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

                                    FORM 10-Q

[X]      Quarterly  report  pursuant  to Section  13 or 15(d) of the  Securities
         Exchange Act of 1934 for the quarterly period ended March 29, 2003, or

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


                         Commission file number 0-31162
                             O P T I C N E T, I N C.
             (Exact name of Registrant as specified in its charter)



              Delaware                                94-3368561
      -----------------------             -----------------------------------
      (State of incorporation)            (I.R.S. Employer Identification No.)


                           One Post Street, Suite 2500
                         San Francisco, California 94104
                     ---------------------------------------
                     (Address of principal executive office)

                                 (415) 956-4477
                         ------------------------------
                         (Registrant's telephone number)


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

                                  Yes X   No
                                     ---    ---

Indicate the number of shares  outstanding  of each of the  issuer's  classes of
common stock, as of the latest practicable date.

Common  Stock:  $.0001 Par Value;  3,093,202  shares of Voting  Common Stock and
2,998,902 shares of Nonvoting Common Stock outstanding as of March 29, 2003.

                                      -1-
<PAGE>

OPTICNET, INC.
(a development stage company)

INDEX

PART 1.         FINANCIAL INFORMATION                                       PAGE

Item 1.         Financial Statements (Unaudited)

                     Condensed  Balance  Sheets--March  29,  2003  and
                     September 28, 2002                                        3

                     Condensed  Statements of Operations-- Quarter and
                     Six  Months  ended  March 29,  2003 and March 30,
                     2002  and  the  period  from  February  23,  2000
                     (inception) to March 29, 2003                             4

                     Condensed  Statements of Cash Flows-- Quarter and
                     Six  Months  ended  March 29,  2003 and March 30,
                     2002  and  the  period  from  February  23,  2000
                     (inception) to March 29, 2003                             5

                     Notes to  Condensed  Financial  Statements--March
                     29, 2003                                                  6

Item 2.         Management's  Discussion  and  Analysis  of  Financial
                Condition and Results of Operations                           12

Item 3.         Quantitative and Qualitative Disclosure About Market
                Risk                                                          16

Item 4.         Controls and Procedures                                       17

PART II.        OTHER INFORMATION

Item 6.         Exhibits and Reports on Form 8-K                              18

                     (a) Exhibits

                     (b) Reports on Form 8-K

                SIGNATURES                                                    19


                                                                             -2-
<PAGE>

PART I.  FINANCIAL INFORMATION

Item 1.      FINANCIAL STATEMENTS (UNAUDITED)

OPTICNET, INC.
(a development stage company)
CONDENSED BALANCE SHEETS

                                                    March 29,     September 28,
                                                       2003           2002
                                                   (Unaudited)  (See note below)
                                                   -----------    -----------
ASSETS
Cash and cash equivalents                          $    14,205    $     4,881
Trade receivables, less customer allowance for
 doubtful accounts (2003--$0; 2002--$57,080)                --             --
Receivable from prototype deliveries                    60,508             --
Prepaid expenses                                         6,380          3,263
Other current assets                                    14,401            324
                                                   -----------    -----------
    Total current assets                                95,494          8,468

Other assets                                               728            728
                                                   -----------    -----------
                                                   $    96,222    $     9,196
                                                   ===========    ===========

LIABILITIES AND STOCKHOLDERS' DEFICIT
Accounts payable                                   $    15,743    $    13,713
Accrued expenses and other liabilities                  23,698         40,394
Other related party liability                          234,619        214,078
Note payable to related party                        2,656,338      2,656,338
Customer funded research and
  development liability                                 72,500             --
                                                   -----------    -----------
    Total current liabilities                        3,002,898      2,924,523

Stockholders' deficit                               (2,906,676)    (2,915,327)
                                                   -----------    -----------
                                                   $    96,222    $     9,196
                                                   ===========    ===========

Note:  The balance sheet at September 28, 2002 has been derived from the audited
balance sheet at that date.


See notes to condensed financial statements.


                                                                             -3-
<PAGE>

OPTICNET, INC.
(a development stage company)
CONDENSED STATEMENTS OF OPERATIONS
(Unaudited)
<TABLE>
<CAPTION>
                                                    Quarter Ended             Six Months Ended
                                              -------------------------   -------------------------
                                                                                                     Period from
                                                                                                     February 23,
                                                                                                   2000 (inception)
                                               March 29,     March 30,     March 29,     March 30,    to March 29,
                                                 2003          2002          2003          2002          2003
                                              -----------   -----------   -----------   -----------   -----------
<S>                                           <C>                 <C>           <C>   <C>           <C>
Revenues                                      $        --   $        --   $        --   $    87,500   $   611,500
Cost of revenues                                       --            --            --        43,752       343,441
                                              -----------   -----------   -----------   -----------   -----------
Gross margin                                           --            --            --        43,748       268,059


Selling, general and administrative expenses      133,158       479,526       192,169       767,868     2,355,177
Research and development expenses                 169,165     1,256,733       232,289     1,720,299     4,065,128
                                              -----------   -----------   -----------   -----------   -----------
Loss from operations                            (302,323)   (1,736,259)     (424,458)   (2,444,419)   (6,152,246)


Interest expense                                   38,193        25,787        77,816        44,567       227,131
Other income (expense)                                 --        (5,725)           --         3,275        65,173
                                              -----------   -----------   -----------   -----------   -----------
Deficit accumulated in the development stage  $  (340,516)  $(1,767,771)  $  (502,274)  $(2,485,711)  $(6,314,204)
                                              ===========   ===========   ===========   ===========   ===========


                Basic and Diluted Net Loss per Share

Basic and diluted net loss per share          $     (0.06)  $     (0.32)  $     (0.08)  $     (0.45)  $     (1.34)
                                              ===========   ===========   ===========   ===========   ===========

Weighted average shares used in computation
of basic and diluted net loss per share         6,044,585     5,539,735     6,047,112     5,486,573     4,699,890
                                              ===========   ===========   ===========   ===========   ===========
</TABLE>

See notes to condensed financial statements.

