subleases  and  the  five property leases as capital leases and has recorded the
assets,  as shown below, and the future obligations on the balance sheet at $2.5
and  $2.1  million,  respectively.

<TABLE>
<CAPTION>

<S>                           <C>               <C>
                               DECEMBER 29,       DECEMBER 28,
                                  2001              2002
                                ------------    ------------
Buildings and equipment        $      2,466    $      2,501
                               ============    ============
</TABLE>

<TABLE>
<CAPTION>

<S>                                                                          <C>
The Company scheduled future minimum lease payments for the next five fiscal
years under the property and equipment capital leases are as follows:

          2003. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  $  757
          2004. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .     803
          2005. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .     829
          2006. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .     833
          2007. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .     833
          Beyond 2007 . . . . . . . . . . . . . . . . . . . . . . . . . . .   1,231
                                                                             ------
          Total minimum lease payments. . . . . . . . . . . . . . . . . . .   5,286
          Amounts representing interest . . . . . . . . . . . . . . . . . .   3,159
                                                                             ------
          Present value of minimum lease payments . . . . . . . . . . . . .  $2,127
                                                                             ======
</TABLE>

                                      F18
<PAGE>

<TABLE>
<CAPTION>

Long-term  debt  outstanding,  including  capital  lease  obligations,
consists  of  the  following:


<S>                                                  <C>             <C>
                                                     DECEMBER 29,       DECEMBER 28,
                                                       2001               2002
                                                   --------------    --------------

   Exchange Notes, face amount of $150,000
     and $130,000, respectively, net of unamortized
     debt discount of $309 and $261, respectively .  $     149,691   $     129,739
   New credit facility. . . . . . . . . . . . . . .              -         117,000
   Old credit facility. . . . . . . . . . . . . . .        100,853               -
   Capital lease and other obligations. . . . . . .          2,519           2,894
   Revolving credit facility. . . . . . . . . . . .         21,500           5,000
                                                     --------------  --------------
                                                           274,563         254,633
   Less current portion . . . . . . . . . . . . . .        (13,786)        (15,524)
                                                     $     260,777   $     239,109
                                                     ==============  ==============
</TABLE>

<TABLE>
<CAPTION>

   Future  principal maturities for long-term debt and capital lease obligations
are  as  follows:

<S>                                         <C>
   2003. . . . . . . . . . . . . . . . . .  $ 15,524
   2004. . . . . . . . . . . . . . . . . .    20,246
   2005. . . . . . . . . . . . . . . . . .    20,332
   2006. . . . . . . . . . . . . . . . . .    20,400
   2007. . . . . . . . . . . . . . . . . .    48,392
   Beyond 2007 . . . . . . . . . . . . . .   129,739
                                            --------
   Total future principal payments on debt  $254,633
                                            ========
</TABLE>

     As  of  the  end  of  fiscal 2002, the fair value of the Company's Exchange
Notes  was  approximately $107.9 million and the fair value of the capital lease
obligations  was  approximately  $2.1  million.  The  estimated  fair  value  of
long-term  debt  is  based  primarily  on  quoted  market prices for the same or
similar  issues  and the estimated fair value of the

                                      F19
<PAGE>

capital  lease obligation is based on the present value of estimated future cash
flows. The carrying amount of the variable rate credit facility approximates its
fair  value.

9.  CONDENSED  CONSOLIDATING  INFORMATION  (UNAUDITED)

     The  Exchange  Notes described in Note 8 were issued by Eye Care Centers of
America,  Inc.  ("ECCA")  and are guaranteed by Enclave Advancement Group, Inc.,
Managed Vision Care, Inc., Visionworks Holdings, Inc. and Eye Care Holdings (the
"Guarantor  Subsidiaries")  but  are  not  guaranteed  by  ODs.  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) ECCA, as parent, as if it accounted for its subsidiaries on
the equity method, (ii) the Guarantor Subsidiaries, and (iii) ODs. There were no
transactions  between  the  Guarantor  Subsidiaries  during  any  of the periods
presented.  Separate  financial statements of the Guarantor Subsidiaries are not
presented  herein  as  management does not believe that such statements would be
material  to  investors.

                                      F20
<PAGE>
<TABLE>
<CAPTION>

                                      CONSOLIDATING STATEMENTS OF OPERATIONS
                                       FOR THE YEAR ENDED DECEMBER 30, 2000


<S>                                               <C>          <C>             <C>       <C>             <C>
                                                                Guarantor                             Consolidated
                                                  Parent       Subsidiaries    ODs       Eliminations    Company
                                                  -----------  --------------  --------  --------------  ---------
Revenues:
   Optical sales . . . . . . . . . . . . . . . .  $  167,555   $     113,510   $54,559   $           -   $335,624
   Management fees . . . . . . . . . . . . . . .         808          20,939         -         (18,914)     2,833
   Investment earnings in subsidiaries . . . . .     (14,583)              -         -          14,583          -
                                                  -----------  --------------  --------  --------------  ---------
Net revenues . . . . . . . . . . . . . . . . . .     153,780         134,449    54,559          (4,331)   338,457
Operating costs and expenses:
   Cost of goods sold. . . . . . . . . . . . . .      54,379          42,422    10,648               -    107,449
   Selling, general and administrative expenses.      93,393          84,395    45,491         (18,914)   204,365
   Store closure expense . . . . . . . . . . . .       3,580               -         -               -      3,580
   Amortization of intangibles:
    Goodwill . . . . . . . . . . . . . . . . . .       1,056           4,154         4               -      5,214
    Noncompete and other intangibles . . . . . .           -           3,922         -               -      3,922
                                                  -----------  --------------  --------  --------------  ---------
Total operating costs and expenses . . . . . . .     152,408         134,893    56,143         (18,914)   324,530
                                                  -----------  --------------  --------  --------------  ---------
Income (loss) from operations. . . . . . . . . .       1,372            (444)   (1,584)         14,583     13,927
Interest expense, net. . . . . . . . . . . . . .      17,066          11,621         8               -     28,695
                                                  -----------  --------------  --------  --------------  ---------
Loss before income taxes. . .          . . . . .     (15,694)        (12,065)   (1,592)         14,583    (14,768)
Income tax expense . . . . . . . . . . . . . . .        (160)            176       750               -        766
                                                  -----------  --------------  --------  --------------  ---------
Net loss.          . . . . . . . . . . . . . . .  $  (15,534)  $     (12,241)  $(2,342)  $      14,583   $(15,534)
                                                  ===========  ==============  ========  ==============  =========
</TABLE>

