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

                                   FORM 10-KSB

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

                 For the fiscal year ended -- December 31, 2001

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

            For the transition period from ___________ to ___________

                       Commission file number 33-33042-NY


                            CORONADO INDUSTRIES, INC.
                 ----------------------------------------------
                 (Name of small business issuer in its charter)

          Nevada                                         22-3161629
-------------------------------             ------------------------------------
(State or other jurisdiction of             (I.R.S. Employer Identification No.)
Incorporation or organization)

  16929 E. Enterprise Drive, Suite 202, Fountain Hills, AZ           85268
--------------------------------------------------------------     ---------
(Address of principal executive offices) (as of date of filing)    (Zip Code)

                    Issuer's telephone number (480) 837-6810

       Securities registered under Section 12(b) of the Exchange Act: None

       Securities registered under Section 12(g) of the Exchange Act: None

Check  whether the issuer (1) 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 [X]  No [ ]

Check if disclosure  of delinquent  filers in response to Item 405 of Regulation
S-B is not contained in this form, and no disclosure  will be contained,  to the
best of Registrant's  knowledge,  in definitive proxy or information  statements
incorporated  by reference  in Part III of this Form 10-KSB or any  amendment to
this Form 10-KSB. [X]

State issuer's revenues for its most recent fiscal year. $0

State the aggregate market value of the voting and non-voting common equity held
by  non-affiliates  computed by  reference to the average bid and asked price of
such common equity, as of a specific date within the past 60 days. $9,986,161 as
of March 25, 2002

State the number of shares  outstanding  of issuer's  common  equity,  as of the
latest practicable date. 68,769,336 as of March 19, 2002

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<PAGE>
                            CORONADO INDUSTRIES, INC.

                                   FORM 10-KSB

                   FOR THE FISCAL YEAR ENDED DECEMBER 31, 2001

                                                                            Page
                                                                            ----
PART I
        Item 1.  Business Development.....................................     2

        Item 2.  Description of Property..................................     9

        Item 3.  Legal Proceedings........................................     9

        Item 4.  Submission of Matters to a Vote of Security Holders......     9

PART II
        Item 5.  Market for Registrant's Common Equity and Related
                  Stockholders Matters....................................    10

        Item 6.  Management's Discussion and Analysis or Plan of
                  Operation...............................................    12

        Item 7.  Financial Statements.....................................    14

        Item 8.  Changes In and Disagreement with Accountants on
                  Accounting and Financial disclosure.....................    14

PART III
        Item 9.  Directors, Executive Officers, Promoters and Control
                  Persons' Compliance with Section 16(a) of the
                  Exchange Act............................................    15

        Item 10. Executive Compensation...................................    16

        Item 11. Security Ownership of Certain Beneficial Owners
                  and Management..........................................    19

        Item 12. Certain Relationships and Related Transactions...........    20

PART IV
        Item 13. Exhibits, Financial Statements, Schedules and Reports
                  on Form 8-K.............................................    20

SIGNATURES................................................................    21

SUPPLEMENTAL INFORMATION AND EXHIBITS.....................................    22

                                       1
<PAGE>
                                     PART I

                   SPECIAL NOTE ON FORWARD-LOOKING STATEMENTS

         Except for  historical  information  contained  herein,  this  document
contains  forward-looking  statements.  Such forward-looking  statements involve
risks  and  uncertainties  and  include,  but are  not  limited  to,  statements
regarding  future  events  and the  Registrant's  plans  and  expectations.  The
Registrant's actual results may differ materially from such statements. Although
the Registrant  believes that the  assumptions  underlying  the  forward-looking
statements herein are reasonable,  any of the assumptions could prove inaccurate
and, therefore,  there can be no assurance that the results contemplated in such
forward-looking  statements  will be  realized.  In  addition,  the business and
operations of the Registrant are subject to substantial risks which increase the
uncertainties  inherent  in the  forward-looking  statements  included  in  this
document.  The  inclusion  of such  forward-looking  information  should  not be
regarded as a  representation  by the  Registrant  or any other  person that the
future events,  plans or  expectations  contemplated  by the Registrant  will be
achieved.

ITEM 1(A). BUSINESS DEVELOPMENT. INITIAL PUBLIC OFFERING

     The Registrant was  incorporated  under the name First Lloyd Funding,  Inc.
pursuant  to the  laws of the  State  of New  York on  December  21,  1989.  The
effective  date of the  Registrant's  public  offering was March 13,  1990.  The
Offering  closed  on  May  1,  1990.  For  further  information  concerning  the
Registration Statement,  see File No. 33-33042-NY at the Securities and Exchange
Commission's  Regional  Office  in New York City or at its  principal  office in
Washington,  D.C. In January 1997,  the New York  corporation at that time named
Coronado  Industries,  Inc.  merged into and became a Nevada  corporation of the
same name.

OPHTHALMIC INTERNATIONAL, L.L.C. AND AMERICAN GLAUCOMA, INC.

     After a series of immaterial  acquisitions  and spin-offs  from May 1990 to
September  1996,  on  November  5,  1996 the  Registrant  entered  into an Asset
Purchase Agreement with Ophthalmic  International,  L.L.C.  ("OI"), and American
Glaucoma,  a joint venture ("AG"), which provided for the purchase of the assets
of OI and AG in exchange for 15,592,224 shares of the Registrant's  common stock
(85%) to be issued to the Registrant's  current three  Directors.  An additional
855,000 shares were issued as finders fees to twelve  entities and  individuals.
The assets of OI transferred  to the Registrant  were a patent pending and other
proprietary  information concerning equipment and a process for the treatment of
open angle  glaucoma.  The assets of AG transferred  to the Registrant  were the
concept and a business plan for forty glaucoma  treatment  centers in the United
States.

                                        2
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ITEM 1(B). BUSINESS OF ISSUER

OVERVIEW

     The  Registrant  is a  holding  company  and all  business  operations  are
conducted through its two wholly-owned subsidiaries. The Registrant, through its
Ophthalmic International,  Inc. subsidiary,  manufactures and markets a fixation
device  with a  patented  designed  suction  ring  that  treats  Open  Angle and
Pigmentary  glaucoma.  American Glaucoma,  Inc. ("AGI"),  the Registrant's other
subsidiary,  operated a glaucoma  treatment  center in Scottsdale,  Arizona from
September 1997 to March 1999.

     In the United  States,  glaucoma is the second  leading  cause of blindness
affecting  approximately  3,000,000 persons.  Of those, about 60,000 are legally
blind. If detected and treated early,  glaucoma need not cause blindness or even
severe vision loss. While there is no cure for glaucoma, the Registrant believes
that its  patented  device  and  process  provide  an  effective  treatment  for
afflicted persons and that a significant global market for its patented process,
equipment and rings currently exists.

     Glaucoma  may  have  many  forms  which  cause  or  present  a  feature  of
progressive  damage to the optic  nerve due to  increased  pressure  within  the
eyeball. As the optic nerve  deteriorates,  blind spots and patterns develop. If
left untreated,  the result may be total  blindness.  The space between the lens
and the cornea in the eye is filled with a fluid called the aqueous humor.  This
fluid  circulates  from behind the colored portion of the eye (the iris) through
the opening at the center of the eye (pupil) and into the space between the iris
and cornea.  The aqueous  humor is  produced  constantly,  so it must be drained
constantly.  The drain is at the point where the iris and cornea meet,  known as
the drainage angle,  which directs fluid into a channel  (Schlemm's  canal) that
then leads it to a system of small  veins  outside  the eye.  When the  drainage
angle does not function properly,  the fluid cannot drain and pressure builds up
within  the eye.  Pressure  also is exerted  on  another  fluid in the eye,  the
vitreous  humor  behind  the lens,  which in turn  presses on the  retina.  This
pressure affects the fibers of the optic nerve, slowly damaging them. The result
over time is a loss of vision.

THE FIXATION DEVICE

     After four years of ongoing studies  involving Dr. John T. LiVecchi,  M.D.,
F.A.C.S.,  Assistant Clinical Professor of Ophthalmology,  Allegheny  University
and Dr. Guillermo Avolos, Professor of Ophthalmology, University of Guadalajara,
Mexico,   it  was  determined   that  a  2  minute   treatment  with  Ophthalmic
International's  "vacuum  fixation  device and  patented  design  suction  ring"
temporarily  reduced  inter-ocular  pressure ("I.O.P.") in the treatment of Open
angle  Glaucoma by  approximately  6 Hg for an average of three  months at which
time the treatment  can be repeated  with no serious side  effects.  This I.O.P.
lowering  is  achieved  when the  external  suction  device is applied  over the
perilimbal  area for a  specified  time.  With  this  treatment  the  Registrant
believes that there are no harmful side effects,  like those associated with eye
drop treatments. In addition, the patent entitled "Open Angle Glaucoma Treatment
Apparatus and Method" has been approved and is believed to allow the  Registrant
to achieve a significant market advantage over competitors.

                                       3
<PAGE>
     The first clinical study of the Registrant's product (the "PNT device") was
conducted  on 86  patients  over an 8 month  period  in  1992 by Dr.  Avolos  in
Guadalajara,  Mexico. The second clinical study of the Registrant's  product was
conducted on 250 patients  over a two-year  period  ending in 1996 by Dr. Avolos
and Dr. LiVecchi.  The Registrant  initiated a third study in September 1997 was
conducted by Dr. Leo Bores, the Medical Director of the Registrant's  Scottsdale
treatment center. This third study involved approximately 150 patients.

     The Registrant views the gross losses incurred at its Scottsdale  treatment
center from September 1997 through March 2, 1999 (approximately $563,000) as the
major  expense of preparing  the clinical  studies which may be required for FDA
product approval.

     In recent years,  Dr. John  LiVecchi,  a Registrant  Director,  and Dr. Leo
Bores, a consultant, have been asked to address to different medical conventions
of  ophthalmologists concerning  the  results of the  studies of
Registrant's  procedure  and  equipment.  These  presentations  to the  ultimate
end-users  of  Registrant's  products  serve to educate the  industry  about the
Registrant's products and their efficacy.

     On October 21, 2000  Registrant  executed a one year option  agreement with
CIBA Vision AG, a Swiss corporation doing business from Atlanta,  Georgia ("Ciba
Vision").  This agreement permits Ciba Vision to obtain the exclusive  worldwide
license to the patent rights and technology for Registrant's  PNT product.  Ciba
Vision will conduct a study, at its cost, of Registrant's  PNT product in Europe
in  accordance  with the study  protocol  previously  agreed to by the  parties.
Registrant  will have access to all European  clinical  study  results and it is
anticipated Dr. Leo Bores,  Registrant's  medical director,  will participate in
the  initial  patient  procedures  in  Europe.  Ciba  Vision  will  also  assist
Registrant in its  discussion  with the FDA in order to lead to the  expeditious
approval in the United  States of PNT as a first line therapy for the  treatment
of  glaucoma.  Registrant  and Ciba  Vision are  required by this  agreement  to
negotiate  in good  faith the  exclusive  license  agreement  during  the option
period. In October 2001 Registrant executed an extension of the option agreement
through  May  2002.  In  September  2001  Ciba  Vision   commenced  a  study  of
Registrant's  PNT device in Italy.  This  Italian  study was  completed in March
2002.  During  the  review  of  the  patient  results  in  this  Italian  study,
Registrant's  PNT device  performed as well as or better than it had in previous
patient trials. Registrant is hopefull a license agreement will be executed with
Ciba Vision in 2002;  however, at this time there is no assurance any definitive
license agreement with Ciba Vision will ever be executed by Registrant.

                                        4
<PAGE>
     The Registrant's  vacuum equipment is composed of special order parts, such
as the molded case,  display board,  circuit boards,  and motors,  all for which
Registrant  has  established  manufacturing  relationships  with  manufacturers.
Registrant's subsidiary,  Ophthalmic  International,  Inc., assembles the vacuum
fixation  device at its  offices in  Fountain  Hills,  Arizona.  At such time as
Registrant executes an agreement with a major worldwide distributor,  Registrant
may also sell the manufacturing  rights to the same company.  The Registrant has
contracted  for the  manufacture  of the  patented  rings with a medical  device
manufacturer located in California.

