SECURITIES AND EXCHANGE COMMISSION

                                    FORM 8-K

                                 CURRENT REPORT


                     Pursuant to Section 13 or 15(d) of the
                         Securities Exchange Act of 1934



                                 Date of Report
               (Date of earliest event reported): January 17, 2003
                                                  ----------------

                             Advanced Photonix, Inc.
                             -----------------------
             (Exact Name of Registrant as specified in its Charter)



    Delaware                            1-11056                 33-0325836
--------------------------------------------------------------------------------
(State  or other  jurisdiction        (Commission              (IRS Employer
       of incorporation)              File Number)           Identification No.)



                 1240 Avenida Acaso, Camarillo, California 93012
                 -----------------------------------------------
               (Address of Principal Executive Offices) (ZIP Code)





                         Registrant's telephone number,
                      including area code: (805) 987-0146
                                           --------------


<PAGE>

Item 2.  Acquisition or Disposition of Assets.

     (a) On January 17, 2003,  Advanced Photonix,  Inc. ("API"),  purchased from
the Sellers named in the Stock Purchase  Agreement,  attached  hereto as Exhibit
2.1,  all of the  issued  and  outstanding  shares  of  common  stock  of  Texas
Optoelectronics,   Inc.  ("TOI"),  a  privately  owned  custom  manufacturer  of
optoelectric  components and assemblies.  None of the Sellers is an affiliate of
API, or any of API's executive  officers,  directors or principal  shareholders.
The purchase price was 1,000,000 shares of API Class A Common Stock,  subject to
an adjustment based on the TOI's financial statements as of January 17, 2003. In
addition,  at  closing  API  paid  off a debt  of TOI in  the  total  amount  of
$1,200,000   representing  principal  and  interest.  This  purchase  price  was
determined  through  arm's-length  negotiations  between the  parties.  API used
internally generated cash to pay off the TOI debt.

     (b) The  principal  assets  owned by Sellers  are its  customer  base,  its
equipment  used  in  the  manufacture   and  assembly  of  custom   optoelectric
semiconductor   based  components,   hybrid  assemblies  and  other  proprietary
solid-state light and radiation detection devices, and related inventory and raw
materials.  API intends to terminate  operations  at TOI's  facility in Garland,
Texas and move the TOI assets to API facilities where API intends to continue to
use these assets for these purposes.


Item 7.  Financial Statements and Exhibits

(a)  Financial Statements.
     ---------------------
     The financial statements of Texas  Optoelectronics,  Inc. for the 11 months
     ended November 30, 2002 audited by Farber & Hass LLP, Independent Certified
     Public Accountants, are included in this filing.

(b)  Pro  Forma  Information.
     ------------------------
     It is impracticable to provide the pro forma financial information required
     under  this  Item as of the date  this  Current  Report on Form 8-K must be
     filed.  The  required  pro  forma  financial  information  will be filed by
     amendment hereto as soon as practicable, but in any event not later than 60
     days after the date hereof.

(c)  Exhibits:
     ---------
     Item Ref
     in 17 CFR                                                           Exhibit
     229.601(b)  Exhibit                                                  Number
     ----------  -------                                                 -------
         2       Stock Purchase Agreement dated January 17, 2003, by        2.1
                 and among API and the Stockholders named therein.

        23       Consent of Farber & Hass LLP, Independent Certified       23.1
                 Public Accountants, to the filing of the Financial
                 Statements of Texas Optoelectronics, Inc. included
                 herein.

<PAGE>

Following are the financial statements of Texas Optoelectronics, Inc. for the
eleven months ended November 30, 2002, which include:
(1)  Independent Auditors' Report
(2)  Balance Sheet
(3)  Statement of Operations
(4)  Statement of Shareholders' Equity (Deficit)
(5)  Statement of Cash Flows
(6)  Notes to Financial Statements






<PAGE>



INDEPENDENT AUDITORS' REPORT


To the Board of Directors and Shareholders
  of Texas Optoelectronics, Inc.:

We have audited the accompanying  balance sheet of Texas  Optoelectronics,  Inc.
(the "Company") as of November 30, 2002 and the related consolidated  statements
of operations,  shareholders' deficit and cash flows for the eleven months ended
November 30, 2002.  These  financial  statements are the  responsibility  of the
Company's  management.  Our  responsibility  is to  express  an opinion on these
financial statements based on our audit.

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

In our opinion,  the accompanying  financial  statements  present fairly, in all
material  respects,  the financial  position of the Company at November 30, 2002
and the results of its operations and its cash flows for the eleven months ended
November 30, 2002 in conformity with accounting principles generally accepted in
the United States.






/s/ Farber & Hass LLP
January 8, 2003
Oxnard, CA






<PAGE>


                           TEXAS OPTOELECTRONICS INC.

                                  BALANCE SHEET

                                November 30, 2002


ASSETS

Current assets:
    Cash and cash equivalents                                        $ 205,110
    Trade accounts receivable, net of reserves of $20,000              527,917
    Inventory, net                                                     304,918
    Prepaid expenses and other current assets                           73,508
                                                                    ----------
                  Total current assets                               1,111,453


Property and equipment, net                                            106,343

Assets held for sale                                                    10,395
                                                                    ----------
                                                                    $1,228,191
                                                                    ==========

LIABILITIES AND SHAREHOLDERS' EQUITY

Current liabilities:
    Note payable                                                      $ 27,206
    Accounts payable                                                   164,864
    Accrued payroll                                                     73,268
    Accrued bonuses                                                     38,000
    Customer advances                                                   54,254
    Other accrued expenses                                              63,312
    Current portion of long-term debt                                   47,575
                                                                    ----------
                  Total current liabilities                            468,479

Long-term debt, net of current portion                                  25,635
Long-term debt due to a shareholder                                  1,200,000

Shareholders' equity (deficit):
    Preferred stock
        no par value, 100,000,000 shares
        authorized, none issued and outstanding                           --
    Common stock
        $0.01 par value, 100,000,000 shares
        authorized, 14,363,395 shares issued and
        outstanding                                                    143,634

    Additional paid-in capital                                       1,827,833
    Accumulated deficit                                             (2,437,390)
                                                                    ----------
                  Total shareholders' equity (deficit)                (465,923)

Commitments and contingencies (Note 8)
                                                                    $1,228,191
                                                                    ==========




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

<PAGE>


                           TEXAS OPTOELECTRONICS INC.

