FORM 10-QSB


                       SECURITIES AND EXCHANGE COMMISSION
                              Washington, DC 20549



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


For the quarterly period ended February 29, 2000

Commission File Number:      1-11140

                           OPHTHALMIC IMAGING SYSTEMS
             (Exact name of registrant as specified in its charter)

      California                                          94-3035367
(State of Incorporation)                       (IRS Employer Identification No.)

                 221 Lathrop Way, Suite I, Sacramento, CA 95815
                    (Address of principal executive offices)

                                 (916) 646-2020
                (Issuer's telephone number, including area code)

Check  whether  the issuer  (1) has filed all  reports  required  to be filed by
Section 13 or 15(d) of the  Exchange  Act during the past 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    XX            No

As of April 14, 2000,  4,305,428  shares of common stock, at no par value,  were
outstanding.

<PAGE>1
                          PART I FINANCIAL INFORMATION


ITEM 1. FINANCIAL STATEMENTS


<PAGE>2

                           Ophthalmic Imaging Systems
                             Condensed Balance Sheet
                                February 29, 2000
                                   (Unaudited)

Assets
Current assets:
      Cash and equivalents                                         $    137,499
      Accounts receivable, net                                          583,170
      Inventories, net                                                  329,653
      Prepaid expenses and other current assets                          36,242
                                                                   ------------
Total current assets                                                  1,086,564
Furniture and equipment, net of accumulated
      depreciation and amortization of $1,062,452                       254,019
Other assets                                                             18,216
                                                                   ============
                                                                   $  1,358,799
                                                                   ============

Liabilities and Stockholders' Equity
Current liabilities:
      Borrowings under line of credit                              $          -
      Borrowings under note payable to, and unsecured
          advances from significant shareholder                       1,882,280
      Accounts payable                                                  687,018
      Accrued liabilities                                             1,281,033
      Accrued warrant appreciation right                                307,329
      Deferred extended warranty revenue                                 88,728
      Customer deposits                                                 536,949
      Capitalized lease obligation and other notes payable                8,939
                                                                   ------------
Total current liabilities                                             4,792,276
Capitalized lease obligation and other notes payable,
      less current portion                                               15,828
Commitments
Stockholders' deficit:
  Preferred stock, without par value, 20,000,000 shares authorized:
    Series A Junior Participating Preferred Stock, without par value,
       100,000 shares authorized; none issued or outstanding                  -
    Series B Preferred Stock, $.01 par value, 2,000 shares
       authorized; 150 issued and outstanding                             3,750
    Common stock, no par value, 20,000,000 shares authorized;
       4,305,428 issued and outstanding                              10,518,854
      Deferred compensation                                             (54,689)
      Accumulated deficit                                           (13,917,220)
                                                                   ------------
Total stockholders' deficit                                          (3,449,305)
                                                                   ============
                                                                   $  1,358,799
                                                                   ============

See accompanying notes.

<PAGE>3

                           Ophthalmic Imaging Systems
                       Condensed Statements of Operations
                                   (Unaudited)


<TABLE>
<CAPTION>

                                                  Three months ended                            Six months ended

                                      February 29, 2000      February 28,1999      February 29, 2000      February 28,1999
                                      -----------------      ----------------      -----------------      ----------------

<S>                                   <C>                    <C>                    <C>                   <C>
Net revenues                          $       2,010,828      $      1,860,053      $       3,020,996      $      3,350,287
Cost of sales                                 1,219,735             1,077,985              1,966,081             2,050,406
                                      -----------------      ----------------      -----------------      ----------------
Gross Profit                                    791,093               782,068              1,054,915             1,299,881
Operating expenses:
    Sales and marketing                         397,684               400,153                946,331               925,540
    General and administrative                  278,274               223,928                525,622               523,792
    Research and development                     74,316               262,999                196,736               470,913
                                      -----------------      ----------------      -----------------      ----------------
         Total operating expenses               750,274               887,080              1,668,689             1,920,245
                                      -----------------      ----------------      -----------------      ----------------
Income (loss) from operations                    40,819              (105,012)              (613,774)             (620,364)
Other expense, net                              (17,864)              (21,926)               (55,635)              (63,936)
                                      -----------------      ----------------      -----------------      ----------------
Net income (loss)                     $          22,955      $       (126,938)     $        (669,409)     $       (684,300)
                                      =================      ================      =================      ================

Shares used in the calculation of basic
    net income (loss) per share               4,305,428             4,155,428              4,263,395             4,155,428
                                      =================      ================      =================      ================
Basic net income (loss) per share     $            0.01      $          (0.03)     $           (0.16)     $          (0.16)
                                      =================      ================      =================      ================
Shares used in the calculation of diluted
    net income (loss) per share               4,427,332             4,155,428              4,263,395             3,906,817
                                      =================      ================      =================      ================
Diluted net income (loss) per share   $            0.01      $          (0.03)     $           (0.16)     $          (0.18)
                                      =================      ================      =================      ================

</TABLE>

See accompanying notes.

<PAGE>4

                           Ophthalmic Imaging Systems
                       Condensed Statements of Cash Flows
                   Increase (Decrease) in Cash and Equivalents
                                   (Unaudited)

<TABLE>
<CAPTION>

                                                                       Six months ended

                                                           February 29, 2000     February 28, 1999
                                                           -----------------     -----------------

<S>                                                       <C>                   <C>
Operating activities:
Net loss                                                   $       (669,409)     $       (684,300)
Adjustments to reconcile net loss to net cash
     used in operating activities:
         Depreciation and amortization                               63,105                66,192
         Stock option compensation expense                           39,444                55,240
         Net increase in current assets other than
             cash and equivalents                                  (108,820)             (185,996)
         Net increase in current liabilities other than
             short-term borrowings                                  873,747               327,067
                                                           ----------------      ----------------
Net cash provided by (used in) operating activities                 198,067              (421,797)
Investing activities:
Purchases of furniture and equipment                                (13,994)               (9,663)
Net increase in other assets                                        (10,831)              (11,277)
                                                           ----------------      ----------------
Net cash used in investing activities                               (24,825)              (20,940)
Financing activities:
Principal payments on notes payable                                      --                  (318)
Net (repayments of) proceeds from borrowings under
     note payable to and unsecured advances from
     significant shareholder                                       (273,750)                9,289
Net proceeds from (repayments of) line-of-credit
     borrowings                                                          --                50,519
Net proceeds from sale of common stock                               56,250                    --
Net proceeds from sale of preferred stock                             3,750                    --
                                                           ----------------      ----------------
Net cash (used in) provided by financing activities                (213,750)               59,490
                                                           ----------------      ----------------
Net decrease in cash and equivalents                                (40,508)             (383,247)
Cash and equivalents at beginning of period                         178,007               514,186
                                                           ----------------      ----------------
Cash and equivalents at end of period                      $        137,499      $        130,939
                                                           ================      ================

Supplemental schedule of noncash financing activities:
Increase in borrowings under note payable to and
     other advances from significant shareholder,
     net of reductions in exchange for inventory           $        685,178      $             --
                                                           ================      ================

</TABLE>


See accompanying notes.