     Registrant  has received a CE mark for its PNT product and has been advised
that its manufacturing  facility could be prepared to receive ISO 9000 clearance
in as little as six weeks. Therefore,  the Registrant believes its manufacturing
facility is prepared to move forward with European  distribution  of its product
as soon as a distributor is located.

TREATMENT CENTERS

     Registrant's subsidiary, American Glaucoma, Inc., opened its first glaucoma
treatment  center in  Scottsdale,  Arizona in  September  1997.  During 1998 the
Registrant's   Scottsdale  Center  generated  approximately  $293,000  of  gross
revenues  and a net loss from  operations  of  $220,000,  before  allocation  of
management  overhead.  The Registrant closed the Scottsdale  treatment center on
March 2, 1999.

GOVERNMENTAL REGULATION

     No medical  device may be sold or  distributed in the United States without
FDA approval or an exemption  from such  approval.  The FDA has the authority to
enjoin the manufacture and sale of a medical device, to seize such device and to
levy fines against a  manufacturer  or seller of a medical  device which has not
been registered or approved for sale in the United States.  A device which needs
FDA approval is considered a Class III device,  unless a similar  product with a
similar  intended  use has  previously  been  granted FDA  approval (a "Class II
Device") or the FDA has listed the product as generally safe and not needing FDA
approval  (a "Class I  Device").  The process for having the FDA remove a device
from  the  Class  III  category  to a Class  II  category  is  called  a  510(k)
application.

     The Registrant submitted a 510(k) premarket  notification to the FDA on its
PNT product in August of 1998. The FDA rejected this  notification in October of
1998,  on the basis that the  Registrant's  PNT  product  was not  substantially
equivalent  to other  products  currently  on the market and  intended  to lower
intraocular  pressure.  The  Registrant  met with the FDA in February of 1999 to
discuss the concerns  expressed  by the agency with  respect to the  substantial
equivalence  and safety of the PNT product.  The Registrant made a submission to
the FDA in April 1999 that was  intended  to provide  the agency  with  detailed
information addressing many of the concerns expressed by the FDA at the February
1999  meeting.  This  submission  did not  satisfy  the FDA with  respect to the
patient risk associated with the clinical use of the PNT product.

                                       5
<PAGE>
     In February  1999,  the FDA  requested  more  information  be  submitted on
patients  treated  to date with the PNT  product.  In  September  1999,  the FDA
demanded  Registrant  submit a new  clinical  protocol  for  additional  patient
studies.  In October 2000  Registrant  negotiated a protocol  with the FDA which
provides for an additional  six-month study of a minimum of 204 patients (with a
two-year  follow-up)  from 5 different  study  sites.  Registrant  continues  in
negotiation  with the FDA  concerning  various  features of the protocol and the
study,  such as the length of the study and the number of patients,  in hopes of
expediting FDA approval.  However,  there can be no assurance  Registrant's  PNT
products will ever receive FDA approval for sale in the United States.

     A Class III device may be approved for sale and  distribution in the United
States by the FDA pursuant to a Premarket Approval  Application ("PMA"). The FDA
approves  PMAs  after a review  of the  clinical  trials  information  contained
therein  demonstrating  that the device is safe and  effective  for its  labeled
indications.  In addition,  the FDA will inspect the facilities where the device
is manufactured  prior to approving a PMA. The Registrant has not discussed with
the FDA the type and quantity of clinical  and  manufacturing  information  that
might be required to secure PMA  approval  for its PNT  product,  because of the
Registrant's continuing belief that the product is more suitably reviewed by the
FDA in a 510(k) premarket notification, rather than a PMA.

     Clinical data to support either a 510(k)  premarket  notification  or a PMA
must be collected pursuant to the FDA's Investigational Device Exemption ("IDE")
regulation  The IDE  regulation  describes  two  types  of  device  studies:  1)
significant risk and 2) nonsignificant  risk studies.  The principal  difference
from a  regulatory  point  of view  between  the two  types of  studies  is that
significant  risk  studies  must be reviewed and approved by both the FDA and an
Institutional  Review  Board  ("IRB")  before  they  may  be  initiated,   while
nonsignificant  risk studies require only IRB review and approval prior to study
initiation.  The  Registrant  believes  that its  studies of its PNT product are
nonsignificant  risk in nature.  The Registrant  therefore has conducted several
clinical  studies of the PNT product after receiving IRB approval in 1994, 1996,
and 1998 from three different IRBs. The  approximately  170 patients  treated at
the  Registrant's  Scottsdale  treatment  center  since  1997  were  treated  in
accordance  with the clinical  protocols  that received IRB approval in 1994 and
1998,  while the future  treatment  of patients at the  Registrant's  Clearwater
center will be in  accordance  with the  clinical  protocol  that  received  IRB
approval in 1998. To date, no negative  adverse  reactions have been reported in
connection  with the use of the PNT device on glaucoma  patients  for any of the
studies conducted. However, as of March 3, 2000, the FDA is maintaining that the
PNT  product  presents  "significant  risk" to  patients  and is  requiring  the
additional patient study proceed under "significant risk" criteria.

     Under the IDE regulation,  a sponsor of a clinical study may charge for the
investigational  device,  provided  that the price  charged for the device is no
larger  than  that  necessary  to  recover  costs  of   manufacture,   research,
development,  and handling  associated with the device.  The IDE regulation does
not  prohibit or limit  charges for medical or  laboratory  services.  It is the
Registrant's  position that  approximately  $1,000,000 of net losses incurred by
the Registrant in connection  with its Scottsdale  treatment  center and certain
past management salaries are properly recoverable under the IDE regulation,  and
the Registrant  therefore  intends to impose a charge on the distribution of PNT
product to clinical investigators who purchase the PNT product and enroll in its
IDE studies which are consistent with the IDE regulation.

                                       6
<PAGE>
     The  manufacturer  of a medical  device which is to be  distributed  in the
United  States must be  inspected  and  licensed by the FDA.  The company  which
currently  manufactures  the  Registrants's  suction ring and the company  which
sterilizes and packages this ring are licensed as medical  device  manufacturers
by the FDA. The Registrant's facility was inspected and licensed by the FDA as a
manufacturer of the  predecessor  fixation device product and the PNT product in
1996.

     No medical  device may be  advertised  for sale in the United States with a
false or misleading label or  advertisement.  The fixation device which preceded
the PNT  product  device was  advertised,  used and sold as a device for certain
types of invasive  eye  surgeries.  Therefore,  that product was labeled as only
being used for eye surgery,  and not the treatment of glaucoma.  The labeling of
the Registrant's PNT product as a glaucoma  treatment device or a device for the
lowering of inter-ocular  pressure of glaucoma  patients must be approved by the
FDA (or the product must be exempt from FDA  registration  as a Class I or Class
II  device),  for the  Registrant  to  advertise  and sell its PNT  device  as a
glaucoma treatment product.

PATENT

     On February 11, 1997 the U.S. Patents and Trademarks Office issued a patent
to Ophthalmic  International,  L.L.C., Patent Number 5,601,548, for the process,
equipment  and the  procedure  which has been  licensed to the  Registrant.  The
Registrant believes, without assurance, that this patent provides the Registrant
with a  substantial  competitive  advantage  over  current  and future  glaucoma
treatment  competitors.  The  Registrant  is not aware of any other patent being
granted for glaucoma treatment.  The granting of a patent to the Registrant does
not assure that the FDA will ever  approve the  commercial  distribution  of the
Registrant's PNT product in the U.S.

     The Registrant  intends to follow a policy of aggressively  pursuing claims
of infringement on its patent and the Registrant does not believe its patent, or
product or services infringe on the rights of any other person.

COMPETITION

     The  medical  device and service  industries  are highly  competitive.  The
Registrant's   patented  device  and  treatment  process  are  and  will  be  in
competition  with  established  and future  glaucoma  treatment  procedures  and
products. The following table sets forth the type and names of the most commonly
recommended  prescription glaucoma  medications,  the approximate monthly retail
cost of such  medications,  and the side effects of each type of  medication  as
published by The American  Academy of  Ophthalmology.  Since  Medicare  does not
currently reimburse patients for the cost of these prescription  medications but
has paid for the PNT procedure,  the Registrant believes a substantial number of
the  glaucoma  patients  in the U.S.  would  benefit  economically  from the PNT
procedure to the extent their prescription medication could be reduced.

                                        7
<PAGE>
        Medication               Monthly Cost        Side Effects
        ----------               ------------        ------------
BETA BLOCKERS                                  Congestive Heart Failure
        Timolol                     $21.00     Bronchospasm
        Levobunolol                 $42.00     Bradycardia
        Carleolol                   $36.00     Depression, confusion
        Betaxolol                   $65.00     Worsening of myasthenia gravis

ADRENERGIC AGONISTS                            Increased blood pressure,
        Alphagan                    $50.00     Tachyarrythmia
        Dipivefrin                  $33.00     Tremor, Headache,
        Apracionidine               $41.00     Anxiety, Burning on Instillation,
                                               Conjunctival Injection, Pupullary
                                               dilation, Allergic Reactions
CHOLINERGIC AGONISTS
        Pilocarpine                 $25.00     Increased bronchial secretion
        Carbochol                   $26.00     Nausea
        Echothiophate iodide        $31.00     Vomiting, Diarrhea, Apnea,
                                               Increased myopia, Eye or brow
                                               pain, Decreased vision

ORAL CARBONIC ANHYDRASE INHIBITORS             Malaise, anorexia, depression,
                                               parashesias
        Acetazolamide               $33.00     Serum electrolyte abnormalities
        Methazolamide               $19.00     Renal calculi, Blood dyscrsias

EMPLOYEES

     In addition to its two officers, the Registrant has engaged four persons as
full-time  consultants  at the  corporate  headquarters  and  an  administrative
employee.  The  Registrant  anticipates  hiring  additional  administrative  and
marketing personnel upon receipt of additional funding.

                                       8
<PAGE>
ITEM 2. DESCRIPTION OF PROPERTY.

     During calendar year 1999, the  Registrant's  offices were located at 16929
E. Enterprise Drive,  Suite 202,  Fountain Hills, AZ 85268,  where Registrant is
currently  leasing  approximately  1,600 square feet of space from a third party
landlord.  Registrant  is  paying  approximately  $1,000  per  month,  including
utilities,  in rent for this  space on a  five-year  lease.  In June  1998,  the
Registrant  entered into a  month-to-month  lease for 1,800 square feet of space
adjacent to its original space in Fountain  Hills,  Arizona,  for  approximately
$1,400 per month rent, including utilities. This combined space will be adequate
for the Registrant's  needs throughout its initial  manufacturing  stages,  when
commenced.

ITEM 3. LEGAL PROCEEDINGS.

     In February 2000,  Registrant  was served with a demand for  arbitration in
San Diego, California by a former public relations firm of Registrant. This firm
claimed a monetary  debt of  approximately  $19,000 and the  issuance of 300,000
shares of Registrant's common stock.  Registrant did not deny the monetary debt,
but claimed the written  agreement  with this public  relations firm included no
provision for the issuance of  Registrant's  stock.  An arbitration  hearing was
held on October 2, 2000 and on October 18,  2000 the  arbitrator  announced  his
decision  against the  Registrant  for claims of $22,243  and 300,000  shares of
common stock,  with the cash award to accrue annual interest of 7% from March 7,
2000. In November 2000 Registrant  appealed the  arbitrator's  award to Superior
Court of Orange County,  California.  A hearing was held on January 19, 2001 and
the arbitrator's  award was upheld. In June 2001 Registrant  settled this matter
by the payment of $30,000 and the issuance of 300,000 shares to the claimant.