                                      F21
<PAGE>

<TABLE>
<CAPTION>

                                         CONSOLIDATING STATEMENT OF CASH FLOWS
                                          FOR THE YEAR ENDED DECEMBER 30, 2000


<S>                                                    <C>          <C>             <C>       <C>             <C>
                                                                     Guarantor                             Consolidated
                                                       Parent       Subsidiaries    ODs       Eliminations    Company
                                                       -----------  --------------  --------  --------------  ---------
Cash flows from operating activities:
Net loss          . . . . . . . . . . . . . . . . . .  $  (15,534)  $     (12,241)  $(2,342)  $      14,583   $(15,534)
Adjustments to reconcile net loss to net cash
   provided by (used in) operating activities:
   Depreciation . . . . . . . . . . . . . . . . . . .      12,988           7,476         -               -     20,464
   Amortization of intangibles. . . . . . . . . . . .       1,056           8,076         4               -      9,136
   Other amortization . . . . . . . . . . . . . . . .       1,507             277         -               -      1,784
   Amortization of deferred gain. . . . . . . . . . .        (159)            (75)        -               -       (234)
   Deferred revenue . . . . . . . . . . . . . . . . .        (237)            757         6               -        526
   Deferred rent. . . . . . . . . . . . . . . . . . .          61             111         -               -        172
   Loss on disposition of property and equipment. .           118               -         -               -        118
Changes in operating assets and liabilities:
   Accounts and notes receivable. . . . . . . . . . .     (15,189)        (30,059)   (1,794)         42,590     (4,452)
   Inventory. . . . . . . . . . . . . . . . . . . . .       1,681           3,089      (313)              -      4,457
   Prepaid expenses and other . . . . . . . . . . . .       5,084          (8,558)       (2)              -     (3,476)
   Accounts payable and accrued liabilities . . . . .      (2,136)         38,043     4,938         (42,590)    (1,745)
                                                       -----------  --------------  --------  --------------  ---------

Net cash provided by (used in) operating activities .     (10,760)          6,896       497          14,583     11,216
                                                       -----------  --------------  --------  --------------  ---------

Cash flows from investing activities:
   Acquisition of property and equipment. . . . . . .     (12,290)         (6,642)        -               -    (18,932)
   Net outflow for The VTO Retail Acquisition . . . .           -             (87)        -               -        (87)
   Proceeds from sale of property and equipment . . .          54               -         -               -         54
   Payment received on notes receivable . . . . . . .           -              33         -               -         33
   Investment in Subsidiaries . . . . . . . . . . . .      14,583               -         -         (14,583)         -
                                                       -----------  --------------  --------  --------------  ---------

Net cash provided by ( used in) investing activities.       2,347          (6,696)        -         (14,583)   (18,932)
                                                       -----------  --------------  --------  --------------  ---------
</TABLE>

                                      F22
<PAGE>

<TABLE>
<CAPTION>

                                       CONSOLIDATING STATEMENT OF CASH FLOWS
                                        FOR THE YEAR ENDED DECEMBER 30, 2000


<S>                                                   <C>          <C>             <C>     <C>            <C>
                                                                    Guarantor                          Consolidated
                                                      Parent       Subsidiaries    ODs     Eliminations   Company
                                                      -----------  --------------  ------  -------------  ---------
Cash flows from financing activities:
   Proceeds from issuance of long-term debt. . . . .      17,000               -       -               -    17,000
   Distribution to affiliated OD . . . . . . . . . .           -               -    (365)              -      (365)
   Redemption of common stock. . . . . . . . . . . .        (234)              -       -               -      (234)
   Payments on debt and capital leases . . . . . . .      (7,000)           (669)      -               -    (7,669)
                                                      -----------  --------------  ------  -------------  ---------

Net cash provided by (used in) financing activities.       9,766            (669)   (365)              -     8,732
                                                      -----------  --------------  ------  -------------  ---------

Net increase (decrease) in cash and cash equivalents       1,353            (469)    132               -     1,016

Cash and cash equivalents at beginning of period . .         862           1,656     437               -     2,955
                                                      -----------  --------------  ------  -------------  ---------

Cash and cash equivalents at end of period . . . . .  $    2,215   $       1,187   $ 569   $           -  $  3,971
                                                      ===========  ==============  ======  =============  =========
</TABLE>

                                      F23
<PAGE>

<TABLE>
<CAPTION>

                                        CONSOLIDATING BALANCE SHEET
                                   FOR THE YEAR ENDED DECEMBER 29, 2001


<S>                                      <C>          <C>             <C>       <C>             <C>
                                                       Guarantor                              Consolidated
                                         Parent       Subsidiaries    ODs       Eliminations    Company
                                         -----------  --------------  --------  --------------  ----------
ASSETS
Current assets:
   Cash and cash equivalents. . . . . .  $      755   $       2,209   $   408   $           -   $   3,372
   Accounts and notes receivable. . . .     121,675          35,434     2,434        (149,268)     10,275
   Inventory. . . . . . . . . . . . . .      15,371           7,747     1,547               -      24,665
   Prepaid expenses and other . . . . .       2,152           1,191        46               -       3,389
                                         -----------  --------------  --------  --------------  ----------
Total current assets. . . . . . . . . .     139,953          46,581     4,435        (149,268)     41,701