                            STATEMENT OF OPERATIONS

                  for the eleven months ended November 30, 2002



Net sales                                                           $2,836,954
Cost of goods sold                                                   2,244,257
                                                                    ----------
         Gross profit                                                  592,697

Selling, general and administrative expenses                           896,508
                                                                    ----------
         Loss from operations                                         (303,811)

Other income (expense):
         Interest expense                                             (171,828)
         Interest income                                                 2,810
         Other income                                                    6,507
         Loss on sale of assets                                        (23,189)
                                                                    ----------
Total Other Expense                                                   (185,700)

                  Net loss                                           ($489,511)
                                                                    ==========























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



<PAGE>



                           TEXAS OPTOELECTRONICS INC.

                   STATEMENT OF SHAREHOLDERS' EQUITY (DEFICIT)

                  for the eleven months ended November 30, 2002




<TABLE>
<CAPTION>


                                    Preferred         Additional            Paid-In                 Accumulated
                                      Stock          Common Stock           Capital                   Deficit             Total
                                    ---------        ------------         -----------               -----------          -------
<S>                                 <C>                <C>                <C>                       <C>                  <C>
Balance, December 31, 2001            $ -0-            $143,728           $1,827,833                ($1,947,879)         $23,682

Issuance of preferred
stock  (15,000,000 shares)            15,000                                                                              15,000

Purchase of common stock                                    (94)                                                             (94)
(9,379 Shares)

Redemption of preferred stock        (15,000)                                                                            (15,000)

Net Loss                                                                                               (489,511)        (489,511)
                                    ---------------------------------------------------------------------------------------------
Balance, November 30, 2002          $   -0-            $143,634           $1,827,833                ($2,437,390)       ($465,923)
                                    =============================================================================================

</TABLE>


























                     The accompanying notes are an integral
                       part of these financial statements.
<PAGE>


                           TEXAS OPTOELECTRONICS INC.

                             STATEMENT OF CASH FLOWS

                  for the eleven months ended November 30, 2002

                           Increase (Decrease) in Cash

Cash flows from operating activities:
    Net loss                                                          ($489,511)
    Adjustments to reconcile net loss to net cash
    used by operating activities:
        Depreciation and amortization                                    85,687
        Loss on sale of assets                                           23,189
        Increase in trade accounts receivable                          (134,279)
        Decrease in inventory                                           229,375
        Decrease in prepaid expenses and other current assets            88,907
        Increase in accounts payable                                     56,709
        Decrease in accrued expenses and customer advances             ( 61,785)
                                                                    ------------
             Net cash used by operating activities                     (201,708)
                                                                    ------------
Cash flows from investing activities:
    Proceeds from asset sales                                           347,241
    Capital expenditures                                                (11,262)
                                                                    ------------
             Net cash provided by investing activities                  335,979
                                                                    ------------
Cash flows from financing activities:
    Principal payments on note payable                                  (11,290)
    Principal payment on shareholder notes                             (435,000)
    Principal payment on capital leases                                 (60,093)
    Purchases of common stock                                               (94)
                                                                    ------------
             Net cash used in financing activities                   (  506,477)
                                                                    ------------

Net decrease in cash in cash and cash equivalents                      (372,206)

Cash and cash equivalents at beginning of period                        577,316
                                                                    ------------
Cash and cash equivalents at end of period                              205,110
                                                                    ============
Supplemental disclosure of cash flow information:
    Cash paid during the period for interest                         $  170,266
                                                                    ============

Supplemental disclosure of non-cash financing activities:

    Issuance of preferred stock for accrued interest                 $   15,000
                                                                    ============

    Redemption of preferred stock by issuing debt                    $   15,000
                                                                    ============

    Insurance premiums financed using a note payable                 $   38,496
                                                                    ============






                     The accompanying notes are an integral
                       part of these financial statements

<PAGE>


                           TEXAS OPTOELECTRONICS INC.

                          NOTES TO FINANCIAL STATEMENTS



1.        Significant Accounting Policies:
          --------------------------------
          General
          -------
          The  Company  currently  operates a facility in  Garland,  Texas.  The
          Company  designs,   manufactures  and  markets  custom  optoelectronic
          components and  assemblies.  Custom assembly of printed circuit boards
          and  mechanical  assemblies  is  performed  in a  strategic  partner's
          facility in Juarez,  Mexico. The Company's fiscal year end is December
          31.

          Concentration of Credit Risk:
          -----------------------------
          Financial  instruments,  which  potentially  subject  the  Company  to
          concentrations  of credit risk,  consist  principally  of cash,  cash
          equivalents  and trade  accounts  receivable.  At November  30,  2002,
          substantially  all  cash  and  cash  equivalents  were on  deposit  at
          Comerica Bank N.A.

          At  November  30,  2002,  two  customers  accounted  for  36%  and 13%
          respectively, of the Company's trade receivables. The Company performs
          ongoing  credit  evaluations  of its  customers  and normally does not
          require  collateral  to  support  accounts  receivable.

          Cash Equivalents
          ----------------
          The Company  considers  all highly liquid debt  instruments  purchased
          with  an  original  maturity  of  three  months  or  less  to be  cash
          equivalents.

          Revenue Recognition
          -------------------
          The Company enters into two basic types of subcontracts:

               Progress Billed Subcontracts
               ----------------------------
               The Company bills customers based on total costs incurred, less a
               percentage  for  retainage  which is due as  completed  units are
               delivered   under  the   subcontract.   Revenues  and  costs  are
               recognized using the percentage-of-completion method.

               Non-progress Billed Subcontracts
               --------------------------------
               The Company bills customers as units are shipped and revenues and
               costs are recognized on the same basis.

          Changes in production performance and estimated total production costs
          may result in revisions to cost and income and are  recognized  in the
          period in which the revisions are determined.  Changes which result in
          contract  losses  are  recognized  in the  period  when  the  loss  is
          determined.

          Cash received in advance of shipment is deferred as a liability in the
          accompanying financial statements.

<PAGE>

                           TEXAS OPTOELECTRONICS INC.

                    NOTES TO FINANCIAL STATEMENTS, Continued


          Inventory
          ---------
          Inventory  is  valued  at the  lower  of  cost  or  market  with  cost
          determined using the first-in, first-out ("FIFO") method. Inventory is
          comprised  primarily  of raw  materials,  work in process and finished
          goods.  A  provision  for  obsolete  and  slow  moving   inventory  is
          recognized in the period when such determinations are made.