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

     During  calendar  year  2001 no  matters  were  submitted  to a vote of the
Registrant's security holders.

                                       9
<PAGE>
                                     PART II

ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS.

     MARKET  INFORMATION  The principal  U.S.  market in which the  Registrant's
common shares (all of which are one class,  $.001 par value) were traded was the
over-the-counter  bulletin board market. The aforesaid securities are not traded
or  quoted on any  automated  quotation  system.  Such  over-the-counter  market
quotations  reflect  inter-dealer  prices  without  retail  markup,  markdown or
commission and may not necessarily represent actual transactions.  The following
table  shows the low and the high bid  reported  by the  NASDAQ  Bulletin  Board
System in 2000 and 2001, by fiscal quarter, and through March 18, 2002.

                                                    Low              High
                                                    ---              ----

         January 1, 2001 - March 31, 2001          $0.171            $0.201
         April 1, 2001 - June 30, 2001             $0.19             $0.39
         July 1, 2001 - September 30, 2001         $0.095            $0.33
         October 1, 2001 - December 31, 2001       $0.17             $0.50

         January 1, 2000 - March 31, 2000          $0.20             $4.06
         April 1, 2000 - June 30, 2000             $0.84             $2.09
         July 1, 2000 - September 30, 2000         $0.895            $1.97
         October 1, 2000 - December 31, 2000       $0.25             $1.53

         January 1, 2002 - March 11, 2002          $0.15             $0.37

     Registrant's  common  stock is also traded on the  Frankfurt  and  Hamburg,
Germany  exchanges.  Registrant will attempt to have its common stock listed for
trading on the NASDAQ  National  Market System or the NASDAQ Small Cap System at
such time as its stock price becomes stabilized at the appropriate price - $5.00
and $4.00 per share, respectively.

     RECENT SALES OF RESTRICTED SECURITIES.  In January 2001 two of Registrant's
consultants  exercised  stock options by each paying $6,750 for 50,000 shares of
restricted common stock. Registrant believes these transactions were exempt from
registration  pursuant to Section  4(2) under the  Securities  Act of 1933.  All
other securities sold by Registrant were registered on Form S-8 or were reported
previously in a quarterly filing by Registrant.

     HOLDERS.  The  Registrant has  approximately  617  stockholders  of record,
including nominee firms for securities dealers.

     DIVIDENDS.  The  Registrant has not paid or declared any dividends upon its
common shares since its inception and, by reason of its present financial status
and its contemplated financial  requirements,  does not intend to pay or declare
any dividends upon its common shares within the foreseeable future.

COMMON STOCK

     The  authorized  capital stock of the  Registrant  consists of  100,000,000
shares of common stock,  par value $0.001 per share. As of March 19, 2002, there
were 68,769,336 shares of common stock issued and outstanding. Holders of common
stock are  entitled  to one vote for each share held on each  matter to be acted
upon by  stockholders  of the  Registrant.  Stockholders  do not have preemptive
rights or the right to cumulate votes for the election of directors.  Shares are
not subject to redemption nor to any liability for further calls.  All shares of
common stock issued and outstanding  are entitled to receive such dividends,  if
any, as may be declared by the Board of Directors in its discretion out of funds
legally  available  for  that  purpose,  and  to  participate  pro  rata  in any
distribution of the Registrant's assets upon liquidation or dissolution.

                                       10
<PAGE>
     In the event of liquidation or  dissolution of the  Registrant,  all assets
available for distribution after satisfaction of all debts and other liabilities
and after  payment or provision  for any  liquidation  preference  on any issued
Preferred Stock are distributable among the holders of the common stock.

     The transfer agent for the Registrant's common stock is Olde Monmouth Stock
Transfer Co., Inc., 77 Memorial  Parkway,  Suite 101,  Atlantic  Highlands,  New
Jersey 07716.

PREFERRED STOCK

     The Registrant is authorized to issue 3,000,000  shares of Preferred Stock,
par value $.0001 per share,  of which no shares were issued and  outstanding  at
the date of this  Prospectus.  The Preferred Stock shares shall have the rights,
limitations and obligations  which the Board of Directors shall determine at the
time the Preferred Stock is issued.  The Registrant has no present  intention of
issuing any Preferred Stock in the foreseeable future.

                                       11
<PAGE>
ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION.

YEAR ENDING DECEMBER 31, 2001

OPERATIONS.  For the year ending December 31, 2001 Registrant  experienced a net
loss  of  $1,779,787,   which  was  comprised   primarily  of  its  general  and
administrative  expenses  incurred at the  corporate  level of  $1,625,447.  The
Registrant  had a net loss from  operations  of  $1,625,447  for the year ending
December 31, 2001. 91.0% of Registrant's  2001 corporate  expenses  consisted of
salaries and wages of $703,108  (43.3%),  stock bonus  compensation  of $181,966
(11.2%),  professional expenses of $391,322 (21.4%) and shareholder services and
media promotion of $200,815 (12.4%). In comparison,  during the 2000 fiscal year
94.0% of Registrant's  corporate expense of $3,502,515 consisted of salaries and
wages of  $484,215  (13.8%),  stock  option  and  stock  bonus  compensation  of
$1,279,287 (36.6%),  professional  expenses of $382,553 (10.9%), and shareholder
services and media promotion of $1,146,419 (32.7%). The increase in salaries and
wages for 2001  over  2000  occurred  primarily  as a result  of hiring  one new
consultant in 2001. The decrease in stock bonus  compensation for 2001 over 2000
resulted from reduced  rewards for management  performance in 2001. The increase
in  professional  expenses in 2001 over 2000  occurred as a result of Dr. Bores'
trip to Italy in September 2001 to commence the Ciba Vision study.  The decrease
in shareholder  services and media promotion in 2001 over 2000 resulted from the
expenses  in  2000  being  unusually  high.  Approximately  90% of  Registrant's
corporate expenses were paid with Registrant's common stock in order to conserve
Registrant's cash resources.  Registrant  expects its management  salaries to be
stable in 2002  until  Registrant  is  required  to  appoint  as many as two new
outside  Directors  in order to obtain  listing for its stock on the NASD NMS or
Small Cap markets.  Registrant  may compensate its management and employees with
stock  options  and  stock  bonuses  in  2002  when  significant  events  occur.
Registrant  expects its professional  expenses in 2002 to remain at a high level
as a result of its continuing costs for its FDA application  presently estimated
at $18,000 per month. As Registrant  continues its foreign  marketing efforts in
2002, its promotional expenses will likely remain high.

As a result of the  presentation of the Registrant's  patented  equipment at the
various conventions of  ophthalmologists,  in October 2001 Registrant executed a
one-year  option  agreement with Ciba Vision which permits Ciba Vision to obtain
the  exclusive  worldwide  license  to the  patents  rights and  technology  for
Registrant's  PNT product.  In October 2001 this option  agreement  was extended
through May 2002.  Registrant  is hopeful a license  agreement  will be executed
with  Ciba  Vision in 2002;  however,  at this time  there is no  assurance  any
definitive license agreement will ever be executed by Registrant.

LIQUIDITY AND CAPITAL RESOURCES.  On a short-term and long-term basis Registrant
requires  only  minimal  capital to sustain its  manufacturing  of the  patented
equipment,  because of Registrant's  current  inventory  levels.  Because of the
Registrant's cash position at year-end and general and  administrative  expenses
totaling  approximately  $2,000,000  per year,  the  Registrant  suffered from a
liquidity  shortage  during 2001.  Through March 2002 Registrant was required to
borrow a total of $366,000 from its three Directors  after repaying  $427,132 of
loans in August 2001. Unless substantial  product sales are achieved in the near
future,  Registrant will continue to experience a liquidity shortage.  There can
be no  assurance  that  Registrant's  product  will be approved  for sale in the
United  States by the FDA or when foreign  sales will  commence in a substantial
number.  Registrant will likely be forced to borrow additional  funding from its
management  throughout  the  remainder of 2002;  however,  there is no assurance
Registrant will be able to obtain any financing in the future.

     On May 4, 1999  Registrant  obtained a loan of $270,000 from a third party,
bearing an annual  interest rate of 18% and secured by  Registrant's  equipment,
inventory and accounts  receivable,  a security deposit of $40,000 from the loan
proceeds and the personal guaranty of Registrant's  Chairman,  G. Richard Smith.
This loan was repaid in January  2002,  from a  $240,000  one-year  loan from G.
Richard  Smith.  Mr.  Smith's loan bears  interest at the rate of 10% per annum,
paid monthly.

     In August 2001  $204,065 of  outstanding  loans and  accrued  interest  was
repaid to G. Richard Smith by Registrant  issuing  3,045,746  restricted  common
stock shares.  $180,131 of outstanding  loans and accrued interest was repaid to
Gary R. Smith by Registrant  issuing  2,688,522  restricted common stock shares.
$42,936 of outstanding  loans and interest was repaid to Dr. John T. LiVecchi by
Registrant issuing 640,836 restricted common stock shares.

     From August 2001 through March 15, 2002 the Registrant  received additional
working  capital  loans of $17,000 from G. Richard  Smith,  $49,500 from Gary R.
Smith, and $59,500 from Dr. John T. LiVecchi. These loans accrue interest at the
rate of 15% per annum.

     On a long-term basis, Registrant anticipates,  without assurances, that the
sale of its product in the U.S.  and  internationally  will  provide  sufficient
liquidity to the Registrant.

                                       12
<PAGE>
ITEM 7. FINANCIAL STATEMENTS.

     See Financial Statements starting on page F-1 for this information.

ITEM 8. CHANGES IN AND DISAGREEMENT WITH ACCOUNTANTS ON ACCOUNTING AND
        FINANCIAL DISCLOSURE.

     The Registrant has not changed  accountants or had any  disagreements  with
its accountants during the audits of the last two fiscal years.

                                       13
<PAGE>
                                    PART III

ITEM 9. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS'
        COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT.

     The directors and executive  officers of the  Registrant as of December 31,
1999 were as follows:

           Name and Address                               Position
           ----------------                               --------
      G. Richard Smith                        Director, Chairman and Secretary
      16929 E. Enterprise Drive Suite 202
      Fountain Hills, AZ 85268

      Gary R. Smith                           Director, President and Treasurer
      16929 E. Enterprise Drive Suite 202
      Fountain Hills, AZ 85268

      John T. LiVecchi                        Director
      16929 E. Enterprise Drive Suite 202
      Fountain Hills, AZ 85268

     The  Registrant  presently  has two  vacancies  on its Board of  Directors.
Richard and Gary Smith are brothers.

     G.  Richard  Smith,  age 53, has been a Director  of the  Registrant  since
November 5, 1996 and  Secretary of the  Registrant  since  November 5, 1996.  He
became  Chairman in March,  1998. From July, 1995 to November 5, 1996 G. Richard
Smith was a joint  venture  partner  in  American  Glaucoma,  the  company  that
developed the concept of glaucoma treatment centers throughout the U.S which was
sold to the Registrant. From July, 1995 to November 5, 1996 G. Richard Smith was
a member and President of  Ophthalmic  International,  L.L.C.,  the company that
developed and patented the glaucoma  treatment which was sold to the Registrant.
From 1987 to June,  1995 G. Richard Smith was co-owner and President of Southern
California Medical Distributors, Ltd. ("SCMD") which developed a turbine powered
keratome for eye surgery.  G.  Richard  Smith  attended  Oakland  University  in
Oakland County, Michigan from 1968 to 1970.

     Gary R. Smith, age 57, has been a Director of the Registrant since November
5, 1996, and President and Treasurer of the  Registrant  since November 5, 1996.
From July, 1995 to November 5, 1996 Gary R. Smith was a joint venture partner in
American Glaucoma,  the company that developed the concept of glaucoma treatment
centers throughout the U.S which was sold to the Registrant.  From July, 1995 to
November  5,  1996 Gary R.  Smith was a member  and Vice  President  of  Product
Development and Manufacturing of Ophthalmic  International,  L.L.C., the company
that  developed  and  patented  the  glaucoma  treatment  which  was sold to the
Registrant.  From  1987 to  June,  1995  Gary R.  Smith  was  co-owner  and Vice
President of Product  Development  and  Manufacturing  for  Southern  California
Medical  Distributors,  Ltd.  ("SCMD"),  where he  developed  a turbine  powered
keratome for eye surgery. Gary R. Smith attended Detroit Institute of Technology
in Detroit, Michigan from 1961 through 1963.