Property and equipment. . . . . . . . .      37,568          26,950         -               -      64,518
Intangibles . . . . . . . . . . . . . .      16,693          92,673        87               -     109,453
Other assets. . . . . . . . . . . . . .       7,298             706         -               -       8,004
Investment in subsidiaries. . . . . . .     (25,830)              -         -          25,830           -
                                         -----------  --------------  --------  --------------  ----------
Total assets. . . . . . . . . . . . . .  $  175,682   $     166,910   $ 4,522   $    (123,438)  $ 223,676
                                         ===========  ==============  ========  ==============  ==========
LIABILITIES AND SHAREHOLDERS' DEFICIT
Current liabilities:
   Accounts payable . . . . . . . . . .  $   17,551   $     145,646   $ 7,820   $    (149,268)  $  21,749
   Current portion of long-term debt. .      13,431             355         -               -      13,786
   Deferred revenue . . . . . . . . . .       3,620           2,937         -               -       6,557
   Accrued payroll expense. . . . . . .       2,940           2,789         4               -       5,733
   Accrued interest . . . . . . . . . .       2,989             295         -               -       3,284
   Other accrued expenses . . . . . . .       4,894           2,708       898               -       8,500
                                         -----------  --------------  --------  --------------  ----------
Total current liabilities . . . . . . .      45,425         154,730     8,722        (149,268)     59,609
Long-term debt, less current maturities     228,537          32,140       100               -     260,777
Deferred rent . . . . . . . . . . . . .       2,482           1,308         -               -       3,790
Deferred gain . . . . . . . . . . . . .       1,530             469         -               -       1,999
                                         -----------  --------------  --------  --------------  ----------
Total liabilities . . . . . . . . . . .     277,974         188,647     8,822        (149,268)    326,175
                                         -----------  --------------  --------  --------------  ----------
Shareholders' deficit:
   Common stock . . . . . . . . . . . .          74               -         -               -          74
   Preferred stock. . . . . . . . . . .      48,134               -         -               -      48,134
   Additional paid-in capital . . . . .      43,681           1,092    (1,299)              -      43,474
   Accumulated deficit. . . . . . . . .    (194,181)        (22,829)   (3,001)         25,830    (194,181)
                                         -----------  --------------  --------  --------------  ----------
Total shareholders' deficit . . . . . .    (102,292)        (21,737)   (4,300)         25,830    (102,499)
                                         -----------  --------------  --------  --------------  ----------
                                         $  175,682   $     166,910   $ 4,522   $    (123,438)  $ 223,676
                                         ===========  ==============  ========  ==============  ==========
</TABLE>

                                      F24
<PAGE>

<TABLE>
<CAPTION>

                                      CONSOLIDATING STATEMENTS OF OPERATIONS
                                       FOR THE YEAR ENDED DECEMBER 29, 2001


<S>                                              <C>          <C>             <C>       <C>             <C>
                                                               Guarantor                             Consolidated
                                                 Parent       Subsidiaries    ODs       Eliminations    Company
                                                 -----------  --------------  --------  --------------  ---------
Revenues:
   Optical sales. . . . . . . . . . . . . . . .  $  163,733   $     109,196   $59,621   $           -   $332,550
   Management fees. . . . . . . . . . . . . . .         758          20,714         -         (17,988)     3,484
   Investment earnings in subsidiaries. . . . .      (9,844)              -         -           9,844          -
                                                 -----------  --------------  --------  --------------  ---------
Net revenues. . . . . . . . . . . . . . . . . .     154,647         129,910    59,621          (8,144)   336,034
Operating costs and expenses:
   Cost of goods sold . . . . . . . . . . . . .      54,311          38,275    11,860               -    104,446
   Selling, general and administrative expenses      91,855          80,706    48,614         (17,988)   203,187
   Amortization of intangibles:
    Goodwill. . . . . . . . . . . . . . . . . .       1,056           4,259         4               -      5,319
    Noncompete and other intangibles. . . . . .           -           3,378         -               -      3,378
                                                 -----------  --------------  --------  --------------  ---------
Total operating costs and expenses. . . . . . .     147,222         126,618    60,478         (17,988)   316,330
                                                 -----------  --------------  --------  --------------  ---------
Income (loss) from operations . . . . . . . . .       7,425           3,292      (857)          9,844     19,704
Interest expense, net . . . . . . . . . . . . .      15,857          11,672         8               -     27,537
                                                 -----------  --------------  --------  --------------  ---------
Loss before income taxes. . . . . . . . . . . .      (8,432)         (8,380)     (865)          9,844     (7,833)
Income tax expense. . . . . . . . . . . . . . .         640             199       400               -      1,239
                                                 -----------  --------------  --------  --------------  ---------
Net loss. . . . . . . . . . . . . . . . . . . .  $   (9,072)  $      (8,579)  $(1,265)  $       9,844   $ (9,072)
                                                 ===========  ==============  ========  ==============  =========
</TABLE>

                                      F25
<PAGE>

<TABLE>
<CAPTION>

                                         CONSOLIDATING STATEMENT OF CASH FLOWS
                                         FOR THE YEAR ENDED DECEMBER 29, 2001


<S>                                                   <C>          <C>             <C>       <C>             <C>
                                                                    Guarantor                             Consolidated
                                                      Parent       Subsidiaries    ODs       Eliminations    Company
                                                      -----------  --------------  --------  --------------  ---------
Cash flows from operating activities:
Net loss . . . . . . . . . . . . . . . . . . . . . .  $   (9,072)  $      (8,579)  $(1,265)  $       9,844   $ (9,072)
Adjustments to reconcile net loss to net
   cash provided by operating activities:
   Depreciation. . . . . . . . . . . . . . . . . . .      12,532           7,818         -               -     20,350
   Amortization of intangibles . . . . . . . . . . .       1,056           7,636         5               -      8,697
   Other amortization. . . . . . . . . . . . . . . .       1,956               -         -               -      1,956
   Amortization of deferred gain . . . . . . . . . .        (160)            (74)        -               -       (234)
   Deferred revenue. . . . . . . . . . . . . . . . .        (356)            261        (6)              -       (101)
   Deferred rent . . . . . . . . . . . . . . . . . .         (51)             70         -               -         19
   Loss on disposition of property and equipment . .         137             131         -               -        268
Changes in operating assets and liabilities:
   Accounts and notes receivable . . . . . . . . . .       4,866          (3,370)    1,968            (394)     3,070
   Inventory . . . . . . . . . . . . . . . . . . . .        (589)          1,495       119               -      1,025
   Prepaid expenses and other. . . . . . . . . . . .        (290)            (47)        -               -       (337)
   Accounts payable and accrued liabilities. . . . .       1,057             657      (379)            394      1,729
                                                      -----------  --------------  --------  --------------  ---------