                                                                             -4-
<PAGE>

OPTICNET, INC.
(a development stage company)
CONDENSED STATEMENTS OF CASH FLOWS
(Unaudited)
<TABLE>
<CAPTION>
                                                       Quarter Ended                      Six Months Ended
                                                -----------------------------       -----------------------------       Period from
                                                                                                                        February 23,
                                                                                                                           2000
                                                                                                                        (inception)
                                                 March 29,          March 30,        March 29,         March 30,        to March 29,
                                                    2003              2002             2003              2002              2003
                                                -----------       -----------       -----------       -----------       -----------
<S>                                             <C>               <C>               <C>               <C>               <C>
Cash flows from operating activities:
Deficit accumulated in the development stage    $  (340,516)      $(1,767,771)      $  (502,274)      $(2,485,711)      $(6,314,204)
Adjustments to reconcile deficit
accumulated in the development stage
to net cash used by operating
activities:
  Depreciation and amortization                       5,091             6,390            10,182            14,269            61,741
  Other                                             (53,075)          409,446               673           260,673           265,271
                                                -----------       -----------       -----------       -----------       -----------
Net cash used by operating activities              (388,500)       (1,351,935)         (491,419)       (2,210,769)       (5,987,192)

Cash flows from investing activities:
  Purchase of property and equipment                     --                --                --            (1,158)          (24,492)
  Other                                                  --                --                --                --              (728)
                                                -----------       -----------       -----------       -----------       -----------
Net cash used by investing activities                    --                --                --            (1,158)          (25,220)

Cash flows from financing activities:
  Proceeds from borrowing on line of
    credit from related party                            --           927,334                --         1,489,730         2,820,331
  Principal payments on line of credit
    from related party                                   --                --                --                --          (163,993)
  Proceeds from equity funding from a
    related party                                   344,760                --           500,743                --         2,315,385
  Proceeds from issuance of convertible
    preferred stock, net                                 --                --                --                --         1,000,000
  Proceeds from issuance of common stock                 --               542                --               542            54,894
                                                -----------       -----------       -----------       -----------       -----------
Net cash provided by financing activities           344,760           927,876           500,743         1,490,272         6,026,617
                                                -----------       -----------       -----------       -----------       -----------

Net increase (decrease) in cash and
  cash equivalents                                  (43,740)         (424,059)            9,324          (721,655)           14,205
Cash and cash equivalents at beginning of
  period                                             57,945           530,893             4,881           828,489              --
                                                -----------       -----------       -----------       -----------       -----------
Cash and cash equivalents at end of period      $    14,205       $   106,834       $    14,205       $   106,834       $    14,205
                                                ===========       ===========       ===========       ===========       ===========

Supplemental Disclosure of Non Cash Items:

Grants of restricted stock                      $        --       $        --       $        --       $        --       $    95,040
Contribution of treasury stock                           --                --                --                --            14,720
Reacquisition of restricted stock                        --               3,625              --             3,625            19,208
Conversion of equity funding to preferred
  stock                                                  --                --         1,814,642                --         1,814,642
Reclassification of prior period funding        $        --       $        --       $    33,062       $        --       $    33,062

</TABLE>

See notes to condensed financial statements.


                                                                             -5-
<PAGE>

OPTICNET, INC.
(a development stage company)
NOTES TO CONDENSED FINANCIAL STATEMENTS
(Unaudited)

NOTE 1.   BASIS OF PRESENTATION

The accompanying  unaudited condensed financial statements have been prepared in
accordance with accounting  principles  generally  accepted in the United States
for interim  financial  information  and with the  instructions to Form 10-Q and
Article  10 of  Regulation  S-X.  Accordingly,  they do not  include  all of the
information and footnotes required by accounting  principles  generally accepted
in the United  States  for  complete  financial  statements.  In the  opinion of
management, all adjustments (consisting of normal recurring accruals) considered
necessary for a fair presentation have been included.  Operating results for the
interim periods presented are not necessarily indicative of the results that may
be  expected  for the  fiscal  year  ending  September  27,  2003.  For  further
information,  refer to the financial  statements  and  footnotes  thereto in the
Company's annual report on Form 10-K, as amended January 24, 2003.

OpticNet,  Inc.  ("OpticNet" or the "Company") was  incorporated on February 23,
2000 in the State of Delaware.  From its  inception  (February 23, 2000) through
December  31,  2000,  OpticNet  operated  as  a  controlled  subsidiary  of  BEI
Technologies, Inc. ("BEI Technologies").  BEI Technologies accumulated the costs
associated  with  OpticNet's  operations  in the period from  February  23, 2000
through  December 31, 2000  including  all  expenses  directly  attributable  to
OpticNet  and an  allocation  of the costs of shared  facilities,  salaries  and
employee benefits  attributable to OpticNet based on relative  headcount.  These
allocations  were based on assumptions  that management  believes are reasonable
under the  circumstances.  However,  these  allocations  and  estimates  are not
necessarily  indicative  of the costs that would have  resulted if OpticNet  had
been operated on a stand-alone basis during this period.

As of October 30, 2000, BEI  Technologies  distributed  3,578,387  shares of the
Company's common stock to BEI Technologies'  stockholders (the  "Distribution"),
substantially all of the Company's voting common stock held by BEI Technologies.
In the Distribution,  each holder of record of BEI Technologies  common stock as
of October 30, 2000  received  one share of OpticNet  common stock for every two
shares of BEI Technologies common stock held, and cash in lieu of any fractional
share of  OpticNet  common  stock.  After  the  Distribution,  BEI  Technologies
continued to hold securities of the Company in the form of convertible preferred
and common stock,  representing an aggregate ownership interest of approximately
25% in the Company.  During November 2002, the Company issued  18,146,420 shares
of Series B nonvoting and  nonconvertible  preferred stock to BEI  Technologies,
increasing its total ownership interest.

The principal  focus of the Company's  business is to develop,  manufacture  and
market fiber optic components and subsystems for the telecommunications market.

OpticNet's  primary  activities  since inception have been devoted to developing
its product  offerings and related  technologies,  recruiting key management and
technical personnel and attempting to raise capital to fund operations. OpticNet
has not recognized significant revenues since inception.  All revenue recognized
to date consists of engineering work performed under engineering agreements with
unaffiliated  customers  and not from the sale of  fiber  optic  components  and
subsystems.  As a result, the accompanying financial statements are presented in
accordance with Financial  Accounting  Standard  ("FAS") No. 7,  "Accounting and
Reporting by Development Stage Enterprises."

OpticNet's  operations  are  subject  to  significant  risks and  uncertainties,
including  competitive,  financial,   developmental,   operational,  growth  and
expansion, technological, regulatory and other risks associated with an emerging
business.

These  financial  statements  have been prepared  assuming that the Company will
continue as a going concern. Since its inception,  the Company has had recurring
operating  losses and negative cash flows from operations and has an accumulated
deficit of $6.3 million at March 29, 2003. These  conditions  raise  substantial
doubt about the Company's ability to continue as a going concern.

