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

                                    FORM 10-Q
(Mark one)
      [X] Quarterly report pursuant to Section 13 or 15(d) of the Securities
      Exchange Act of 1934 for the quarterly period ended September 30, 2002

                                       OR

      [ ] Transition report pursuant to Section 13 or 15(d) of the Securities
          Exchange Act of 1934 for the transition period from _____________
          to _____________

      Commission file number: 1-14128

                              EMERGING VISION, INC.
             (Exact name of Registrant as specified in its Charter)


      New York                                          11-3096941
------------------------                     ---------------------------------
(State of Incorporation)                     (IRS Employer Identification No.)

                         100 Quentin Roosevelt Boulevard
                           Garden City, New York 11530
                     --------------------------------------
          (Address of Principal Executive Offices, including Zip Code)

                                 (516) 390-2100
              (Registrant's Telephone Number, Including Area Code)


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

                           Yes    X          No
                                -----           -----


                      APPLICABLE ONLY TO CORPORATE ISSUERS:

     As of November 11, 2002,  there were 29,740,620  shares of the Registrant's
Common Stock, par value $0.01 per share, outstanding.


<PAGE>


Item 1.  Financial Statements
         --------------------

                     EMERGING VISION, INC. AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEETS
                        (In Thousands, Except Share Data)
<TABLE>
<CAPTION>

                                                                                                  September 30,      December 31,
                                                                                                       2002              2001
                                                                                                  -------------      ------------
                                                                                                   (Unaudited)

                                              ASSETS
<S>                                                                                               <C>                <C>
Current assets:
         Cash and cash equivalents                                                                $      601         $    1,053
         Franchise receivables, net of allowance of $1,092 and $3,095,
            respectively                                                                                 674              1,837
         Other receivables, net of allowance of $51 and $171, respectively                               303                739
         Current portion of franchise notes receivable                                                 1,316              2,993
         Inventories, net                                                                                426                783
         Prepaid expenses and other current assets                                                       365                 94
                                                                                                  -----------        -----------
                     Total current assets                                                              3,685              7,499
                                                                                                  -----------        -----------

Property and equipment, net                                                                              767              1,075
Franchise notes and other receivables, net of allowance of $1,122 and $3,326,
   respectively                                                                                        1,942                862
Goodwill, net                                                                                          1,266              1,266
Other assets                                                                                             298                355
                                                                                                  -----------        -----------
                                Total assets                                                      $    7,958         $   11,057
                                                                                                  ===========        ===========


                          LIABILITIES AND SHAREHOLDERS' EQUITY (DEFICIT)
Current liabilities:
         Current portion of long-term debt, net                                                   $      598         $      186
         Accounts payable and accrued liabilities                                                      6,529              7,122
         Accrual for store closings (Note 6)                                                             901                964
         Related party borrowings                                                                        338                750
         Net liabilities of discontinued operations                                                      220                235
                                                                                                  -----------        -----------
                     Total current liabilities                                                         8,586              9,257
                                                                                                  -----------        -----------
Long-term debt, net (Note 10)                                                                            401                363
                                                                                                  -----------        -----------
Related party borrowings                                                                                 146                 -
                                                                                                  -----------        -----------
Franchise deposits and other liabilities                                                                 653                820
                                                                                                  -----------        -----------

Contingencies (Note 7)

Shareholders' equity (deficit):
     Preferred stock, $0.01 par value per share; 5,000,000 shares authorized:
        Senior Convertible Preferred Stock, $100,000 liquidation preference
        per share; 1 and 3 shares issued and outstanding, respectively                                    74                287
     Common stock, $0.01 par value per share; 50,000,000 shares authorized;
        29,672,957 and 27,187,309 shares issued, respectively, and 29,490,620
        and 27,004,972 shares outstanding, respectively                                                  297                272
     Treasury stock, at cost, 182,337 shares                                                            (204)              (204)
     Additional paid-in capital                                                                      120,345            119,926
     Accumulated deficit                                                                            (122,340)          (119,664)
                                                                                                  -----------        -----------
                      Total shareholders' equity (deficit)                                            (1,828)               617
                                                                                                  -----------        -----------
                      Total liabilities and shareholders' equity (deficit)                        $    7,958         $   11,057
                                                                                                  ===========        ===========
</TABLE>

     The accompanying notes are an integral part of these  consolidated  balance
sheets.


                                       2

<PAGE>

                     EMERGING VISION, INC. AND SUBSIDIARIES
                CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
                      (In Thousands, Except Per Share Data)
<TABLE>
<CAPTION>

                                                                      For the Three Months          For the Nine Months
                                                                       Ended September 30,           Ended September 30,
                                                                     ----------------------        ----------------------
                                                                       2002           2001           2002          2001
                                                                     ----------------------        ----------------------
<S>                                                                  <C>          <C>              <C>          <C>
  Revenues:
       Net sales                                                     $  2,773     $  2,855         $  7,847     $  8,595
       Franchise royalties                                              1,769        1,938            5,156        6,268
       Net gains from the conveyance of Company-owned
          store assets to franchisees, and other fees                      49           10               56          132
       Interest on franchise notes receivable                              80          203              254          758
       Other income                                                       136           23              232           81
                                                                     ---------    ---------        ---------    ---------
            Total revenues                                              4,807        5,029           13,545       15,834
                                                                     ---------    ---------        ---------    ---------

  Costs and expenses:
       Cost of sales                                                      612          767            2,014        1,973
       Selling, general and administrative expenses                     6,031        6,092           14,199       15,497
       Loss from franchised stores operated under
            management agreements                                          -            97               -           344
       Interest expense
                                                                           59           15              157           60
                                                                     ---------    ---------       ----------    ---------
           Total costs and expenses                                     6,702        6,971           16,370       17,874
                                                                     ---------    ---------       ----------    ---------

       Loss from continuing operations before provision for
            income taxes                                               (1,895)      (1,942)          (2,825)      (2,040)
       Provision for income taxes                                          -            -                -            -
                                                                     ---------    ---------       ----------   ----------
            Loss from continuing operations                            (1,895)      (1,942)          (2,825)      (2,040)
                                                                     ---------    ---------       ----------   ----------

  Discontinued operations (Note 3):
       Income (loss) from discontinued operations                         287         (657)             167          838
                                                                     ---------    ---------       ----------   ----------
            Net income (loss)                                        $ (1,608)    $ (2,599)       $  (2,658)   $  (1,202)
                                                                     =========    =========       ==========   ==========

  Per share information - basic and diluted (Note 5):

       Loss from continuing operations                               $  (0.06)    $  (0.08)       $   (0.10)   $   (0.08)
       Income (loss) from discontinued operations                        0.01        (0.02)            0.01         0.03
                                                                     ---------    ---------       ----------   ----------
            Net income (loss)                                        $  (0.05)    $  (0.10)       $   (0.09)   $   (0.05)
                                                                     =========    =========       ==========   ==========

  Weighted-average number of common shares outstanding -
     basic and diluted                                                 29,433       26,951           28,286       25,492
                                                                     =========    =========       ==========   ==========

</TABLE>

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


                                       3
<PAGE>



                     EMERGING VISION, INC. AND SUBSIDIARIES
                CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
                                 (In Thousands)
<TABLE>
<CAPTION>


                                                                                             For the Nine Months Ended
                                                                                                    September 30,
                                                                                             -------------------------
                                                                                               2002             2001
                                                                                             -------------------------
<S>                                                                                          <C>            <C>
Cash flows from operating activities:
     Net loss from continuing operations                                                     $  (2,825)     $  (2,040)
         Adjustments to reconcile net loss from continuing operations
                to net cash used in operating activities:
            Depreciation and amortization                                                          372            865
            Provision for doubtful accounts                                                        724             60
            Non-cash charges related to options and warrants                                        63            165
            Charges related to long-lived assets                                                   181            372
        Changes in operating assets and liabilities:
                     Franchise and other receivables                                               346           (213)
                     Inventories                                                                   320             (5)
                     Prepaid expenses and other current assets                                    (271)            56
                     Other assets                                                                   57             68
                     Accounts payable and accrued liabilities                                     (593)          (202)
                     Franchise deposits and other liabilities                                     (167)          (326)
                     Accrual for store closings                                                    (63)           435
                                                                                             ----------     ----------
Net cash used in operating activities                                                           (1,856)          (765)
                                                                                             ----------     ----------