Net cash provided by operating activities. . . . . .      11,086           5,998       442           9,844     27,370
                                                      -----------  --------------  --------  --------------  ---------

Cash flows from investing activities:
   Acquisition of property and equipment . . . . . .      (6,059)         (4,500)        -               -    (10,559)
   Proceeds from sale of property and equipment. . .          25              43         -               -         68
   Payment received on notes receivable. . . . . . .           -               3         -               -          3
   Investment in subsidiaries. . . . . . . . . . . .       9,844               -         -          (9,844)         -
                                                      -----------  --------------  --------  --------------  ---------

Net cash provided by ( used in) investing activities       3,810          (4,454)        -          (9,844)   (10,488)
                                                      -----------  --------------  --------  --------------  ---------
</TABLE>

                                      F26
<PAGE>

<TABLE>
<CAPTION>

                                       CONSOLIDATING STATEMENT OF CASH FLOWS
                                        FOR THE YEAR ENDED DECEMBER 29, 2001


<S>                                                   <C>          <C>             <C>     <C>            <C>
                                                                    Guarantor                          Consolidated
                                                      Parent       Subsidiaries    ODs     Eliminations   Company
                                                      -----------  --------------  ------  -------------  ---------
Cash flows from financing activities:
   Proceeds from issuance of long-term debt. . . . .           -              66       -               -        66
   Distribution to affiliated OD . . . . . . . . . .           -               -    (603)              -      (603)
   Redemption of common stock. . . . . . . . . . . .         (15)             (1)      -               -       (16)
   Payments on debt and capital leases . . . . . . .     (16,341)           (587)      -               -   (16,928)
                                                      -----------  --------------  ------  -------------  ---------

Net cash used in financing activities. . . . . . . .     (16,356)           (522)   (603)              -   (17,481)
                                                      -----------  --------------  ------  -------------  ---------

Net increase (decrease) in cash and cash equivalents      (1,460)          1,022    (161)              -      (599)

Cash and cash equivalents at beginning of period . .       2,215           1,187     569               -     3,971
                                                      -----------  --------------  ------  -------------  ---------

Cash and cash equivalents at end of period . . . . .  $      755   $       2,209   $ 408   $           -  $  3,372
                                                      ===========  ==============  ======  =============  =========
</TABLE>

                                      F27
<PAGE>
<TABLE>
<CAPTION>

                                        CONSOLIDATING BALANCE SHEET
                                   FOR THE YEAR ENDED DECEMBER 28, 2002


<S>                                      <C>          <C>             <C>       <C>             <C>
                                                        Guarantor                             Consolidated
                                         Parent       Subsidiaries    ODs       Eliminations    Company
                                         -----------  --------------  --------  --------------  ----------
ASSETS
Current assets:
   Cash and cash equivalents. . . . . .  $      554   $       2,532   $   364   $           -   $   3,450
   Accounts and notes receivable. . . .     134,896          42,366     3,245        (168,423)     12,084
   Inventory. . . . . . . . . . . . . .      14,715           7,491     1,854               -      24,060
   Prepaid expenses and other . . . . .       2,289           1,236        48               -       3,573
                                         -----------  --------------  --------  --------------  ----------
Total current assets. . . . . . . . . .     152,454          53,625     5,511        (168,423)     43,167

Property and equipment. . . . . . . . .      35,016          22,423         -               -   $  57,439
Intangibles . . . . . . . . . . . . . .      16,693          90,808        87               -     107,588
Other assets. . . . . . . . . . . . . .       8,552             310         -               -       8,862
Investment in subsidiaries. . . . . . .     (19,578)              -         -          19,578           -
                                         -----------  --------------  --------  --------------  ----------
Total Assets. . . . . . . . . . . . . .  $  193,137   $     167,166   $ 5,598   $    (148,845)  $ 217,056
                                         ===========  ==============  ========  ==============  ==========
LIABILITIES AND SHAREHOLDERS' DEFICIT
Current liabilities:
   Accounts payable . . . . . . . . . .  $    9,696   $     170,349   $ 8,634   $    (168,423)  $  20,256
   Current portion of long-term debt. .      15,374              83         -               -      15,524
   Deferred revenue . . . . . . . . . .       3,511           2,629       194               -       6,334
   Accrued payroll expense. . . . . . .       4,956           2,792        28               -       7,776
   Accrued interest . . . . . . . . . .       1,798             520         -               -       2,318
   Other accrued expenses . . . . . . .       4,878           2,632     1,013               -       8,523
                                         -----------  --------------  --------  --------------  ----------
Total current liabilities . . . . . . .      40,213         179,005     9,869        (168,423)     60,731
Long-term debt, less current maturities     237,028           2,048       100               -     239,109
Deferred rent . . . . . . . . . . . . .       2,763           1,808         -               -       4,571
Deferred gain . . . . . . . . . . . . .       1,372             394         -               -       1,766
                                         -----------  --------------  --------  --------------  ----------
Total liabilities . . . . . . . . . . .     281,376         183,255     9,969        (168,423)    306,177
                                         -----------  --------------  --------  --------------  ----------
Shareholders' deficit:
   Common stock . . . . . . . . . . . .          74               -         -               -          74
   Preferred stock. . . . . . . . . . .      54,703               -         -               -      54,703
   Additional paid-in capital . . . . .      36,922           1,092    (1,974)              -      36,040
   Accumulated deficit. . . . . . . . .    (179,938)        (17,181)   (2,397)         19,578    (179,938)
                                         -----------  --------------  --------  --------------  ----------
Total shareholders' deficit . . . . . .     (88,239)        (16,089)   (4,371)         19,578     (89,121)
                                         -----------  --------------  --------  --------------  ----------
                                         $  193,137   $     167,166   $ 5,598   $    (148,845)  $ 217,056
                                         ===========  ==============  ========  ==============  ==========
</TABLE>