<PAGE>5

                           Ophthalmic Imaging Systems

                     Notes to Condensed Financial Statements

    Three and Six Month Periods ended February 29, 2000 and February 28, 1999

                                   (Unaudited)


Note 1.      Basis of Presentation

             The accompanying  unaudited  condensed balance sheet as of February
             29, 2000,  condensed statements of operations for the three and six
             month periods ended February 29, 2000 and February 28, 1999 and the
             condensed  statements of cash flows for the six month periods ended
             February  29,  2000 and  February  28,  1999 have been  prepared in
             accordance  with  generally  accepted  accounting   principles  for
             interim  financial  information  and with the  instructions to Form
             10-QSB and Item 310(b) of Regulation S-B. Accordingly,  they do not
             include all of the information and footnote disclosures required by
             generally  accepted  accounting  principles for complete  financial
             statements.   It  is  suggested  that  these  condensed   financial
             statements  be read  in  conjunction  with  the  audited  financial
             statements  and notes  thereto  included in the  registrant's  (the
             Company's)  Annual Report for the Fiscal Year Ended August 31, 1999
             on Form 10-KSB/A.  In the opinion of management,  the  accompanying
             condensed financial statements include all adjustments,  consisting
             only  of  normal  recurring  adjustments,   necessary  for  a  fair
             presentation  of the  Company's  financial  position and results of
             operations for the periods presented. The results of operations for
             the period ended February 29, 2000 are not  necessarily  indicative
             of the operating results for the full year.

             Certain  amounts in the fiscal 1999 financial  statements have been
             reclassified  to conform with the  presentation  in the fiscal 2000
             financial statements.

Note 2.      Net Income (Loss) Per Share

             In 1997, the Financial  Accounting Standards Board issued Statement
             of Financial  Accounting  Standards No. 128,  "Earnings per Share".
             Statement 128 replaced the  previously  reported  primary and fully
             diluted  earnings  per share with basic and  diluted  earnings  per
             share.  Unlike primary earnings per share, basic earnings per share
             excludes any dilutive effects of options, warrants, and convertible
             securities.  Diluted  earnings  per  share is very  similar  to the
             previously  reported  fully  diluted  earnings  per share.  All net
             income   (loss)  per  share  amounts  for  all  periods  have  been
             presented,  and  where  necessary,   restated  to  conform  to  the
             Statement 128 requirements.

<PAGE>6

Note 2.      Net Income (Loss) Per Share (continued)

             The following table sets forth the computation of basic and diluted
             income (loss) per share:

<TABLE>
<CAPTION>

                                           Unaudited                              Unaudited
                                       Three Months Ended                      Six Months Ended
                                   February 29,   February 28,        February 29,        February 28,
                                       2000            1999               2000                1999
                                   ------------   ------------        ------------        ------------

<S>                              <C>             <C>                <C>                  <C>
Numerator for basic and
diluted net income (loss)
per share                          $     22,954   $   (126,938)       $   (669,410)       $   (684,300)
                                   ============   ============        ============        ============
Denominator for basic net
income (loss) per share:
  Weighted average shares             4,305,428      4,155,428           4,263,395           4,155,428
Effect of dilutive securities:
  Employee stock options                121,904             --                  --                  --
  Warrants and other                         --             --                  --                  --
                                   ------------   ------------        ------------        ------------
Dilutive potential common shares        121,904             --                  --                  --
                                   ============   ============        ============        ============
Denominator for diluted
net income (loss) per share           4,427,332      4,155,428           4,263,395           4,155,428
                                   ============   ============        ============        ============
Basic net income (loss) per share  $       0.01   $      (0.03)       $      (0.16)       $      (0.16)
                                   ============   ============        ============        ============
Diluted net income (loss)
per share                          $       0.01   $      (0.03)       $      (0.16)       $      (0.16)
                                   ============   ============        ============        ============

</TABLE>


Note 3.      Short-Term Borrowings

             The Company entered into an accounts  receivable  credit  agreement
             (the  "Agreement")  with a bank  (the  "Bank")  in July  1999.  The
             Agreement  allows  for  up to  an  80%  advance  rate  on  eligible
             receivable  balances.  Borrowings are secured by substantially  all
             assets of the Company and bear interest at the Bank's prime lending
             rate plus 10%. The minimum  monthly  amount  charged by the Bank is
             the  greater  of  interest   calculated  in  accordance   with  the
             immediately  preceding sentence or $1,200. The Agreement remains in
             effect  from  year to year  unless  terminated  in  writing  by the
             Company or the Bank. At February 29, 2000, no principal  borrowings
             were outstanding under the Agreement.

Note 4.      Note Payable to Related Party

             On April 30,  1998,  the Company  executed a  promissory  note (the
             "Note") in favor of  Premier  Laser  Systems,  Inc.,  a  California
             corporation  ("Premier").  Under the Note,  borrowings  against the
             Note  were  available  to the  Company  in  the  form  of  periodic
             advances. The maximum principal amount available under the Note was
             $500,000, which principal amount outstanding, together with any and
             all accrued interest, was payable the earlier of (i) written demand
             by  Premier or (ii)  April 30,  1999.  Under the terms of the Note,
             borrowings  bear  interest  at the  rate of 8 1/2% per  annum,  are
             secured by certain of the Company's  assets and are  subordinate to
             borrowings  against the  accounts  receivable  credit line with the

<PAGE>7

             Company's   Bank  (see  Note  3).   Premier  also  has  made  other
             substantial  advances  to the  Company  that are not covered by the
             Note.

             In February 2000, Premier made demand for repayment of gross amount
             of  intercompany  debt  calculated by Premier to be in excess of $2
             million.

             At  February  29,  2000,  the Company  had  recorded  approximately
             $2,086,000 in principal and interest outstanding under the Note and
             other advances, of which approximately $203,500 of accrued interest
             was included in other accrued liabilities.  The principal amount is
             net of, among other things, an offset for inventory  transferred to
             Premier pursuant to a Manufacturing  Agreement entered into between
             the Company and Premier (see Note 5). The  principal  amount is not
             net of a $500,000 termination fee in connection with the terminated
             Stock Purchase  Agreement in 1998 over which there is  disagreement
             between  Premier  and the  Company  as to  whether  the  Company is
             entitled to said  termination fee and whether such  termination fee
             can be used as an offset to the Company's  debt to Premier,  nor is
             it net of other offsets in presently  undetermined amounts to which
             the Company believes it is entitled.

Note 5.      Manufacturing Agreement

             In March 1999, the Company and Premier entered into a manufacturing
             agreement  ("Manufacturing   Agreement")  whereby  Premier  was  to
             manufacture the majority of the Company's products.

             Under the terms of the Manufacturing Agreement, among other things,
             the Company  charged Premier for certain  inventory  transferred to
             Premier and Premier  charged the Company for products  manufactured
             pursuant to the Manufacturing Agreement.