Cash flows from investing activities:
     Franchise notes receivable issued                                                             (71)          (328)
     Proceeds from franchise and other notes receivable                                          1,234          1,543
     Purchases of property and equipment                                                          (245)          (344)
                                                                                             ----------     ----------
Net cash provided by investing activities                                                          918            871
                                                                                             ----------     ----------

Cash flows from financing activities:
     Proceeds from the exercise of stock warrants                                                   23             -
     Proceeds from borrowings                                                                    1,900             -
     Payments on borrowings                                                                     (1,589)          (148)
        Acquisition of treasury shares                                                              -              (1)
                                                                                             ----------     ----------
Net cash provided by (used in) financing activities                                                334           (149)
                                                                                             ----------     ----------
Net cash used in continuing operations                                                            (604)           (43)
                                                                                             ----------     ----------
Net cash provided by (used in) discontinued operations                                             152         (4,198)
                                                                                             ----------     ----------
Net decrease in cash and cash equivalents                                                         (452)        (4,241)
Cash and cash equivalents - beginning of period                                                  1,053          5,215
                                                                                             ----------     ----------
Cash and cash equivalents - end of period                                                    $     601      $     974
                                                                                             ==========     ==========

Supplemental disclosures of cash flow information: Cash paid during the period
   for:
        Interest                                                                             $      97      $      60
                                                                                             ==========     ==========
        Taxes                                                                                $      55      $      63
                                                                                             ==========     ==========

     Non-cash investing and financing activities:
         Franchise store assets reacquired                                                   $      -       $     372
              Issuance of common shares for consulting services                                     -             165

</TABLE>

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


                                       4

<PAGE>




                     EMERGING VISION, INC. AND SUBSIDIARIES
           CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY (UNAUDITED)
                  FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2002
                        (In Thousands, Except Share Data)

<TABLE>
<CAPTION>


                                                                            Treasury
                                    Senior Convertible                       Stock,           Additional                   Total
                                     Preferred Stock        Common Stock     at cost           Paid-In    Accumulated  Shareholders'
                                    Shares    Amount   Shares       Amount   Shares   Amount   Capital      Deficit       Equity
                                    ------    ------  ----------   --------  ------   ------  ----------  -----------  ------------


<S>                                 <C>      <C>      <C>          <C>       <C>      <C>      <C>         <C>           <C>
BALANCE - DECEMBER 31, 2001              3   $  287   27,187,309   $   272   182,337  $(204)   $119,926    $(119,664)    $    617
                                    ------   ------   ----------   --------  -------  -----    --------    ---------     --------
Issuance of warrants in
   connection with financing
   arrangements (Note 10)                -        -            -         -         -      -         190            -          190
Issuance of common shares upon
   conversion of Senior Convertible
   Preferred Stock (Note 9)             (2)    (213)     235,648         2         -      -         229          (18)           -
Exercise of stock warrants (Note 9)      -        -    2,250,000        23         -      -           -            -           23
Net loss                                 -        -            -         -         -      -           -       (2,658)      (2,658)
                                    ------   ------   ----------   --------  -------  -----    --------    ---------     --------
BALANCE - SEPTEMBER 30, 2002             1   $   74   29,672,957   $   297   182,337  $(204)   $120,345    $(122,340)    $ (1,828)
                                    ======   ======   ==========   ========  =======  =====    ========    =========     ========



</TABLE>

     The accompanying notes are an integral part of this consolidated statement.


                                       5
<PAGE>

                     EMERGING VISION, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (UNAUDITED)

NOTE 1 - BASIS OF PRESENTATION

     The accompanying Consolidated Financial Statements of Emerging Vision, Inc.
and subsidiaries (collectively,  the "Company") have been prepared in accordance
with accounting  principles  generally accepted for interim financial  statement
presentation and in accordance with the instructions to Form 10-Q and Article 10
of Regulation S-X.  Accordingly,  they do not include all of the information and
footnotes  required by  accounting  principles  generally  accepted for complete
financial statement presentation.  In the opinion of management, all adjustments
for a fair statement of the results of operations and financial position for the
interim  periods  presented have been included.  All such  adjustments  are of a
normal  recurring  nature.   This  financial   information  should  be  read  in
conjunction  with  the  Consolidated  Financial  Statements  and  Notes  thereto
included in the Company's  Annual Report on Form 10-K, as amended,  for the year
ended December 31, 2001.  There have been no changes in  significant  accounting
policies since December 31, 2001.


NOTE 2 - MANAGEMENT'S LIQUIDITY PLANS

     As of September 30, 2002  (exclusive  of net  liabilities  of  discontinued
operations),  the Company had negative working capital of $4,681,000 and cash on
hand of $601,000.  During the nine months ended  September 30, 2002, the Company
used approximately  $1,856,000 of cash in its operating  activities.  This usage
was in line with  management's  plans and was  mainly a result of  approximately
$680,000 of costs  related to the  Company's  store closure plan (Note 6), a net
decrease of $593,000 in accounts payable and accrued liabilities that existed as
of December 31, 2001,  and $271,000  related to the  prepayment of certain other
business  expenses,  offset, in part, by a net decrease of $346,000 in franchise
and other  receivables.  Management  anticipates  that it will continue to incur
significant  costs in order to continue to close  certain of its  non-profitable
Company-owned  stores,  all in its effort to  eliminate  future cash flow losses
currently generated by such stores.

     Based  on  its  current  financial  position,  the  Company  may  not  have
sufficient  liquidity available to continue in operation for the next 12 months.
However,  the  Company  plans to  continue  to attempt to improve its cash flows
during the remainder of 2002,  and into 2003, by improving  store  profitability
through   increased   monitoring   of   store-by-store    operations,    closing
non-profitable  Company-owned stores,  implementing reductions of administrative
overhead expenses where necessary and feasible,  actively supporting development
programs  for  franchisees,  and adding  new  franchised  stores to the  system.
Management  believes that with the  successful  execution of the  aforementioned
plans to attempt to improve cash flows,  its existing  cash,  the  collection of
outstanding  receivables,  the  availability  under its existing credit facility
(Note 10), and the  successful  completion of its  shareholder  rights  offering
(Note 9),  there  will be  sufficient  liquidity  available  for the  Company to
continue in operation for the next 12 months. However, there can be no assurance
that the Company will be able to successfully execute the aforementioned  plans,
or that it will be successful in completing its rights offering.


NOTE 3 - DISCONTINUED OPERATIONS

     On March 28,  2001,  the Board  decided  that the Company  should focus its
efforts and resources on growing its retail  optical  business and, as a result,
approved a plan to discontinue all other  operations then being conducted by the
Company.  In connection with this decision,  during 2001, the Company  completed
its plan of disposal  of  substantially  all of the net assets of Insight  Laser
Centers,  Inc.  ("Insight Laser") - which operated three laser vision correction
centers in the New York  metropolitan  area,  Insight Laser Centers N.Y.I,  Inc.
(the  "Ambulatory  Center") - which  owned the assets of an  ambulatory  surgery
center located in Garden City,  New York, and its Internet  Division - which was
to provide a web-based portal designed to take advantage of business-to-business
opportunities in the optical  industry.  As a result,  the remaining  results of
operations and cash flows of these divisions have been reflected as discontinued
operations in the accompanying Consolidated Financial Statements.


                                       6
<PAGE>


     As of  September  30,  2002 and  December  31,  2001,  net  liabilities  of
discontinued operations of $220,000 and $235,000,  respectively, were segregated
on the accompanying  Consolidated  Balance Sheets. In addition,  as of September
30, 2002 and December 31, 2001, respectively, approximately $84,000 and $141,000
was  accrued  as  part  of  accounts  payable  and  accrued  liabilities  on the
accompanying  Consolidated Balance Sheets,  representing the remaining estimated
costs  associated with the Company's  original plan of disposal,  and additional
accrued  costs  associated  with the  Company's  guarantee of certain  potential
continuing liabilities of the Ambulatory Center (Note 7).