     John T.  LiVecchi,  age 53, has been a  Director  of the  Registrant  since
December 16, 1996. From July, 1995 to November 5, 1996 Dr. LiVecchi was a member
of Ophthalmic International, L.L.C., the company that developed and patented the
glaucoma  treatment  which  was  sold to the  Registrant.  Dr.  LiVecchi  had no
relationship to American  Glaucoma.  Dr. LiVecchi received his medical degree in
1977 from the University of Rome,  Italy.  From 1983 to present Dr. LiVecchi has
been in private medical  practice in the field of ophthalmology in the Scranton,
Pennsylvania  area. Dr. LiVecchi has been on the staff of several  hospitals and
universities. Dr. LiVecchi is licensed to practice medicine in the States of New
York, Michigan and Pennsylvania. Dr. LiVecchi has authored numerous articles and
presentations.  In  1994  Dr.  LiVecchi  undertook  the  project  of  developing
equipment  and  procedures  for  treating  open angle  glaucoma,  along with the
Registrant's other Directors.

                                       14
<PAGE>
ITEM 10. EXECUTIVE COMPENSATION.

     The  following  table  sets  forth the  salaries  of the  Registrant's  two
officers for the fiscal year ending December 31, 2001.
<TABLE>
<CAPTION>
                                                                               Long Term Compensation
                                     Annual Compensation               ---------------------------------------
                           -----------------------------------------                  Securities      Awards        Payouts
Name and                                                 Other         Restricted     Underlying    ----------   ---------------
Principal                                                Annual          Stock         Options/       LTIP         All Other
Position            Year   Salary($)     Bonus($)    Compensation($)    Awards($)       SARS(#)     Payouts($)   Compensation($)
--------            ----   ---------     --------    ---------------   ----------       -------     ----------   ---------------
<S>                 <C>    <C>          <C>            <C>                <C>         <C>           <C>               <C>
G. Richard Smith,   2001   $80,000(1)   $101,198(2)     $      0            --        1,054,500(3)      --             --
Chairman            2000   $     0(4)   $ 99,000(5)     $      0            --        2,933,333(6)      --             --
                    1999   $     0(4)         --        $      0            --          500,000(7)      --             --
                    1998   $     0            --        $125,000(8)         --          400,000(9)      --             --

Gary R. Smith,      2001   $80,000(1)   $ 81,859(2)     $      0            --        1,054,500(3)      --             --
President           2000   $     0(4)   $ 99,000(5)     $      0            --        2,933,333(6)      --             --
                    1999   $     0(4)         --        $      0            --          500,000(7)      --             --
                    1998   $     0            --        $125,000(8)         --          400,000(9)      --             --
</TABLE>

----------
(1)  $70,000 of annual salary was accrued for G. Richard Smith and Gary R. Smith
     during  2001,  with $80,000 of salary paid in  restricted  common in August
     2001.
(2)  As a result of an adjustment in the market valuation of the stock issued in
     August 2001 for the payment of loans and accrued salaries, G. Richard Smith
     received a stock bonus of $101,198 and Gary R. Smith received a stock bonus
     of $81,859.
(3)  All of these  options  were  awarded  in  December  2001.  600,000 of these
     options  have a ten-year  term,  are  immediately  exercisable  and have an
     exercise price of $.10 per share. 454,500 of these options have a five-year
     term,  may not be exercised  until December 2002 and have an exercise price
     of $.22 per share.
(4)  An annual  salary of $150,000 was accrued but not paid to G. Richard  Smith
     and Gary R. Smith during 1999 and 2000, but paid in restricted common stock
     in August 2001.
(5)  This bonus was paid in common  stock  upon  issuance  of 500,000  shares in
     January 2001.
(6)  All of these  options  were  awarded in January  2001.  2,600,000  of these
     options  have a ten-year  term,  are  immediately  exercisable  and have an
     exercise  price  of $.135  per  share.  333,333  of  these  options  have a
     five-year  term,  may not be  exercised  until  January  2002  and  have an
     exercise price of $.30 per share.
(7)  These options were awarded in November 1999, have a five-year term, may not
     be exercised  until  November 2000 and have an exercised  price of $.20 per
     share.
(8)  $100,000 of accrued salary for 1998 and $20,000 of salary accrued from 1997
     was  paid to each G.  Richard  Smith  and  Gary  R.  Smith  in the  form of
     restricted common stock at the rate of $.03 per share on December 21, 1998,
     which was the same rate offered to all employees for accrued  salaries.  G.
     Richard  Smith and Gary R. Smith also  received  $5,000 cash as interest on
     their accrued salaries in October 1996.
(9)  These  options were awarded in December  1998,  have a ten-year term and an
     exercise price of $.05 per share.

     The following  table sets forth certain  information  concerning  the stock
options (with stock  appreciation  rights) granted during the fiscal year to the
Copmany's chief executive officer and each other executive officer.

<TABLE>
<CAPTION>
                       Number of        % of Total
                      Securities       Options/SARs
                      Underlying        Granted to
                     Options/SARs      Employees in      Exercise or Base     Expiration
     Name             Granted (#)       Fiscal Year        Price ($/Sh)          Date
     ----             -----------       -----------        ------------          ----
<S>                   <C>              <C>                <C>                  <C>
G. Richard Smith        600,000            16.2%               $.10        December 25, 2011
                        454,500            12.2%               $.22        December 25, 2006

Gary R. Smith           600,000            16.2%               $.10        December 25, 2011
                        454,500            12.2%               $.22        December 25, 2006
</TABLE>

                                       15
<PAGE>
     The  following  table sets forth  information  concerning  each exercise of
stock  options and the value of  unexercised  options  (with stock  appreciation
rights) at December 31, 2001 for the Company's chief executive  officer and each
other officer.

<TABLE>
<CAPTION>
                                                             Number of Securities              Value of
                                                            Underlying Unexercised      Unexercised In-the-Money
                                                           Options/SARs at FY-End(#)    Options/SARs at FY-End($)
                    Shares Acquired                        -------------------------    -------------------------
Name                on Exercise (#)   Value Realized ($)   Exercisable/Unexercisable    Exercisable/Unexercisable
----                ---------------   ------------------   -------------------------    -------------------------
<S>                 <C>               <C>                     <C>                              <C>
G. Richard Smith         --                  --               4,433,333/454,500                $253,000/0(1)

Gary R. Smith            --                  --               4,433,333/454,500                $253,000/0(1)
</TABLE>

----------
(1) Based on a year-end price of $.19 per share.

STOCK OPTION PLANS

     In December  1998,  the  Registrant's  Board of Directors  adopted The 1998
Stock Option Plan (the "1998 Option  Plan") and  1,550,000  shares were reserved
for issuance  thereunder.  On December 21, 1998, the Registrant  granted options
for a total of 1,550,000 shares of Registrant's common stock. These options have
ten-year  terms  and may be  exercised  within 3  months  after  termination  of
employment,  except if the  optionee  dies  while  employed,  the  option may be
exercised  by  the  optionee's  beneficiary.   All  options  issued  have  stock
appreciation  rights  whereby  the  option may be  exercised  by  redeeming  the
appreciated  value of the option and  without  cash being paid by the  optionee,
except the  Registrant's  officers must wait one year after the date of grant to
exercise stock appreciation  rights. The following  individuals received options
for the following  number of shares at the indicated  exercise price: G. Richard
Smith 400,000 shares at $.05; Gary R. Smith 400,000 shares at $.05; and Dr. John
T. LiVecchi  400,000 shares at $.05.  Since these options were granted on a date
when  the  average  market  price  for the  Registrant's  stock  was  $.10,  the
Registrant  accounted  for the  granting  of these  options  as an  expense  and
increase to  stockholder's  equity of $186,235 in 1998.  In February  2000,  Dr.
Bores exercised all of his options.

     In November  1999,  the  Registrant's  Board of Directors  adopted The 1999
Employee Stock Option Plan (the "1999 Employee  Option Plan") and 575,000 shares
were  reserved  for issuance  thereunder.  On November 3, 1999,  the  Registrant
granted options for a total of 575,000 shares of Registrant's common stock at an
exercise  price of $.20.  These options have ten-year terms and may be exercised
at any time  after  one  year  from  the  date of  grant  until 3  months  after
termination  of  employment,  except if the optionee  dies while  employed,  the
option may be exercised by the optionee's beneficiary.  These options may not be
exercised until November 3, 2000.

     In November  1999,  the  Registrant's  Board of Directors  adopted The 1999
Management Stock Option Plan (the "1999  Management  Option Plan") and 1,400,000
shares  were  reserved  for  issuance  thereunder.  On  November  3,  1999,  the
Registrant  granted  options  for a total of  1,400,000  shares of  Registrant's
common stock. These options have ten-year terms (except for 10% shareholders who
only have five-year  terms) and may be exercised at any time after one year from
the date of grant until 3 months after termination of employment,  except if the
optionee  dies while  employed,  the option may be exercised  by the  optionee's
beneficiary.  All options  issued  have stock  appreciation  rights  whereby the

                                       16
<PAGE>
option may be  exercised by redeeming  the  appreciated  value of the option and
without cash being paid by the  optionee.  The  following  individuals  received
options for the following  number of shares at the indicated  exercise price: G.
Richard Smith, 500,000 shares at $.20; Gary R. Smith, 500,000 shares at $.20 and
Dr. John T. LiVecchi, 400,000 shares at $.20. These options may not be exercised
until November 3, 2000.

     In  January  2001 the  Registrant's  Board of  Directors  adopted  the 2000
Management Bonus Stock Option Plan (the "2000 Bonus Option Plan") and on January
2,  2001 the  Registrant  granted  options  for a total of  6,000,000  shares of
Registrant's  common stock to be issued under the 2000 Bonus Option Plan.  These
options  have a ten-year  term and may be exercised at any time from the date of
grant  until 3 months  after  termination,  except if the  optionee  dies  while
employed  the option may be exercised by the  optionee's  beneficiary.  The 2000
Bonus  Option Plan does not provide for stock  appreciation  rights  whereby the
option may be  exercised by redeeming  the  appreciated  value of the option and
without cash being paid by the  optionee.  The  following  individuals  received
options for the following  number of shares at the indicated  exercise price: G.
Richard Smith,  2,000,000  shares at $.135;  Gary R. Smith,  2,000,000 shares at
$.135; and Dr. John T. LiVecchi, 2,000,000 shares at $.135.

     In  January  2001 the  Registrant's  Board of  Directors  adopted  the 2000
Management Stock Option Plan (the "2000 Management  Option Plan") and on January
2,  2001 the  Registrant  granted  options  for a total of  2,599,999  shares of
Registrant's  common stock to be issued under the 2000  Management  Option Plan.
1,933,333 of these options have a ten-year term (666,666 have a five-year  term)
and may be exercised at any time from the date of grant (except  666,666 may not
be exercised until January 2, 2002) until 3 months after termination,  except if
the optionee dies while  employed the option may be exercised by the  optionee's
beneficiary.  The 2000  Management  Option  Plan  does  not  provide  for  stock
appreciation  rights  whereby  the  option may be  exercised  by  redeeming  the
appreciated value of the option and without cash being paid by the optionee. The
following individuals received options for the following number of shares at the
indicated exercise price: G. Richard Smith,  600,000 shares at $.135 and 333,333
shares at $.30;  Gary R. Smith,  600,000  shares at $.135 and 333,333  shares at
$.30;  and Dr. John T.  LiVecchi,  400,000 shares at $.135 and 333,333 shares at
$.30.