             In February 2000, Premier discontinued  production of the Company's
             products  under the  Manufacturing  Agreement.  Premier has alleged
             that the Company breached the Manufacturing Agreement and therefore
             was entitled to terminate the Manufacturing Agreement and force the
             Company to  purchase  inventory in an amount in excess of $850,000.
             The Company believes that Premier was not entitled to terminate the
             Manufacturing  Agreement  for breach and the claim for  recovery of
             termination damages is therefore not valid and that the Company has
             its own  substantial  claims for breach in  presently  undetermined
             amounts.

Note 6.      Merger Agreement

             On October  21,  1999,  the Company  and  Premier  entered  into an
             agreement  and plan of  reorganization  (the  "Merger  Agreement"),
             whereby,  upon requisite  shareholder approval and the satisfaction
             of  certain  other  preconditions,   the  Company  would  become  a
             wholly-owned subsidiary of Premier.

             In  February  2000,  Premier  notified  the  Company  that  it  was
             considering  seeking protection under the U.S.  Bankruptcy Code and

<PAGE>8

             the Company  thereupon  terminated the Merger Agreement on February
             17, 2000.  In March 2000,  Premier  filed a voluntary  petition for
             protection  and  reorganization   under  Chapter  11  of  the  U.S.
             Bankruptcy Code.

Note 7.      Series B Preferred Stock and Related Agreements

             The  Company  and  Premier  executed  a  Series B  Preferred  Stock
             Purchase Agreement on October 21, 1999 whereby, among other things,
             the  Company  agreed to sell to Premier,  upon the  issuance by the
             Company of shares of its common  stock  pursuant to the exercise of
             stock options,  shares of the Company's Series B Preferred Stock at
             a price of $25 per share with each share  carrying the voting power
             of 1,000 shares of the Company's common stock.

             Also on October 21,  1999,  the  Company,  Premier and three of the
             Company's  outside directors (the "exercising  Directors")  entered
             into a stock  purchase  agreement  (the  "Agreement")  pursuant  to
             which, among other things, the Exercising  Directors each exercised
             options to purchase  50,000  shares of common  stock at an exercise
             price of $0.375 per share  resulting in net proceeds to the Company
             of $56,250.

             The stock  purchased by the Exercising  Directors is restricted and
             subject to  repurchase  by the Company  until the earlier of May 9,
             2000 or the Effective Date of the Company's acquisition by Premier,
             as  defined in the Merger  Agreement  (see Note 6).  Also under the
             terms  of  the  Agreement,  Premier  purchased  150  shares  of the
             Company's  Series B Preferred  Stock at a per share price of $25 in
             exchange for  Premier's  cancellation  of certain of the  Company's
             debt in the aggregate amount of $3,750.  These 150 shares of Series
             B Preferred  Stock are also restricted and subject to repurchase by
             the  Company if the  Company  repurchases  any of the common  stock
             purchased by the Exercising Directors.

             As  a  result  of  the   foregoing   transactions,   Premier   owns
             approximately 49 1/2% of the Company's outstanding common stock and
             all 150  outstanding  shares of the  Company's  Series B  Preferred
             Stock, resulting in sole voting power of approximately 53%.

Note 8.      Ability to Continue as a Going Concern

             The Company has an  accumulated  deficit of $13,917,220 at February
             29, 2000. In addition, current liabilities exceed current assets by
             $3,705,712  as of that  date.  These  factors,  among  others,  may
             indicate  that the  Company  will be unable to  continue as a going
             concern for a reasonable period of time.

             As a consequence of Premier's repayment demands,  together with the
             impact of the termination of the Merger Agreement and Manufacturing
             Agreement,  the Company will likely have  difficulty in meeting its
             near-term cash  requirements,  including  those  resulting from any
             significant demand for its products, without an infusion of capital
             or other improvements in its liquidity position (see Note 4, Note 5

<PAGE>9

             and Note 6). Its ability to continue as a going concern will depend
             upon  its  ability  to  restructure  payment  terms  and/or  obtain
             substantial  new financing to repay its debts and ensure  continued
             supply of  materials  and  services.  To that end,  the  Company is
             exploring alternative sources of funding, including debt financing,
             issuing  equity   securities  and  entering  into  other  financing
             arrangements and/or strategic alliances. While certain parties have
             expressed  interest in these  regards,  to date, the Company has no
             commitment  for outside  funding and no  assurance  that it will be
             able to obtain outside  funding upon terms and conditions  that are
             satisfactory to the Company, if at all.

<PAGE>10


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

    This report contains  forward-looking  statements  within the meaning of the
federal securities laws. The Company intends such forward-looking  statements to
be  covered  by the safe  harbor  provisions  contained  in  Section  27A of the
Securities  Act of 1933,  as amended,  and in Section 21E of the Exchange Act of
1934,  as  amended.  Forward-looking  statements,  which  are  based on  certain
assumptions  and describe  future  plans,  strategies  and  expectations  of the
Company,  are generally  identifiable by use of the words  "believe,"  "expect,"
"intend,"  "anticipate,"  "estimate,"  "project,"  or similar  expressions.  The
Company's  ability to predict  results or the actual  effect of future  plans or
strategies is inherently uncertain.  Factors which could have a material adverse
effect on its operations and future prospects  include,  but are not limited to,
changes in: economic  conditions  generally and the medical  instruments  market
specifically, legislative or regulatory changes affecting OIS, including changes
in healthcare regulation,  the availability of working capital, the introduction
of competing products,  and other risk factors described herein. These risks and
uncertainties,  together  with the other  risks  described  from time to time in
reports  and  documents  filed by OIS  with  the SEC  should  be  considered  in
evaluating  forward-looking  statements, and undue reliance should not be placed
on such statements.  Indeed, it is likely that some of the Company's assumptions
will prove to be incorrect.  The Company's actual results and financial position
will vary from those projected or implied in the forward-looking statements, and
the variances may be material.

Overview

To  date,  the  Company  has  designed,  developed,  manufactured  and  marketed
ophthalmic  digital  imaging  systems and has derived  substantially  all of its
revenues  from the sale of such  products.  The  primary  target  market for the
Company's digital angiography systems has been retinal specialists.

In an effort to expand its role in the  ophthalmic  imaging  field by developing
products  and   applications   targeted  at  the  broader   markets  of  general
ophthalmology and optometry, OIS has applied significant resources over the past
two years to the development of two ocular imaging  devices,  the Digital Fundus
Imager the ("DFI") and the Digital Slit Lamp Imager (the "DSLI").

At the 1998 Annual Meeting of the American Academy of  Ophthalmology  (the "1998
AAO  Meeting")  held during the first  quarter of fiscal 1999,  the DFI received
considerable   interest  and  the  Company  has  received  significant  purchase
commitments for that product.

The Company,  however,  has had limited  financial and operational  resources to
meet the demand resulting from the introduction of this product. In that regard,
during  the  third  quarter  of  fiscal  1999,  the  Company  entered  into  the
Manufacturing   Agreement  with  Premier  Laser   Systems,   Inc.  a  California
corporation ("Premier"),  whereby Premier began assembling and manufacturing the
Company's products, including the DFI and DSLI.