NOTE 4 - SIGNIFICANT ACCOUNTING POLICY - REVENUE RECOGNITION

     The Company generally charges franchisees a nonrefundable initial franchise
fee.  Initial  franchise fees are  recognized at the time all material  services
required  to be  provided  by the  Company  have been  substantially  performed.
Continuing  franchise  royalty  fees are based  upon a  percentage  of the gross
revenues  generated  by each  franchised  location  and are  recorded as earned,
subject to meeting all of the requirements of SAB 101 described below.

     The Company derives its revenues from the following four principal sources:

     Net sales - Represents sales from eye care products and related services;

     Franchise  royalties - Represents  continuing  franchise  fees based upon a
percentage of the gross revenues generated by each franchised location;

     Net gains from the  conveyance  of  Company-store  assets to  franchisees -
Represents  the net  gains  from  the  sale of  Company-owned  store  assets  to
franchisees; and

     Interest on franchise  notes - Represents  interest  charged to franchisees
pursuant  to  promissory   notes  issued  in  connection   with  a  franchisee's
acquisition  of the assets of a Sterling  Store or a qualified  refinancing of a
franchisee's obligations to the Company.

     The Company  recognizes  revenues in accordance  with SEC Staff  Accounting
Bulletin No. 101,  "Revenue  Recognition in Financial  Statements"  ("SAB 101").
Accordingly,  revenues are recorded when  persuasive  evidence of an arrangement
exists,  delivery has occurred or services  have been  rendered,  the  Company's
price to the buyer is fixed or determinable,  and  collectibility  is reasonably
assured.  To the extent that  collectibility  of  royalties  and/or  interest on
franchise notes is not reasonably  assured,  the Company recognizes such revenue
when the cash is received.

     The Company  also  follows  the  provisions  of Emerging  Issues Task Force
("EITF")  Issue  01-09,  "Accounting  for  Consideration  Given by a Vendor to a
Customer  (Including  Reseller  of the  Vendor's  Products)"  and,  accordingly,
accounts  for  discounts,  coupons  and  promotions  (that  are  offered  to its
customers) as a direct reduction of sales.


NOTE 5 - PER SHARE INFORMATION

     In accordance with Statement of Financial Accounting Standards ("SFAS") No.
128,  "Earnings  Per Share",  basic net income  (loss) per common share  ("Basic
EPS") is computed by dividing net income (loss) by the  weighted-average  number
of common  shares  outstanding.  Diluted  net income  (loss)  per  common  share
("Diluted   EPS")  is  computed  by  dividing  the  net  income  (loss)  by  the
weighted-average  number of common shares and dilutive common share  equivalents
and  convertible  securities  then  outstanding.   SFAS  No.  128  requires  the
presentation  of both  Basic EPS and  Diluted  EPS on the face of the  Company's
Consolidated  Statements of Operations.  Common stock  equivalents were excluded
from the computation for all periods presented,  as their impact would have been
anti-dilutive.


                                       7
<PAGE>


     The  following  table sets forth the  computation  of basic and diluted per
share information (in thousands, except per share data):

<TABLE>
<CAPTION>

                                                                For the Three Months Ended          For the Nine Months Ended
                                                                      September 30,                        September 30,
                                                                --------------------------          -------------------------
                                                                    2002          2001                 2002           2001
                                                                --------------------------          -------------------------
<S>                                                              <C>            <C>                  <C>            <C>
      Numerator:

      Loss from continuing operations                            $ (1,895)      $ (1,942)            $ (2,825)      $ (2,040)
      Conversion of Senior Convertible Preferred Stock                 -              -                   (18)            -
                                                                 ---------      ---------            ---------      ---------
      Numerator for basic and diluted per share
         information - loss attributable to common
         shareholders                                              (1,895)        (1,942)              (2,843)        (2,040)
                                                                 ---------      ---------            ---------      ---------

      Basic and Diluted:

      Loss attributable to common shareholders                     (1,895)        (1,942)              (2,843)        (2,040)
      Income (loss) from discontinued operations                      287           (657)                 167            838
                                                                 ---------      ---------            ---------      ---------
            Net loss attributable to common shareholders         $ (1,608)      $ (2,599)            $ (2,676)      $ (1,202)
                                                                 =========      =========            =========      =========

      Denominator:

      Denominator for basic and diluted per share
            information - weighted-average number of
            common shares outstanding                              29,433         26,951               28,286         25,492
                                                                 =========      =========            =========      =========

      Basic and Diluted Per Share Information:

      Loss attributable to common shareholders                   $  (0.06)      $  (0.08)            $  (0.10)      $  (0.08)
      Income (loss) from discontinued operations                     0.01          (0.02)                0.01           0.03
                                                                 ---------      ---------            ---------      ---------
            Net loss attributable to common shareholders         $  (0.05)      $  (0.10)            $  (0.09)      $  (0.05)
                                                                 =========      =========            =========      =========

</TABLE>


NOTE 6 - PROVISION FOR STORE CLOSINGS

     The Company  follows  the  provisions  of Emerging  Issues Task Force Issue
94-3, "Liability Recognition for Certain Employee Termination Benefits and Other
Costs to Exit an Activity," and in accordance therewith,  provides for losses it
anticipates  incurring  with respect to those  Company-owned  stores that it has
identified  for  future  closure,  at the time  that  management  makes a formal
commitment  to any such plan of closure.  The  provision is recorded at the time
the  determination  is made to  close a  particular  store  and is  based on the
expected net  proceeds,  if any, to be  generated  from the  disposition  of the
store's  assets,  as compared to the  carrying  value  (after  consideration  of
impairment,  if any) of such store's assets and the estimated  costs  (including
lease  termination costs and other expenses) that are anticipated to be incurred
in the closing of the store in question.  As of December  31, 2001,  the Company
had accrued  approximately  $964,000 (comprised of $766,000 in lease termination
costs and $198,000 for other  associated  expenses)  related to its  anticipated
closure of 11 stores.  During the nine months  ended  September  30,  2002,  the
Company successfully closed 7 of such stores.  During the third quarter of 2002,
management made the decision to close an additional 7 Company-owned  stores, and
as a result,  recorded an additional provision of $617,000.  As of September 30,
2002,   $901,000   remained  accrued  as  accrual  for  store  closings  on  the
accompanying  Consolidated Balance Sheet. The Company anticipates completing its
closure plan by the end of first quarter of 2003.


                                       8
<PAGE>

NOTE 7 - CONTINGENCIES

Litigation

     In 1999, the Company  commenced an action in the Supreme Court of the State
of New York against Dr. Larry Joel and Apryl Robinson for amounts claimed due by
the  Company  on a series of five  separate  Negotiable  Promissory  Notes  (the
"Notes").  The Notes were  issued by  corporations  owned by the  defendants  in
connection  with their purchase of the assets of, and a Sterling  Optical Center
Franchise  for, an aggregate of four of the Company's  retail optical stores and
an  optical  laboratory.  The  repayment  of each of the  Notes  was  personally
guaranteed  by each of the  defendants.  In response,  the  defendants  asserted
counterclaims in excess of $13,000,000  based upon the Company's alleged failure
to comply with the terms of an oral, month-to-month consulting agreement between
Dr. Joel and the Company, as well as to purchase the assets of various companies
owned by Dr. Joel,  including Duling Optical and D & K Optical - notwithstanding
the fact that the parties  failed to agree upon the terms of any such  purchase,
the parties  failed to enter into any  written  agreement  memorializing  such a
transaction,  and the Company  subsequently  purchased  such assets from Norwest
Bank (which held a first lien on  substantially  all of the assets as collateral
for  various  loans  made to each of the  entities,  all of which  were  then in
default) in a private  foreclosure  sale. In March 2001, the Appellate  Division
granted  the  Company's  Motion  for  Summary  Judgment  on  the  issue  of  the
defendants' liability, as guarantors of each of such Notes; and, in August 2001,
the Court granted the Company's claim for damages in the  approximate  amount of
$800,000,  which the  Company is seeking  to  enforce.  In  November  2001,  the
defendants  each filed for  protection  under the U.S.  Bankruptcy  Code and, in
February 2002,  received a discharge in such  proceedings,  which the Company is
presently attempting to overturn.  In addition, in March 2001, the Company filed
an  additional  Motion for  Summary  Judgment  seeking  dismissal  of all of the
defendants'  counterclaims;  and the  defendant,  Dr. Joel,  thereafter  filed a
cross-motion   seeking  a   determination   that  the   Company   breached   the
aforementioned  oral,  month-to-month  consulting  agreement  and  that  he  is,
accordingly,  entitled to damages of  approximately  $13,000,000,  each of which
motions were decided entirely in favor of the Company.  Subsequently, on July 2,
2001, the defendants,  without counsel,  filed an appeal of this decision by the
Court,  which  appeal  has not yet been  decided.  Furthermore,  in 1999,  Apryl
Robinson  commenced  an action in  Kentucky  against  Larry Joel and the Company
seeking  an  unspecified  amount of  damages  and  alleging  a myriad of claims,
including fraud and misrepresentation.  The Company is defending such action and
intends to file a motion to dismiss the same based on the  decisions  in the New
York action.