     In  January  2001 the  Registrant's  Board of  Directors  adopted  the 2000
Employee Stock Option Plan (the "2000  Employee  Option Plan") and on January 2,
2001  the  Registrant   granted  options  for  a  total  of  625,000  shares  of
Registrant's common stock to be issued under the 2000 Employee Option Plan at an
exercise price of $.27.  These options have a ten-year term and may be exercised
at any time from the date of grant until 3 months after  termination,  except if
the optionee dies while  employed the option may be exercised by the  optionee's
beneficiary.

     In  December  2001 the  Registrant's  Board of  Directors  adopted the 2001
Management Stock Option Plan (the "2001 Management Option Plan") and on December
26,  2001 the  Registrant  granted  options for a total of  2,963,500  shares of
Registrant's  common stock to be issued under the 2001  Management  Option Plan.
2,054,500 of these options have a ten-year term (909,000 have a five-year  term)
and may be exercised at any time from the date of grant (except  909,000 may not
be exercised until December 25, 2002) until 3 months after  termination,  except
if  the  optionee  dies  while  employed  the  option  may be  exercised  by the
optionee's beneficiary.  No options issued under the 2001 Management Option Plan
have stock appreciation  rights whereby the option may be exercised by redeeming
the appreciated value of the option and without cash being paid by the optionee.
The following individuals received options for the following number of shares at
the indicated  exercise  price:  G. Richard  Smith,  600,000  shares at $.10 and
454,500 shares at $.22; Gary R. Smith, 600,000 shares at $.10 and 454,500 shares
at $.22; and Dr. John T. LiVecchi,  400,000 shares at $.10 and 454,500 shares at
$.22.

     In  December  2001 the  Registrant's  Board of  Directors  adopted the 2001
Employee Stock Option Plan (the "2001 Employee Option Plan") and on December 26,
2001  the  Registrant   granted  options  for  a  total  of  750,000  shares  of
Registrant's common stock to be issued under the 2001 Employee Option Plan at an
exercise price of $.20.  These options have a ten-year term and may be exercised
at any time after December 25, 2002 until 3 months after termination,  except if
the optionee dies while  employed the option may be exercised by the  optionee's
beneficiary.

     The Registrant currently has no pension,  retirement,  annuity,  savings or
similar benefit plan which provides  compensation  to its executive  officers or
directors.

                                       17
<PAGE>
ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.

     As of  March  19,  2002  there  were  68,769,336  outstanding  shares.  The
following  table sets  forth the name,  address,  number of shares  beneficially
owned, and the percentage of the  Registrant's  total  outstanding  common stock
shares owned by: (i) each of the Registrant's  Officers and Directors;  (ii) the
Registrant's  Officers and Directors as a group; and (iii) other shareholders of
5% or more of the Registrant's total outstanding common stock shares.

                    Name and Address            Amount and Nature of     Percent
Title of Class      Beneficial Owner            Beneficial Ownership    of Class
--------------      ----------------            --------------------    --------
Common Stock   Gary R. Smith                        17,876,916(1)          26.0%
               16929 E. Enterprise Drive Suite 202
               Fountain Hills, AZ 85268

Common Stock   G. Richard Smith                     15,546,630(2)          22.6%
               16929 E. Enterprise Drive Suite 202
               Fountain Hills, AZ 85268

Common Stock   John T. LiVecchi                      4,174,729(3)           6.1%
               16929 E. Enterprise Drive Suite 202
               Fountain Hills, AZ 85268

Common Stock   Officers and Directors, as a         37,598,275(4)          54.7%
                  Group (3 People)

----------
(1)  Does not include  4,887,833  shares of stock which may be  purchased by Mr.
     Smith under the  Registrant's  Stock Option  Plans.  In the event Mr. Smith
     purchased  all  of  those  shares,   Mr.  Smith  would  own  30.9%  of  the
     Registrant's total outstanding shares. This number does not include 900,000
     shares  owned by a  charitable  foundation  of which Mr.  Smith is the sole
     officer and director.
(2)  Does not include  4,887,833  shares of stock which may be  purchased by Mr.
     Smith under the  Registrant's  Stock Option  Plans.  In the event Mr. Smith
     purchased  all  of  those  shares,   Mr.  Smith  would  own  27.7%  of  the
     Registrant's total outstanding shares. This number does not include 900,000
     shares  owned by a  charitable  foundation  of which Mr.  Smith is the sole
     officer and director.
(3)  Does not include  4,387,833  shares of stock which may be  purchased by Dr.
     LiVecchi  under  the  Registrant's  Stock  Option  Plans.  In the event Dr.
     LiVecchi purchased all of those shares, Dr. LiVecchi would own 11.7% of the
     Registrant's total outstanding shares.
(4)  Does not  include  a total of  14,163,499  shares  of  stock  which  may be
     purchased by Mr. Gary R. Smith, Mr. G. Richard Smith and Dr. LiVecchi under
     the Registrant's Stock Option Plans. In the event Messrs.  Smith, Smith and
     LiVecchi  purchased all of those shares,  they would collectively own 62.4%
     of the Registrant's total outstanding shares.

                                       18
<PAGE>
ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.

     On  November  5,  1996,  the  Registrant  entered  into the Asset  Purchase
Agreement with Ophthalmic International,  L.L.C., and American Glaucoma, whereby
6,796,112 restricted shares of the Registrant's common stock were issued to each
of Gary R. Smith and G. Richard  Smith,  and  2,000,000  restricted  shares were
issued to John T.  LiVecchi.  Messrs.  Smith,  Smith  and  LiVecchi  became  the
Registrant's  sole  Directors as a result of this  transaction.  For  accounting
purposes,  Messrs.  Smith,  Smith and LiVecchi are deemed to have no cost in the
assets transferred to the Registrant.

     During 1999 G. Richard Smith loaned Registrant a total of $82,500, of which
$36,800 was repaid in May, 1999.  These loans bear 15% annual  interest rate. At
December 31, 2000 G. Richard Smith was owed  $53,700.  Through March 15, 2001 G.
Richard Smith had loaned an additional $116,000 to Registrant on the same terms.
These loans were repaid in August 2001 by issuance of restricted common stock.

     During  1999 Gary R. Smith  loaned  Registrant  a total of $35,000 of which
$11,900 was repaid in May,  1999.  These loan bear 15% annual  interest rate. At
December 31, 2000 Gary R. Smith was owed $26,260. Through March 15, 2001 Gary R.
Smith had loaned an additional  $116,000 to Registrant on the same terms.  These
loans were repaid in August 2001 by issuance of restricted common stock.

                                    PART IV

ITEM 13. EXHIBITS, FINANCIAL STATEMENTS, SCHEDULES AND REPORTS ON FORM 8K.

     Reference is herewith  made to the financial  statements  and notes thereto
included  herein and to the cover page of this 10-KSB with  respect to documents
incorporated by reference in accordance with Rule 12b-33.

         Exhibits   10.1   2001 Management Stock Option Plan

                    10.2   2001 Employee Stock Option Plan

                    10.3   Form of 2001 Management Stock Option Agreement

                    10.4   Form of 2001 Employee Stock Option Agreement

         Financial Statements -- F-1

                                       19
<PAGE>
                                   SIGNATURES

     Pursuant  to the  requirements  of  Section  13 or 15(d) of the  Securities
Exchange Act of 1934, the Registrant has duly caused this report to be signed on
its behalf on March 22, 2002 by the undersigned, thereunto authorized.

                                        CORONADO INDUSTRIES, INC.


                                        By: /s/ Gary R. Smith
                                            ------------------------------------
                                            Gary R. Smith, President


Pursuant to the requirements of the Securities Exchange Act of 1934, this report
has been signed by the following  persons on behalf of the Registrant and in the
capacities on the date(s) indicated.


/s/ G. Richard Smith        Chairman (Chief Executive      Dated: March 22, 2002
-------------------------   Officer), Secretary and
     G. Richard Smith       Director



/s/ Gary R. Smith           President, Treasurer           Dated: March 22, 2002
-------------------------   (Chief Accounting Officer),
     Gary R. Smith          Director



-------------------------   Director                       Dated:
     John LiVecchi

                                       20
<PAGE>
                      SUPPLEMENTAL INFORMATION AND EXHIBITS

SUPPLEMENTAL  INFORMATION TO BE FURNISHED WITH REPORTS FILED PURSUANT TO SECTION
15(d) OF THE  SECURITIES  EXCHANGE  ACT OF 1934 BY  REGISTRANTS  WHICH  HAVE NOT
REGISTERED SECURITIES PURSUANT TO SECTION 12 OF THE ACT.

     The  Registrant's  fiscal year ended  December  31,  2001.  The  Registrant
currently has not held its Annual Meeting of Stockholders.

     Four copies of all  material to be mailed to  stockholders  with respect to
such meeting will be furnished to the  Securities  and Exchange  Commission  but
such  documents,  when  furnished,  will  not be  deemed  to be  filed  with the
Securities  and Exchange  Commission  or  otherwise  subject to  liabilities  of
Section 18 of the Act  (except to the extent  that the  Registrant  specifically
incorporates  such material by reference in any subsequent  Form 10-KSB);  it is
expected that such documents  will consist of a Form of Proxy,  Notice of Annual
Meeting, Information Statement with Schedules and/or Exhibits annexed thereto.

                                       21
<PAGE>
                          INDEPENDENT AUDITORS' REPORT


To the Stockholders and Board of Directors of
Coronado Industries, Inc.

We have  audited  the  accompanying  consolidated  balance  sheets  of  Coronado
Industries,  Inc. as of December 31, 2001 and 2000, and the related consolidated
statements of operations,  changes in stockholders'  equity (deficit),  and cash
flows for the years then ended. These consolidated  financial statements are the
responsibility of the Company's management.  Our responsibility is to express an
opinion on these consolidated financial statements based on our audits.

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

In our opinion, the consolidated  financial statements referred to above present
fairly, in all material respects, the financial position of Coronado Industries,
Inc.  as of  December  31,  2001 and 2000,  and the  results of its  operations,
changes in stockholders' equity (deficit),  and it cash flows for the years then
ended in conformity with accounting  principles generally accepted in the United
States of America.

The accompanying  consolidated  financial statements have been prepared assuming
that the Company will  continue as a going  concern.  As discussed in Note 10 to
the  consolidated  financial  statements,  the Company's  significant  operating
losses raise substantial doubt about its ability to continue as a going concern.
The consolidated  financial statements do not include any adjustments that might
result from the outcome of this uncertainty.