          Property and Equipment
          ----------------------
          Property  and   equipment  are  stated  at  cost.   Depreciation   and
          amortization  are provided by the  straight-line  method for financial
          reporting  purposes and the  accelerated  cost recovery system and the
          modified  accelerated cost recovery system for tax reporting purposes.
          The cost of property and equipment is  depreciated  over the estimated
          useful lives of the related assets (3 to 5 years for personal property
          and equipment and 31.5 years for the building).  The cost of leasehold
          improvements is amortized over the lesser of the length of the related
          lease or the  estimated  useful lives of the assets.  Gains and losses
          from  retirements  and  dispositions  of property  and  equipment  are
          recognized  in  the  period  incurred.  Maintenance  and  repairs  are
          expensed when incurred; renewals and betterments are capitalized.

          Impairment of Long-Lived Assets and Assets to be Disposed of
          ------------------------------------------------------------
          SFAS No. 121,  Accounting for the Impairment of Long-Lived  Assets and
          for  Long-Lived  Assets  to  Be  Disposed   Statement   requires  that
          long-lived assets and certain identifiable intangibles be reviewed for
          impairment  whenever events or changes in circumstances  indicate that
          the carrying amount of an asset may not be recoverable. Recoverability
          of  assets  to be held and used is  measured  by a  comparison  of the
          carrying  amount of an asset to future net cash flows  expected  to be
          generated by the asset.  If such assets are considered to be impaired,
          the impairment to be recognized is measured as the amount by which the
          carrying  amounts of the assets  exceed the fair value of the  assets.
          Assets to be  disposed of are  reported  at the lower of the  carrying
          amount or fair value less costs to sell.

          During 2002, the Company sold one of its manufacturing  facilities and
          reclassified  certain  excess  assets  with a book value of $10,395 to
          Assets held for sale.  The carrying  value of the assets  exceed their
          fair value less costs to sell and no impairment loss was incurred.

          Warranty Reserve:
          -----------------
          The  Company  offers  a  warranty  of 3 months  to one year for  major
          product groups and maintains a reserve  against sales and  anticipated
          future losses.

          Income Taxes
          ------------
          The Company  recognizes  deferred tax  liabilities  and assets for the
          expected future tax  consequences of events that have been included in
          the financial statements or tax returns.  Under this method,  deferred
          tax  liabilities  and assets are  determined  based on the  difference
          between  the   financial   statement  and  tax  bases  of  assets  and
          liabilities  using  enacted  tax rates in effect for the year in which
          the differences are expected to reverse.

          Use of Estimates
          ----------------
          Financial  statements  prepared in conformity with generally  accepted
          accounting   principles  require  management  to  make  estimates  and
          assumptions   about  reported   amounts  of  assets  and  liabilities,
          disclosure of contingent assets and liabilities and reported amount of
          revenues  and  expenses.  Management  must  also  make  estimates  and
          judgments  about  future  results of  operations  related to  specific
          elements of the  business in  assessing  recoverability  of assets and
          recorded values of liabilities. Actual results could differ from those
          estimates.

<PAGE>


                           TEXAS OPTOELECTRONICS INC.

                    NOTES TO FINANCIAL STATEMENTS, Continued


          Research and Development
          ------------------------
          The Company is engaged in a number of projects to develop products for
          industries it believes have market prospects.  The Company's  research
          and development costs are charged to operations when incurred.

          Fair Value of Financial Instruments
          -----------------------------------
          The fair and carrying values of cash equivalents, accounts receivable,
          accounts  payable,  short-term debt and accrued  liabilities and those
          potentially   subject  to   valuation   risk  at  November   30,  2002
          approximated fair value due to their short maturity or nature.

          The fair value of notes payable to a shareholder  at November 30, 2002
          are materially  consistent  with the related  carrying values based on
          current  rates  offered to the Company for  instruments  with  similar
          maturities.

          Impact of New Accounting Standards:
          -----------------------------------
          Statement  of   Financial   Standards   ("SFAS")  Nos.  141  "Business
          Combinations"  is effective for business  combinations  after June 30,
          2001. It requires that the "purchase  method" of accounting be used to
          account for all business  combinations  and specifies  criteria for an
          acquired  intangible asset to be recognized  separately from goodwill.
          SFAS No. 142 is effective for  financial  statements  beginning  after
          December 15, 2000.  It requires  that goodwill no longer be amortized,
          but tested for impairment on an annual basis.  The Company adopted the
          provisions of SFAS Nos. 141 and 142 on January 1, 2001.

          In August  2001,  the FASB issued SFAS No. 143  "Accounting  for Asset
          Retirement Obligations." SFAS 143 establishes accounting standards for
          recognition  and  measurement  of a  liability  for the costs of asset
          retirement obligations. Under SFAS 143, the costs of retiring an asset
          will be recorded as a liability when the retirement obligation arises,
          and will be  amortized  to  expense  over the life of the  asset.  The
          Company does not expect any effect on financial position or results of
          operations from the adoption of this statement.

          SFAS 144 establishes a single  accounting  model for the impairment or
          disposal of long-lived assets, including discontinued operations. SFAS
          144 superseded SFAS 121 and APB Opinion No. 30, "Reporting the Results
          of  Operations-Reporting  the  Effects of  Disposal  of a Segment of a
          Business, and Extraordinary, Unusual and Infrequently Occurring Events
          and Transactions".  The provisions of SFAS 144 are effective in fiscal
          years   beginning   after  December  15,  2001,  with  early  adoption
          permitted, and in general are to be applied prospectively. The Company
          adopted SFAS 144 on January 1, 2002. It did not have a material impact
          on its results of operations or financial position.

          In  June  2002,  the  FASB  issued  SFAS  146  "Accounting  for  Costs
          Associated  with Exit or Disposal  Activities",  which  nullifies EITF
          Issue 94-3.  SFAS 146 is effective  for exit and  disposal  activities
          that  are  initiated  after  December  31,  2002 and  requires  that a
          liability for a cost associated  with an exit or disposal  activity be
          recognized when the liability is incurred,  in contrast to the date of
          an  entity's  commitment  to an exit plan,  as  required by EITF Issue
          94-3.  The  Company  will adopt the  provision  of SFAS 146  effective
          January 1, 2003 and believes that this will not have a material impact
          on its results from operations or financial position

2.        Inventory:
          ----------
          Inventory consists of the following at November 30, 2002

             Raw materials and supplies                              $ 441,980
             Work in process                                            79,913
             Finished goods                                            186,430
             Progress billed inventory                                 (27,174)
             Customer prepaid inventory                                (25,576)
             Reserve for obsolete and slow moving inventory           (350,655)
                                                                     ---------
                                                                     $ 304,918
                                                                     =========
<PAGE>


                           TEXAS OPTOELECTRONICS INC.