                                      F28
<PAGE>
<TABLE>
<CAPTION>

                                       CONSOLIDATING STATEMENTS OF OPERATIONS
                                        FOR THE YEAR ENDED DECEMBER 28, 2002


<S>                                                  <C>          <C>            <C>      <C>             <C>
                                                                   Guarantor                           Consolidated
                                                     Parent       Subsidiaries   ODs      Eliminations    Company
                                                     -----------  -------------  -------  --------------  ---------
Revenues:
   Optical sales. . . . . . . . . . . . . . . . . .  $  175,733   $     114,834  $69,699  $           -    360,266
   Management fees. . . . . . . . . . . . . . . . .         554          22,319        -        (19,472)     3,401
   Investment earnings in subsidiaries. . . . . . .       6,251               -        -         (6,251)         -
                                                     -----------  -------------  -------  --------------  ---------
Net revenues. . . . . . . . . . . . . . . . . . . .     182,538         137,153   69,699        (25,723)   363,667
Operating costs and expenses:
   Cost of goods sold . . . . . . . . . . . . . . .      58,914          39,535   14,022              -    112,471
   Selling, general and administrative expenses . .      97,663          80,926   54,566        (19,472)   213,683
   Amortization of noncompete and other intangibles           -           1,865        -              -      1,865
                                                     -----------  -------------  -------  --------------  ---------
Total operating costs and expenses. . . . . . . . .     156,577         122,326   68,588        (19,472)   328,019
                                                     -----------  -------------  -------  --------------  ---------
Income from operations. . . . . . . . . . . . . . .      25,961          14,827    1,111         (6,251)    35,648
Interest expense, net . . . . . . . . . . . . . . .      12,495           8,548        8              -     21,051
                                                     -----------  -------------  -------  --------------  ---------
Income before income taxes. . . . . . . . . . . . .      13,466           6,279    1,103         (6,251)    14,597
Income tax expense. . . . . . . . . . . . . . . . .         339             419      500              -      1,258
                                                     -----------  -------------  -------  --------------  ---------
Net income before extraordinary item. . . . . . . .      13,127           5,860      603         (6,251)    13,339
Extraordinary (gain) loss . . . . . . . . . . . . .      (1,116)            212        -              -       (904)
                                                     -----------  -------------  -------  --------------  ---------
Net income. . . . . . . . . . . . . . . . . . . . .  $   14,243   $       5,648  $   603  $      (6,251)  $ 14,243
                                                     ===========  =============  =======  ==============  =========
</TABLE>

                                      F29
<PAGE>

<TABLE>
<CAPTION>

                                      CONSOLIDATING STATEMENT OF CASH FLOWS
                                      FOR THE YEAR ENDED DECEMBER 28, 2002


<S>                                               <C>          <C>             <C>     <C>             <C>
                                                  Guarantor    Consolidated
                                                  Parent       Subsidiaries    ODs     Eliminations    Company
                                                  -----------  --------------  ------  --------------  ---------
Cash flows from operating activities:
Net income . . . . . . . . . . . . . . . . . . .  $   14,243   $      12,234   $ 603   $     (12,837)  $ 14,243
Adjustments to reconcile net income to net
   cash provided by operating activities:
   Depreciation. . . . . . . . . . . . . . . . .      11,363           7,398       -               -     18,761
   Amortization of intangibles . . . . . . . . .           -           1,865       -               -      1,865
   Amortization of debt issue costs. . . . . . .       1,901               -       -               -      1,901
   Amortization of deferred gain . . . . . . . .        (158)            (75)      -               -       (233)
   Deferred revenue. . . . . . . . . . . . . . .        (109)           (308)    194               -       (223)
   Deferred rent . . . . . . . . . . . . . . . .         281             500       -               -        781
   Loss on disposition of property and equipment          30              32       -               -         62
   Extraordinary (gain) loss . . . . . . . . . .      (1,290)            386       -               -       (904)
Changes in operating assets and liabilities:
   Accounts and notes receivable . . . . . . . .     (13,311)         (6,932)   (811)         19,155     (1,899)
   Inventory . . . . . . . . . . . . . . . . . .         656             256    (307)              -        605
   Prepaid expenses and other. . . . . . . . . .        (166)            (35)     (2)              -       (203)
   Accounts payable and accrued liabilities. . .        (459)         18,268     954         (19,156)      (393)
                                                  -----------  --------------  ------  --------------  ---------

Net cash provided by operating activities. . . .      12,981          33,589     631         (12,838)    34,363
                                                  -----------  --------------  ------  --------------  ---------

Cash flows from investing activities:
   Acquisition of property and equipment . . . .      (7,765)         (2,903)      -               -    (10,668)
   Investment in subsidiaries. . . . . . . . . .     (12,838)              -       -          12,838          -
                                                  -----------  --------------  ------  --------------  ---------

Net cash used in investing activities. . . . . .     (20,603)         (2,903)      -          12,838    (10,668)
                                                  -----------  --------------  ------  --------------  ---------
</TABLE>

                                      F30
<PAGE>

<TABLE>
<CAPTION>

                                         CONSOLIDATING STATEMENT OF CASH FLOWS
                                         FOR THE YEAR ENDED DECEMBER 28, 2002


<S>                                                   <C>        <C>             <C>     <C>            <C>
                                                             .    Guarantor          .                 .  Consolidated
                                                      Parent     Subsidiaries    ODs     Eliminations        Company
                                                      ---------  --------------  ------  -------------  --------------
Cash flows from financing activities:
   Payments on debt related to refinancing . . . . .   (88,346)        (30,000)      -               -       (118,346)
   Proceeds from issuance of long-term debt. . . . .   124,000               -       -               -        124,000
   Payments on debt and capital leases . . . . . . .   (23,345)           (363)      -               -        (23,708)
   Payments for refinancing fees . . . . . . . . . .    (4,788)              -       -               -         (4,788)
   Distribution to affiliated OD . . . . . . . . . .         -               -    (675)              -           (675)
   Stock buyback . . . . . . . . . . . . . . . . . .      (100)              -       -               -           (100)
                                                      ---------  --------------  ------  -------------  --------------