     In 1999, Berenter Greenhouse and Webster, the advertising agency previously
utilized by the Company,  commenced an action,  against the Company,  in the New
York State Supreme  Court,  New York County,  for amounts  alleged to be due for
advertising and related fees. The amounts claimed by the plaintiff are in excess
of $200,000.  In response to this action,  the Company  filed  counterclaims  of
approximately $500,000,  based upon estimated overpayments allegedly made by the
Company pursuant to the agreement  previously  entered into between the parties.
As of the date hereof, this action was still in the discovery stage.

     In April 2000, the Company  commenced an action in the Supreme Court of the
State of New Jersey against  Preit-Rubin,  Inc. and Cumberland Mall  Associates,
the landlord of the former  Sterling  Optical Store located in Cumberland  Mall,
Vineland,  New Jersey,  seeking damages of approximately $200,000 as a result of
the defendants  alleged wrongful eviction of the Company from this location.  In
response  thereto,  the  defendants  asserted   counterclaims  of  approximately
$100,000  plus legal fees based upon the Company's  alleged  breach of the lease
pursuant to which it occupied  such store.  Thereafter,  the  defendant  filed a
motion for summary judgment seeking a dismissal of the Company's  claims,  which
motion was  decided by the Court,  in a favor of the  defendant.  As of the date
hereof,  it is  anticipated  that a trial  of this  action  will  take  place in
approximately 120 days.


                                       9
<PAGE>


     In July 2001,  the  Company  commenced  an  Arbitration  Proceeding  in the
Ontario  Superior  Court  of  Justice,  against  Eye-Site,  Inc.  and  Eye  Site
(Ontario),  Ltd.,  as the  makers  of two  promissory  notes  (in the  aggregate
original  principal  amount of  $600,000)  made by one or more of the  makers in
favor of the Company,  as well as against  Mohammed Ali, as the guarantor of the
obligations  of each maker under each note.  The notes were issued by the makers
in connection  with their  acquisition of a Master  Franchise  Agreement for the
Province of Ontario,  Canada,  as well as their purchase of the assets of, and a
Sterling  Optical  Center  Franchise  for, four of the Company's  retail optical
stores  then  located  in  Ontario,   Canada.   In  response,   the   defendants
counterclaimed for damages, in the amount of $1,500,000, based upon, among other
items,  alleged  misrepresentations  made by  representatives  of the Company in
connection  with  these  transactions.  The  Company  believes  that  it  has  a
meritorious  defense  to  each  counterclaim.  As  of  the  date  hereof,  these
proceedings were in the discovery stage.

     In February 2002, Kaye Scholer,  LLP, the law firm  previously  retained by
the Company as its outside  counsel,  commenced  an action in the New York State
Supreme  Court  seeking  unpaid legal fees in the amount of $122,500.  As of the
date hereof,  the Company has answered the Complaint in such action. The Company
believes that it has a meritorious defense to such claim.

     In May 2002, a class action was commenced in the California Superior Court,
Los Angeles County,  against the Company and VisionCare of California ("VCC"), a
wholly owned subsidiary of the Company,  by Consumer Cause, Inc. seeking:  (i) a
preliminary  and  permanent  injunction  enjoining  the  defendants  from  their
continued alleged violation of the California Business and Professions Code (the
"California  Code");  and (ii)  restitution  based upon the defendants'  alleged
illegal  charging  of  dilation  fees  during the four year  period  immediately
preceding  the  date of the  plaintiff's  commencement  of such  action.  In its
complaint, the plaintiff alleges that VCC's employment of licensed optometrists,
as well as its  operation  (under the name  Sterling  VisionCare)  of optometric
offices in locations which are usually situated adjacent to the Company's retail
optical stores located in the State of California,  violates certain  provisions
of the California  Code and seeks to permanently  enjoin VCC from  continuing to
operate in such manner.  EVI and VCC intend to vigorously defend this action and
believe  that they have  meritorious  defenses to the  plaintiff's  allegations,
which  defenses  will  include a claim  that VCC is a  Specialized  Health  Care
Maintenance  Organization  which  has  been  specifically  licensed,  under  the
California  Knox Keene  Health  Care  Service  Plan Act of 1975,  to provide the
identical  services which the plaintiff seeks to enjoin.  As of the date hereof,
the  action  has  been  transferred  to the  Court  located  in  Orange  County,
California and is in its preliminary stages.

     On August 2, 2002,  Sterling  Advertising,  Inc.  ("SAI"),  a wholly  owned
subsidiary  of the Company,  commenced  an action in the New York State  Supreme
Court,  Nassau  County,  against  Harvey Herman  Associates,  Inc.  ("HHA"),  an
advertising agency previously retained by SAI, seeking damages, in the estimated
amount of $150,000,  as a result of HHA's alleged  failure to provide certain of
the  services  otherwise  required  of it  pursuant  to the  terms of a  certain
Client-Agency  Agreement,  dated July 9, 2001, between SAI and HHA.  Thereafter,
HHA, on August 6, 2002, commenced an action in the New York State Supreme Court,
New York County,  against EVI, Sterling Optical and Site For Sore Eyes,  seeking
damages in the approximate amount of $90,000,  based upon one or more additional
agreements  allegedly  entered  into  between  HHA,  Site For Sore  Eyes  and/or
Sterling Optical,  which, in the opinion of SAI, required HHA to perform certain
services which were already  included within the scope of the services  required
to be performed,  by HHA,  under such  Client-Agency  Agreement.  As of the date
hereof, the parties have agreed, in principal, to settle such litigation without
the payment of any additional compensation.

     On October 29, 2002,  an action was  commenced  against the Company and its
wholly owned subsidiary,  Sterling Vision of Eastland,  Inc. (the "Tenant"),  in
the North Carolina General Court of Justice,  in which Charlotte  Eastland Mall,
LLC, as the Landlord of the Tenant's former  Sterling  Optical Center located in
Charlotte,  North Carolina, is seeking,  among other things, damages against the
Company, in the approximate amount of $81,000, under its Limited Guaranty of the
Tenant's  obligations under the Lease for such Center. The Company believes that
it has a meritorious defense to such action. As of the date hereof, the Tenant's
and the Company's time to answer the complaint has not yet expired.


                                       10
<PAGE>


     In  addition  to the  foregoing,  the  Company  is a  defendant  in certain
lawsuits  alleging  various claims  incurred in the ordinary course of business,
certain of which claims are covered by various  insurance  policies,  subject to
certain  deductible  amounts  and  maximum  policy  limits.  In the  opinion  of
management,  the  resolution of these claims should not have a material  adverse
effect,  individually  or in the  aggregate,  upon  the  Company's  business  or
financial  condition.  Other than as set forth above,  management  believes that
there are no other legal proceedings  pending or threatened to which the Company
is, or may be, a party, or to which any of its properties are or may be subject,
which, in the opinion of management,  will have a material adverse effect on the
Company.