                    NOTES TO FINANCIAL STATEMENTS, Continued


3.        Property and equipment:
          -----------------------
          Property  and  equipment  at  November  30,  2002   consisted  of  the
          following:

             Leasehold improvements                                $    15,417
             Furniture fixtures and equipment                          617,514
             Assets under capital leases                               243,218
                                                                   -----------
                                                                       876,149

             Less accumulated depreciation and amortization            769,806
                                                                   -----------
                                                                   $   106,343
                                                                   ===========

          Included in  accumulated  depreciation  and  amortization  is $154,991
          related to assets under capital leases.

4.        Note Payable
          ------------
          In August 2002, the Company  financed  $38,496 of insurance  premiums.
          The note is payable at $3,991 per month  including  interest  at 7.99%
          per annum. The note will mature in June 2003.

5.        Long-Term Debt:
          ---------------
          Long-term debt consists of the following at November 30, 2002:

          Note  payable,  to a  shareholder,  bearing  interest
          at 12% per annum payable monthly, principal payable
          January 20, 2004                                            $425,000

          Note  payable,  to a  shareholder,  bearing  interest
          at 12% per annum payable monthly, principal payable
          January 20, 2004                                             765,000

          Capitalized  leases,  bearing  interest at rates
          ranging from 11.4% to 20% per annum, principal and
          interest of $6,216 due monthly                                83,210
                                                                    ----------
                                                                     1,273,210

          Less current portion                                         (47,575)
                                                                    ----------
                                                                    $1,225,635
                                                                    ==========

          Following is a summary of maturities of long-term  debt for the fiscal
          years ending December 31:

             2003                         $   47,575
             2004                          1,210,709
             2005                              8,965
             2006                              5,961
             2007                                --

          The shareholder loans are collateralized by a first and second lien on
          all the  Company's  assets.  The proceeds  were used to pay off a Bank
          line of credit and a note payable to a bank.

6.        Capital Transactions:
          ---------------------
          During  the  eleven  months  ended  November  30,  2002,  the  Company
          reacquired  9,379  shares of TOI's  common stock for cash at the price
          originally paid per share from a terminated employee pursuant to terms
          of stock repurchase agreement.
<PAGE>

                           TEXAS OPTOELECTRONICS INC.

                    NOTES TO FINANCIAL STATEMENTS, Continued


7.        Preferred Stock:
          ----------------
          The  Board of  Directors  is  entitled  to  establish  the  rights  of
          preferred  shares when  issued.  Currently,  no  preferred  shares are
          issued and outstanding  and as such the voting rights,  dividend rate,
          and other preferences of the preferred shares are not determined.

8.        Commitments and Contingencies:
          ------------------------------
          The Company  leases its facility in Garland,  Texas under an operating
          lease. The facility lease may be cancelled by giving a 240 day notice.
          Future minimum rentals  required under these leases are as follows for
          the fiscal years ending:
              2003                      $48,414
              2004                        7,140
              2005                          --
              2006                          --
              2007                          --
                                        -------
          Total minimum payments        $55,554
                                        =======

          Rental expense was $46,983 for the eleven months ended November 30,
          2002.

          From time to time, the Company is subject to various legal proceedings
          arising in the ordinary conduct of its business.  It is the opinion of
          management that the ultimate disposition of any such proceedings would
          not  have  a  material  adverse  effect  on  the  Company's  financial
          condition or results of operations.

9.        Income Taxes:
          -------------
          Temporary  differences and  carryforwards  which give rise to deferred
          tax asset and liabilities are summarized as follows:

          Assets
          ------
          Vacation accrual                                 $     20,217
          Inventory reserve                                     119,222
          Research credit carryforward                          114,733
          Tax Loss carryforward                                 795,091
          Inventory cost capitalization                          16,870
                                                           ------------
                                                              1,066,133

          Liabilities
          -----------
          Depreciation                                           14,788
                                                           ------------
          Net deferred taxes                                  1,051,345
          Valuation allowance                                (1,051,345)
                                                           ------------
                  Total deferred taxes                     $      -0-
                                                           ============

          In assessing  the  realizability  of deferred  tax assets,  management
          considers  whether it is more likely than not that some portion or all
          of the  deferred  tax  assets  will  not  be  realized.  The  ultimate
          realization of deferred tax assets is dependent upon the generation of
          future  taxable  income  during the periods in which  those  temporary
          differences become deductible.  Management  considers projected future
          taxable income and tax planning  strategies in making this assessment.
          Based upon the level of historical taxable losses, management believes
          it is more likely than not the Company  will not realize the  benefits
          of  these  deductible  differences  and has  established  a  valuation
          allowance  to fully  reserve the  deferred  tax assets at November 30,
          2002. Additionally, the ultimate realizability of net operating losses
          may be limited by change of control  provisions  under  Section 382 of
          the Internal Revenue Code.


<PAGE>

                           TEXAS OPTOELECTRONICS INC.

                    NOTES TO FINANCIAL STATEMENTS, Continued


          The Company has net  operating  loss  carryforwards  of  approximately
          $2,300,000  which  expire  beginning  in  2011.  The  research  credit
          carryforward expires beginning in 2003.

10.       Major Customers:
          ----------------
          The Company has three major customers,  which represent  approximately
          45% (20%, 15%, and 10% respectively) of the total sales for the eleven
          months  ended  November  30,  2002.  Amounts due from these  customers
          comprise  approximately  18% of accounts  receivable  at November  30,
          2002.

11.       Subsequent Event (unaudited)
          ----------------------------
          In November 2002, the Company's  shareholders entered into a letter of
          intent to sell all of the outstanding shares of the Company's Stock to
          Advanced  Photonix,  Inc.  for 1 million  shares  of  common  stock of
          Advanced  Photonix.  The  letter  of  intent  also  requires  Advanced
          Photonix  to  pay   $1,200,000   to  pay  off  the  notes  payable  to
          shareholders with accrued interest.





<PAGE>


                                   SIGNATURES

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


                                       ADVANCED PHOTONIX, INC.