Certified Public Accountants            /s/ Semple & Cooper LLP

Phoenix, Arizona
February 28, 2002

                                       F-1
<PAGE>
                   CORONADO INDUSTRIES, INC. AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEETS
                           DECEMBER 31, 2001 AND 2000


                                     ASSETS

                                                                December 31,
                                                           ---------------------
                                                             2001         2000
                                                           --------     --------
Current Assets:
  Cash (Note 1)                                            $ 21,588     $  1,195
                                                           --------     --------
    Total Current Assets                                     21,588        1,195
                                                           --------     --------
Property and equipment, net (Notes 1, 2 and 9)               24,209       96,065

Other Assets:
  Inventory (Notes 1 and 9)                                  23,985       23,985
  Intangible assets, net (Notes 1 and 3)                     21,607       25,078
  Deferred loan expense                                       3,333       13,333
                                                           --------     --------
    Total Assets                                           $ 94,722     $159,656
                                                           ========     ========

     The Accompanying Notes are an Integral Part of the Financial Statements

                                       F-2
<PAGE>
                   CORONADO INDUSTRIES, INC. AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEETS
                           DECEMBER 31, 2001 AND 2000


                 LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)

<TABLE>
<CAPTION>
                                                                             December 31,
                                                                     --------------------------
                                                                         2001           2000
                                                                     -----------    -----------
<S>                                                                  <C>            <C>
Current Liabilities:
  Notes payable to related parties - current portion (Note 4)        $        --    $   232,200
  Accounts payable                                                        38,403         27,763
  Accrued salaries                                                            --        616,250
  Other liabilities                                                        4,050        151,043
                                                                     -----------    -----------
      Total Current Liabilities                                           42,453      1,027,256

Long-Term Liabilities
  Note payable (Note 9)                                                  230,000        230,000
                                                                     -----------    -----------
      Total Liabilities                                                  272,453      1,257,256
                                                                     -----------    -----------
Commitments: (Note 7)
Stockholders' Equity (Deficit): (Note 5)
  Preferred Stock - $.0001 par value; 3,000,000 shares
    authorized, none issued or outstanding
  Common Stock - $.001 par value; 100,000,000 shares
    authorized, 67,836,909 and 38,115,096 shares outstanding
    at December 31, 2001 and 2000, respectively                           67,837         38,115
  Additional paid-in capital                                           8,803,599      6,133,665
  Accumulated deficit                                                 (9,049,167)    (7,269,380)
                                                                     -----------    -----------
      Total Stockholder's Equity (Deficit)                              (177,731)    (1,097,600)
                                                                     -----------    -----------
      Total Liabilities and Stockholder's Equity (Deficit)           $    94,722    $   159,656
                                                                     ===========    ===========
</TABLE>

     The Accompanying Notes are an Integral Part of the Financial Statements

                                       F-3
<PAGE>
                   CORONADO INDUSTRIES, INC. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF OPERATIONS
                 FOR THE YEARS ENDED DECEMBER 31, 2001 AND 2000


                                                 For the Year Ended December 31,
                                                 -------------------------------
                                                      2001            2000
                                                  ------------    ------------
Product Revenues                                  $         --    $     12,000

Cost of Product Revenues                                    --             280
                                                  ------------    ------------
Gross Profit                                                --          11,720
                                                  ------------    ------------
General and Administrative Expenses
  Salaries and wages                                   885,074       1,763,502
  Public relations                                     200,815       1,146,419
  Legal and professional fees                          108,928         207,014
  FDA expense                                          282,394         175,539
  Rent expense                                          27,000          43,000
  Miscellaneous expense                                121,236         167,041
                                                  ------------    ------------
     Total general and administrative expenses       1,625,447       3,502,515
                                                  ------------    ------------
Loss from Operations                                (1,625,447)     (3,490,795)
                                                  ------------    ------------
Other Income/(Expense):
  Interest expense                                    (106,393)        (95,028)
  Loss on sale of assets                               (38,747)             --
  Deferred loan expense                                (10,000)             --
  Other income                                             800           5,024
                                                  ------------    ------------
     Total Other Income (Expense)                     (154,340)        (90,004)
                                                  ------------    ------------
Net Loss                                          $ (1,779,787)   $ (3,580,799)
                                                  ============    ============
Basic Loss per Share (Note 1)                     $      (0.04)   $      (0.10)
                                                  ============    ============
Weighted Average Shares Outstanding                 46,173,592      35,055,497
                                                  ============    ============

     The Accompanying Notes are an Integral Part of the Financial Statements

                                       F-4
<PAGE>
                   CORONADO INDUSTRIES, INC. AND SUBSIDIARIES
       CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY (DEFICIT)
                 FOR THE YEARS ENDED DECEMBER 31, 2001 AND 2000

<TABLE>
<CAPTION>
                                                  COMMON STOCK           ADDITIONAL    RETAINED     STOCKHOLDERS'
                                          --------------------------      PAID-IN      EARNINGS        EQUITY
                                             SHARES       PAR VALUE       CAPITAL      (DEFICIT)      (DEFICIT)
                                          -----------    -----------    -----------   -----------    -----------
<S>                                       <C>            <C>            <C>           <C>            <C>
Balance at December 31, 1999               33,385,046    $    33,385    $ 3,170,378   $(3,688,581)   $  (484,818)
Stock issued for services                   2,254,978          2,255      1,373,550                    1,375,805
Stock issued for salaries                     250,072            250        156,100                      156,350
Stock options exercised                       200,000            200         14,800                       15,000
Stock warrants sold and forfeited                  --             --        125,000                      125,000
Stock options issued for services                  --             --         16,575                       16,575
Stock options issued for salaries                  --             --        892,287                      892,287
Stock issued for bonuses                    2,025,000          2,025        384,975                      387,000
Net loss                                                                               (3,580,799)    (3,580,799)
                                          -----------    -----------    -----------   -----------    -----------
Balance at December 31, 2000               38,115,096         38,115      6,133,665    (7,269,380)    (1,097,600)

Stock issued for services                   3,014,667          3,015        635,814                      638,829
Stock issued for salaries                  18,250,183         18,250      1,309,137                    1,327,387
Stock issued for related party debt         7,003,583          7,004        462,237                      469,241
Stock issued for related party interest     1,353,380          1,353         89,323                       90,676
Stock options issued for salaries                  --             --        160,000                      160,000
Stock options exercised                       100,000            100         13,423                       13,523
Net loss                                                                               (1,779,787)    (1,779,787)
                                          -----------    -----------    -----------   -----------    -----------
Balance at December 31, 2001               67,836,909    $    67,837    $ 8,803,599   $(9,049,167)   $  (177,731)
                                          ===========    ===========    ===========   ===========    ===========
</TABLE>

     The Accompanying Notes are an Integral Part of the Financial Statements

                                       F-5
<PAGE>
                   CORONADO INDUSTRIES, INC. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENT OF CASH FLOWS
                 FOR THE YEARS ENDED DECEMBER 31, 2001 AND 2000

<TABLE>
<CAPTION>
                                                               For the Year Ended December 31,
                                                               -------------------------------
                                                                  2001                2000
                                                               -----------         -----------
<S>                                                            <C>                 <C>
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS:
 Cash flows from operating activities:
 Net Income / (Loss)                                           $(1,779,787)        $(3,580,799)
 Adjustments to reconcile net income to net
  cash provided (used) by operating activities:
   Depreciation                                                     11,641              29,733
   Amortization                                                      3,471               3,755
   Stock issued for services                                       638,829           1,375,805
   Stock issued for salaries                                     1,327,387             156,350
   Stock issued for related party interest                          90,676                  --
   Stock options issued for services                                    --              16,575
   Stock options issued for salaries                               160,000             892,287
   Stock options issued for bonuses                                     --             387,000
   Loss on sale of fixed assets                                     38,747                  --

 Changes in Assets and Liabilities:
   Inventory                                                            --                 280
   Deferred loan expense                                            10,000              12,667
   Accounts payable                                                 10,640             (66,489)
   Accrued salaries                                               (616,250)            340,160
   Accrued payroll taxes and other                                (146,993)            148,208
                                                               -----------         -----------
   NET CASH USED IN OPERATING ACTIVITIES                          (251,639)           (284,468)
                                                               -----------         -----------
 CASH FLOWS FROM INVESTING ACTIVITIES:
   Acquisition of property and equipment                              (532)            (10,031)
   Sale of property and equipment                                   22,000                  --
                                                               -----------         -----------
   NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES              21,468             (10,031)
                                                               -----------         -----------
 CASH FLOWS FROM FINANCING ACTIVITIES:
   Proceeds from borrowings                                        237,041             242,240
   Repayment of notes payable                                           --             (90,000)
   Stock warrants sold and forfeited                                    --             125,000
   Cash received from exercise of options                           13,523              15,000
                                                               -----------         -----------
   NET CASH PROVIDED BY FINANCING ACTIVITIES                       250,564             292,240
                                                               -----------         -----------

Net change in cash and cash equivalents                             20,393              (2,259)

CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD                     1,195               3,454
                                                               -----------         -----------
CASH AND CASH EQUIVALENTS AT END OF PERIOD                          21,588               1,195
                                                               ===========         ===========
</TABLE>

     The Accompanying Notes are an Integral Part of the Financial Statements

                                       F-6
<PAGE>
                            CORONADO INDUSTRIES, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


1.   SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, NATURE OF OPERATIONS AND USE OF
     ESTIMATES:

     ORGANIZATION:

     Coronado Industries,  Inc. (the Company) was originally  incorporated under
     the laws of the State of New York in December 1989 as First Lloyd  Funding,
     Inc., which  subsequently  changed its name to Logical Computer Services of
     New York, Ltd. In September, 1996, the Company changed its name to Coronado
     Industries,  Inc. The Company was a non-operating  shell  corporation  with
     nominal  net assets  prior to its  merger on  November  5,  1996,  when the
     Company  acquired one hundred  percent  (100%) of the assets of  Ophthalmic
     International, L.L.C. and American Glaucoma

     The stockholders of American Glaucoma and Ophthalmic International, L.L.C.,
     which are the same for both corporations,  obtained majority control of the
     Company in the combination,  and therefore,  were considered the accounting
     acquiror. Therefore, the transaction was accounted for as a reverse merger.

     The Company was in the development stage from its acquisition of Ophthalmic
     International,  L.L.C.  and  American  Glaucoma in  November,  1996 through
     September,  1997. In September,  1997,  American  Glaucoma opened its first
     glaucoma treatment clinic in Scottsdale, Arizona. Ophthalmic International,
     L.L.C.  has  received  a patent  on the  method  for  treating  Open  Angle
     Glaucoma,  as well as the  devices  used in the  treatment,  including  the
     Vacuum Fixation  Device.  The Company intends to manufacture and market the
     patented  Vacuum  Fixation  Device and the patented  suction rings to major
     medical supply companies and health care providers throughout the world.

     PRINCIPLES OF CONSOLIDATION:

     The  consolidated  financial  statements  include the  activity of Coronado
     Industries,  Inc., together with its wholly-owned subsidiaries,  Ophthalmic
     International,   Inc.,   American  Glaucoma,   Inc.  and  Arizona  Glaucoma
     Institute, Inc. All significant intercompany accounts and transactions have
     been eliminated.

     USE OF ESTIMATES IN THE PREPARATION OF FINANCIAL STATEMENTS:

     The  preparation  of financial  statements  in  conformity  with  generally
     accepted  accounting  principles  requires management to make estimates and
     assumptions  that affect the reported amounts of assets and liabilities and
     disclosure  of  contingent  assets  and  liabilities  at  the  date  of the
     financial  statements  and the  reported  amounts of revenues  and expenses
     during  the  reporting  period.  Actual  results  could  differ  from those
     estimates.

                                       F-7
<PAGE>
                            CORONADO INDUSTRIES, INC.
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)


1.   SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, NATURE OF OPERATIONS AND USE OF
     ESTIMATES: (CONTINUED)

     CASH AND CASH EQUIVALENTS:

     Cash  and  cash   equivalents  are  considered  to  be  all  highly  liquid
     investments purchased with an initial maturity of three (3) months or less.

     INVENTORIES:

     Inventories  consist primarily of materials and parts and are stated at the
     lower of cost,  as  determined on a first-in,  first-out  (FIFO) basis,  or
     market.

     PROPERTY AND EQUIPMENT:

     Property and  equipment  are stated at cost.  Maintenance  and repairs that
     neither materially add to the value of the property nor appreciably prolong
     its life are charged to operations as incurred. Betterments or renewals are
     capitalized  when  incurred.  Depreciation  is provided  using  accelerated
     methods over the following useful lives:

             Office furniture and equipment                5-7 years
             Machinery                                     5-7 years
             Leasehold improvements                       7-39 years

     DEFERRED INCOME TAXES:

     Deferred  income  taxes  are  provided  on an asset and  liability  method,
     whereby  deferred  tax  assets  are  recognized  for  deductible  temporary
     differences  and operating loss and tax credit  carryforwards  and deferred
     tax liabilities are recognized for taxable temporary differences. Temporary
     differences are the differences  between the reported amounts of assets and
     liabilities  and their tax basis.  Deferred  tax  assets  are  reduced by a
     valuation  allowance when in the opinion of  management,  it is more likely
     than not that some  portion or all of the  deferred  tax assets will not be
     realized.  Deferred tax assets and liabilities are adjusted for the effects
     of changes in tax laws and rates on the date of enactment.