Guarantees

     In connection  with the Company's sale of the Ambulatory  Center on May 31,
2001 (Note 3), the Company agreed to guarantee  certain of the potential ongoing
liabilities of the Ambulatory  Center.  As of December 31, 2001, the Company had
accrued $104,000 for estimated  guaranteed  liabilities in 2002. During the nine
months ended September 30, 2002, the Company accrued an additional  $120,000 for
such estimated guaranteed  liabilities in 2002,  representing the estimated cash
flow  losses  of the  Ambulatory  Center  through  the  date  hereof,  based  on
information provided by the owner.  Although the term of the Company's guarantee
(of such liabilities) will not expire until April 2008, its exposure there under
may, in the future, be reduced,  on a pro-rata basis,  based upon the ability of
the current owner to attract additional  investors who agree to guarantee all or
a portion thereof. However, there can be no assurance that such liabilities will
be so reduced  and,  as a result,  the Company  could in the future  continue to
incur further costs associated with such guarantee should the Ambulatory  Center
continue to generate cash flow losses.

     As of September 30, 2002,  the Company was a guarantor of certain leases of
retail optical stores franchised and subleased to its franchisees.  In the event
that all of such  franchisees  defaulted  on  their  respective  subleases,  the
Company would be obligated  for aggregate  lease  obligations  of  approximately
$2,443,567.


NOTE 8 - RELATED PARTY TRANSACTIONS

     On  December  3,  2001 and  December  20,  2001,  respectively,  the  Board
authorized the Company to borrow  $150,000 and $300,000 from Horizons  Investors
Corp.  ("Horizons"),  a New York corporation principally owned by a director and
principal  shareholder of the Company. The loan was payable on demand,  together
with  interest  calculated  at the prime rate plus 1%. The Company  repaid these
loans (which  aggregated  $450,000 as of December 31, 2001), in full, on January
23, 2002 (Note 10).

     On December 6, 2001, the Board  authorized  the Company to borrow  $300,000
from Broadway  Partners  LLC, a partnership  owned by certain of the children of
certain of the Company's  principal  shareholders  and  directors.  The loan was
payable on demand,  together with interest calculated at the prime rate plus 1%.
The Company  repaid this loan  ($300,000 as of December 31,  2001),  in full, on
January 23, 2002 (Note 10).

     Until January 10, 2002,  the Company  subleased,  from a limited  liability
company owned by certain of the Company's principal  shareholders and directors,
and shared with Cohen Fashion  Optical,  Inc.  ("CFO"),  a retail  optical chain
owned by certain of the principal shareholders and directors of the Company, and
other tenants,  an office building located in East Meadow,  New York.  Occupancy
costs were  appropriately  allocated  based upon the  applicable  square footage
leased by the  respective  tenants of the building.  For the year ended December
31, 2001, the Company paid  approximately  $440,000 for rent and related charges
for these  offices.  On January 10,  2002,  the Company  relocated  to an office
building  located in Garden City, New York, and entered into a sublease with CFO
for one of the two floors then being  subleased to CFO. The Company's new annual
rent is approximately $163,000.  Occupancy costs are being allocated between the
Company  and CFO based  upon the  respective  square  footages  being  occupied.
Management believes that the sublease is at fair market rental value.

     In April 2002, the Company sold  substantially  all of the assets of one of
its stores  located in New York City,  together with all of the capital stock of
its wholly-owned subsidiary, Sterling Vision of 125th Street, Inc., which is the
tenant under the master lease for such store,  to General Vision Services LLC, a
retail  optical  chain  owned  by  certain  of the  principal  shareholders  and
directors of the Company and members of their respective immediate families, for
the sum of $55,000.


                                       11
<PAGE>

     On July 23, 2002, the Board  authorized the Company to borrow $300,000 from
one of its principal shareholders and directors.  The loan was payable on August
10,  2002,  together  with  interest in an amount  equal to 1% of the  principal
amount of such loan.  The Company  repaid this loan,  in full, on August 8, 2002
(Note 10).

     In the  ordinary  course  of  business,  largely  due to the fact  that the
entities  occupy office space in the same  building,  and in an effort to obtain
savings with respect to certain  administrative costs, the Company and CFO will,
at times, share in the costs of minor expenses.  Management  believes that these
expenses have been appropriately accounted for by the Company.

     In the opinion of management,  all of the above transactions were conducted
at "arms-length."


NOTE 9 - SHAREHOLDERS' EQUITY

Issuance of Warrants in Connection with Financing Arrangements

     On  January  23,  2002,   in  connection   with   obtaining  its  financing
arrangements  (Note 10), the Company granted  Horizons an aggregate of 2,500,000
warrants  (1,750,000  of which were  immediately  exercisable,  with the balance
vesting in quarterly increments of 250,000, beginning April 22, 2002, subject to
any amounts then  remaining  unpaid  under the secured  term note and/or  credit
facility).  The warrants had a five-year term and provided for an exercise price
of  $0.01  per  share.  The  fair  value of these  warrants  (valued  using  the
Black-Scholes  model) was  approximately  $234,000.  On May 1, 2002 and July 22,
2002,  respectively,  Horizons exercised 2,000,000 and 250,000 of such warrants.
Additionally,  on October 22, 2002, Horizons exercised the final 250,000 of such
warrants.


Increase in Authorized Number of Shares of Common Stock

     On  April  29,  2002,  the  Board  unanimously  voted to  recommend  to the
shareholders  that the  Company's  Certificate  of  Incorporation  be amended to
increase the number of authorized  shares of its Common Stock from 50,000,000 to
150,000,000 shares, and to increase the total number of authorized shares of its
capital stock from  55,000,000 to  155,000,000.  On July 11, 2002, the Company's
shareholders  approved  of such  amendment,  which was  thereafter  filed by the
Company.


Shareholder Rights Offering

     On  April  29,  2002,  the  Board  unanimously  approved  of the  Company's
initiation of a shareholder rights offering (the "Rights Offering),  whereby the
Company would attempt to raise  approximately  $2,000,000 of gross proceeds.  On
October 23, 2002,  the Company  formally  announced that it filed a registration
statement with the Securities  and Exchange  Commission in connection  with such
Rights Offering, as of a record date to be determined.  The rights offering will
consist  of  50,000,000  units,  with each unit  consisting  of one share of the
Company's Common Stock, and a warrant,  having a term of twelve (12) months,  to
purchase one additional  share of Common Stock at an exercise price equal to the
average of the last reported  sales price,  of the Common Stock,  during the ten
(10) trading days immediately preceding the closing date of the Rights Offering.

     The terms of the Rights Offering will provide that each shareholder will be
granted  approximately  1.67  non-transferable  rights for every share of Common
Stock owned as of the record date.  Each right will be exercisable  for one unit
at a price of $0.04,  the  proceeds  of which will be used to repay the  amounts
outstanding  under the Company's  existing  credit  facility and term loan (Note
10), to fund its plan to continue to close  non-profitable  stores  (Note 6) and
for general corporate and working capital purposes.

     In addition,  an  over-subscription  privilege has been included,  allowing
shareholders  to subscribe  for  additional  units not  subscribed  for by other
shareholders  pro rata  based on the number of units  purchased  under the basic
subscription  privilege.  No fractional  rights will be issued,  but the Company
will round the number of rights its  shareholders  receive  down to the  nearest
whole number.


                                       12
<PAGE>

Conversion of Senior Convertible Preferred Stock

     In April 1998,  the Company  issued a series of its  Preferred  Stock,  par
value $0.01 per share (the "Senior Convertible Preferred Stock"),  together with
warrants (all of which expired in February 2001) to acquire shares of its Common
Stock.  Each  share of Senior  Convertible  Preferred  Stock  had a  liquidation
preference of $100,000,  and was originally  convertible  into Common Stock at a
price of $5.00 per share. In December 1999, the conversion  price was reduced to
$0.75 per share for all of the remaining holders of Senior Convertible Preferred
Stock.  As of December  31, 2001,  there were 2.51 shares of Senior  Convertible
Preferred Stock outstanding with a stated value of $251,000.

     On June 8, 2002,  one of the remaining two holders of the Company's  Senior
Convertible  Preferred  Stock  exercised  its right to convert an  aggregate  of
$177,736 stated value of Senior  Convertible  Preferred Stock, into an aggregate
of 235,648 shares of the Company's Common Stock.


NOTE 10 - FINANCING ARRANGEMENTS

     On  January  23,  2002,   the  Company   secured  two  separate   financing
arrangements as follows:

     Secured Term Note

     The  Company  entered  into a  secured  term  note for  $1,000,000  with an
independent  financial  institution.  This note is repayable in 24 equal monthly
installments  of $41,666,  and bears interest as defined (4.95% at the inception
of the note, and  subsequently  amended on April 1, 2002 to 3.95%).  The note is
fully collateralized by a $1,000,000  certificate of deposit posted by Horizons,
a related party (Note 8), at the same financial institution.