                                   By: /s/ Brock Koren
                                       -----------------------------------
                                       Brock Koren
                                       President and Chief Executive Officer

Dated: January 31, 2003
       ----------------

<PAGE>
[{"type": "8-K", "sequence": "1", "filename": "api8k1-03rv.txt", "description": "API 8-K ACQ OF TEXAS OPTOELECTRONICS INC.", "secsgml_size_bytes": 38251}]
{"company-data": {"conformed-name": "ADVANCED PHOTONIX INC", "cik": "0000869986", "assigned-sic": "3674", "irs-number": "330325826", "state-of-incorporation": "DE", "fiscal-year-end": "0328"}, "filing-values": {"form-type": "8-K", "act": "34", "file-number": "001-11056", "film-number": "03534145"}, "business-address": {"street1": "1240 AVENIDA ACASCO", "city": "CAMARILLO", "state": "CA", "zip": "93012", "phone": "8059870146"}, "mail-address": {"street1": "1240 AVENIDA ACASO", "city": "CAMARILLO", "state": "CA", "zip": "93012"}}
SECURITIES AND EXCHANGE COMMISSION

                                    FORM 8-K

                                 CURRENT REPORT

                     Pursuant to Section 13 or 15(d) of the
                         Securities Exchange Act of 1934

                                 Date of Report
               (Date of earliest event reported): January 17, 2003
                                                  ----------------

                             Advanced Photonix, Inc.
                             -----------------------
             (Exact Name of Registrant as specified in its Charter)

    Delaware                            1-11056                 33-0325836
--------------------------------------------------------------------------------
(State  or other  jurisdiction        (Commission              (IRS Employer
       of incorporation)              File Number)           Identification No.)

                 1240 Avenida Acaso, Camarillo, California 93012
                 -----------------------------------------------
               (Address of Principal Executive Offices) (ZIP Code)

                         Registrant's telephone number,
                      including area code: (805) 987-0146
                                           --------------
Item 2.  Acquisition or Disposition of Assets.

     (a) On January 17, 2003,  Advanced Photonix,  Inc. ("API"),  purchased from
the Sellers named in the Stock Purchase  Agreement,  attached  hereto as Exhibit
2.1,  all of the  issued  and  outstanding  shares  of  common  stock  of  Texas
Optoelectronics,   Inc.  ("TOI"),  a  privately  owned  custom  manufacturer  of
optoelectric  components and assemblies.  None of the Sellers is an affiliate of
API, or any of API's executive  officers,  directors or principal  shareholders.
The purchase price was 1,000,000 shares of API Class A Common Stock,  subject to
an adjustment based on the TOI's financial statements as of January 17, 2003. In
addition,  at  closing  API  paid  off a debt  of TOI in  the  total  amount  of
$1,200,000   representing  principal  and  interest.  This  purchase  price  was
determined  through  arm's-length  negotiations  between the  parties.  API used
internally generated cash to pay off the TOI debt.

     (b) The  principal  assets  owned by Sellers  are its  customer  base,  its
equipment  used  in  the  manufacture   and  assembly  of  custom   optoelectric
semiconductor   based  components,   hybrid  assemblies  and  other  proprietary
solid-state light and radiation detection devices, and related inventory and raw
materials.  API intends to terminate  operations  at TOI's  facility in Garland,
Texas and move the TOI assets to API facilities where API intends to continue to
use these assets for these purposes.

Item 7.  Financial Statements and Exhibits

(a)  Financial Statements.
     ---------------------
     The financial statements of Texas  Optoelectronics,  Inc. for the 11 months
     ended November 30, 2002 audited by Farber & Hass LLP, Independent Certified
     Public Accountants, are included in this filing.

(b)  Pro  Forma  Information.
     ------------------------
     It is impracticable to provide the pro forma financial information required
     under  this  Item as of the date  this  Current  Report on Form 8-K must be
     filed.  The  required  pro  forma  financial  information  will be filed by
     amendment hereto as soon as practicable, but in any event not later than 60
     days after the date hereof.

(c)  Exhibits:
     ---------
     Item Ref
     in 17 CFR                                                           Exhibit
     229.601(b)  Exhibit                                                  Number
     ----------  -------                                                 -------
         2       Stock Purchase Agreement dated January 17, 2003, by        2.1
                 and among API and the Stockholders named therein.

        23       Consent of Farber & Hass LLP, Independent Certified       23.1
                 Public Accountants, to the filing of the Financial
                 Statements of Texas Optoelectronics, Inc. included
                 herein.
Following are the financial statements of Texas Optoelectronics, Inc. for the
eleven months ended November 30, 2002, which include:
(1)  Independent Auditors' Report
(2)  Balance Sheet
(3)  Statement of Operations
(4)  Statement of Shareholders' Equity (Deficit)
(5)  Statement of Cash Flows
(6)  Notes to Financial Statements
INDEPENDENT AUDITORS' REPORT

To the Board of Directors and Shareholders
  of Texas Optoelectronics, Inc.:

We have audited the accompanying  balance sheet of Texas  Optoelectronics,  Inc.
(the "Company") as of November 30, 2002 and the related consolidated  statements
of operations,  shareholders' deficit and cash flows for the eleven months ended
November 30, 2002.  These  financial  statements are the  responsibility  of the
Company's  management.  Our  responsibility  is to  express  an opinion on these
financial statements based on our audit.

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

In our opinion,  the accompanying  financial  statements  present fairly, in all
material  respects,  the financial  position of the Company at November 30, 2002
and the results of its operations and its cash flows for the eleven months ended
November 30, 2002 in conformity with accounting principles generally accepted in
the United States.

/s/ Farber & Hass LLP
January 8, 2003
Oxnard, CA
TEXAS OPTOELECTRONICS INC.

                                  BALANCE SHEET

                                November 30, 2002

ASSETS

Current assets:
    Cash and cash equivalents                                        $ 205,110
    Trade accounts receivable, net of reserves of $20,000              527,917
    Inventory, net                                                     304,918
    Prepaid expenses and other current assets                           73,508
                                                                    ----------
                  Total current assets                               1,111,453

Property and equipment, net                                            106,343

Assets held for sale                                                    10,395
                                                                    ----------
                                                                    $1,228,191
                                                                    ==========

LIABILITIES AND SHAREHOLDERS' EQUITY

Current liabilities:
    Note payable                                                      $ 27,206
    Accounts payable                                                   164,864
    Accrued payroll                                                     73,268
    Accrued bonuses                                                     38,000
    Customer advances                                                   54,254
    Other accrued expenses                                              63,312
    Current portion of long-term debt                                   47,575
                                                                    ----------
                  Total current liabilities                            468,479

Long-term debt, net of current portion                                  25,635
Long-term debt due to a shareholder                                  1,200,000

Shareholders' equity (deficit):
    Preferred stock
        no par value, 100,000,000 shares
        authorized, none issued and outstanding                           --
    Common stock
        $0.01 par value, 100,000,000 shares
        authorized, 14,363,395 shares issued and
        outstanding                                                    143,634

    Additional paid-in capital                                       1,827,833
    Accumulated deficit                                             (2,437,390)
                                                                    ----------
                  Total shareholders' equity (deficit)                (465,923)

Commitments and contingencies (Note 8)
                                                                    $1,228,191
                                                                    ==========

                     The accompanying notes are an integral
                       part of these financial statements.
TEXAS OPTOELECTRONICS INC.