In  addition,  the  Company  agreed  with  Premier on  co-marketing  and selling
arrangements  whereby,  among other things:  (a) the Company would distribute in

<PAGE>11

the United  States and Canada  certain of  Premier's  EyeSys  products;  and (b)
Premier  would  distribute  the  Company's  products  in  certain  international
markets. In anticipation of these arrangements, the Company and Premier had been
selling their ophthalmic products through a jointly managed EyeSys Vision Group,
which made its debut at the American Society of Cataract and Refractive  Surgery
meeting in April 1999.

The  Company  entered  into these  arrangements  in  anticipation  of the Merger
Agreement,   discussed  in  further  detail  below,   and  consummation  of  the
transactions  contemplated  thereby.  As a consequence of the termination of the
Merger  Agreement in February 2000 and Premier's filing for protection under the
U.S. Bankruptcy Code in March 2000 and the related furlough of the preponderance
of its workforce,  the  co-marketing  and selling  arrangements are no longer in
effect and Premier has discontinued  producing the Company's  products under the
Manufacturing Agreement. The Company has resumed manufacture and assembly of its
products in its facilities in Sacramento,  California but has incurred increased
costs and significant delays in production and product deliveries as a result of
these failed arrangements.

The Company's results of operations have historically fluctuated from quarter to
quarter and from year to year and management  anticipates that such fluctuations
will continue in the future.  The Company has experienced  operating  losses for
each fiscal  year since its initial  public  offering in 1992.  At February  29,
2000,  the Company had an  accumulated  deficit in excess of $13 million and its
current  liabilities  exceeded its current  assets by more than $3 million.  The
Company continues to experience cash flow deficits and there can be no assurance
that the Company will be able to achieve or sustain  significant  positive  cash
flows, revenues or profitability in the future.

On February 25,  1998,  the Company and Premier  entered  into a Stock  Purchase
Agreement (the "Stock Purchase  Agreement"),  whereby Premier would offer to buy
those shares of the  Company's  common stock not already  owned by it. In August
1998, however,  Premier notified that Company that, due to a variety of factors,
Premier would not be able to close the transactions contemplated under the Stock
Purchase  Agreement  and the Company  thereupon  terminated  the Stock  Purchase
Agreement.  As a result of such termination,  the Company made demand to Premier
for payment of a $500,000  termination fee as provided for in the Stock Purchase
Agreement.  The demand was not pursued at the time because of a revival of plans
for merger of the companies.

On October 21, 1999, the Company and Premier  entered into an Agreement and Plan
of Reorganization (the "Merger Agreement") whereby,  upon requisite  shareholder
approval, the Company would have become a wholly-owned subsidiary of Premier.

Also on October  21,  1999,  the  Company  and  Premier  entered  into two stock
purchase  agreements  with  respect to the  Company's  Series B Preferred  Stock
whereby,  among other  things,  Premier  purchased  150 shares of the  Company's
Series B  Preferred  Stock with each share  carrying  the voting  power of 1,000
shares of the Company's  common  stock,  at a per share price of $25 in exchange
for Premier's  cancellation  of certain of the  Company's  debt in the aggregate
amount of $3,750.

<PAGE>12

In February 2000,  Premier notified the Company that it was considering  seeking
protection under the U.S.  Bankruptcy Code and the Company thereupon  terminated
the Merger  Agreement  on February  17,  2000.  In March 2000,  Premier  filed a
voluntary  petition for  protection and  reorganization  under Chapter 11 of the
U.S. Bankruptcy Code.

As a result of the foregoing transactions, Premier currently owns 49 1/2% of the
Company's  outstanding  common  stock  and all  150  outstanding  shares  of the
Company's  Series B Preferred  Stock,  thereby  giving Premier  majority  voting
control.

By letter dated February 17, 2000,  Premier made demand for the repayment by the
Company of certain  intercompany  debt allegedly owed to Premier,  which Premier
claims  exceeds $2 million.  Premier also alleged that the Company  breached the
Manufacturing   Agreement   and   therefore   was  entitled  to  terminate   the
Manufacturing Agreement and force the Company to purchase inventory in an amount
in excess of  $850,000.  The Company  believes  that Premier was not entitled to
terminate the  Manufacturing  Agreement for breach and the claim for recovery of
termination  damages is  therefore  not valid and that the  Company  has its own
substantial claims for breach in presently undetermined amounts.

The Company is actively exploring alternative sources of funding, including debt
financing,   issuing  equity   securities  and  entering  into  other  financing
arrangements  and/or strategic  alliances.  While certain parties have expressed
interest in these  regards,  to date,  the Company has no commitment for outside
funding and no  assurance  that it will be able to obtain  outside  funding upon
terms and conditions that are satisfactory to the Company, if at all.

The Company's results of operations have historically fluctuated from quarter to
quarter due to a number of factors  and are not  necessarily  indicative  of the
results to be expected  for any future  period or  expected  for the fiscal year
ending  August  31,  2000.  There can be no  assurance  that  revenue  growth or
profitability can be achieved or sustained in the future.

The  following  discussion  should  be read in  conjunction  with the  unaudited
interim financial statements and the notes thereto which are set forth elsewhere
in this Report on Form  10-QSB.  In the  opinion of  management,  the  unaudited
interim period financial statements include all adjustments, all of which are of
a normal  recurring  nature,  that are necessary for a fair  presentation of the
results of the periods.

Results of Operations

The Company  generated net income of $22,954,  or $.01 per share, for the second
quarter of fiscal 2000 as compared to incurring a net loss of $126,938,  or $.03
per share,  for the second  quarter of fiscal 1999.  The Company  incurred a net
loss of $669,410,  or $.16 per share,  for the first six months of 2000 versus a
net loss of $684,300,  or $.16 per share per share, for the comparable period of
1999.  The per share  figures are basic  amounts in  accordance  with  Financial
Accounting  Standards  No.  128  (see  Note 2 of Notes  to  Condensed  Financial
Statements included in Item 1 of this Form 10-QSB).

<PAGE>13

The  1999  figures  reflect  the  negative  impact  attributable  to  continuing
diversion of the Company's  resources and management's  attention to acquisition
matters during the period. The results of operations for the first six months of
2000 figures  reflect the adverse  impact on revenues and  corporate  operations
resulting from delays in delivery of the Company's products  associated with the
outsourcing of the manufacture and assembly of the Company's products during the
period under the Manufacturing  Agreement with Premier. In addition, the Company
has  incurred  higher than normal  costs and  professional  fees and expenses in
connection  the  contemplated  transactions  with  Premier,  while  diverting  a
significant  amount of the Company's  resources and  management's  attention and
selling efforts away from the Company's core operations during this period.

The results of operations do not include any amounts with respect to a potential
contingent  liability in connection  with the collection of sales taxes from the
Company's  customers,  which amount has been  estimated on the basis of numerous
factors and assumptions  that might, in the least favorable  combination,  reach
$1.4 million.  Management believes that the probability of such an assessment is
remote  and  accordingly,   has  not  recorded  a  liability  in  its  financial
statements.  However,  there can be no  assurance  that the  amount  that  might
ultimately  be  assessed  for prior  periods  would not  materially  affect  the
Company's results of operations or cash flows in any given reporting period.