During  fiscal  2002 and the  first  six  months of  fiscal  2003,  the  Company
continued  to  be  unsuccessful   in  attracting   outside   financing   despite
management's efforts and continued operations on a reduced basis. Management and
the  Company's  board


                                                                             -6-
<PAGE>

of directors  decided in March 2002 to reduce the level of incremental  spending
for  research and  development  and to reduce  operations  to a level that would
solely  support  the  current  customer  base.  Management's  plan to enable the
Company to continue as a going concern calls for the Company's  operations to be
frozen at a minimal  level,  sufficient  to  support  current  product  delivery
commitments.  The Company reduced its fixed cost base to an absolute minimum and
no longer maintains any employees of its own other than officers of the Company,
each of whom provide  services to the Company on a part time basis. The majority
of  OpticNet's  operating  costs are paid by BEI  Technologies,  who  shares the
Hayward  facility and from whom  engineering and other services are rented on an
as required basis.  The cash outlay for the Company's  portion of these costs is
recorded as an additional  investment in the Company by BEI Technologies because
it is the intention of both parties that equity will be issued. New prototype or
product contracts will not be initiated by the Company if these contracts cannot
generate positive cash flows within 12 months.  Management believes that funding
for fiscal 2003 of less than $1.0 million will enable the Company to continue on
a reduced basis as a going  concern  through  September 30, 2003,  and that such
funding  will  be  available  from  BEI  Technologies,   if  required.  However,
management  cannot be certain  such  additional  funding will be on desirable or
acceptable terms to the Company.  Management continues to seek additional equity
financing  from existing  sources on an  opportunistic  and as available  basis.
Management plans to defer substantially all research and development activity in
the absence of additional equity financing.

These  financial  statements  do not  include  any  adjustments  to reflect  the
possible future effects on the  recoverability  and  classification of assets or
the amounts and  classification  of liabilities that may result from the outcome
of this uncertainty.

During the third and fourth quarters of fiscal 2002, BEI  Technologies  provided
the Company with  approximately  $1.8 million in  financing,  which was advanced
with the  understanding  that  such  amount  would be  converted  into a form of
nonvoting equity in the Company.  Effective  September 28, 2002, the Company and
BEI  Technologies  determined  the  Company  would  authorize  and  issue to BEI
Technologies  a series of  nonvoting  preferred  stock.  In November  2002,  the
Company issued a total of 18,146,420  shares of the Company's  newly  authorized
nonvoting Series B Preferred Stock to BEI Technologies,  in consideration of the
approximately $1.8 million advanced.

The Company  received  approximately  $0.5  million in equity  funding  from BEI
Technologies  during  the first six  months of  fiscal  2003,  used for  general
operating expenses.

Use of Estimates

The  preparation  of the  Company's  financial  statements  in  conformity  with
accounting  principles  generally  accepted  in the  United  States  of  America
requires  management to make estimates and  assumptions  that affect the amounts
reported in the financial  statements  and  accompanying  notes.  Actual results
could differ materially from those estimates. The judgments and assumptions used
by management are based on historical  experience  and other factors,  which are
believed to be reasonable under the circumstances.

Long-Lived Assets

The  Company  recognizes  impairment  losses  in  accordance  with FAS No.  144,
"Accounting  for the  Impairment or Disposal of Long-Lived  Assets."  Long-lived
assets,  including  property and equipment  and other  assets,  are reviewed and
impairment recognized when indicators of impairment are present and undiscounted
cash flows  estimated to be generated by those assets are less than the carrying
amounts of the assets.  Indicators of impairment were present during the periods
presented. Total net realizable fair value of all long-lived assets at March 29,
2003 was $728.

Recent Accounting Pronouncements

The Financial Accounting Standards Board ("FASB") issued FASB Interpretation No.
46 ("FIN  46"),  "Consolidation  of  Variable  Interest  Entities."  The primary
objectives of FIN 46 are to provide guidance on the  identification  of entities
for which  control is achieved  through  means other than through  voting rights
("variable  interest  entities" or "VIEs") and how to  determine  when and which
business enterprise should consolidate the VIE (the "primary beneficiary"). This
new model for consolidation  applies to an entity in which either (1) the equity
investors  (if  any) do not have a  controlling  financial  interest  or (2) the
equity  investment at risk is insufficient  to finance that entity's  activities
without receiving additional  subordinated financial support from other parties.
In addition,  FIN 46 requires  that both the primary  beneficiary  and all other
enterprises


                                                                             -7-
<PAGE>

with a significant variable interest in a VIE make additional  disclosures.  FIN
46 is  effective  for the  Company's  quarter  ended  September  27,  2003  with
transitional  disclosure required with these financial  statements.  The Company
will adopt these provisions in its quarter ended September 27, 2003, however the
Company  does not  believe  it is a  primary  beneficiary  of a VIE or holds any
significant interests or involvement in a VIE and does not expect there to be an
impact on the Company's financial statements.

In  December  2002,  the FASB issued FAS No. 148,  "Accounting  for  Stock-Based
Compensation:  Transition and Disclosure" ("FAS No. 148"). FAS No.148 amends FAS
No. 123,  "Accounting  for  Stock-Based  Compensation,"  to provide  alternative
methods of transition for a voluntary change to the fair  value-based  method of
accounting for stock-based employee compensation ("transition  provisions").  In
addition,  FAS  No.  148  amends  the  disclosure   requirements  of  Accounting
Principals  Board ("APB")  Opinion No. 28,  "Interim  Financial  Reporting,"  to
require pro forma disclosure in interim  financial  statements by companies that
elect to account for stock-based  compensation  using the intrinsic value method
prescribed  in APB  Opinion No. 25  ("disclosure  provisions").  The  transition
methods of FAS No. 148 are effective  for the Company's  September 27, 2003 Form
10-K. The Company  continues to use the intrinsic value method of accounting for
stock-based  compensation.  As a result, the transition provisions will not have
an effect on the  Company's  financial  statements.  The Company has adopted the
interim disclosure requirements as presented below.

Stock-Based Compensation

The  Company's  2000 Equity  Incentive  Plan  provides for the granting of stock
options to  consultants,  employees  and  directors.  The Company  accounts  for
stock-based  compensation  using the  intrinsic  value method  prescribed in APB
Opinion No. 25 whereby the options are granted at market price, and therefore no
compensation costs are recognized. The Company has elected to retain its current
method  of  accounting  as  described  above  and  has  adopted  the  disclosure
requirements FAS Nos. 123 and 148.

If compensation  expense for the Company's stock option plan had been determined
based  upon fair  values at the grant  dates for  awards  under  those  plans in
accordance  with FAS No. 123, the Company's  pro-forma  net earnings,  basic and
diluted earnings per common share would have been as follows:


                                                                             -8-
<PAGE>

<TABLE>
<CAPTION>
                                                    Three Months Ended               Six Months Ended
                                               -----------------------------    -----------------------------
                                                                                                               Period from February
                                                 March 29,       March 30,        March 29,         March 30,   23, 2000 (inception)
                                                   2003            2002             2003             2002        to March 29, 2003
                                               -----------      -----------     -----------      -----------    --------------------
<S>                                            <C>              <C>             <C>              <C>                <C>
Deficit accumulated during the
development stage, as reported                 $  (340,516)     $(1,767,771)    $  (502,274)     $(2,485,711)       $(6,314,204)

Deduct: Total stock based
employee compensation expense
determined under fair value
based method for all awards,
net of related tax effects                              --           (1,297)             --           (3,443)            (4,445)
                                               -----------      -----------     -----------      -----------        -----------