                            STATEMENT OF OPERATIONS

                  for the eleven months ended November 30, 2002

Net sales                                                           $2,836,954
Cost of goods sold                                                   2,244,257
                                                                    ----------
         Gross profit                                                  592,697

Selling, general and administrative expenses                           896,508
                                                                    ----------
         Loss from operations                                         (303,811)

Other income (expense):
         Interest expense                                             (171,828)
         Interest income                                                 2,810
         Other income                                                    6,507
         Loss on sale of assets                                        (23,189)
                                                                    ----------
Total Other Expense                                                   (185,700)

                  Net loss                                           ($489,511)
                                                                    ==========

                     The accompanying notes are an integral
                       part of these financial statements.
TEXAS OPTOELECTRONICS INC.

                   STATEMENT OF SHAREHOLDERS' EQUITY (DEFICIT)

                  for the eleven months ended November 30, 2002
Preferred         Additional            Paid-In                 Accumulated
                                      Stock          Common Stock           Capital                   Deficit             Total
                                    ---------        ------------         -----------               -----------          -------
Balance, December 31, 2001            $ -0-            $143,728           $1,827,833                ($1,947,879)         $23,682

Issuance of preferred
stock  (15,000,000 shares)            15,000                                                                              15,000

Purchase of common stock                                    (94)                                                             (94)
(9,379 Shares)

Redemption of preferred stock        (15,000)                                                                            (15,000)

Net Loss                                                                                               (489,511)        (489,511)
                                    ---------------------------------------------------------------------------------------------
Balance, November 30, 2002          $   -0-            $143,634           $1,827,833                ($2,437,390)       ($465,923)
                                    =============================================================================================
The accompanying notes are an integral
                       part of these financial statements.
TEXAS OPTOELECTRONICS INC.

                             STATEMENT OF CASH FLOWS

                  for the eleven months ended November 30, 2002

                           Increase (Decrease) in Cash

Cash flows from operating activities:
    Net loss                                                          ($489,511)
    Adjustments to reconcile net loss to net cash
    used by operating activities:
        Depreciation and amortization                                    85,687
        Loss on sale of assets                                           23,189
        Increase in trade accounts receivable                          (134,279)
        Decrease in inventory                                           229,375
        Decrease in prepaid expenses and other current assets            88,907
        Increase in accounts payable                                     56,709
        Decrease in accrued expenses and customer advances             ( 61,785)
                                                                    ------------
             Net cash used by operating activities                     (201,708)
                                                                    ------------
Cash flows from investing activities:
    Proceeds from asset sales                                           347,241
    Capital expenditures                                                (11,262)
                                                                    ------------
             Net cash provided by investing activities                  335,979
                                                                    ------------
Cash flows from financing activities:
    Principal payments on note payable                                  (11,290)
    Principal payment on shareholder notes                             (435,000)
    Principal payment on capital leases                                 (60,093)
    Purchases of common stock                                               (94)
                                                                    ------------
             Net cash used in financing activities                   (  506,477)
                                                                    ------------

Net decrease in cash in cash and cash equivalents                      (372,206)

Cash and cash equivalents at beginning of period                        577,316
                                                                    ------------
Cash and cash equivalents at end of period                              205,110
                                                                    ============
Supplemental disclosure of cash flow information:
    Cash paid during the period for interest                         $  170,266
                                                                    ============

Supplemental disclosure of non-cash financing activities:

    Issuance of preferred stock for accrued interest                 $   15,000
                                                                    ============

    Redemption of preferred stock by issuing debt                    $   15,000
                                                                    ============

    Insurance premiums financed using a note payable                 $   38,496
                                                                    ============

                     The accompanying notes are an integral
                       part of these financial statements
TEXAS OPTOELECTRONICS INC.

                          NOTES TO FINANCIAL STATEMENTS

1.        Significant Accounting Policies:
          --------------------------------
          General
          -------
          The  Company  currently  operates a facility in  Garland,  Texas.  The
          Company  designs,   manufactures  and  markets  custom  optoelectronic
          components and  assemblies.  Custom assembly of printed circuit boards
          and  mechanical  assemblies  is  performed  in a  strategic  partner's
          facility in Juarez,  Mexico. The Company's fiscal year end is December
          31.

          Concentration of Credit Risk:
          -----------------------------
          Financial  instruments,  which  potentially  subject  the  Company  to
          concentrations  of credit risk,  consist  principally  of cash,  cash
          equivalents  and trade  accounts  receivable.  At November  30,  2002,
          substantially  all  cash  and  cash  equivalents  were on  deposit  at
          Comerica Bank N.A.

          At  November  30,  2002,  two  customers  accounted  for  36%  and 13%
          respectively, of the Company's trade receivables. The Company performs
          ongoing  credit  evaluations  of its  customers  and normally does not
          require  collateral  to  support  accounts  receivable.

          Cash Equivalents
          ----------------
          The Company  considers  all highly liquid debt  instruments  purchased
          with  an  original  maturity  of  three  months  or  less  to be  cash
          equivalents.

          Revenue Recognition
          -------------------
          The Company enters into two basic types of subcontracts:

               Progress Billed Subcontracts
               ----------------------------
               The Company bills customers based on total costs incurred, less a
               percentage  for  retainage  which is due as  completed  units are
               delivered   under  the   subcontract.   Revenues  and  costs  are
               recognized using the percentage-of-completion method.

               Non-progress Billed Subcontracts
               --------------------------------
               The Company bills customers as units are shipped and revenues and
               costs are recognized on the same basis.

          Changes in production performance and estimated total production costs
          may result in revisions to cost and income and are  recognized  in the
          period in which the revisions are determined.  Changes which result in
          contract  losses  are  recognized  in the  period  when  the  loss  is
          determined.

          Cash received in advance of shipment is deferred as a liability in the
          accompanying financial statements.
TEXAS OPTOELECTRONICS INC.

                    NOTES TO FINANCIAL STATEMENTS, Continued

          Inventory
          ---------
          Inventory  is  valued  at the  lower  of  cost  or  market  with  cost
          determined using the first-in, first-out ("FIFO") method. Inventory is
          comprised  primarily  of raw  materials,  work in process and finished
          goods.  A  provision  for  obsolete  and  slow  moving   inventory  is
          recognized in the period when such determinations are made.