The  results of  operations  also do not include  any  amounts  with  respect to
Premier's  allegation  that  the  Company  is in  breach  of  the  Manufacturing
Agreement and therefore  owes to Premier an amount in excess of $850,000 for the
purchase  of certain  inventory.  The  Company  believes  that  Premier  was not
entitled to terminate the  Manufacturing  Agreement for breach and the claim for
recovery of termination damages is therefore not valid, and accordingly, has not
recorded a  liability  in its  financial  statements.  However,  there can be no
assurance that the amount of termination  damages,  if any, would not materially
affect the  Company's  results of  operations or cash flows in any given period.
Subsequent  to the claim, the Company  has  purchased  and would be  willing  to
continue to purchase  inventory  from  Premier as and when needed to meet future
production schedules.

The  Company's  revenues for the second  quarter of fiscal 2000 were  $2,010,828
representing an increase of approximately 8% from revenues of $1,860,053 for the
second quarter of fiscal 1999.  Revenues for the first six months of fiscal 2000
were $3,020,996,  representing a decrease of approximately  10% from revenues of
$3,350,287 for the comparable  period of fiscal 1999. The reduced revenue levels
during the first six months of fiscal 2000 resulted,  in large part, from delays
in delivery of the Company's  products  associated  with the  outsourcing of the
manufacture  and assembly of the Company's  products during the period under the
Manufacturing  Agreement with Premier. In addition,  this reduction reflects, to
some extent,  the adverse impact of  management's  efforts being directed to the
negotiation of the Merger Agreement with Premier during the period and less time
devoted to the generation of sales.  Lastly,  the fiscal 2000 six-month  revenue
levels were  negatively  affected by the  allocation  of the  Company's  selling
resources away from its core WinStation products.  Substantial selling resources
were allocated  during the period to EyeSys  products in support of co-marketing
and  co-selling  arrangements  with  Premier as well as the  Company's  low-cost
digital  imaging systems  incorporating  its recently  developed  ocular imaging
devices,  the DFI and the DSLI.  These low-cost  digital  imaging  products were
introduced  at the 1998 AAO Meeting and the  Company  has  received  significant
purchase  commitments  for these  products.  While the Company  made its initial
commercial  deliveries  of these  products  during the fourth  quarter of fiscal
1999,  revenues  from  the  sales  of  these  units  to  date  have  been  below
management's  initial  expectations  for a variety of reasons,  including  those

<PAGE>14

noted  above  as  well  as  certain  delays   inherent  in  the  launch  of  new
technology-based  products.  While,  as a result of the  foregoing,  the Company
currently has a significant backlog of orders, the Company has noted a reduction
in its new order bookings  following the termination of the Merger Agreement and
Premier's subsequent filing for bankruptcy protection.  In addition,  certain of
the Company's sales,  marketing and executive management personnel have recently
resigned their  positions,  which could further  adversely  impact the Company's
ability to generate new order  bookings in the future.  Certain of the executive
management  personnel are  currently  working  with,  and  providing  consulting
services for, the Company as independent contractors.  The Company's Chairman of
the Board of Directors is presently  acting as the Company's  President until it
is able to recruit and hire new management pending the results of its efforts to
secure additional funding.  Reference is made to the Company's Form 8-K filed on
March 17, 2000 summarizing the executive management resignations.

Gross margins were  approximately  39% during the second  quarter ended February
29, 2000 versus  approximately  42% for the comparable  quarter of 1999. For the
six-month period ended February 29, 2000, gross margins were  approximately  35%
as compared to approximately 39% during the comparable period of 1999. The lower
gross margin  percentages  during the fiscal 2000 second  quarter and  six-month
periods are due in large measure to product and other direct costs  comprising a
higher percentage of revenues during the periods as compared with the comparable
periods of fiscal  1999.  The Company has  expended  considerable  resources  in
connection with the outsourcing  arrangements under the Manufacturing  Agreement
and has  experienced  delays in the timely  delivery of certain of its  products
during the  transition  period,  both of which  have  adversely  impacted  gross
margins.  Premier has recently  discontinued  producing the  Company's  products
under the  Manufacturing  Agreement and the Company has resumed  manufacture and
assembly of its products in its  facilities in  Sacramento,  California.  During
this transition period,  delays in delivering  products,  if significant,  would
adversely impact the Company.

Sales and  marketing  and  general and  administrative  expenses  accounted  for
approximately  34% of total  revenues  during the second  quarter of both fiscal
2000 fiscal  1999.  For the first six months of fiscal 2000 and fiscal 1999 such
expenses  accounted  for  approximately  49% and 43% of total  revenues  for the
respective   six-month  periods,   with  the  increased   percentage   resulting
principally  as a function of the reduced  revenue  levels  during the six-month
period of 2000.  Expense levels  increased to $675,958 during the second quarter
of 2000 versus  $624,081  during the second  quarter of 1999.  For the first six
months of 2000,  expense levels  increased to $1,471,953 from $1,449,332  during
the comparable period of 1999. As previously noted, certain sales, marketing and
executive  management  personnel have recently  resigned their positions and the
Company's ability to recruit and hire new management is largely dependent on the
results of its efforts to secure additional funding.

Research and development  expenses decreased by approximately 72% to $74,316, or
approximately 4% of revenues in the second quarter of fiscal 2000 from $262,999,
or  approximately  14% of revenues in the second quarter of fiscal 1999. For the
first six months of fiscal 2000, such expenses accounted for approximately 7% of
total revenues as compared to approximately  14% during the comparable period of

<PAGE>15

1999.  While  the  Company  intends  to  continue  to  focus  its  research  and
development  efforts on its new digital image capture products and reducing cost
configurations for its current products, the extent and focus of future research
and development  efforts will be extremely limited and depend, in large measure,
on the Company's ability to secure additional funding.

Other  expense  was  $17,864  during the second  quarter of fiscal  2000  versus
$21,926 during the same period of 1999. For the six-month periods, other expense
was  $55,635 and $63,936 in fiscal  2000 and fiscal  1999,  respectively.  Other
expense in both years was comprised  principally of interest expense  associated
with  borrowings  and other advances from Premier,  as well as borrowings  under
credit  facilities  with the  Company's  bank.  The fiscal  2000  expenses  were
partially offset by an insurance claim settlement during the second quarter.

Liquidity and Capital Resources

The Company's operating  activities  generated cash of $198,067 in the first six
months  of  fiscal  2000 and used cash of  $421,797  in the first six  months of
fiscal 1999. The cash generated from  operations  during the first six months of
fiscal 2000 was  principally  from  increased  liability in connection  with the
Manufacturing Agreement with Premier, increases in customer deposits,  increased
accounts payable and collection of accounts receivable,  which amounts more than
offset cash  expended  to fund the net loss during the period.  The cash used in
operations during the first six months of 1999 was expended  principally to fund
the net loss during the period. This amount was partially offset by increases in
customer  deposits and increases in accrued  liabilities,  including accrued but
unpaid interest  associated with borrowings from Premier (see Note 4 of Notes to
Condensed Financial Statements included in Item 1 of this Form 10-QSB).