     Credit Facility

     The  Company  entered  into an  agreement  with  Horizons to borrow up to a
maximum of  $1,000,000.  This credit  facility  bears interest at the prime rate
plus 1% (5.5% as of the date of the loan  agreement),  provided  for an  initial
advance of $300,000,  requires minimum incremental advances of $150,000, matures
on January 22, 2004, requires ratable monthly principal and interest payments of
each  borrowing,  is amortizable  through the maturity date of the facility,  is
fully  collateralized  by a  pledge  of  certain  of  the  Company's  qualifying
franchise  notes,  and  requires  the payment of a facility fee of 2% per annum,
payable monthly, on the unused portion of the credit facility.

     Simultaneous  with  obtaining the above  financing,  the Company repaid its
outstanding related party borrowings totaling $750,000,  plus interest (Note 8).
In  consideration  for providing  access to the credit facility and guaranteeing
the term note, the Company granted Horizons an aggregate of 2,500,000  warrants,
the fair value of which was $234,000  (Note 9). The net proceeds  received  were
allocated  based on the  relative  fair  values  of the  debt and the  warrants.
Accordingly,  $810,000 was allocated to the debt,  and $190,000 was allocated to
the warrants as a discount to the debt to be amortized as interest  expense over
the term of the note (2 years).  For the nine months ended  September  30, 2002,
approximately  $63,000 of such discount was amortized and recognized as interest
expense in the accompanying Consolidated Statement of Operations.

     On August 8, 2002,  the Company  obtained an  additional  advance under the
credit  facility  of  $300,000,  the  proceeds  of which  were  used to repay an
outstanding  related party borrowing  (Note 8). As of the date hereof,  $517,000
remained available to the Company under the credit facility.


                                       13
<PAGE>


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

     This Report  contains  certain  forward-looking  statements and information
relating  to the  Company  that  are  based  on  the  beliefs  of the  Company's
management,  as well as assumptions made by, and information currently available
to, the Company's management.  When used in this Report, the words "anticipate",
"believe",  "estimate", "expect", and similar expressions, as they relate to the
Company or the Company's  management,  are intended to identify  forward-looking
statements. Such statements reflect the current view of the Company with respect
to future events,  are not guarantees of future  performance  and are subject to
certain  risks and  uncertainties.  These risks and  uncertainties  may include:
product demand and market acceptance  risks; the effect of economic  conditions;
the impact of competitive products,  services and pricing;  product development,
commercialization and technological difficulties; and the outcome of pending and
future  litigation.   Should  one  or  more  of  these  risks  or  uncertainties
materialize,  or should underlying  assumptions prove incorrect,  actual results
may vary materially from those described  herein as  "anticipated",  "believed",
"estimated",  or  "expected".  The  Company  does not  intend  to  update  these
forward-looking statements.


Results of Operations
---------------------

For the Three and Nine Months Ended September 30, 2002, as Compared to the
Comparable Periods in 2001

     Net sales for Company-owned  stores,  including  revenues  generated by the
Company's  wholly-owned  subsidiary,  VisionCare  of  California,  a specialized
health  care  maintenance  organization  licensed  by the  State  of  California
Department of Managed Health Care, decreased by approximately $82,000 or 2.9% to
$2,773,000  for the three  months  ended  September  30,  2002,  as  compared to
$2,855,000  for the comparable  period in 2001,  and decreased by  approximately
$748,000, or 8.7% to $7,847,000 for the nine months ended September 30, 2002, as
compared to $8,595,000 for the comparable  period in 2001.  These decreases were
primarily due to the lower average number of  Company-owned  stores in operation
during the three and nine months ended  September  30, 2002,  as compared to the
same  periods  in  2001.   These  decreases  were  in  line  with   management's
expectations due to the plan to close the Company's non-profitable Company-owned
stores.

     As of September 30, 2002, there were 186 stores in operation, consisting of
31  Company-owned  stores  (including 13  Company-owned  stores being managed by
franchisees) and 155 franchised  stores,  as compared to 210 stores in operation
as of September 30, 2001,  consisting of 38  Company-owned  stores  (including 7
Company-owned  stores being managed by  franchisees)  and 172 franchised  stores
(including 2 stores being managed by the Company on behalf of franchisees). On a
same store basis (for stores that operated as a Company-owned  store during both
of the  three  and nine  month  periods  ended  September  30,  2002 and  2001),
comparative  net sales  decreased by $146,000,  or 9.0%, to  $1,473,000  for the
three  months  ended  September  30,  2002,  as compared to  $1,619,000  for the
comparable  period in 2001, and decreased by $652,000,  or 14.8%,  to $3,755,000
for the nine months ended  September 30, 2002, as compared to $4,407,000 for the
comparable  period in 2001.  Management  believes that this decline was a direct
result of the general downturn in the economy that has occurred during 2002.

     Franchise  royalties  decreased by $169,000 or 8.7% to  $1,769,000  for the
three  months  ended  September  30,  2002,  as compared to  $1,938,000  for the
comparable  period in 2001,  and  decreased by $1,112,000 or 17.7% to $5,156,000
for the nine months ended  September 30, 2002, as compared to $6,268,000 for the
comparable  period in 2001.  These  decreases were primarily a result of a lower
average number of franchised stores in operation during the three and nine-month
periods ended September 30, 2002 as compared to 2001, as described above.

     For the three and nine months ended  September 30, 2002,  there was $49,000
and $56,000,  respectively,  of net gains from the  conveyance of  Company-owned
store assets to franchisees  (including  initial  franchise fees). For the three
and nine month periods ended September 30, 2001, the Company  recognized $10,000
and $132,000,  respectively, of such gains and fees. The overall decrease is due
to the fact that the  Company  did not convey to  franchisees  (and thus did not
realize a gain on) any assets of  Company-owned  stores  during the nine  months
ended September 30, 2002.


                                       14
<PAGE>


     Interest on franchise  notes  receivable  decreased by $123,000 or 60.6% to
$80,000 for the three months ended  September  30, 2002, as compared to $203,000
for the  comparable  period in 2001,  and  decreased by $504,000,  or 66.5%,  to
$254,000 for the nine months ended  September  30, 2002, as compared to $758,000
for the  comparable  period  in 2001.  These  decreases  were  primarily  due to
numerous  franchise  notes  maturing,  principal  payments  on  the  balance  of
franchise  notes,  and fewer new notes being generated during the three and nine
month periods ended September 30, 2002 as compared to the comparable  periods in
2001.

     Other income increased to $136,000 for the three months ended September 30,
2002, as compared to $23,000 for the comparable period in 2001, and increased to
$232,000 for the nine months ended  September  30, 2002,  as compared to $81,000
for the  comparable  period in 2001.  These  increases  were primarily due to an
increase in certain franchise related fees (related to renewals and/or transfers
of franchise  agreements)  during the three and nine months ended  September 30,
2002.

     The Company's gross profit margin increased by 4.8%, to 77.9% for the three
months ended September 30, 2002, as compared to 73.1% for the comparable  period
in 2001,  and decreased by 2.7%, to 74.3%,  for the nine months ended  September
30, 2002, as compared to 77.0% for the  comparable  period in 2001. In an effort
to remain  competitive  with other  retail  optical  chains  during the economic
downturn in 2002, the Company  substantially  reduced the selling prices on many
of its products,  thus causing profit margins to decrease.  Further,  during the
nine months ended  September 30, 2002,  the Company,  largely due to a decrease,
from the comparable  period in 2001, of its financial  resources,  was unable to
obtain the same  discounts  from certain of its vendors  than in the  comparable
periods in 2001,  and,  additionally,  was unable to take  advantage  of certain
product purchase discounts tied to prompt payment. During the three months ended
September  30,  2002,  as compared  to the same period in 2001,  the Company did
experience an increase in its gross profit margin,  primarily due to the success
of certain sales  promotions  and a reduction in lab costs in the 3rd quarter of
2002. In the future,  the Company's gross profit margin may fluctuate  depending
upon the  extent  and timing of  changes  in the  product  mix in  Company-owned
stores,  competitive  pricing,  promotional  incentives,  and the ability of the
Company to take advantage of purchase discounts.