          Property and Equipment
          ----------------------
          Property  and   equipment  are  stated  at  cost.   Depreciation   and
          amortization  are provided by the  straight-line  method for financial
          reporting  purposes and the  accelerated  cost recovery system and the
          modified  accelerated cost recovery system for tax reporting purposes.
          The cost of property and equipment is  depreciated  over the estimated
          useful lives of the related assets (3 to 5 years for personal property
          and equipment and 31.5 years for the building).  The cost of leasehold
          improvements is amortized over the lesser of the length of the related
          lease or the  estimated  useful lives of the assets.  Gains and losses
          from  retirements  and  dispositions  of property  and  equipment  are
          recognized  in  the  period  incurred.  Maintenance  and  repairs  are
          expensed when incurred; renewals and betterments are capitalized.

          Impairment of Long-Lived Assets and Assets to be Disposed of
          ------------------------------------------------------------
          SFAS No. 121,  Accounting for the Impairment of Long-Lived  Assets and
          for  Long-Lived  Assets  to  Be  Disposed   Statement   requires  that
          long-lived assets and certain identifiable intangibles be reviewed for
          impairment  whenever events or changes in circumstances  indicate that
          the carrying amount of an asset may not be recoverable. Recoverability
          of  assets  to be held and used is  measured  by a  comparison  of the
          carrying  amount of an asset to future net cash flows  expected  to be
          generated by the asset.  If such assets are considered to be impaired,
          the impairment to be recognized is measured as the amount by which the
          carrying  amounts of the assets  exceed the fair value of the  assets.
          Assets to be  disposed of are  reported  at the lower of the  carrying
          amount or fair value less costs to sell.

          During 2002, the Company sold one of its manufacturing  facilities and
          reclassified  certain  excess  assets  with a book value of $10,395 to
          Assets held for sale.  The carrying  value of the assets  exceed their
          fair value less costs to sell and no impairment loss was incurred.

          Warranty Reserve:
          -----------------
          The  Company  offers  a  warranty  of 3 months  to one year for  major
          product groups and maintains a reserve  against sales and  anticipated
          future losses.

          Income Taxes
          ------------
          The Company  recognizes  deferred tax  liabilities  and assets for the
          expected future tax  consequences of events that have been included in
          the financial statements or tax returns.  Under this method,  deferred
          tax  liabilities  and assets are  determined  based on the  difference
          between  the   financial   statement  and  tax  bases  of  assets  and
          liabilities  using  enacted  tax rates in effect for the year in which
          the differences are expected to reverse.

          Use of Estimates
          ----------------
          Financial  statements  prepared in conformity with generally  accepted
          accounting   principles  require  management  to  make  estimates  and
          assumptions   about  reported   amounts  of  assets  and  liabilities,
          disclosure of contingent assets and liabilities and reported amount of
          revenues  and  expenses.  Management  must  also  make  estimates  and
          judgments  about  future  results of  operations  related to  specific
          elements of the  business in  assessing  recoverability  of assets and
          recorded values of liabilities. Actual results could differ from those
          estimates.
TEXAS OPTOELECTRONICS INC.

                    NOTES TO FINANCIAL STATEMENTS, Continued

          Research and Development
          ------------------------
          The Company is engaged in a number of projects to develop products for
          industries it believes have market prospects.  The Company's  research
          and development costs are charged to operations when incurred.

          Fair Value of Financial Instruments
          -----------------------------------
          The fair and carrying values of cash equivalents, accounts receivable,
          accounts  payable,  short-term debt and accrued  liabilities and those
          potentially   subject  to   valuation   risk  at  November   30,  2002
          approximated fair value due to their short maturity or nature.

          The fair value of notes payable to a shareholder  at November 30, 2002
          are materially  consistent  with the related  carrying values based on
          current  rates  offered to the Company for  instruments  with  similar
          maturities.

          Impact of New Accounting Standards:
          -----------------------------------
          Statement  of   Financial   Standards   ("SFAS")  Nos.  141  "Business
          Combinations"  is effective for business  combinations  after June 30,
          2001. It requires that the "purchase  method" of accounting be used to
          account for all business  combinations  and specifies  criteria for an
          acquired  intangible asset to be recognized  separately from goodwill.
          SFAS No. 142 is effective for  financial  statements  beginning  after
          December 15, 2000.  It requires  that goodwill no longer be amortized,
          but tested for impairment on an annual basis.  The Company adopted the
          provisions of SFAS Nos. 141 and 142 on January 1, 2001.

          In August  2001,  the FASB issued SFAS No. 143  "Accounting  for Asset
          Retirement Obligations." SFAS 143 establishes accounting standards for
          recognition  and  measurement  of a  liability  for the costs of asset
          retirement obligations. Under SFAS 143, the costs of retiring an asset
          will be recorded as a liability when the retirement obligation arises,
          and will be  amortized  to  expense  over the life of the  asset.  The
          Company does not expect any effect on financial position or results of
          operations from the adoption of this statement.

          SFAS 144 establishes a single  accounting  model for the impairment or
          disposal of long-lived assets, including discontinued operations. SFAS
          144 superseded SFAS 121 and APB Opinion No. 30, "Reporting the Results
          of  Operations-Reporting  the  Effects of  Disposal  of a Segment of a
          Business, and Extraordinary, Unusual and Infrequently Occurring Events
          and Transactions".  The provisions of SFAS 144 are effective in fiscal
          years   beginning   after  December  15,  2001,  with  early  adoption
          permitted, and in general are to be applied prospectively. The Company
          adopted SFAS 144 on January 1, 2002. It did not have a material impact
          on its results of operations or financial position.

          In  June  2002,  the  FASB  issued  SFAS  146  "Accounting  for  Costs
          Associated  with Exit or Disposal  Activities",  which  nullifies EITF
          Issue 94-3.  SFAS 146 is effective  for exit and  disposal  activities
          that  are  initiated  after  December  31,  2002 and  requires  that a
          liability for a cost associated  with an exit or disposal  activity be
          recognized when the liability is incurred,  in contrast to the date of
          an  entity's  commitment  to an exit plan,  as  required by EITF Issue
          94-3.  The  Company  will adopt the  provision  of SFAS 146  effective
          January 1, 2003 and believes that this will not have a material impact
          on its results from operations or financial position

2.        Inventory:
          ----------
          Inventory consists of the following at November 30, 2002

             Raw materials and supplies                              $ 441,980
             Work in process                                            79,913
             Finished goods                                            186,430
             Progress billed inventory                                 (27,174)
             Customer prepaid inventory                                (25,576)
             Reserve for obsolete and slow moving inventory           (350,655)
                                                                     ---------
                                                                     $ 304,918
                                                                     =========
TEXAS OPTOELECTRONICS INC.