Cash used in  investing  activities  was $24,825  during the first six months of
2000 as  compared  to $20,940  during the same  period for 1999.  The  Company's
primary  investing  activities  consist of  equipment  and other  capital  asset
acquisitions.   The  Company  does  not  currently  have  any  pending  material
commitments for capital  expenditures  and the Company has deferred  significant
capital acquisition decisions pending improved cash flow.

The Company used cash for financing  activities of $213,750 during the first six
months of fiscal 2000 as compared to generating  cash of $59,490 during the same
period of fiscal 1999. The cash generated from financing  activities  during the
first six months of fiscal 2000  resulted  from the exercise of stock options by
the Exercising Directors during the period as well as the purchase by Premier of
shares of the Company's Series B Preferred  Stock.  These amounts only partially
offset  amounts paid to Premier  during the second  quarter in  connection  with
inventory purchases under the Manufacturing  Agreement.  The source of cash from
financing  activities  during the 1999  period  was  principally  proceeds  from
increased  borrowings  under the credit facility with Imperial Bank (the "Bank")
and, to a lesser extent,  an increase in the amount of borrowings under the note
payable to and other advances by Premier.

<PAGE>16

As  discussed in further  detail in Note 3 of the Notes to  Condensed  Financial
Statements included in Item 1 of this Form 10-QSB, on July 13, 1999, the Company
entered into an accounts  receivable  credit agreement (the "Credit  Agreement")
with the Bank.  There were no outstanding  borrowings under the Credit Agreement
at February 29, 2000.

Additionally, as discussed further in Note 4 of the Notes to Condensed Financial
Statements  included  in Item 1 of this  Form  10-KSB,  on April 30,  1998,  the
Company executed a promissory note in favor of Premier (the "Premier Note"). The
Company has borrowed the maximum  principal  amount of $500,000  available under
the Premier Note, which principal amount outstanding,  together with any and all
accrued interest,  was payable the earlier of written demand by Premier or April
30, 1999.  Under the terms of the Premier Note,  borrowings bear interest at the
rate of 8 1/2% per annum, are secured by certain of the Company's assets and are
subordinate to borrowings under the Credit Agreement with the Bank. Premier also
has made other  substantial  advances to the Company  that are not  specifically
covered by the Premier  Note.  At February  29,  2000,  the Company had recorded
approximately $2.1 million of indebtedness to Premier,  including  principal and
interest  outstanding  under the  Premier  Note and other  advances,  as well as
charges and credits pursuant to the terms of the  Manufacturing  Agreement.  The
amount  is  not  net  of a  $500,000  termination  fee in  connection  with  the
terminated  Stock  Purchase  Agreement in 1998 over which there is  disagreement
between  Premier  and the  Company as to whether the Company is entitled to said
termination fee and whether such termination fee can be used as an offset to the
Company's debt to Premier, nor is it net of certain other offsets in a presently
undetermined  amount to which the  Company  believes it is  entitled.  By letter
dated  February  17,  2000,  Premier  made  demand  for the  repayment  of gross
intercompany  debt allegedly owed to Premier in an amount  calculated by Premier
to be in excess of $2 million.  Premier also  alleged that the Company  breached
the Manufacturing Agreement and therefore owes Premier in excess of $850,000 for
the purchase of certain  inventory.  The Company  believes  that Premier was not
entitled to terminate the  Manufacturing  Agreement for breach and the claim for
recovery of termination  damages is therefore not valid and that the Company has
its own substantial claims for breach in presently undetermined amounts.

At February 29, 2000,  the Company's  cash and cash  equivalents  were $137,499.
Premier's repayment demand notwithstanding, the Company's existing cash balances
together  with ongoing  collections  of its accounts  receivable  and  available
borrowing  capacity  under the Credit  Agreement  will likely not be adequate to
meet its  other  liquidity  and  capital  requirements  in the  immediate  term.
Substantial  delays in the delivery of the  Company's  products  would result in
reduced  anticipated  cash flow from sales of such products as well as potential
increased costs  associated  therewith.  Additionally,  such delays could prompt
customers to request return  deposits which would further  adversely  impact the
Company's  cash  position.  Further,  demand for  payment by the Bank of amounts
claimed pursuant to a stock appreciation right granted to the Bank in connection
with a Credit  Agreement  could also result in the immediate need for additional
cash. At February 29, 2000,  the Company had accrued  approximately  $307,000 in
contingent liability under the stock appreciation right.

As a consequence of Premier's repayment demands, together with the impact of the
termination of the Merger  Agreement and  Manufacturing  Agreement,  the Company
will  likely  have  difficulty  in  meeting  its  near-term  cash  requirements,
including those resulting from any significant demand for its products,  without

<PAGE>17

an infusion of capital or other improvements in its liquidity position (see Note
4, Note 5 and Note 6 of the Notes to Consolidated  Financial Statements included
in Item 1 of this Form 10-QSB).  Its ability to continue as a going concern will
depend upon its ability to restructure  payment terms and/or obtain  substantial
new  financing to repay its debts and ensure  continued  supply of materials and
services.  To that end, the Company is exploring alternative sources of funding,
including  debt  financing,  issuing  equity  securities and entering into other
financing  arrangements and/or strategic  alliances.  While certain parties have
expressed interest in these regards,  to date, the Company has no commitment for
outside  funding and no assurance that it will be able to obtain outside funding
upon terms and conditions that are satisfactory to the Company, if at all.

<PAGE>18

                            PART II OTHER INFORMATION

ITEM 1.   LEGAL PROCEEDINGS
          None.

ITEM 2.   CHANGES IN  SECURITIES

          On October 18, 1999, the Company filed with the  California  Secretary
          of State a certificate of  determination  establishing  the rights and
          privileges  of the  Company's  convertible  Series B Preferred  Stock.
          Reference is made to the Company's Form 8-K filed on November 24, 1999
          summarizing those rights and privileges.

          On October 21,  1999,  the  Company  and  Premier  executed a Series B
          Preferred Stock Purchase  Agreement  whereby,  among other things, the
          Company agreed to sell to Premier, upon the issuance by the Company of
          shares of its common stock  pursuant to the exercise of stock options,
          shares of the Company's Series B Preferred Stock at a price of $25 per
          share with each share carrying the voting power of 1,000 shares of the
          Company's common stock.

          Also on  October  21,  1999,  the  Company,  Premier  and three of the
          Company's outside directors (the "exercising  Directors") entered into
          a stock purchase agreement (the "Agreement")  pursuant to which, among
          other things,  the  Exercising  Directors  each  exercised  options to
          purchase  50,000 shares of common stock at an exercise price of $0.375
          per share resulting in net proceeds to the Company of $56,250.

          The stock  purchased by the  Exercising  Directors is  restricted  and
          subject to  repurchase by the Company until the earlier of May 9, 2000
          or the Effective  date of the  Company's  acquisition  by Premier,  as
          defined in the Merger  Agreement (see Note 6). Also under the terms of
          the Agreement,  Premier purchased 150 shares of the Company's Series B
          Preferred  Stock at a per share price of $25 in exchange for Premier's
          cancellation of certain of the Company's debt in the aggregate  amount
          of  $3,750.  These 150  shares of  Series B  Preferred  Stock are also
          restricted  and  subject to  repurchase  by the Company if the Company
          repurchases  any of  the  common  stock  purchased  by the  Exercising
          Directors.