     Selling, general and administrative expenses decreased by $61,000, or 1.0%,
to  $6,031,000  for the three months ended  September  30, 2002,  as compared to
$6,092,000  for the comparable  period in 2001,  and decreased by 1,298,000,  or
8.4%, to $14,199,000  for the nine months ended  September 30, 2002, as compared
to $15,497,000 for the comparable  period in 2001. These decreases were a direct
result of the  closure  of  non-profitable  Company-owned  stores  during  2002,
management's  implementation of reductions of administrative  overhead expenses,
and closer monitoring of store-by-store  and corporate  operations,  offset by a
3rd  quarter  provision  of $617,000  for the  estimated  costs of 7  additional
planned store  closures,  and a 3rd quarter  provision for doubtful  accounts of
$618,000 for certain  franchise  accounts and notes  receivable  that management
deemed to be uncollectible.

     The  Company  has  certain  outstanding  contingent  warrants  that  become
exercisable  upon the  achievement,  by the  Company,  of certain  predetermined
EBITDA  targets.  Due to these  contingencies,  the  future  valuation  of these
contingent warrants, if and when they become exercisable, will result in charges
to the Company's  results of operations in future periods.  The  significance of
these  charges,  if any,  will be  dependent  upon the fair market  value of the
Company's  Common  Stock at the time  that the  respective  EBITDA  targets  are
achieved.

     Loss from  franchised  stores  operated  under  management  agreements  was
$97,000  and  $344,000,  respectively,  for the  three  and  nine  months  ended
September  30, 2001.  There was no such loss for the three and nine months ended
September 30, 2002, as there are no longer any  franchised  stores being managed
by the Company on behalf of franchisees.

     Interest expense increased  $44,000,  to $59,000 for the three months ended
September  30, 2002, as compared to $15,000 for the  comparable  period in 2001,
and  increased by $97,000,  to $157,000 for the nine months ended  September 30,
2002, as compared to $60,000 for the comparable  period in 2001. These increases
were  primarily due to the interest  being paid in  connection  with the related
party debt financing obtained in January 2002 (Note 10), and the amortization of
the discount associated with such financing.


                                       15
<PAGE>


Liquidity and Capital Resources
-------------------------------

     As of September 30, 2002  (exclusive  of net  liabilities  of  discontinued
operations),  the Company had negative working capital of $4,681,000 and cash on
hand of $601,000.  During the nine months ended  September 30, 2002, the Company
used approximately  $1,856,000 of cash in its operating  activities.  This usage
was in line with  management's  plans and was  mainly a result of  approximately
$680,000 of costs  related to the  Company's  store closure plan (Note 6), a net
decrease of $593,000 in accounts payable and accrued liabilities that existed as
of December 31, 2001,  and $271,000  related to the  prepayment of certain other
business  expenses,  offset, in part, by a net decrease of $346,000 in franchise
and other receivables.

     For the nine  months  ended  September  30,  2002,  cash flows  provided by
investing  activities were $918,000,  as compared to $871,000 for the comparable
period in 2001. This increase was principally due to a lower amount of purchases
of property and equipment,  and less franchise notes  receivable being issued in
favor of the Company.

     For the nine  months  ended  September  30,  2002,  cash flows  provided by
financing  activities  were  $334,000,  principally  due  to the  $1,300,000  of
financing the Company received in January 2002 (Note 10), $300,000 of additional
borrowings under the credit facility,  and $300,000 of related party borrowings,
offset  principally  by  the  repayment  of a  portion  of  such  financing  and
$1,050,000 of related party borrowings.

     On  January  23,  2002,   the  Company   secured  two  separate   financing
arrangements, as follows:

     Secured Term Note

     The  Company  entered  into a  secured  term  note for  $1,000,000  with an
independent  financial  institution.  This note is repayable in 24 equal monthly
installments  of $41,666,  and bears interest as defined (4.95% at the inception
of the note, and  subsequently  amended on April 1, 2002 to 3.95%).  The note is
fully collateralized by a $1,000,000  certificate of deposit posted by Horizons,
a related party, at the same financial institution.

     Credit Facility

     The  Company  entered  into an  agreement  with  Horizons to borrow up to a
maximum of  $1,000,000.  This credit  facility  bears interest at the prime rate
plus 1% (5.5% as of the date of the loan  agreement),  provided  for an  initial
advance of $300,000,  requires minimum incremental advances of $150,000, matures
on January 22, 2004, requires ratable monthly principal and interest payments of
each  borrowing,  is amortizable  through the maturity date of the facility,  is
fully  collateralized  by a  pledge  of  certain  of  the  Company's  qualifying
franchise  notes,  and  requires  the payment of a facility fee of 2% per annum,
payable monthly, on the unused portion of the credit facility.

     Simultaneous  with  obtaining  the  above  financing,  the  Company  repaid
outstanding  related  party  borrowings  due to Horizons and  Broadway  totaling
$750,000,  plus interest.  On August 8, 2002, the Company obtained an additional
advance under the credit  facility of $300,000,  the proceeds of which were used
to repay an outstanding related party borrowing (Note 8). As of the date hereof,
$517,000 remained available to the Company under the credit facility.

     Based  on  its  current  financial  position,  the  Company  may  not  have
sufficient  liquidity available to continue in operation for the next 12 months.
However,  the  Company  plans to  continue  to attempt to improve its cash flows
during the remainder of 2002,  and into 2003, by improving  store  profitability
through   increased   monitoring   of   store-by-store    operations,    closing
non-profitable  Company-owned stores,  implementing reductions of administrative
overhead expenses where necessary and feasible,  actively supporting development
programs  for  franchisees,  and adding  new  franchised  stores to the  system.
Management  believes that with the  successful  execution of the  aforementioned
plans to attempt to improve cash flows,  its existing  cash,  the  collection of
outstanding  receivables,  the  availability  under its existing credit facility
(Note 10), and the  successful  completion of its  shareholder  rights  offering
(Note 9),  there  will be  sufficient  liquidity  available  for the  Company to
continue in operation for the next 12 months. However, there can be no assurance
that the Company will be able to successfully execute the aforementioned  plans,
or that it will be successful in completing its rights offering.


                                       16
<PAGE>


Item 3.  Quantitative and Qualitative Disclosures about Market Risk
         ----------------------------------------------------------

     The Company  presently has  outstanding  certain  equity  instruments  with
beneficial  conversion terms.  Accordingly,  the Company,  in the future,  could
incur non-cash charges to equity (as a result of the exercise of such beneficial
conversion  terms),  which  would  have a  negative  impact on future  per share
calculations.

     The Company is exposed to market risks from  potential  changes in interest
rates as they relate to the Company's  investments  in highly liquid  marketable
securities and borrowings  under its credit  facility and term loan. The Company
believes  that  the  level  of risk  related  to its  investments  and any  such
borrowings,  is not material to the Company's  financial condition or results of
operations.  The  Company  does not expect to use  interest  rate swaps or other
instruments to hedge its borrowings under its credit facility or term loan.


Item 4.  Controls and Procedures
         -----------------------

a)       Evaluation of Disclosure Controls and Procedures

     Based  on  their  evaluation  of  the  Company's  disclosure  controls  and
procedures  as of a date  within  90 days of the  filing  of  this  Report,  the
Co-Chief  Operating Officers (one of which is also the Company's Chief Financial
Officer) have concluded that such controls and procedures are effective.

b)       Changes in Internal Controls

     There were no significant changes in the Company's internal controls, or in
other factors,  that could significantly  affect such controls subsequent to the
date of their evaluation.











                                       17

<PAGE>


                           PART II - OTHER INFORMATION


Item 1.  Legal Proceedings
         -----------------

     In April 2000, the Company  commenced an action in the Supreme Court of the
State of New Jersey against  Preit-Rubin,  Inc. and Cumberland Mall  Associates,
the landlord of the former  Sterling  Optical Store located in Cumberland  Mall,
Vineland,  New Jersey,  seeking damages of approximately $200,000 as a result of
the defendants  alleged wrongful eviction of the Company from this location.  In
response  thereto,  the  defendants  asserted   counterclaims  of  approximately
$100,000  plus legal fees based upon the Company's  alleged  breach of the lease
pursuant to which it occupied  such store.  Thereafter,  the  defendant  filed a
motion for summary judgment seeking a dismissal of the Company's  claims,  which
motion was  decided by the Court,  in a favor of the  defendant.  As of the date
hereof,  it is  anticipated  that a trial  of this  action  will  take  place in
approximately 120 days.