     LOSS PER SHARE:

     Basic loss per share  includes no dilution and is computed by dividing loss
     to common  stockholders  by the weighted  average  number of common  shares
     outstanding  for the  period.  Assumed  exercise of the  outstanding  stock
     options  and  warrants  at December  31,  2001 and 2000 of  16,263,499  and
     12,649,999,  respectively, have been excluded from the calculation of basic
     net loss per common share as their effect is antidilutive.  In addition, as
     the Company has a net loss available to common  stockholders  for the years
     ended  December  31,  2001 and 2000 the diluted  EPS  calculation  has been
     excluded from the financial statements.

                                       F-8
<PAGE>
                            CORONADO INDUSTRIES, INC.
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)


1.   SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, NATURE OF OPERATIONS AND USE OF
     ESTIMATES: (CONTINUED)

     INTANGIBLE ASSETS:

     The Company  reviews its  intangible  assets at least  annually to evaluate
     potential  impairment  by comparing  the carrying  value of the  intangible
     assets  with  expected  future net  operating  cash flows from the  related
     operations.  If the expected  future net operating cash flows are less than
     the carrying value, the Company  recognizes an impairment loss equal to the
     amount by which the carrying value exceeds the discounted  expected  future
     net operating cash flows from the related operations.

     ADVERTISING:

     Advertising  costs are charged to  operations  when  incurred.  Advertising
     costs for the years ended  December  31, 2001 and 2000 were $495 and $2,409
     respectively.

     REVENUE RECOGNITION:

     The Company recognizes revenues on the accrual basis, when the equipment is
     delivered.

     STOCK BASED COMPENSATION:

     The Company has elected to follow  Accounting  Principles Board Opinion No.
     25,  Accounting  for Stock Issued to Employees (APB No. 25) and the related
     interpretations in accounting for its employee stock options. Under APB No.
     25, if the exercise  price of employee  stock options equals or exceeds the
     market price of the underlying  stock on the date of grant, no compensation
     expense is recorded.  If the exercise  price of employee  stock  options is
     below  the  market  price of the  underlying  stock  on the date of  grant,
     compensation  expense is recorded in the year of grant in  accordance  with
     FAS No. 123. See Note 5 below. The Company has adopted the  disclosure-only
     provisions  of  Statement  of  Financial   Accounting  Standards  No.  123,
     Accounting  for  Stock-based  Compensation  (Statement  No.  123)  when the
     exercise price equals or exceeds the market price on the date of grant.

2.   PROPERTY AND EQUIPMENT:

     At  December  31, 2001 and 2000,  property  and  equipment  consists of the
     following:

                                                            2001         2000
                                                         ---------    ---------
     Office furniture and equipment                      $  58,433    $  58,433
     Machinery and equipment                                10,563      151,301
     Leasehold improvements                                     --        5,463
                                                         ---------    ---------
                                                            68,996      215,197
     Less: accumulated depreciation                        (44,787)    (119,132)
                                                         ---------    ---------

     Net property and equipment                          $  24,209    $  96,065
                                                         =========    =========

     Depreciation  expense was $11,641 and $29,733, for the years ended December
     31, 2001 and 2000, respectively.

                                       F-9
<PAGE>
                            CORONADO INDUSTRIES, INC.
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)


3.   INTANGIBLE ASSETS:

     Intangible  assets consist of legal costs incurred to secure  patents.  The
     patents are being amortized  ratably over fifteen (15) years.  Amortization
     expense  charged to  operations  for the years ended  December 31, 2001 and
     2000 was $3,471 and $3,755,  respectively.  Accumulated  amortization as of
     December 31, 2001 is $9,077.

4.   RELATED PARTY TRANSACTIONS:

     Notes Payable to Related Parties:

     As of December 31, 2000,  the notes payable to related  parties  consist of
     various 15% per annum notes  payable to two principal  stockholders.  These
     notes are considered short-term in nature, payable on demand.

5.   STOCKHOLDERS' EQUITY (DEFICIT):

     Common Stock and Common Stock Warrants:

     100,000  common stock  warrants  valued at $2,830 were issued for financing
     fees in  1999,  with an  exercise  price of $2.00  per  share,  exercisable
     through May 4, 2002.  All  100,000  common  stock  warrants  are  currently
     exercisable as of December 31, 2001.

     Employee Stock Options and Stock Plans:

     On December  26, 2001 the Board of  Directors  approved  the 2001  Coronado
     Industries,  Inc.  Management  Stock Option Plan.  The Plan  authorizes the
     Company to grant stock options to key  employees of the Company.  Under the
     above Plan, 2,963,500 shares of common stock were reserved for issuance.

     A summary of the activity of the Plan follows:

                                                                    Weighted
                                                     Number          Average
                                                   of Options     Exercise Price
                                                   ----------     --------------
     Outstanding at December 31, 2000                      --         $0.16

     Granted                                        2,963,500          0.16
                                                   ----------         -----
     Outstanding at December 31, 2001               2,963,500         $0.16
                                                   ==========         =====

                                      F-10
<PAGE>
                            CORONADO INDUSTRIES, INC.
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)


5.   STOCKHOLDERS' EQUITY (DEFICIT): (CONTINUED)

     Additional  information about outstanding options to purchase the Company's
     common stock as of December 31, 2001:

<TABLE>
<CAPTION>
                      Options Outstanding                                    Options Exercisable
                      -------------------                                    -------------------

                                Weighted Average
                                   Remaining         Weighted Average                  Weighted Average
     Exercise     Number of       Contractual            Exercise         No. of           Exercise
      Price        Shares        Life (In Years)          Price           Shares             Price
      -----        ------        ---------------          -----           ------             -----
<S>               <C>           <C>                  <C>                 <C>           <C>
      $0.16       2,963,500           8.47                $0.16          2,963,500           $0.16
</TABLE>

     On December  26, 2001 the Board of  Directors  approved  the 2001  Coronado
     Industries,  Inc.  Employee  Stock Option  Plan.  The Plan  authorizes  the
     Company to grant stock options to key  employees of the Company.  Under the
     above Plan, 750,000 shares of common stock were reserved for issuance.

     A summary of the activity of the Plan follows:

                                                                  Weighted
                                                  Number           Average
                                                of Options      Exercise Price
                                                ----------      --------------
     Outstanding at December 31, 2000                  --           $0.20

     Granted                                      750,000            0.20
                                                 --------           -----
     Outstanding at December 31, 2001             750,000           $0.20
                                                 ========           =====

     Additional  information about outstanding options to purchase the Company's
     common stock as of December 31, 2001:

<TABLE>
<CAPTION>
                      Options Outstanding                                    Options Exercisable
                      -------------------                                    -------------------

                                Weighted Average
                                   Remaining         Weighted Average                  Weighted Average
     Exercise     Number of       Contractual            Exercise         No. of           Exercise
      Price        Shares        Life (In Years)          Price           Shares             Price
      -----        ------        ---------------          -----           ------             -----
<S>               <C>           <C>                  <C>                 <C>           <C>
      $0.20       750,000            10.00                $0.20           750,000            $0.20
</TABLE>

                                      F-11
<PAGE>
                            CORONADO INDUSTRIES, INC.
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)


5.   STOCKHOLDERS' EQUITY (DEFICIT): (CONTINUED)

     On  January  2,  2001 the Board of  Directors  approved  the 2000  Coronado
     Industries,  Inc.  Management  Bonus Stock Option Plan. The Plan authorizes
     the Company to grant stock options to key  employees of the Company.  Under
     the above  Plan,  6,000,000  shares  of  common  stock  were  reserved  for
     issuance.

     A summary of the activity of the Plan follows:

                                                                  Weighted
                                                  Number           Average
                                                of Options      Exercise Price
                                                ----------      --------------
     Outstanding at December 31, 1999                   --          $0.135

     Granted                                     6,000,000           0.135
                                                ----------          ------
     Outstanding at December 31, 2000            6,000,000           0.135

     Exercised                                          --           0.135
                                                ----------          ------
     Outstanding at December 31, 2001            6,000,000          $0.135
                                                ==========          ======

     Additional  information about outstanding options to purchase the Company's
     common stock as of December 31, 2001:

<TABLE>
<CAPTION>
                      Options Outstanding                                    Options Exercisable
                      -------------------                                    -------------------

                                Weighted Average
                                   Remaining         Weighted Average                  Weighted Average
     Exercise     Number of       Contractual            Exercise         No. of           Exercise
      Price        Shares        Life (In Years)          Price           Shares             Price
      -----        ------        ---------------          -----           ------             -----
<S>               <C>           <C>                  <C>                 <C>           <C>
     $0.135       6,000,000           9.00               $0.135          6,000,000          $0.135
</TABLE>

     On  January  2,  2001 the Board of  Directors  approved  the 2000  Coronado
     Industries,  Inc.  Management  Stock Option Plan.  The Plan  authorizes the
     Company to grant stock options to key  employees of the Company.  Under the
     above Plan, 2,599,999 shares of common stock were reserved for issuance.

     A summary of the activity of the Plan follows:

                                                                  Weighted
                                                  Number           Average
                                                of Options      Exercise Price
                                                ----------      --------------
     Outstanding at December 31, 1999                   --          $0.211

     Granted                                     2,599,999           0.211
                                                ----------          ------
     Outstanding at December 31, 2000            2,599,999           0.211

     Exercised                                          --           0.211
                                                ----------          ------
     Outstanding at December 31, 2001            2,599,999          $0.211
                                                ==========          ======

                                      F-12
<PAGE>
                            CORONADO INDUSTRIES, INC.
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

5.       STOCKHOLDERS' EQUITY (DEFICIT):  (CONTINUED)

      Additional information about outstanding options to purchase the Company's
common stock as of December 31, 2001:

<TABLE>
<CAPTION>
                      Options Outstanding                                    Options Exercisable
                      -------------------                                    -------------------

                                Weighted Average
                                   Remaining         Weighted Average                  Weighted Average
     Exercise     Number of       Contractual            Exercise         No. of           Exercise
      Price        Shares        Life (In Years)          Price           Shares             Price
      -----        ------        ---------------          -----           ------             -----
<S>               <C>           <C>                  <C>                 <C>           <C>
     $0.211       2,599,999           7.21               $0.211          2,599,999          $0.211
</TABLE>

     On  January  2,  2001 the Board of  Directors  approved  the 2000  Coronado
     Industries,  Inc.  Employee  Stock Option  Plan.  The Plan  authorizes  the
     Company to grant stock options to key  employees of the Company.  Under the
     above Plan, 625,000 shares of common stock were reserved for issuance.

     A summary of the activity of the Plan follows:

                                                  Number           Average
                                                of Options      Exercise Price
                                                ----------      --------------
     Outstanding at December 31, 1999                  --           $0.135

     Granted                                      625,000            0.135
                                                 --------           ------
     Outstanding at December 31, 2000             625,000            0.135

     Exercised                                    100,000            0.135
                                                 --------           ------
     Outstanding at December 31, 2001             525,000           $0.135
                                                 ========           ======

     Additional  information about outstanding options to purchase the Company's
     common stock as of December 31, 2001:

<TABLE>
<CAPTION>
                      Options Outstanding                                    Options Exercisable
                      -------------------                                    -------------------

                                Weighted Average
                                   Remaining         Weighted Average                  Weighted Average
     Exercise     Number of       Contractual            Exercise         No. of           Exercise
      Price        Shares        Life (In Years)          Price           Shares             Price
      -----        ------        ---------------          -----           ------             -----
<S>               <C>           <C>                  <C>                 <C>           <C>
     $0.135       525,000             9.00               $0.135          525,000            $0.135
</TABLE>

                                      F-13
<PAGE>
                            CORONADO INDUSTRIES, INC.
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)


5.    STOCKHOLDERS' EQUITY (DEFICIT):  (CONTINUED)

      On November 3, 1999,  the Board of Directors  approved  the 1999  Coronado
      Industries,  Inc.  Employee  Stock Option Plan.  The Plan  authorizes  the
      Company to grant stock options to key employees of and consultants for the
      Company.  Under the above  Plan,  575,000  shares  of  common  stock  were
      reserved for issuance.