Pro forma deficit accumulated
  during the development stage                 $  (340,516)     $(1,769,068)    $  (502,274)     $(2,489,154)       $(6,318,649)

   Basic and Diluted Net Loss per Share:

Basic-as reported                              $     (0.06)     $     (0.32)    $     (0.08)     $     (0.45)       $     (1.34)

Basic-pro forma                                $     (0.06)     $     (0.32)    $     (0.08)     $     (0.45)       $     (1.34)


Diluted-as reported                            $     (0.06)     $     (0.32)    $     (0.08)     $     (0.45)       $     (1.34)

Diluted-pro forma                              $     (0.06)     $     (0.32)    $     (0.08)     $     (0.45)       $     (1.34)
</TABLE>

NOTE 2.   TRANSACTIONS WITH RELATED PARTIES

On October 6, 2000, the Company and BEI  Technologies  entered into a Technology
Transfer and Distribution  Agreement (the "Distribution  Agreement") whereby BEI
Technologies contributed to the Company certain assets and intellectual property
related to the fiber optic components  technology  developed by BEI Technologies
and BEI  Technologies'  majority  owned  subsidiary,  SiTek,  Inc.  ("SiTek") in
exchange for 3,616,000  shares of the Company's  common stock.  BEI Technologies
later distributed  3,578,387 of these shares to its stockholders on November 21,
2000 in connection with the Company's separation from BEI Technologies.

In connection with the Distribution  Agreement,  on October 6, 2000, the Company
and SiTek  entered into a License and  Technical  Assistance  Agreement  whereby
SiTek agreed to license certain technology to the Company, assist the Company in
certain  research and development  efforts  following the  Distribution and also
fabricate and supply  certain  components  utilized in the  Company's  products.
Further,  SiTek  granted to the Company a perpetual,  royalty  free,  worldwide,
exclusive  license to develop,  make, use and sell products  within the field of
telecommunications data transmission utilizing technology now possessed or later
developed  by  SiTek,  and the  Company  has  granted  to SiTek a  corresponding
perpetual, royalty free, worldwide,  exclusive license to develop, make, use and
sell products outside of the Company's  defined market utilizing  technology now
possessed or later  developed by the Company.  This agreement  shall continue in
effect  for five  years  and  automatically  renew  thereafter  for  consecutive
one-year terms unless either party gives written notice of termination.


                                                                             -9-
<PAGE>

On  October  27,  2000,  the  Company  and  BEI  Technologies  entered  into  an
InterCompany   Services  Agreement  (the  "Services   Agreement")   whereby  BEI
Technologies agreed to make available to the Company certain office and facility
space, personnel support and supervision, financial and administrative services,
record-keeping  functions  and other  assistance,  with BEI  Technologies  being
reimbursed for the costs and expenses  incurred in connection with the provision
of these services to OpticNet.  Charges for these services were allocated to the
Company based upon usage,  headcount and other methods that management  believes
to be reasonable.  In the fiscal  quarter ended June 29, 2002, BEI  Technologies
agreed to suspend  charges for the third and fourth  quarters of fiscal 2002 and
future  quarters'  service  charges,  due to the  Company's  inability to obtain
significant  strategic partners or third party financing and reduced services to
a minimal level.

The  Services  Agreement  further  provided  for  a  line  of  credit  from  BEI
Technologies  to the Company for up to $2.0 million with  interest at prime plus
1.5%, expiring on September 28, 2002, unless extended by mutual agreement of the
parties.  During fiscal 2002, BEI Technologies  increased this line of credit by
$1.0  million.  As of  September  28, 2002 and March 29,  2003,  the Company had
outstanding  borrowings  totaling  approximately  $2.7  million  on this line of
credit.  During the fiscal quarter ended June 29, 2002, the Company was informed
by BEI Technologies  that no further advances would be made to the Company under
this line of credit beyond the approximately $2.7 million funded as of March 30,
2002.  During October 2002, BEI  Technologies  extended the maturity date of the
line of credit to December 31, 2002.  At March 29, 2003,  BEI  Technologies  has
taken no action to seek  repayment  and the  Company  intends  to seek a further
extension from BEI Technologies.  To maintain sufficient liquidity in the future
and to fund operations,  the Company will need to obtain  additional  financing,
which may be on unfavorable terms in light of the Company's credit position.

On  September  28, 2001 the Company  entered into a general  equipment  sublease
agreement with BEI Technologies as the lessor,  which is subordinate to a master
lease agreement entered into by BEI Technologies as the lessee. On September 28,
2001, December 20, 2001 and March 28, 2002, the Company executed equipment lease
schedules under the general equipment sublease with BEI Technologies.  The total
value of the scheduled  equipment under the sublease agreement was approximately
$7.0 million,  with an initial lease term of 36 months.  Rental payments are due
on a quarterly  basis and the amount  determined by the Company's level of usage
of the equipment, the cost of the equipment and applicable interest. Payment due
for the six months ended March 29, 2003 was approximately $85,000.

The Company  originally  entered into a sublease  agreement in October 2001 with
BEI Technologies for a 15,571 square feet facility for administration,  research
and development and manufacturing  activities in Hayward,  California,  expiring
December  2005.  As of March  30,  2002,  the  Company,  in  recognition  of its
inability to obtain  significant  strategic  partners or third party  financing,
concluded it was necessary to reduce  operating  costs.  The Company agreed with
BEI  Technologies  that this  reduction in  operations  would lower usage of the
equipment and the subleased facilities described above. Accordingly,  the annual
lease  payments to BEI  Technologies  have been prorated since the quarter ended
June 29, 2002,  based on the portion of the facilities  the Company  requires to
support its current customers.

In the six months  ended  September  28,  2002,  BEI  Technologies  advanced  an
additional  $1.8  million to the Company.  Effective  September  28,  2002,  the
Company and BEI  Technologies  had  determined  the Company would  authorize and
issue to BEI  Technologies a series of nonvoting  preferred  stock.  In November
2002,  the Company  issued a total of 18,146,420  shares of the Company's  newly
authorized  nonvoting  and  nonconvertible  Series  B  Preferred  Stock  to  BEI
Technologies, in consideration of the $1.8 million advanced noted above.

The Company  received  approximately  $0.5  million in equity  funding  from BEI
Technologies  during  the first six  months of  fiscal  2003,  used for  general
operating  expenses.  These  monies  were  advanced by BEI  Technologies  to the
Company  on the basis that the  Company  would in the  future  issue  additional
equity securities to BEI Technologies representing this sum.

During the fiscal  quarter ended March 29, 2003,  the Company  received a letter
from BEI  Technologies  stating that BEI Technologies is interested in acquiring
those shares of the Company's  common stock that are not currently owned by that
company.  See Schedule 13D as filed by BEI  Technologies  on March 24, 2003.  If
this transaction is approved,  the Company expects the aggregate  purchase price
for all  common  stock not  already  owned by BEI  Technologies  will not exceed
$250,000 for the stock.