Net cash provided by (used in) financing activities.     7,421         (30,363)   (675)              -        (23,617)
                                                      ---------  --------------  ------  -------------  --------------

Net increase (decrease) in cash and cash equivalents      (201)            323     (44)              -             78

Cash and cash equivalents at beginning of period . .       755           2,209     408               -          3,372
                                                      ---------  --------------  ------  -------------  --------------

Cash and cash equivalents at end of period . . . . .  $    554   $       2,532   $ 364   $           -  $       3,450
                                                      =========  ==============  ======  =============  ==============
</TABLE>

                                      F31
<PAGE>

11.  PREFERRED  STOCK

     During  1998,  the  Company  issued  300,000 shares of Preferred Stock, par
value  $  .01  per  share. Dividends on shares of 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. Cumulative preferred dividends in arrears
were  $18.2  and  $24.8  million  as of December 29, 2001 and December 28, 2002,
respectively.  The  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. The Preferred Stock has no voting rights.

12.  SHAREHOLDERS'  DEFICIT

     1998 Executive Stock Option Plan. On April 25, 1998, the Company authorized
a non-qualified stock option plan whereby key executives and senior officers may
be  offered  options to purchase the Company's Common Stock. Under the plan, the
exercise  price set by the Board of Directors of the Company must at least equal
the  fair  market  value of the Company's Common Stock at the date of grant. The
options  begin  vesting one year after the date of grant in four installments of
10%, 15%, 25% and 50% provided the optionee is an employee of the Company on the
anniversary  date  and  shall  expire  10  years  after the date of grant. Under
certain  specified conditions the vesting schedule may be altered. During fiscal
2000,  the  Company granted options to purchase 66,500 shares at an option price
of  $12.85  per  share  under this plan. During fiscal 2001, the Company entered
into Option Cancellation Agreements (the "Cancellation Agreements") with certain
employees  and  directors  (the  "Optionees")  to cancel all outstanding options
which  were granted through the cancellation date under the Company's 1998 Stock
Option  Plan  (the  "Plan")  due  to  changes  in  the  fair market value of the
Company's common stock. The Company provided all of the Optionees with an option
cancellation  notice  detailing  the Company's offer for the Optionees to cancel
and  terminate  their  respective  options in exchange for the commitment of the
Company  to grant new options under the Plan (the "New Options"), such new grant
to  be made no earlier than six months and a day after the effective date of the
cancellation  of  the  options and at an exercise price equal to the fair market
value  of  the  common  stock  as  of the effective date of the grant of the New
Options.  The Cancellation Agreements provided that, in January 2002 (the "Grant
Date"),  the  Company  granted to each of the Optionees a New Option to purchase
the number of shares of common stock subject to the options being terminated and
cancelled and that

                                      F32
<PAGE>

such  New  Option  will have an exercise price equal to the fair market value of
the  common  stock  as of the Grant Date. The vesting period for the New Options
granted  to  employees will be 40% on the Grant Date, and an additional 20% will
vest  on  each of the first, second and third anniversary of the Grant Date. The
exercise  price  at  the  Grant  Date  was $5.00 per share. Subsequent grants of
131,000  options  were made throughout the remainder of fiscal 2002. Such grants
begin  vesting one year after the date of the grant in four installments of 10%,
15%,  25% and 50% and have an exercise price of $5.00 to $15.13 per share, based
on  the  fair  market  value  at  the  Grant  Date.

<TABLE>
<CAPTION>

Following  is  a summary of activity in the plan for fiscal years 2000, 2001 and
2002.


<S>                            <C>              <C>           <C>
                               AVERAGE OPTION
                                  PRICE            OPTIONS       OPTIONS
                                PER SHARE($)     OUTSTANDING   EXERCISABLE
                               ---------------  ------------  ------------

Outstanding January 1, 2000 .                       515,000        39,300
Granted . . . . . . . . . . .           12.85        66,500             -
Became exercisable. . . . . .                             -        61,950
Canceled or expired . . . . .           10.41       (98,500)       (6,800)
                                                ------------  ------------

Outstanding December 30, 2000                        483,000        94,450
Granted . . . . . . . . . . .           12.85        11,000             -
Became exercisable. . . . . .                              -         4,650
Canceled or expired . . . . .   10.41 & 12.85      (494,000)      (99,100)
                                                ------------  ------------

Outstanding December 29, 2001                              -             -
                                                ------------  ------------

Granted . . . . . . . . . . .    5.00 & 15.13       988,775              -
Became exercisable. . . . . .                       341,310              -
Canceled or expired . . . . .                       (41,000)      (15,200)
                                                ------------  ------------

Outstanding December 28, 2002                        947,775       326,110
                                                ============  ============
</TABLE>

     During  fiscal  2001, the Company granted two directors options to purchase
15,000 and 111,142 shares, respectively. Each option is exercisable at $5.00 per
share  and  begins vesting on the date of the grant in three installments of 50%
25%  and  25%,  with  such  options  expiring 10 years from the date of grant. A
subsequent grant of 5,000 options was made to one director in October 2002. Each
option  is  exercisable  at  $5.00  per  share  and

                                      F33
<PAGE>

begins vesting one year after the date of the grant in four installments of 25%,
25%,  25%  and  25%, with such options expiring 10 years from the date of grant.