     On October 29, 2002,  an action was  commenced  against the Company and its
wholly owned subsidiary,  Sterling Vision of Eastland,  Inc. (the "Tenant"),  in
the North Carolina General Court of Justice,  in which Charlotte  Eastland Mall,
LLC, as the Landlord of the Tenant's former  Sterling  Optical Center located in
Charlotte,  North Carolina, is seeking,  among other things, damages against the
Company, in the approximate amount of $81,000, under its Limited Guaranty of the
Tenant's  obligations under the Lease for such Center. The Company believes that
it has a meritorious defense to such action. As of the date hereof, the Tenant's
and the Company's time to answer the complaint has not yet expired.


Item 2. Changes in Securities and Use of Proceeds
        -----------------------------------------

     On January 23, 2002, the Company issued warrants to Horizons to purchase an
aggregate of 2,500,000  shares of its Common Stock at an exercise price of $0.01
per share,  in  consideration  for providing the Company  access to a $1,000,000
credit facility and for  guaranteeing a $1,000,000 term note made by the Company
in favor of an independent financial institution.  On May 1, 2002, July 22, 2002
and October 22, 2002,  respectively,  Horizons exercised 2,000,000,  250,000 and
250,000 of such warrants,  and shares of the Company's  Common Stock were issued
in their place. The issuance of all of the aforementioned  securities was exempt
from  registration  requirements  pursuant to an exemption under Section 4(2) of
the Securities Act of 1933, as amended.


Item 3. Defaults Upon Senior Securities
        -------------------------------

Not applicable.


Item 4. Submission of Matters to a Vote of Security Holders
        ---------------------------------------------------

Not applicable.


Item 5. Other Information
        -----------------

Not applicable.


Item 6. Exhibits and Reports on Form 8-K
        --------------------------------

A.    Exhibits

     99.1 Certifications of Principal Executive Officers and Principal Financial
Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

B.    Reports on Form 8-K

     On August 12, 2002,  the Company  filed a Report on Form 8-K  regarding the
appointment of Miller Ellin & Company LLP as its independent public accountants.



                                       18
<PAGE>



                                   SIGNATURES


     Pursuant to the  requirements  of the  Securities  Exchange Act of 1934, as
amended,  the  Registrant has duly caused this Report to be signed on its behalf
by the undersigned hereunto duly authorized.


                                               EMERGING VISION, INC.
                                                    (Registrant)



                                         BY:  /s/ Christopher G. Payan
                                             -----------------------------
                                             Christopher G. Payan
                                             Senior Vice President,
                                             Chief Financial Officer and
                                             Co-Chief Operating Officer
                                             (Principal Financial and
                                             Accounting Officer)


                                         Dated: November 14, 2002





                                       19
<PAGE>


I, Christopher G. Payan, certify that:

     1. I have reviewed this quarterly  report on Form 10-Q of Emerging  Vision,
Inc.;

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

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

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

     c)  presented  in  this   quarterly   report  our   conclusion   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
quarterly  report  whether or not there  were  significant  changes in  internal
controls or in other factors that could  significantly  affect internal controls
subsequent to the date of our most recent  evaluation,  including any corrective
actions with regard to significant deficiencies and material weaknesses.


Date: November 14, 2002
      -----------------


  /s/ Christopher G. Payan
-------------------------------
Christopher G. Payan
Co-Chief Operating Officer and
Chief Financial Officer



                                       20
<PAGE>


I, Myles S. Lewis, certify that:

     1. I have reviewed this quarterly  report on Form 10-Q of Emerging  Vision,
Inc.;

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

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

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

     c)  presented  in  this   quarterly   report  our   conclusion   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
quarterly  report  whether or not there  were  significant  changes in  internal
controls or in other factors that could  significantly  affect internal controls
subsequent to the date of our most recent  evaluation,  including any corrective
actions with regard to significant deficiencies and material weaknesses.


Date: November 14, 2002
      -----------------


 /s/ Myles S. Lewis
---------------------------
Myles S. Lewis
Co-Chief Operating Officer



                                       21
<PAGE>


I, Samuel Z. Herskowitz, certify that:

     1. I have reviewed this quarterly  report on Form 10-Q of Emerging  Vision,
Inc.;

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

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

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

     c)  presented  in  this   quarterly   report  our   conclusion   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
quarterly  report  whether or not there  were  significant  changes in  internal
controls or in other factors that could  significantly  affect internal controls
subsequent to the date of our most recent  evaluation,  including any corrective
actions with regard to significant deficiencies and material weaknesses.


Date: November 14, 2002
      -----------------


 /s/ Samuel Z. Herskowitz
---------------------------
Samuel Z. Herskowitz
Co-Chief Operating Officer



                                       22

<PAGE>


                                                                    Exhibit 99.1


 Certifications of Principal Executive Officers and Principal Financial Officer
 ------------------------------------------------------------------------------
           Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
           ---------------------------------------------------------



                              (Company Letterhead)



           Certification of Principal Executive and Financial Officer
                           Pursuant to 18 U.S.C. 1350
                 (Section 906 of the Sarbanes-Oxley Act of 2002)



     I,  Christopher G. Payan,  Co-Chief  Operating  Officer and Chief Financial
Officer  (co-principal  executive  officer and principal  financial  officer) of
Emerging  Vision,  Inc.  (the  "Registrant"),  certify  that  to the  best of my
knowledge,  based  upon a review  of the  Quarterly  Report on Form 10-Q for the
period ended September 30, 2002 of the Registrant (the "Report"):

     (1) The Report fully  complies  with the  requirements  of Section 13(a) or
15(d) of the Securities Exchange Act of 1934, as amended; and

     (2)  The  information  contained  in the  Report  fairly  presents,  in all
material  respects,  the  financial  condition  and results of operations of the
Registrant.


      /s/ Christopher G. Payan
---------------------------------
Name:    Christopher G. Payan
Date:    November 14, 2002



                                       1
<PAGE>



                              (Company Letterhead)



                  Certification of Principal Executive Officer
                           Pursuant to 18 U.S.C. 1350
                 (Section 906 of the Sarbanes-Oxley Act of 2002)


     I, Myles S.  Lewis,  Co-Chief  Operating  Officer  (co-principal  executive
officer) of Emerging Vision, Inc. (the  "Registrant"),  certify that to the best
of my knowledge,  based upon a review of the  Quarterly  Report on Form 10-Q for
the period ended September 30, 2002 of the Registrant (the "Report"):

     (1) The Report fully  complies  with the  requirements  of Section 13(a) or
15(d) of the Securities Exchange Act of 1934, as amended; and

     (2)  The  information  contained  in the  Report  fairly  presents,  in all
material  respects,  the  financial  condition  and results of operations of the
Registrant.


      /s/ Myles S. Lewis
-----------------------------
Name:    Myles S. Lewis
Date:    November 14, 2002



                                       2
<PAGE>



                              (Company Letterhead)



                  Certification of Principal Executive Officer
                           Pursuant to 18 U.S.C. 1350
                 (Section 906 of the Sarbanes-Oxley Act of 2002)


     I, Samuel Z. Herskowitz, Co-Chief Operating Officer (co-principal executive
officer) of Emerging Vision, Inc. (the  "Registrant"),  certify that to the best
of my knowledge,  based upon a review of the  Quarterly  Report on Form 10-Q for
the period ended September 30, 2002 of the Registrant (the "Report"):

     (1) The Report fully  complies  with the  requirements  of Section 13(a) or
15(d) of the Securities Exchange Act of 1934, as amended; and

     (2)  The  information  contained  in the  Report  fairly  presents,  in all
material  respects,  the  financial  condition  and results of operations of the
Registrant.


     /s/ Samuel Z. Herskowitz
--------------------------------
Name:    Samuel Z. Herskowitz
Date:    November 14, 2002




                                       3