All of the  arrangements  outlined above were  negotiated by related parties and
may not represent transactions at arms length and the Company may not be able to
obtain terms as favorable with third parties if and when the  arrangements  with
BEI Technologies come to an end.

                                                                            -10-
<PAGE>

NOTE 3.   NOTE PAYABLE TO RELATED PARTY

During fiscal 2001, the Company entered into a line of credit agreement with BEI
Technologies,  an investor.  Under the terms of the agreement,  BEI Technologies
has made  available to the Company from time to time until December 31, 2002, an
amount not to exceed at any time the aggregate principle amount of $3.0 million,
as amended.  The Company's  obligation to repay the loans outstanding was due in
full on December 31, 2002,  however  payment has not been made.  As of March 29,
2003, BEI  Technologies has not taken action to seek repayment from the Company.
The Company  intends to seek a further  extension of the line of credit from BEI
Technologies. The final terms of such an extension would be determined when, and
if, such an extension is  consummated.  During the fiscal quarter ended June 29,
2002,  the Company was  informed by BEI  Technologies  that no further  advances
would be made to the Company under this line of credit beyond the  approximately
$2.7 million  funded as of March 30, 2002 in view of the Company's  inability to
obtain  outside  financing  to date and other  general  indications  of investor
disaffection  with  businesses  in  the  telecommunications  market.  Borrowings
outstanding on the line of credit were as follows:

                                               March 29, 2003    March 30, 2002
                                               --------------    --------------
Unsecured revolving promissory note from
BEI Technologies due 12/31/02, at a rate
of prime plus 1.5%; 5.75% and 6.3% at
March 29, 2003 and March 30, 2002,
respectively                                     $2,656,338        $2,656,338
                                               --------------    --------------
                                                 $2,656,338        $2,656,338
                                               ==============   ===============

No interest  was paid  during the six months  ended March 29, 2003 or in the six
months ended March 30, 2002. Accrued interest expense was approximately $227,000
and $68,000 at March 29, 2003 and March 30,  2002,  respectively.  The  interest
payable of  approximately  $227,000 at March 29,  2003 was  recorded as an other
related party liability.

NOTE 4.   REDUCTION IN FORCE

In April 2002,  the Company  underwent a reduction  in force  resulting in eight
individuals  departing  employment  with  the  Company,  including  engineering,
manufacturing  and marketing  personnel.  Severance pay for affected persons was
per Company policy,  including cash payment and the  acceleration of the vesting
of options for certain  affected  individuals.  Total cash costs  related to the
reduction in force of  approximately  $86,000 was recorded in the fiscal quarter
ending June 29, 2002 within research and development expense.

To further reduce costs for the Company in the near term,  during July 2002, all
of the Company's remaining 15 employees were released from their employment with
the Company and accepted  employment with a subsidiary of BEI  Technologies,  as
agreed to by both companies. The Company's President and Chief Technical Officer
have also become  employees of this same  subsidiary  of BEI  Technologies,  but
continue to serve as executive officers of the Company.  The services of certain
key individuals are expected to continue to be available to the Company on an as
needed basis,  with  reimbursement  by the Company to their present employer for
the time value of their services.  No material  severance costs were incurred by
the Company as a result of the release of these employees.

NOTE 5.   CONTINGENCIES AND LITIGATION

The Company has various  pending legal  actions  arising in the normal course of
business.  Management believes that none of these legal actions, individually or
in the  aggregate,  will  have a  material  impact  on the  Company's  business,
financial  condition or operating  results.  The Company is a  codefendant  in a
dispute with a former  employee,  which at March 29, 2003,  cannot be reasonably
estimated to the future financial impact. The Company believes this claim has no
merit and is defending the allegation.


                                                                            -11-
<PAGE>

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

Except for the historical information contained herein, the following discussion
contains  forward-looking  statements that involve risks and uncertainties.  The
Company's  actual results could differ  materially  from those  expressed in, or
implied  by,  such  forward-looking  statements.  Factors  that  could  cause or
contribute to such differences  include, but are not limited to, those discussed
in this  section,  and those  discussed in the  Company's  Form 10-K, as amended
January 24, 2003, in particular, within the "Risk Factors" section thereof.

See "Critical accounting policies and the use of estimates" for a description of
the Company's critical accounting policies.

Quarters ended March 29, 2003 and March 30, 2002

There were no revenues during the second quarter of fiscal 2003 and fiscal 2002.

Payments  and  receivables  recorded  from  customers  for  the  delivery  under
contracts of prototype units of approximately $15,000 and $0 were offset against
research  and  development  expense  in the  statements  of  operations  for the
quarters  ended  March 29,  2003 and March 30,  2002,  respectively.  During the
second  quarter of fiscal 2003,  the Company made  prototype  deliveries  to one
customer. There were no prototype deliveries during the second quarter of fiscal
2002.

Selling,  general and  administrative  expenses in the second  quarter of fiscal
2003 decreased  approximately  $347,000 from $480,000 in the same quarter of the
prior fiscal year to $133,000.  During fiscal 2002, the Company,  in recognition
of its  inability  to  obtain  significant  strategic  partners  or third  party
financing,  concluded it was necessary to reduce  operating  costs.  The Company
agreed with BEI Technologies that this reduction in operations would lower usage
of the Company's subleased facilities. Accordingly, the annual lease payments to
BEI  Technologies  are now prorated  based on the portion of the  facilities the
Company  requires to support work under  agreements with its current  customers.
Prior to the second quarter of fiscal 2002, selling,  general and administrative
expenses  included a quarterly  payment of $25,000 made to BEI  Technologies for
accounting,  human resources and other  administrative  services provided by BEI
Technologies  pursuant to the  Services  Agreement  between  the two  companies.
Commencing  with the second  quarter of fiscal  2002,  these  charges  have been
waived in light of the Company's financial position.

Research and development expenses in the second quarter of fiscal 2003 decreased
approximately $1,088,000 from $1,257,000 in the same quarter of the prior fiscal
year to $169,000 for employee  compensation  and subleased  facilities rent. The
decrease was  primarily due to the Company's  decision to  significantly  reduce
operations to conserve cash.

Interest  expense in the second quarter of fiscal 2003  increased  approximately
$12,000 from $26,000 in the same quarter of the prior fiscal year to $38,000 due
to the increased  outstanding  balance on the Company's line of credit agreement
with BEI Technologies during the quarter.

Six Months ended March 29, 2003 and March 30, 2002

There were no  revenues  during the first six  months of fiscal  2003.  Revenues
during the first six months of fiscal 2002 of  approximately  $88,000  reflected
work performed under engineering agreements with two unaffiliated customers. The
decrease is due to the Company's reduced operations in light of the slow down of
demand for new telecommunications  equipment components. In addition, during the
first six months of fiscal 2003,  the Company  recorded  payments or receivables
for deliveries of prototype products to one unaffiliated customer, accounted for
as an offset against research and development expense.