      A summary of the activity of the Plan follows:

                                                                  Weighted
                                                  Number           Average
                                                of Options      Exercise Price
                                                ----------      --------------
     Outstanding at December 31, 1999             575,000           $0.20

     Exercised                                         --            0.20
                                                 --------           -----
     Outstanding at December 31, 2000             575,000            0.20

     Exercised                                         --            0.20
                                                 --------           -----
     Outstanding at December 31, 2001             575,000           $0.20
                                                 ========           =====

     Additional  information about outstanding options to purchase the Company's
     common stock as of December 31, 2001:

<TABLE>
<CAPTION>
                      Options Outstanding                                    Options Exercisable
                      -------------------                                    -------------------

                                Weighted Average
                                   Remaining         Weighted Average                  Weighted Average
     Exercise     Number of       Contractual            Exercise         No. of           Exercise
      Price        Shares        Life (In Years)          Price           Shares             Price
      -----        ------        ---------------          -----           ------             -----
<S>               <C>           <C>                  <C>                 <C>           <C>
      $0.20       575,000             7.84                $0.20          575,000             $0.20
</TABLE>

                                      F-14
<PAGE>
                            CORONADO INDUSTRIES, INC.
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

5.    STOCKHOLDERS' EQUITY (DEFICIT):  (CONTINUED)

      On November 3, 1999,  the Board of Directors  approved  the 1999  Coronado
      Industries,  Inc.  Management  Stock Option Plan. The Plan  authorizes the
      Company to grant stock options to key employees of and consultants for the
      Company.  Under the above  Plan,  1,400,000  shares of common  stock  were
      reserved for issuance.

      A summary of the activity of the Plan follows:

                                                  Number           Average
                                                of Options      Exercise Price
                                                ----------      --------------
     Outstanding at December 31, 1999            1,400,000           $0.20

     Exercised                                          --            0.20
                                                ----------           -----
     Outstanding at December 31, 2000            1,400,000            0.20

     Exercised                                          --            0.20
                                                ----------           -----
     Outstanding at December 31, 2001            1,400,000           $0.20
                                                ==========           =====

     Additional  information about outstanding options to purchase the Company's
     common stock as of December 31, 2001:

<TABLE>
<CAPTION>
                      Options Outstanding                                    Options Exercisable
                      -------------------                                    -------------------

                                Weighted Average
                                   Remaining         Weighted Average                  Weighted Average
     Exercise     Number of       Contractual            Exercise         No. of           Exercise
      Price        Shares        Life (In Years)          Price           Shares             Price
      -----        ------        ---------------          -----           ------             -----
<S>               <C>           <C>                  <C>                 <C>           <C>
      $0.20       1,400,000           4.24                $0.20          1,400,000           $0.20
</TABLE>

     On December 21, 1998,  the Board of  Directors  approved the 1998  Coronado
     Industries,  Inc.  Stock Option Plan.  The Plan  authorizes  the Company to
     grant stock options to key employees of the Company.  Under the above Plan,
     1,550,000 shares of common stock were reserved for issuance.

     A summary of the activity of the Plan follows:

                                                  Number           Average
                                                of Options      Exercise Price
                                                ----------      --------------
     Outstanding at December 31, 1999            1,550,000          $0.075

     Exercised                                     200,000           0.075
                                                ----------          ------
     Outstanding at December 31, 2000            1,350,000           0.075

     Exercised                                          --           0.075
                                                ----------          ------
     Outstanding at December 31, 2001            1,350,000          $0.075
                                                ==========          ======

                                      F-15
<PAGE>
                            CORONADO INDUSTRIES, INC.
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

5.    STOCKHOLDERS' EQUITY (DEFICIT):  (CONTINUED)

      Additional information about outstanding options to purchase the Company's
common stock as of December 31, 2001:

<TABLE>
<CAPTION>
                                Weighted Average
                                   Remaining         Weighted Average                  Weighted Average
     Exercise     Number of       Contractual            Exercise         No. of           Exercise
      Price        Shares        Life (In Years)          Price           Shares             Price
      -----        ------        ---------------          -----           ------             -----
<S>               <C>           <C>                  <C>                 <C>           <C>
     $0.075      1,350,000            6.84               $0.075          1,350,000          $0.075
</TABLE>

     Consistent  with  accounting  for options  utilizing  the  intrinsic  value
     method,  options  granted during 2001 and 2000, in which the exercise price
     was less than the fair market  value of the  Company's  common stock on the
     date of grant,  have been  reflected in  compensation  expense for the year
     ended  December  31,  2001 and 2000.  Some of the stock  options  issued to
     employees have an exercise price not less than the fair market value of the
     Company's  common stock on the date of grant. In accordance with accounting
     for such options utilizing the intrinsic value method,  there is no related
     compensation expense recorded in the Company's financial statements for the
     years  ended  December  31,  2001  and  2000.  Had  compensation  cost  for
     stock-based  compensation  been  determined  based on the fair value of the
     options at the grant  dates  consistent  with the  method of SFAS 123,  the
     Company's  net loss for the years  ended  December  31, 2001 and 2000 would
     have been increased to the pro forma amounts presented below:

                                            2001               2000
                                        ------------       ------------
     As reported:
       Net loss                         $ (1,779,787)      $ (3,580,799)
                                        ============       ============
       Loss per share                   $      (0.04)      $      (0.10)
                                        ============       ============
       Pro forma Net loss               $ (1,983,412)      $ (3,667,466)
                                        ============       ============
       Loss per share                   $      (0.04)      $      (0.10)
                                        ============       ============

     The fair  value  of  option  grants  is  estimated  as of the date of grant
     utilizing  the  Black-Scholes   option-pricing  model  with  the  following
     weighted  average  assumptions for all grants,  expected life of options of
     five (5) to ten (10) years, risk-free interest rates of eight percent (8%),
     and a zero percent (0%) dividend yield.  The weighted average fair value at
     date of grant for options  granted during the years ended December 31, 2001
     and 2000 approximated $.14 and $.09, respectively.

                                      F-16
<PAGE>
                            CORONADO INDUSTRIES, INC.
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)


6.   INCOME TAXES:

     As of December 31, 2001,  the  components  of deferred  income taxes are as
     follows:

     Long-term Deferred Tax Assets (Liabilities)
     Net operating loss carryforwards                             $ 3,546,000
     Depreciation and Amortization                                    (16,079)
                                                                  -----------
                                                                    3,529,921
     Less:  valuation allowance                                    (3,529,921)
                                                                  -----------
     Net Long-term Deferred Tax Asset                             $        --
                                                                  ===========

     Based on the weight of available evidence,  the Company has provided a full
     valuation allowance on its deferred tax asset at December 31, 2001.

     As of December 31, 2001, the Company has net operating  loss  carryforwards
     available to offset future  federal and state taxable income in the amounts
     of $8,879,520 and $8,777,194 respectively, and expiring as follows:

                   Net Loss Carryforward                Year of
                     Amount Available                 Expiration
                --------------------------     --------------------------
     Year         Federal         State          Federal         State
     ----       -----------    -----------     -----------    -----------
     1993       $    37,195    $        --        2008             --
     1994            65,131             --        2009             --
     1995            96,528         96,528        2010            2000
     1996            31,021         31,021        2011            2001
     1997           673,948        673,948        2012            2002
     1998         1,448,812      1,448,812        2018            2003
     1999         1,201,118      1,201,118        2019            2004
     2000         3,580,799      3,580,799        2020            2005
     2001         1,744,968      1,744,968        2021            2006
                ===========    ===========

                $ 8,879,520    $ 8,777,194
                ===========    ===========

7.   COMMITMENTS:

     The  Company  leased  office  space in  Fountain  Hills,  Arizona,  under a
     non-cancellable  operating  lease  agreement  which expired in June,  2001.
     Subsequent to the expiration,  the Company has continued to lease the space
     on a month-to-month  basis. The rent is currently $2,500 per month. For the
     years  ended  December  31,  2001 and 2000,  rent  expense  under the lease
     agreements was $27,000 and $43,000, respectively.

                                      F-17
<PAGE>
                            CORONADO INDUSTRIES, INC.
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)


8.   NON-CASH INVESTING AND FINANCING ACTIVITIES:

     The Company  recognized  investing and financing  activities  that affected
     assets,  liabilities,  and equity,  but did not result in cash  receipts or
     payments.

     For the year ended  December 31, 2001,  these  non-cash  activities  are as
     follows:

          21,264,850  shares  of common  stock  were  issued  for  services  and
          salaries, which were valued at $1,966,216.

          7,003,583  shares of common stock were issued for related  party debt,
          which was valued at $469,241.

          1,353,380  shares  of common  stock  were  issued  for  related  party
          interest, which was valued at $90,676.

          1,600,000  stock options were issued to employees for services,  which
          were valued at $160,000.

     For the year ended  December 31, 2000,  these  non-cash  activities  are as
     follows:

          2,505,050  shares  of  common  stock  were  issued  for  services  and
          salaries, which were valued at $1,532,155.

          8,075,000  stock options were issued to employees for services,  which
          were valued at $892,287.

          150,000 stock options were issued to non-employees for services, which
          were valued at $16,575.

          2,025,000 stock options were issued to key employees as bonuses, which
          were valued at $387,000.


9.   NOTE PAYABLE:

     At December 31, 2001, note payable consists of the following:

     Note  Payable  to  TLD  Funding  Group,   with  monthly
     interest payments of $4,050,  with principal due on May
     4, 2002, interest imputed at 18% per annum;  secured by
     equipment and inventory.                                           $230,000
                                                                        ========

10.  GOING CONCERN:

     The accompanying financial statements have been prepared in conformity with
     generally accepted accounting principles,  which contemplates  continuation
     of the Company as a going  concern.  However,  the  Company  has  sustained
     continuing operating losses.

     The primary business of the Company is to manufacture and market a patented
     treatment  device for Open  Angle  Glaucoma,  and was to  operate  glaucoma
     treatment  clinics where the patented  treatment  procedures are performed.
     The first of these clinics was opened in 1997, but was not profitable,  and
     was closed March 2, 1999.

     In  addition,  the  Company  has  incurred  net  losses of  $1,779,787  and
     $3,580,799 in 2001 and 2000, respectively. Unaudited information subsequent
     to December 31, 2001, indicates that the losses are continuing.

     The above conditions indicate that the Company may be unable to continue in
     existence. The financial statements do not include any adjustments relating
     to the recoverability and classification of recorded asset amounts,  or the
     amounts and  classification  of liabilities  that might be necessary should
     the Company be unable to continue in existence.

                                      F-18
<PAGE>
                            CORONADO INDUSTRIES, INC.
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)


11.  PENDING ACCOUNTING PRONOUNCEMENTS:

     In September 2001 the Financial  Accounting Standards Board adopted Opinion
     No. 144,  Accounting for the  Impairment or Disposal of Long-Lived  Assets.
     The  pronouncement  provides a single,  comprehensive  accounting model for
     impairment and disposal of long-lived assets and discounted operations. The
     Company  does not expect the  adoption of the  standards to have a material
     effect on the  financial  statements.  The standard is effective for fiscal
     years beginning after December 15, 2001.

12.  SUBSEQUENT EVENTS:

     On January 9, 2002, the Company received $240,000 through a promissory note
     with a principal  shareholder.  The  promissory  note calls for twelve (12)
     interest  only  payments  in the amount of $2,000,  commencing  February 1,
     2002, followed by a balloon payment of the remaining principal balance. The
     promissory note is  collateralized by all assets of the Company and carries
     an interest rate of ten percent (10%) per annum.  The Company used $234,000
     to pay off a note to another lender.

                                      F-19