          As a result of the foregoing transactions,  Premier owns approximately
          49  1/2%  of the  Company's  outstanding  common  stock  and  all  150
          outstanding   shares  of  the  Company's  Series  B  Preferred  Stock,
          resulting in sole voting power of approximately 53%.

          The sale of Series B Preferred  Stock to Premier was exempt  under the
          federal  securities  laws by virtue of  Regulation  D.  Premier  was a
          corporation  with  total  assets in excess  of $5  million,  the total

<PAGE>19

          purchase  price was of the  transaction  was less than $1 million  and
          there was no general solicitation with respect to the transaction.

ITEM 3.   DEFAULTS UPON SENIOR SECURITIES
          As indicated in Note 4 of the Notes to Condensed Financial Statements,
          and  addressed   further  in  the  Liquidity  and  Capital   Resources
          discussion  of Item 2 of  Part I of this  report,  the  Company  is in
          default of its principal and interest  payment  obligations  under the
          Note with Premier.

          In addition,  the Company  also has recorded  liability to Premier for
          other advances made to the Company by Premier.

          The aggregate  amount recorded as liability at February 29, 2000 under
          the Note and other  advances,  including  principal and interest,  was
          approximately  $2,086,000,  which  amount  was net of  certain  offset
          charges pursuant to the terms of the Manufacturing Agreement described
          in Note 5 of the Notes to Condensed Financial Statements.  This amount
          is not  net of a  $500,000  termination  fee in  connection  with  the
          terminated  Stock  Purchase  Agreement  in 1998  over  which  there is
          disagreement between Premier and the Company as to whether the Company
          is entitled to said  termination fee and whether such  termination fee
          can be used as an offset to the Company's  debt to Premier,  nor is it
          net of other  offsets in an  undetermined  amount to which the Company
          believes it is entitled.

          By letter  dated  February  17,  2000,  Premier  made  demand  for the
          repayment of gross intercompany debt allegedly owed to Premier,  which
          Premier  claims  exceeds $2 million.  Premier  also  alleged  that the
          Company is in breach of the Manufacturing Agreement and therefore owes
          Premier in excess of $850,000 for the purchase of certain inventory.

ITEM 4.   SUBMISSION OF MATTERS TO A VOTE OF SECURITIES
          None.

ITEM 5.   OTHER INFORMATION
          None.

ITEM 6.   EXHIBITS AND REPORTS ON FORM 8-K

          (a)  The exhibits listed on the  accompanying  Index to Exhibits below
               are filed as a part hereof and are  incorporated  by reference as
               noted.  (b) On March 17, 2000,  Issuer filed a Form 8-K to report
               (a)  the   resignation   on   January   29,   2000  of   Issuer's
               President/Chief   Executive  Officer;   (b)  the  resignation  on
               February 14, 2000 of Issuer's Chief Financial  Officer/Secretary;
               (c) the termination on February 17, 2000 of the Merger Agreement;
               and (d) the receipt by Issuer of letter  dated  February 17, 2000
               in which  Premier  made a demand for the  repayment  by Issuer of

<PAGE>20

               certain  intercompany  debt  allegedly  owed to Premier  and also
               alleging that Issuer is in breach of the Manufacturing Agreement.

<PAGE>21


                                   SIGNATURES

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

                                         OPHTHALMIC IMAGING SYSTEMS
                                                (Registrant)


                                  By:     /s/  WALT WILLIAMS
                                        -----------------------------------
                                        Walt Williams
                                        Chief Executive Officer


Dated:  April 14, 2000


<PAGE>22


                                INDEX TO EXHIBITS

<TABLE>
<CAPTION>

Exhibit                                                                           Footnote
Number                          Description of Exhibit                            Reference
-------                         ----------------------                            ----------

<S>  <C>                                                                        <C>
2.1  Stock  Purchase  Agreement,  dated as of  February  25,  1998,  by and          (13)
     between OIS and Premier.

2.2  Agreement and Plan of Reorganization By and Among Premier,  Ophthalmic          (18)
     Acquisition Corporation and OIS, dated as of October 21, 1999.

2.3  Series B Preferred  Stock Purchase  Agreement  dated as of October 21,          (19)
     1999 by and among OIS and Premier.

2.4  Agreement dated as of October 21, 1999 by and among OIS, Premier, Walt          (20)
     Williams, Daniel S. Durrie and Randall C. Fowler.

3.1  Articles of Incorporation of OIS, as amended.                                    *

3.2  Amendment to Articles of Incorporation  (Certificate of Determination           (11)
     of Preferences of Series A Junior Participating Preferred Stock of OIS).

3.3  Amendment to Articles of Incorporation  (Certificate of Determination           (21)
     of Preferences of Series B Preferred Stock of OIS).

3.4  Amended Bylaws of OIS.                                                           *

3.5  Amendment to Amended Bylaws of OIS dated January 28, 1998.                      (16)

4.1  Specimen of Stock Certificate.                                                  *

4.2  Rights  Agreement,  dated as of  December  31,  1997,  between OIS and          (10)
     American Securities  Transfer,  Inc.,  including form of Rights Certificate
     attached thereto.

4.3  Amendment to Rights Agreement,  dated as of February 25, 1998, between          (14)
     OIS and American Securities Transfer, Inc.

4.4  Second  Amendment  to Rights  Agreement,  effective  as of October 20,          (22)
     1999, between OIS and American Securities Transfer, Inc.

10.1 Lease Agreement,  dated as of July 10, 1987,  between OIS (as tenant)  and      *
     Transamerica/Emkay  Income  Properties  I, as amended on July 23,  1990 and
     June 11, 1991.

10.2 Seventh Amendment to Lease Agreement, effective as of July 18, 1996.            (7)

<PAGE>23

10.3 Confidentiality Agreement, dated March 27, 1992 between OIS and  Steven R.      *
     Verdooner.

10.4 Assignment  dated  October  23,  1990  of  U.S.  Patent  Application  for       *
     Apparatus and Method for Topographical Analysis of the Retina to the Issuer
     by Steven R. Verdooner,  Patricia C. Meade and Dennis J. Makes (as recorded
     on Reel 5490,  Frame 423 in the  Assignment  Branch of the U.S.  Patent and
     Trademark Office).

10.5 Form of International  Distribution Agreement used by OIS and sample  form      *
     of End User Software License Agreement.

10.6 Original Equipment Manufacturer  Agreement,  dated April 1, 1991,  between      *
     the Issuer and SONY Medical Electronics,  a division of SONY Corporation of
     America.

10.7 Original Equipment Manufacturer/Value Added Reseller Agreement, dated  May      *
     7, 1991, between the Issuer and Eastman Kodak Company.

10.8 The  Company's  1992  Nonstatutory  Stock  Option Plan and sample form of       *
     Nonstatutory Stock Option Agreement.

10.9 Cross-Indemnification  Agreement,  dated February 14, 1991,  among  Dennis      *
     Makes, Steven Verdooner and Richard Wullaert.