Cost of revenues as a percentage  of revenues was 50% in the first six months of
fiscal 2002.

Selling,  general  and  administrative  expenses  during the first six months of
fiscal 2003  decreased  approximately  $576,000 from $768,000 in the  comparable
period of the prior fiscal year to $192,000. During fiscal 2002, the Company, in
recognition of its inability to obtain  significant  strategic partners or third
party  financing,  concluded it was  necessary to reduce  operating  costs.


                                                                            -12-
<PAGE>

The Company agreed with BEI Technologies that this reduction in operations would
lower usage of the Company's subleased facilities. Accordingly, the annual lease
payments  to BEI  Technologies  are now  prorated  based on the  portion  of the
facilities  the  Company  requires  to support  work under  agreements  with its
current customers.  Prior to the second quarter of fiscal 2002, selling, general
and administrative  expenses included a quarterly payment of $25,000 made to BEI
Technologies for accounting,  human resources and other administrative  services
provided by BEI Technologies  pursuant to the Services Agreement between the two
companies. Commencing with the second quarter of fiscal 2002, these charges have
been waived in light of the Company's financial position.

Research  and  development  expenses  during the first six months of fiscal 2003
decreased  approximately  $1,488,000 from $1,720,000 in the comparable period of
the prior  fiscal  year to  $232,000.  The  decrease  was  primarily  due to the
Company's  decision to  significantly  reduce  operations  to support work under
agreements with its current customers.

Interest expense in the first six months of fiscal 2003 increased  approximately
$33,000 from $45,000 in the same quarter of the prior fiscal year to $78,000 due
primarily  to  the  increased  outstanding  balance  during  the  period  on the
Company's line of credit agreement with BEI Technologies.

Financing from Related Party

Since inception,  all operating  capital of the Company has been provided by BEI
Technologies  as debt or equity  financing.  The Company has been unable to gain
outside  financing  from  independent  parties  to date,  in light of the severe
downturn in the optical networking industry.

In October  2000,  BEI  Technologies  agreed to provide  OpticNet with a line of
credit  originally  established for up to $2.0 million.  During fiscal 2002, the
line of credit was amended to allow for  borrowings up to $3.0  million.  During
the  fiscal  quarter  ended  June  29,  2002,  BEI  Technologies  suspended  the
availability  of advances to the Company  under the line of credit,  under which
amounts outstanding at such time totaled approximately $2.7 million in principal
amount,  in view of the Company's  inability to obtain outside financing to date
and other general indications of investor dissatisfaction with businesses in the
telecommunications  market.  During October 2002, BEI Technologies  extended the
maturity date of the line of credit to December 31, 2002. BEI  Technologies  has
taken no action to date to seek  repayment  and the  Company  intends  to seek a
further  extension from BEI  Technologies.  The final terms of such an extension
would be determined  when, and if, such an extension is consummated.  In the six
months ending September 28, 2002, BEI  Technologies  provided an additional $1.8
million of  financing  to the  Company,  which was  advanced  with the intent to
convert such cash advances into additional equity. Effective September 28, 2002,
the Company and BEI  Technologies had determined the Company would authorize and
issue to BEI  Technologies  a series of nonvoting and  nonconvertible  preferred
stock.  In November  2002,  the Company  issued a total of 18,146,420  shares of
nonvoting and  nonconvertible  Series B Preferred Stock to BEI Technologies,  in
consideration  of the $1.8 million advanced during the third and fourth quarters
of fiscal 2002.

The Company  received  approximately  $0.5  million in equity  funding  from BEI
Technologies  during  the first six  months of  fiscal  2003,  used for  general
operating  expenses.  These  monies  were  advanced by BEI  Technologies  to the
Company  on the basis that the  Company  would in the  future  issue  additional
equity securities to BEI Technologies representing this sum.

During the fiscal  quarter ended March 29, 2003,  the Company  received a letter
from BEI  Technologies  stating that BEI Technologies is interested in acquiring
those shares of the Company's  common stock that are not currently owned by that
company.  See Schedule 13D as filed by BEI  Technologies  on March 24, 2003.  If
this transaction is approved,  the Company expects the aggregate  purchase price
for all  common  stock not  already  owned by BEI  Technologies  will not exceed
$250,000 for the stock.

Pursuant to the facilities sublease agreement,  equipment sublease agreement and
the Services Agreement described above, payments due to BEI Technologies were as
follows:


                                                                            -13-
<PAGE>
<TABLE>
<CAPTION>
                                                                                   Period from
                                           Fiscal Year    Quarter    Six Months  February 23, 2000
                                             Ended         Ended        Ended      (inception) to
                                          September 28,   March 29,    March 29,      March 29,
                                              2002          2003         2003          2003
                                            --------      -------      -------      ----------
<S>                                         <C>           <C>          <C>          <C>
Subleases
Facilities sublease                         $134,585      $ 5,395      $ 9,872      $  366,512
Equipment sublease                           660,449       39,447       85,456         745,905
                                            --------      -------      -------      ----------
Total amounts financed under subleases       795,034       44,842       95,328       1,112,417
Intercompany services charges                 50,000           --           --         125,000
                                            --------      -------      -------      ----------
Total payments due                          $845,034      $44,842      $95,328      $1,237,417
                                            ========      =======      =======      ==========
</TABLE>

Liquidity and Capital Resources

During the first six months of fiscal 2003,  total cash used by  operations  was
approximately $491,000. Cash provided by operations included the positive impact
of non-cash charges from depreciation and amortization of $10,000.  In addition,
positive  impacts to cash  resources  resulted  primarily  from an  increase  in
customer  funded research and development  liability of  approximately  $73,000.
These cash inflows  were offset  primarily  by an increase in  receivables  from
prototype deliveries of approximately  $60,000 and a net loss of $502,000.  Cash
provided by financing  activities  consisted of net proceeds from equity funding
from a related party of approximately  $501,000. The funding was used to support
daily operations and product development.

If the Company continues as a going concern,  the Company anticipates  incurring
substantial  additional  losses  over at least  the next  several  years.  Since
inception, the Company has incurred recurring operating losses and negative cash
flows from  operations.  As of March 29,  2003,  the Company had an  accumulated
deficit of $6.3 million.  After extensive  discussions with prospective  outside
investors  throughout  fiscal 2002,  during March 2002 the Company  became aware
that none of these  discussions  would result in near term equity  financing for
the Company.  As of March 30, 2002, the Company was advised by BEI  Technologies
that, in view of the Company's inability to obtain outside financing to date and
other  general  indications  of investor  disaffection  with  businesses  in the
telecommunications  market,  further debt financing would not be provided by BEI
Technologies.  These  conditions  raise  substantial  doubt about the  Company's
ability to continue as a going concern. In the first quarter of fiscal 2003, the
Company issued nonvoting preferred stock to BEI Technologies in consideration of
cash amounts advanced in the third and fourth quarters of fiscal 2002. As of the
end of the Company's March 30, 2002 fiscal quarter,  management  determined that
the Company  would not have  sufficient  financing for the remainder of its 2002
fiscal year without modifying the Company's business plan,  implementing  strict
cost-cutting   measures  and  additional  financing  was  obtained.   Therefore,
management and the Company's board of directors reduced the level of spending by
the Company for research and development and facility and equipment expenditures
and to  reduce  operations  to a level  that will  solely  support  the  current
customer base. The Company  intends to continue to operate in such a scaled back
manner until  additional  outside  financing is available or other prospects are
realized by the Company.