     The  Company  has elected to follow Accounting Principles Board Opinion No.
25  "Accounting  for  Stock  Issued  to  Employees"  ("APB  25")  and  related
interpretations  in  accounting  for  its  employee  stock  options  because, as
discussed  below,  the alternative fair value accounting provided for under FASB
Statement  No.  123  "Accounting  for Stock-Based Compensation," requires use of
option  valuation  models  that  were  not developed for use in valuing employee
stock  options  of  privately held companies. Under APB 25, because the exercise
price of the Company's employee stock options equals the estimated fair value of
the  underlying  stock  on  the  date  of  grant,  no  compensation  expense  is
recognized.

     The  fair  value  for  these options was estimated at the date of the grant
using  the minimum value method with the following assumptions for 2000 and 2002
respectively:  risk-free  interest rates of 6% and 3%; respectively, no dividend
yield;  and  a  weighted-average  expected  life  of  the  options  of  4 years.

     Option valuation models require the input of highly subjective assumptions.
Because  the Company's employee stock options have characteristics significantly
different  from  those  of traded options, and because changes in the subjective
input assumptions can materially affect the fair value estimate, in management's
opinion,  the  existing  models  do  not  necessarily  provide a reliable single
measure  of  the  fair  value  of  its  employee  stock  options.

                                      F34
<PAGE>

<TABLE>
<CAPTION>

13.   INCOME  TAXES

The  provision  for  income  taxes  is  comprised  of  the  following:

<S>               <C>            <C>            <C>
                                  YEAR ENDED
                                -------------
                   DECEMBER 30,   DECEMBER 29,   DECEMBER 28,
                      2000           2001           2002
                  -------------  -------------  -------------

        Current.  $         766  $       1,239  $       1,258
        Deferred              -              -              -
                  -------------  -------------  -------------

                  $         766  $       1,239  $       1,258
                  =============  =============  =============
</TABLE>

<TABLE>
<CAPTION>

The reconciliation between the federal statutory tax rate at 34% and the Company
effective  tax  rate  is  as  follows:


<S>                                         <C>             <C>             <C>
                                             DECEMBER 30,    DECEMBER 29,    DECEMBER 28,
                                                2000            2001            2002
                                            --------------  --------------  --------------

        Expected tax expense (benefit) . .  $      (5,021)  $      (2,663)  $       5,270
        Goodwill . . . . . . . . . . . . .          1,772           1,483            (811)
        Nondeductible meals and donations.             33              30              35
        Other. . . . . . . . . . . . . . .            990             650            2,027
        Change in valuation allowance. . .          2,992           1,739          (5,263)
                                            --------------  --------------  --------------

                                            $         766   $       1,239   $       1,258
                                            ==============  ==============  ==============
<FN>

The  above  reconciliation  takes  into  account  certain  entities  that  are
consolidated  for financial accounting purposes but are not consolidated for tax
purposes,  therefore,  the  net  operating  loss  carryforward cannot offset the
income  from  the  non-consolidated  entities.

</TABLE>

                                      F35
<PAGE>

<TABLE>
<CAPTION>

The  components  of  the  net  deferred  tax  assets  are  as  follows:


<S>                                                                 <C>             <C>
                                                                      DECEMBER 29,    DECEMBER 28,
                                                                         2001            2002
                                                                    --------------  --------------

        Total deferred tax liabilities, current. . . . . . . . . .  $        (707)  $        (705)
        Total deferred tax liabilities, long-term. . . . . . . . .           (630)         (1,172)
        Total deferred tax assets, current . . . . . . . . . . . .          3,201           2,117
        Total deferred tax assets, long-term . . . . . . . . . . .         25,078          21,439
        Valuation allowance. . . . . . . . . . . . . . . . . . . .        (26,942)        (21,679)
                                                                    --------------  --------------

Net deferred tax assets. . . . . . . . . . . . . . . . . . . . . .  $           -   $           -
                                                                    ==============  ==============

The sources of the difference between the financial accounting and
tax Company assets and liabilities which give rise to the deferred
tax assets and deferred tax liabilities are as follows:

                                                                      DECEMBER 29,    DECEMBER 28,
                                                                         2001            2002
                                                                    --------------  --------------
Deferred tax assets:
        Deferred rent. . . . . . . . . . . . . . . . . . . . . . .  $         873   $       1,138
        Allowance for bad debts. . . . . . . . . . . . . . . . . .          1,314           1,121
        Deferred revenue . . . . . . . . . . . . . . . . . . . . .            958             921
        Net operating loss and credit carryforward. . . . . . . .         10,934           5,769
        Inventory basis differences. . . . . . . . . . . . . . . .            619             482
        Accrued salaries . . . . . . . . . . . . . . . . . . . . .            928             611
        Property and equipment . . . . . . . . . . . . . . . . . .          9,275           9,791
        Gain on debt purchase. . . . . . . . . . . . . . . . . . .              -           2,315
        Recapitalization expenses. . . . . . . . . . . . . . . . .          1,510               -
        Other. . . . . . . . . . . . . . . . . . . . . . . . . . .          1,868           1,417
                                                                    --------------  --------------

Total deferred tax assets. . . . . . . . . . . . . . . . . . . . .         28,279          23,565

Deferred tax liabilities:
        Prepaid expense. . . . . . . . . . . . . . . . . . . . . .  $         699   $         705
        Store pre-opening costs. . . . . . . . . . . . . . . . . .            269             269
        Deferred financing costs . . . . . . . . . . . . . . . . .            164             612
        Other. . . . . . . . . . . . . . . . . . . . . . . . . . .            205             300
                                                                    --------------  --------------
Total deferred tax liability . . . . . . . . . . . . . . . . . . .          1,337           1,886
                                                                    --------------  --------------

        Net deferred tax assets. . . . . . . . . . . . . . . . . .         26,942          21,679
        Valuation allowance. . . . . . . . . . . . . . . . . . . .        (26,942)        (21,679)

Net deferred tax assets. . . . . . . . . . . . . . . . . . . . . .  $           -   $           -
                                                                    ==============  ==============
</TABLE>

                                      F36
<PAGE>

     At December 29, 2001 and December 28, 2002, the Company had, subject to the
limitations discussed below, net operating loss carryforward for tax purposes of
$32,158  and  $16,967,  respectively.  These loss carryforwards will expire from
2008  through  2018  if  not  utilized.