                    NOTES TO FINANCIAL STATEMENTS, Continued

3.        Property and equipment:
          -----------------------
          Property  and  equipment  at  November  30,  2002   consisted  of  the
          following:

             Leasehold improvements                                $    15,417
             Furniture fixtures and equipment                          617,514
             Assets under capital leases                               243,218
                                                                   -----------
                                                                       876,149

             Less accumulated depreciation and amortization            769,806
                                                                   -----------
                                                                   $   106,343
                                                                   ===========

          Included in  accumulated  depreciation  and  amortization  is $154,991
          related to assets under capital leases.

4.        Note Payable
          ------------
          In August 2002, the Company  financed  $38,496 of insurance  premiums.
          The note is payable at $3,991 per month  including  interest  at 7.99%
          per annum. The note will mature in June 2003.

5.        Long-Term Debt:
          ---------------
          Long-term debt consists of the following at November 30, 2002:

          Note  payable,  to a  shareholder,  bearing  interest
          at 12% per annum payable monthly, principal payable
          January 20, 2004                                            $425,000

          Note  payable,  to a  shareholder,  bearing  interest
          at 12% per annum payable monthly, principal payable
          January 20, 2004                                             765,000

          Capitalized  leases,  bearing  interest at rates
          ranging from 11.4% to 20% per annum, principal and
          interest of $6,216 due monthly                                83,210
                                                                    ----------
                                                                     1,273,210

          Less current portion                                         (47,575)
                                                                    ----------
                                                                    $1,225,635
                                                                    ==========

          Following is a summary of maturities of long-term  debt for the fiscal
          years ending December 31:

             2003                         $   47,575
             2004                          1,210,709
             2005                              8,965
             2006                              5,961
             2007                                --

          The shareholder loans are collateralized by a first and second lien on
          all the  Company's  assets.  The proceeds  were used to pay off a Bank
          line of credit and a note payable to a bank.

6.        Capital Transactions:
          ---------------------
          During  the  eleven  months  ended  November  30,  2002,  the  Company
          reacquired  9,379  shares of TOI's  common stock for cash at the price
          originally paid per share from a terminated employee pursuant to terms
          of stock repurchase agreement.
TEXAS OPTOELECTRONICS INC.

                    NOTES TO FINANCIAL STATEMENTS, Continued

7.        Preferred Stock:
          ----------------
          The  Board of  Directors  is  entitled  to  establish  the  rights  of
          preferred  shares when  issued.  Currently,  no  preferred  shares are
          issued and outstanding  and as such the voting rights,  dividend rate,
          and other preferences of the preferred shares are not determined.

8.        Commitments and Contingencies:
          ------------------------------
          The Company  leases its facility in Garland,  Texas under an operating
          lease. The facility lease may be cancelled by giving a 240 day notice.
          Future minimum rentals  required under these leases are as follows for
          the fiscal years ending:
              2003                      $48,414
              2004                        7,140
              2005                          --
              2006                          --
              2007                          --
                                        -------
          Total minimum payments        $55,554
                                        =======

          Rental expense was $46,983 for the eleven months ended November 30,
          2002.

          From time to time, the Company is subject to various legal proceedings
          arising in the ordinary conduct of its business.  It is the opinion of
          management that the ultimate disposition of any such proceedings would
          not  have  a  material  adverse  effect  on  the  Company's  financial
          condition or results of operations.

9.        Income Taxes:
          -------------
          Temporary  differences and  carryforwards  which give rise to deferred
          tax asset and liabilities are summarized as follows:

          Assets
          ------
          Vacation accrual                                 $     20,217
          Inventory reserve                                     119,222
          Research credit carryforward                          114,733
          Tax Loss carryforward                                 795,091
          Inventory cost capitalization                          16,870
                                                           ------------
                                                              1,066,133

          Liabilities
          -----------
          Depreciation                                           14,788
                                                           ------------
          Net deferred taxes                                  1,051,345
          Valuation allowance                                (1,051,345)
                                                           ------------
                  Total deferred taxes                     $      -0-
                                                           ============

          In assessing  the  realizability  of deferred  tax assets,  management
          considers  whether it is more likely than not that some portion or all
          of the  deferred  tax  assets  will  not  be  realized.  The  ultimate
          realization of deferred tax assets is dependent upon the generation of
          future  taxable  income  during the periods in which  those  temporary
          differences become deductible.  Management  considers projected future
          taxable income and tax planning  strategies in making this assessment.
          Based upon the level of historical taxable losses, management believes
          it is more likely than not the Company  will not realize the  benefits
          of  these  deductible  differences  and has  established  a  valuation
          allowance  to fully  reserve the  deferred  tax assets at November 30,
          2002. Additionally, the ultimate realizability of net operating losses
          may be limited by change of control  provisions  under  Section 382 of
          the Internal Revenue Code.
TEXAS OPTOELECTRONICS INC.

                    NOTES TO FINANCIAL STATEMENTS, Continued

          The Company has net  operating  loss  carryforwards  of  approximately
          $2,300,000  which  expire  beginning  in  2011.  The  research  credit
          carryforward expires beginning in 2003.

10.       Major Customers:
          ----------------
          The Company has three major customers,  which represent  approximately
          45% (20%, 15%, and 10% respectively) of the total sales for the eleven
          months  ended  November  30,  2002.  Amounts due from these  customers
          comprise  approximately  18% of accounts  receivable  at November  30,
          2002.

11.       Subsequent Event (unaudited)
          ----------------------------
          In November 2002, the Company's  shareholders entered into a letter of
          intent to sell all of the outstanding shares of the Company's Stock to
          Advanced  Photonix,  Inc.  for 1 million  shares  of  common  stock of
          Advanced  Photonix.  The  letter  of  intent  also  requires  Advanced
          Photonix  to  pay   $1,200,000   to  pay  off  the  notes  payable  to
          shareholders with accrued interest.
SIGNATURES

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

                                       ADVANCED PHOTONIX, INC.

                                   By: /s/ Brock Koren
                                       -----------------------------------
                                       Brock Koren
                                       President and Chief Executive Officer

Dated: January 31, 2003
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