In April 2002,  the Company  underwent a reduction  in force  resulting in eight
individuals  terminating  employment  with the Company,  including  engineering,
manufacturing  and marketing  personnel.  Severance pay for affected persons was
per Company policy,  including cash payment and the  acceleration of the vesting
of options for certain  affected  individuals.  Total cash costs  related to the
reduction in force of  approximately  $86,000 was recorded in the fiscal quarter
ending June 29, 2002.  No costs  related to the reduction in force were recorded
in the first six months of fiscal 2003.

To further reduce costs for the Company in the near term,  during July 2002, all
of the Company's remaining 15 employees were released from their employment with
the Company and accepted  employment with a subsidiary of BEI  Technologies,  as
agreed to by both companies. The Company's President and Chief Technical Officer
have also become  employees of this same  subsidiary  of BEI  Technologies,  but
continue to serve as executive officers of the Company.  The services of certain
key


                                                                            -14-
<PAGE>

individuals  are  expected to continue to be  available  to the Company on an as
needed basis,  with  reimbursement  by the Company to their present employer for
the time value of their services.  No material  severance costs were incurred by
the Company as a result of the release of these employees.

Effects of Inflation

Management  believes  that, for the periods  presented,  inflation has not had a
material effect on the Company's operations.

Critical Accounting Policies and the Use of Estimates

Management's  discussion  and  analysis of  financial  condition  and results of
operations is based upon the  Company's  financial  statements,  which have been
prepared in accordance  with  accounting  principles  generally  accepted in the
United States of America.  The Company  reviews the accounting  policies used in
reporting its financial  results on a regular  basis.  The  preparation of these
financial  statements  requires  management to make estimates and judgments that
affect the reported  amounts of assets,  liabilities,  revenues and expenses and
related disclosure of contingent assets and liabilities. The estimates are based
on  historical  experience  and on various  other  assumptions  that  management
believes to be reasonable  under the  circumstances.  On an ongoing  basis,  the
Company evaluates its estimates.  Results may differ from these estimates due to
actual  outcomes  being  different  from  those on which the  Company  based its
assumptions.  The Company believes the following  critical  accounting  policies
affect  significant  judgments  and  estimates  used in the  preparation  of its
financial statements.

Allowance for Doubtful Accounts

The Company  continuously  monitors  collections and payments from its customers
and from time to time  maintains  allowances  for doubtful  accounts  based upon
historical  experience  and any  specific  customer  collection  issues that the
Company has identified.  While such credit losses have  historically been within
management's  expectations,  there can be no  assurance  that the  Company  will
continue to experience  the same relative  level of credit losses that it has in
the past.  In addition,  the  Company's  revenues and  accounts  receivable  are
concentrated  in a relatively few number of customers.  A significant  change in
the liquidity or financial  position of any one of these  customers or a further
deterioration in the economic  environment or  telecommunications  industry,  in
general,  could  have a material  adverse  impact on the  collectability  of the
Company's  accounts  receivable  and  future  operating  results,   including  a
reduction in future  revenues and additional  allowances for doubtful  accounts.
If, at the time revenue is recognized, the Company determines that collection of
a receivable is not reasonably  assured,  the revenue is deferred and recognized
at the time  collection  becomes  reasonably  assured,  which is generally  upon
receipt of payment.

Litigation

The Company  reserves for legal claims when payments  associated with the claims
become  probable  and can be  reasonably  estimated.  Due to the  difficulty  in
estimating  costs of resolving legal claims,  actual costs may be  substantially
higher  than the  amounts  reserved.  See Note 5 for a  further  description  of
litigation.

Environmental Matters

The Company reserves for known environmental  claims, of which there are none to
date, when payments associated with the claims become probable and the costs can
be reasonably estimated.  The Company's  environmental reserves, for all periods
presented,  are  recorded at the  expected  payment  amount.  The actual cost of
resolving environmental issues may be higher than that reserved primarily due to
difficulty  in  estimating  such  costs and  potential  changes in the status of
government regulations.


                                                                            -15-
<PAGE>

Significant Accounting Policies

Revenue Recognition

The Company  recognizes  revenue  using the guidance  from SEC Staff  Accounting
Bulletin No. 101 "Revenue  Recognition  in  Financial  Statements."  Under these
guidelines, revenue recognition is deferred on transactions where (i) persuasive
evidence  of  an  arrangement  does  not  exist,  (ii)  revenue  recognition  is
contingent upon performance of one or more obligations of the Company, (iii) the
price is not fixed or determinable or (iv) payment is not reasonably assured.

To date, the Company has not recognized revenue related to non-prototype product
offerings. All revenue recognized to date consists of engineering work performed
under  engineering  agreements  with  unaffiliated  customers.  Revenue for this
engineering  work  is  recognized  based  on  customer  acknowledgement  of  the
achievement of milestones in the engineering agreement.

Research and Development Expense

The Company's  products are highly technical in nature and require a significant
level of research and development  effort.  Research and  development  costs are
charged to expense as incurred in  accordance  with FAS No. 2,  "Accounting  for
Research  and  Development  Costs."  Payments  and  receivables   recorded  from
customers for the delivery under contracts of prototype units are offset against
research  and  development  expense  in  the  statements  of  operations  in the
respective period.

Property, Plant and Equipment and Related Depreciation

The Company records property,  plant and equipment at cost, which is depreciated
using the straight line method for structures  and  accelerated or straight line
methods for equipment over their estimated useful lives.  Leasehold improvements
and assets  acquired  under capital leases are amortized over the shorter of the
lease term or their  estimated  useful lives.  Management  reviews the estimated
useful  lives of  property,  plant and  equipment  to verify that the assets are
being  depreciated  in  accordance  with their usage and all assets no longer in
service are fully depreciated.

Accrued Expenses and Other Liabilities

The Company records  liabilities for services or products received in the period
in which the benefit was recognized.  Due to the difficulty in estimating  costs
of these services or products received, actual costs may be substantially higher
than the amounts recorded.

Item 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK

The  Company  was  incorporated  in  February  2000  and  commenced  independent
operations in November  2000.  The Company has not yet  generated  revenues from
sales of its  products  but only  from  engineering  work  performed  for  three
customers to date. The Company  expects to incur net losses for the  foreseeable
future.  The Company may never  achieve  profitability  and may not succeed as a
going  concern  and its  independent  auditor has  included a statement  to this
effect in their most recently issued audit report.