     Uncertainties  exist as to the future realization of the deferred tax asset
under  the criteria set forth under FASB Statement No. 109.  These uncertainties
primarily  consist  of  the lack of taxable income historically generated by the
Company.  Therefore,  the  Company  has  established  a  valuation allowance for
deferred  tax assets of $26,942 at December 29, 2001 and $21,679 at December 28,
2002.

14.  EMPLOYEE  BENEFITS

     401(k)  Plan.  The  Company  maintains  a defined contribution plan whereby
substantially  all employees who have been employed for at least six consecutive
months  are  eligible to participate. Contributions are made by the Company as a
percentage  of  employee contributions. In addition, discretionary contributions
may  be made at the direction of the Company's Board of Directors. Total Company
contributions were approximately $174, $227 and $220 for fiscal years 2000, 2001
and  2002,  respectively.

15.  LEASES

     The Company is obligated as lessee under operating leases for substantially
all  of  the  Company's retail facilities as well as certain warehouse space. In
addition  to  rental  payments,  the leases generally provide for payment by the
Company  of  property  taxes,  insurance, maintenance and it's pro rata share of
common  area maintenance. These leases range in terms of up to 15 years. Certain
leases also provide for additional rent in excess of the base rentals calculated
as  a  percentage  of  sales.

     The  Company  subleases  a portion of substantially all of the stores to an
independent  optometrist  or  a  corporation  controlled  by  an  independent
optometrist. The terms of these leases or subleases are principally one to seven
years  with  rentals consisting of a percentage of gross receipts, base rentals,
or  a  combination  of  both.  Certain  of these leases contain renewal options.

     Certain  of the Company's lease agreements contain provisions for scheduled
rent  increases or provide for occupancy periods during which no rent payment is
required.  For  financial  statement purposes, rent expense is recorded based on
the  total rentals due over the entire lease term and charged to rent expense on
a  straight-line  basis. The difference between the actual cash rentals paid and
rent  expenses  recorded  for  financial  statement

                                      F37
<PAGE>

purposes  is  recorded as a deferred rent obligation. At the end of fiscal years
2001  and  2002, deferred rent obligations aggregated approximately $3.8 million
and  $4.6  million,  respectively.

     Rent  expense  for  all  locations, net of lease and sublease income, is as
follows.  For the purposes of this table, base rent expense includes common area
maintenance  costs.  Common area maintenance costs were approximately 20, 21 and
21  percent  of  base  rent  expense  for  fiscal  years  2000,  2001  and 2002,
respectively.

<TABLE>
<CAPTION>



<S>                         <C>             <C>             <C>
                              DECEMBER 30,    DECEMBER 29,    DECEMBER 28,
                                 2000            2001            2002
                            --------------  --------------  --------------

Base rent expense. . . . .  $      37,331   $      38,666   $      40,364
Rent as a percent of sales            537             266             436
Lease and sublease income.         (4,512)         (4,259)         (4,435)
                            --------------  --------------  --------------

Rent expense, net. . . . .  $      33,356   $      34,673   $      36,365
                            ==============  ==============  ==============
</TABLE>

Future  minimum  lease payments, excluding common area maintenance costs, net of
future  minimum  lease  and sublease income under noncancelable operating leases
for  the  next  five  years  and  beyond  are  as  follows:

<TABLE>
<CAPTION>



<S>                                      <C>         <C>          <C>
                                         OPERATING   LEASE AND     OPERATING
                                          RENTAL     SUBLEASE        LEASE,
                                         PAYMENTS    INCOME           NET
                                         ----------  -----------  ----------

2003. . . . . . . . . . . . . . . . . .  $   31,707  $   (2,050)  $   29,657
2004. . . . . . . . . . . . . . . . . .      29,358      (1,071)      28,287
2005. . . . . . . . . . . . . . . . . .      26,453        (835)      25,618
2006. . . . . . . . . . . . . . . . . .      22,465        (568)      21,897
2007. . . . . . . . . . . . . . . . . .      18,945        (339)      18,606
Beyond 2007 . . . . . . . . . . . . . .      45,013        (434)      44,579
                                         ----------  -----------  ----------

Total minimum lease payments/(receipts)  $  173,941  $   (5,297)  $  168,644
                                         ==========  ===========  ==========
</TABLE>

                                      F38
<PAGE>

16.  COMMITMENTS  AND  CONTINGENCIES

     The  Company is involved in various claims and legal actions arising in the
ordinary  course  of  business.  In  the  opinion  of  management,  the ultimate
disposition  of  these  matters  will  not have a material adverse effect on the
Company's consolidated financial position or consolidated results of operations.

                                      F39
<PAGE>
<TABLE>
<CAPTION>

                                                                     SCHEDULE II

                                 EYE CARE CENTERS OF AMERICA, INC.

                          CONSOLIDATED VALUATION AND QUALIFYING ACCOUNTS

<S>                                 <C>           <C>           <C>         <C>          <C>
                                                 CHARGED TO    CHARGED TO
                                    BALANCE AT    CREDITED      CREDITED    DEDUCTIONS   BALANCE
                                   BEGINNING OF   FROM COST     FROM OTHER    FROM       AT CLOSE
                                     PERIOD      AND EXPENSES    ACCOUNTS    RESERVE     OF PERIOD
                                    ------------  ------------  ----------  -----------  ---------

Allowance for doubtful accounts of
   current receivables:
      Year ended December 30, 2000     1,471,000     2,466,000           -           -   3,937,000
      Year ended December 29, 2001     3,937,000       919,000           -           -   4,856,000
      Year ended December 28, 2002     4,856,000             -           -    (565,000)  4,291,000

Inventory obsolescence reserves:
      Year ended December 30, 2000       700,000       304,000           -           -   1,004,000
      Year ended December 29, 2001     1,004,000        95,000           -           -   1,099,000
      Year ended December 28, 2002     1,099,000             -           -    (422,000)    677,000
</TABLE>

                                      F40
<PAGE>