10.10 Key Man Life  Insurance  Policies in the amount of $1,000,000 for each  of      *
      Dennis J. Makes  and  Steven R.  Verdooner,  with the  Issuer as the named
      beneficiary.

10.11 Stock Option Plan.                                                             (1)

10.12 Rental Agreement  dated  May 1, 1994 by and  between  the  Issuer  and         (2)
      Robert J. Rossetti.

10.13 Security and Loan Agreement  (with Credit Terms and  Conditions)  dated        (3)
      April 12, 1995 by and between the Issuer and Imperial Bank.

10.14 General  Security  Agreement  dated  April 12,  1995 by and between the        (3)
      Issuer and Imperial Bank.

10.15 Warrant  dated  November 1, 1995 issued by the Issuer to Imperial  Bank        (4)
      to purchase 67,500 shares of common stock.

10.16 Amended Loan and Security  Agreement (with Credit Terms and Conditions)        (4)
      dated November 1, 1995.

10.17 Registration  Rights  Agreement  dated  November  1, 1995  between  the        (4)
      Issuer and Imperial Bank.

<PAGE>24

10.18 Amended Loan and Security  Agreement (with Credit Terms and Conditions)        (6)
      dated April 4, 1996.

10.19 Amended Loan and Security  Agreement (with Credit Terms and  Conditions)       (7)
      dated July 12, 1996.

10.20 Amended Loan and Security  Agreement (with Credit Terms and Conditions)        (7)
      dated November 21, 1996.

10.21 Amended Loan and Security  Agreement (with Credit Terms and Conditions)        (8)
      dated June 3, 1997.

10.22 Amended Loan and Security Agreement (with Credit Terms and  Conditions)        (9)
      dated August 28, 1997.

10.23 Amended Loan and Security  Agreement (with Credit Terms and Conditions)        (9)
      dated October 24, 1997.

10.24 Amended Loan and Security  Agreement (with Credit Terms and Conditions)        (9)
      dated November 3, 1997.

10.25 Amended Loan and Security  Agreement (with Credit Terms and Conditions)        (9)
      dated November 21, 1997.

10.26 Agreement of Purchase of Receivable (Full Recourse) dated November 18,         (9)
      1997 between the Issuer and Imperial Bank.

10.27 Agreement  of Purchase of  Receivable  dated July 13, 1999 between the         (23)
      Issuer and Imperial Bank.

10.28 Employment  Agreement  dated  November  20, 1995 between the Issuer and        (4)
      Steven R. Verdooner.

10.29 Amendment dated effective July 14, 1997 to Employment  Agreement dated         (16)
      November 20, 1995 between the Issuer and Steven R. Verdooner.

10.30 The Company's  1995  Nonstatutory  Stock Option Plan and sample form of        (5)
      Nonstatutory Stock Option Agreement.

10.31 The Company's 1997  Nonstatutory  Stock Option Plan and sample form of         (12)
      Nonstatutory Stock Option Agreement.

10.32 Promissory  Note dated April 30, 1998 from the Issuer to Premier Laser         (15)
      Systems, Inc.  in the  maximum  amount  of  $500,000  due in full upon the
      earlier of (i) written demand by Premier or (ii) April 30, 1999.

10.33 Security  Agreement dated April 30, 1998 by and between the Issuer and         (15)
      Premier Laser Systems, Inc.

<PAGE>25

10.34 Form of  Indemnification  Agreement between the Issuer and each of its         (16)
      directors, officers and certain key employees.

10.35 Manufacturing  Agreement  dated  March 7, 1999  between the Issuer and         (17)
      Premier Laser Systems, Inc.

27   Financial Data Schedule (for SEC use only).                                     (23)

</TABLE>


*    Incorporated by reference to the Company's  Registration  Statement on Form
     S-18, number 33-46864-LA.

(1)  Incorporated by reference to the Company's Annual Report on Form 10-KSB for
     the fiscal year ended August 31, 1993, filed on November 26, 1993.

(2)  Incorporated by reference to the Company's Annual Report on Form 10-KSB for
     the fiscal year ended August 31, 1994, filed on November 29, 1994.

(3)  Incorporated by reference to the Company's  Quarterly Report on Form 10-QSB
     for the quarterly period ended May 31, 1995, filed on July 14, 1995.

(4)  Incorporated by reference to the Company's Annual Report on Form 10-KSB for
     the fiscal year ended August 31, 1995, filed on November 29, 1995.

(5)  Incorporated by reference to the Company's  Registration  Statement on Form
     S-8, filed on May 28, 1996, number 333-0461.

(6)  Incorporated by reference to the Company's  Quarterly Report on Form 10-QSB
     for the quarterly period ended May 31, 1996, filed on July 15, 1996.

(7)  Incorporated by reference to the Company's Annual Report on Form 10-KSB for
     the fiscal year ended August 31, 1996, filed on November 29, 1996.

(8)  Incorporated by reference to the Company's  Quarterly Report on Form 10-QSB
     for the quarterly period ended May 31, 1997, filed on July 15, 1997.

(9)  Incorporated by reference to the Company's Annual Report on Form 10-KSB for
     the fiscal year ended August 31, 1997, filed on December 1, 1997.

(10) Incorporated  by reference to Exhibit 1 of the Company's Form 8-K, filed on
     January 2, 1998.

(11) Incorporated  by reference to Exhibit A of Exhibit 1 of the Company's  Form
     8-K, filed on January 2, 1998.

<PAGE>26


(12) Incorporated by reference to the Company's  Quarterly Report on Form 10-QSB
     for the  quarterly  period ended  November  30, 1997,  filed on January 14,
     1998.

(13) Incorporated  by reference to Exhibit 2.1 of the Company's  Form 8-K, filed
     on March 9, 1998.

(14) Incorporated  by reference to Exhibit 4.1 of the Company's  Form 8-K, filed
     on March 9, 1998.

(15) Incorporated by reference to the Company's  Quarterly Report on Form 10-QSB
     for the quarterly period ended May 31, 1998, filed on July 15, 1998.

(16) Incorporated by reference to the Company's Annual Report on Form 10-KSB for
     the fiscal year ended August 31, 1998, filed on December 15, 1998.

(17) Incorporated by reference to the Company's  Quarterly Report on Form 10-QSB
     for the quarterly period ended February 28, 1999, filed on April 14, 1999.

(18) Incorporated  by reference to Exhibit 2.1 of the Company's  Form 8-K, filed
     on November 24, 1999.

(19) Incorporated  by reference to Exhibit 4.2 of the Company's  Form 8-K, filed
     on November 24, 1999.

(20) Incorporated  by reference to Exhibit 4.3 of the Company's  Form 8-K, filed
     on November 24, 1999.

(21) Incorporated  by reference to Exhibit 3.1 of the Company's  Form 8-K, filed
     on November 24, 1999.

(22) Incorporated  by reference to Exhibit 4.1 of the Company's  Form 8-K, filed
     on November 24, 1999.

(23) Incorporated by reference to the Company's Annual Report on Form 10-KSB for
     the fiscal year ended August 31, 1999, filed on November 29, 1999.