The Company  believes  that there have been no material  changes in the reported
market risks faced by the Company since those  discussed in the  Company's  Form
10-K, as amended January 24, 2003,  under the heading  corresponding to that set
forth above. The Company's exposure to market risk is limited to interest income
sensitivity,  which is affected by changes in the general level of U.S. interest
rates,  as a portion of the Company's  cash  equivalents  are in short term debt
securities  issued by  corporations.  The Company's cash  equivalents are placed
with high-quality issuers and the Company attempts to limit the amount of credit
exposure  to any one  issuer.  Due to the  nature of the  Company's  short  term
investments,  the Company believes that it is not subject to any material market
risk  exposure.  The  Company  does  not  have  any  foreign  currency  or other
derivative financial instruments.


                                                                            -16-
<PAGE>

Item 4.  CONTROLS AND PROCEDURES

The Company's  President and Chief Financial  Officer have  concluded,  based on
their  evaluation  within 90 days of the filing  date of this  report,  that the
Company's  disclosure controls and procedures (as defined in Rules 13a-14(c) and
15d-14(c)  under  the  Securities  Exchange  Act  of  1934)  are  effective  for
gathering,  analyzing and disclosing the  information the Company is required to
disclose in its reports filed under the Securities Exchange Act. There have been
no significant  changes in the Company's  internal  controls or in other factors
that could  significantly  affect these  controls  subsequent to the date of the
previously mentioned evaluation.


                                                                            -17-
<PAGE>

OPTICNET, INC.
(a development stage company)

PART II.      OTHER INFORMATION

Item 6.       EXHIBITS AND REPORTS ON FORM 8-K

              (a)      Exhibits

           Exhibit
           Numbers  Description                                         Footnote
           -------  -----------                                         --------
           99.1     President  Certification Pursuant to 18 U.S.C.
                    as  adopted  Pursuant  to  Section  906 of the
                    Sarbanes - Oxley Act of 2002

           99.2     CFO  Certification  Pursuant  to 18 U.S.C.  as
                    adopted   Pursuant   to  Section  906  of  the
                    Sarbanes - Oxley Act of 2002


           (b)      Reports on Form 8-K

                    No  reports on Form  8-K  were  filed  by  the
                    Company  during the fiscal quarter ended March
                    29, 2003


                                                                            -18-
<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 on May 8, 2003.


                                         OpticNet, Inc.


                                         By:      /s/ Gary D. Wrench
                                                  ------------------------------
                                                  Gary D. Wrench
                                                  Chief Financial Officer


                                                                            -19-
<PAGE>

                                CERTIFICATION OF
                                    PRESIDENT


I, Gerald D. Brasuell, certify that:

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

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

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

4.     The  registrant's  other  certifying  officers and I are  responsible for
       establishing  and  maintaining  disclosure  controls and  procedures  (as
       defined in Exchange Act Rules 13a-14 and 15d-14) for the  registrant  and
       have:

       a)    designed  such  disclosure  controls and  procedures to ensure that
             material  information  relating to the  registrant,  including  its
             consolidated  subsidiaries,  is made  known to us by others  within
             those  entities,  particularly  during  the  period  in which  this
             quarterly report is being prepared;

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

       c)    presented  in  this   quarterly   report  our   conclusions   about
             effectiveness  of the disclosure  controls and procedures  based on
             our evaluation as of the Evaluation Date;

5.     The registrant's other certifying officers and I have disclosed, based on
       our most recent  evaluation,  to the registrant's  auditors and the audit
       committee of registrant's  board of directors (or persons  performing the
       equivalent functions):

       a)    all significant deficiencies in the design or operation of internal
             controls which could adversely affect the  registrant's  ability to
             record,  process,  summarize  and  report  financial  data and have
             identified for the registrant's  auditors any material  weakness in
             internal controls; and

       b)    any fraud,  whether or not material,  that  involves  management or
             other  employees  who have a significant  role in the  registrant's
             internal controls; and

6.     The registrant's  other  certifying  officer and I have indicated in this
       quarterly  report  whether  there were  significant  changes in  internal
       controls or in other  factors that could  significantly  affect  internal
       controls subsequent to the date of our most recent evaluation,  including
       any  corrective  actions  with  regard to  significant  deficiencies  and
       material weaknesses.

      Dated     May 8, 2003
             -------------------


         /s/ Gerald D. Brasuell
      --------------------------
      Gerald D. Brasuell
      President


                                                                            -20-
<PAGE>

                                CERTIFICATION OF
                             CHIEF FINANCIAL OFFICER


I, Gary D. Wrench, certify that:

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

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

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

4.     The  registrant's  other  certifying  officers and I are  responsible for
       establishing  and  maintaining  disclosure  controls and  procedures  (as
       defined in Exchange Act Rules 13a-14 and 15d-14) for the  registrant  and
       have:

       a)    designed  such  disclosure  controls and  procedures to ensure that
             material  information  relating to the  registrant,  including  its
             consolidated  subsidiaries,  is made  known to us by others  within
             those  entities,  particularly  during  the  period  in which  this
             quarterly report is being prepared;

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

       c)    presented  in  this   quarterly   report  our   conclusions   about
             effectiveness  of the disclosure  controls and procedures  based on
             our evaluation as of the Evaluation Date;

5.     The registrant's other certifying officers and I have disclosed, based on
       our most recent  evaluation,  to the registrant's  auditors and the audit
       committee of registrant's  board of directors (or persons  performing the
       equivalent functions):

       a)    all significant deficiencies in the design or operation of internal
             controls which could adversely affect the  registrant's  ability to
             record,  process,  summarize  and  report  financial  data and have
             identified for the registrant's  auditors any material  weakness in
             internal controls; and

       b)    any fraud,  whether or not material,  that  involves  management or
             other  employees  who have a significant  role in the  registrant's
             internal controls; and

6.     The registrant's  other  certifying  officer and I have indicated in this
       quarterly  report  whether  there were  significant  changes in  internal
       controls or in other  factors that could  significantly  affect  internal
       controls subsequent to the date of our most recent evaluation,  including
       any  corrective  actions  with  regard to  significant  deficiencies  and
       material weaknesses.

      Dated    May 8, 2003
            --------------------


      /s/ Gary D. Wrench
      --------------------------
      Gary D. Wrench
      Chief Financial Officer


                                                                            -21-
<PAGE>

INDEX TO EXHIBITS


Exhibit
Number             Description
------             -----------

99.1               President  Certification  Pursuant  to 18  U.S.C  as  adopted
                   Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

99.2               CFO Certification Pursuant to 18 U.S.C as adopted Pursuant to
                   Section 906 of the Sarbanes-Oxley Act of 2002


                                                                            -22-