Note Holder Update October 23, 2015
LEGAL NOTICES AND DISCLAIMERS � This presentation is for informational purposes only and is not intended for any other use. This presentation is not an offering memorandum or prospectus and should not be treated as offering material of any sort. The information contained in this presentation shall not constitute an offer to sell or the solicitation of an offer to buy securities. This presentation is intended to be of general interest only, and does not constitute or set forth professional opinions or advice. The information in this document is speculative and may or may not be accurate. Actual information and results may differ materially from those stated in this document. � The Company makes no representations or warranties which respect to the accuracy of the whole or any part of this the Company presentation and disclaims all such representations and warranties. Some of the data and industry information used in the preparation of this presentation (and on which the presentation is based) was published by third-party sources, and has not been independently verified, validated, or audited. Neither the Company nor its principals, employees, or agents shall be liable to any user of this document or to any other person or entity for the truthfulness or accuracy of information contained in this presentation or for any errors or omissions in its content, regardless of the cause of such inaccuracy, error, or omission. Furthermore, the Company, its principals, employees, or agents accept no liability and disclaim all responsibility for the consequences of any user of this document or anyone else acting, or refraining to act, in reliance on the information contained in this document or for any decision based on it, or for any actual, consequential, special, incidental, or punitive damages to any person or entity for any matter relating to this document even if advised of the possibility of such damages. � This presentation contains forward-looking statements within the meaning of the federal securities laws. Forward- looking statements express the Company’s expectations or predictions of future events or results. They are not guarantees and are subject to many risks and uncertainties. There are a number of factors beyond the Company’s control that could cause actual events or results to be significantly different from those described in the forward- 2 looking statements. Any or all of the forward-looking statements in this document or in any other statements the Company makes may turn out to be wrong and should not be regarded as a representation by the Company or any other person that its objectives, future results, levels of activity, performance or plans will be achieved. Except as required by applicable law, the Company does not intend to publicly update or revise any forward-looking statements, whether as a result of new information, future developments or otherwise.
CAUTIONARY NOTE REGARDING FINANCIAL INFORMATION � This presentation and the financial information contained herein (“Projections”) have not been audited or reviewed by our independent certified public accountants and accordingly they express no opinion or other form of assurance as to this financial information. � No representation or warranty of any kind is or can be made with respect to the accuracy or completeness of, and no representation or warranty should be inferred from, the Company’s Projections or the assumptions underlying them. No representation or warranty can be made as to the Company’s future operations or the amount of any future income or loss. Some assumptions on which the Projections are based may not materialize, and unanticipated events and circumstances will occur. Further, the Projections are not necessarily prepared nor are they presented in accordance with generally accepted accounting principles. Therefore, subsequent adjustments may be made that may cause the actual results achieved during the periods presented to vary from the Projections, and the variations may be significant and material. Prospective investors are cautioned not to rely on the Projections contained in the presentation and should not make an investment decision based on the Projections. The Projections are not complete and do not necessarily provide a clear picture of the future financial health of the Company. � The Company does not intend to update or otherwise revise the Projections to reflect circumstances existing or adjustments made after the date hereof or to reflect the occurrence of unanticipated events even if some or all of the underlying assumptions do not come to fruition. Any historical financial information contained herein may change significantly after the date hereof. � THIS INFORMATION IS CONFIDENTIAL AND HAS BEEN PROVIDED TO THE RECIPIENT FOR INFORMATIONAL PURPOSES ONLY AND NO REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED, IS MADE AS TO THE COMPLETENESS OR ACCURACY OF THE INFORMATION CONTAINED HEREIN. 3
Pre-merger Results ($ Millions) 1Q15 2Q15 Revenue 0.8 0.7 Gross Profit 0.2 0.2 SG&A, excluding 2.1 1.9 Depreciation EBITDA (1.9) (1.7) Other (0.7) (2.9) Net Loss (2.6) (4.6) � New business from VCD, Vision Source and others is increasing � “Other” income/expense includes depreciation, interest, amortization of debt discount and 4 debt issuance costs, change in fair value of derivative instruments, and sale of obsolete inventory
Balance Sheet Pre- and Post-Merger ($ Millions) December 2014 June 2015 Cash 0.1 0.0 Other current assets 2.1 1.8 Non-current assets 0.8 4.8 (4.2 goodwill) Total assets 2.9 6.6 AP and accrued expenses 4.3 6.3 Debt 10.9 13.3 Debt discount (1.8) (1.2) Derivative liab. & def. revenue 3.7 4.3 Equity (14.2) (16.1) Total Liabilities and Equity 2.9 6.6 5 � Operations have been funded via debt � Additional $4M borrowed on 7/1/15 and $1M borrowed on 9/30/15
3Q 2015 Funding � PFO issued $4M of debentures on July 1, 2015 July 2015 Net Proceeds ($ Millions) Use of Proceeds ($ Millions) � � Gross proceeds $4.0 A/P balance at 6/30/15 $3.1 � � Transaction costs Bridge note due at closing 0.3 (investment banker, Short-term liabilities at 6/30/15 $3.4 legal and lender fees) (1.1) � Other ENRG liabilities (0.1) Average quarterly operating Net proceeds to PFO $2.8 loss in first half of 2015 $1.8 � Short term liabilities and average quarterly operating loss exceeded July 2015 net proceeds 6 � PFO issued an additional $1M of debentures on September 30, 2015
Update Since Merger � Sales leadership changed to improve productivity � Ruedi Suter / Christina Jones � Reduced costs � Personnel reduced by 20% in 2015 � Introduced new products � Vitaris lenses � EyeX 3 new software release � JusttheRX B-to-C program � Hillair Capital invested $5M in 3Q � Additional investment subject to financial results and capital reorganization 7
VITARIS TM Blue Light VITARIS TM � Blue light waves are among � Vitaris lenses from PFO reduce high-energy the highest energy visible (HEV) 380-420 nm wavelengths, wavelengths in the visible protecting the eyes from blue light spectrum � The radiation blocker is in the lens material � Artificial blue light sources � Transparent, no color absorption such as digital devices and LED screens emit excessive blue light � Blue light reaches the retina and damages our macula � Conventional lenses and coatings do not block blue light 8 PFO has exclusive U.S. distribution rights with potential demand in excess of 100,000 lenses/year
� Highly accurate, 3D lens tracing system � Lens placed in scanner � Produces ultra high resolution 3D image � Data sent directly to edging machine at PFO’s lab � Recurring revenue model � Potential to transform the optical industry � Placed in ECP’s office and enable scanning of the lens within minutes � Directly connect to lab system via cloud � Reduces initiation of lens production to minutes instead of days 9 � Perfect set of lenses delivered to ECP for mounting within 2 – 3 days � Significant logistical cost savings passed along to ECP
� JusttheRx is a new, disruptive business model � Enables consumer to save money on lenses while benefitting from trained professionals for frame selection, hands-on measurement, prescription verification, and final adjustment of eyewear � JusttheRx is a B2C site which promotes premium prescription lens products from PFO Global, through direct consumer sales of procurement vouchers 10 � Targets “online eyeglass sales” -- currently 8% of the U.S. optical market � GettheRx is a B2B lens fulfillment site, enabling ECP’s to redeem consumer vouchers for premium prescription lenses
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