MICROSEMI CORP, 10-Q, 1998-02-09

MICROSEMI CORP
10-Q, 1998-02-09
SEMICONDUCTORS & RELATED DEVICES

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<PAGE>

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 December 28, 1997
------------------------------------------------

[_] Transition Report Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934

For the transition period from _______ to _______

Commission File No. 0-8866

MICROSEMI CORPORATION
---------------------
(Exact name of registrant as specified in its charter)

Delaware 95-2110371
------------------------------- ------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)

2830 South Fairview Street, Santa Ana, California 92704
-------------------------------------------------------
(Address of principal executive offices) (Zip Code)

(714) 979-8220
----------------------------------------------------
(Registrant's telephone number, including area code)

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 [_]

The number of shares outstanding of the issuer's Common Stock, $.20 par value,
on January 12, 1998 was 9,214,676.

1
<PAGE>

PART I - FINANCIAL INFORMATION

Item 1. FINANCIAL STATEMENTS

The unaudited consolidated financial information for the quarter ended
December 28, 1997 of Microsemi Corporation and Subsidiaries (the "Company") and
the comparative unaudited consolidated financial information for the
corresponding period of the prior year, together with the balance sheet as of
September 28, 1997 are attached hereto and incorporated herein by this
reference.

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MICROSEMI CORPORATION AND SUBSIDIARIES
Unaudited Consolidated Balance Sheets
(amounts in 000's)
<TABLE>
<CAPTION>
December 28, 1997 September 28, 1997
----------------- ------------------
<S> <C> <C>
ASSETS
Current assets
Cash and cash equivalents $ 5,753 $ 6,145
Accounts receivable less allowance for
doubtful accounts, $2,614 at December 28,
1997 and $2,665 at September 28, 1997 25,212 25,093
Inventories 53,700 53,248
Deferred income taxes 8,160 8,160
Other current assets 2,034 4,363
-------- --------
Total current assets 94,859 97,009
-------- --------

Property and equipment, at cost 72,219 70,485
Less: Accumulated depreciation (36,625) (35,614)
-------- --------
35,594 34,871
-------- --------

Other assets 4,426 3,314
-------- --------

$134,879 $135,194
======== ========

LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities
Notes payable to banks and others $ 2,350 $ 4,633
Current maturity of long-term debt 3,577 3,574
Accounts payable 9,846 11,304
Accrued liabilities 16,151 15,942
Income taxes payable 6,201 5,743
-------- --------
Total current liabilities 38,125 41,196
-------- --------

Deferred income taxes 2,544 2,544
-------- --------

Long-term debt 46,394 47,621
-------- --------

Other long-term liabilities 1,908 1,924
-------- --------
Stockholders' equity
Common stock, $.20 par value; authorized 20,000
shares; issued 9,176 shares at December 28,
1997 and 8,736 shares at September 28, 1997 1,835 1,747
Paid-in capital 17,046 16,197
Retained earnings 27,027 23,965
-------- --------
Total stockholders' equity 45,908 41,909
-------- --------

$134,879 $135,194
======== ========
</TABLE>

See accompanying Notes to Unaudited Consolidated Financial Statements.

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MICROSEMI CORPORATION AND SUBSIDIARIES
Unaudited Consolidated Income Statements
(amounts in 000's, except earnings per share)

13 Weeks Ended 13 Weeks Ended
December 28, 1997 December 29, 1996
----------------- -----------------
<S> <C> <C>
Net sales $44,052 $35,759
Cost of sales 32,033 26,015
------- -------

Gross profit 12,019 9,744
------- -------

Operating expenses
Selling 2,542 2,149
General and administrative 3,598 3,344
------- -------

Total operating expenses 6,140 5,493
------- -------

Income from operations 5,879 4,251
------- -------

Other (expense) income
Interest expense (net) (912) (960)
Other 20 (34)
------- -------

Total other expense (892) (994)
------- -------

Income before income taxes 4,987 3,257
Provision for income taxes 1,895 1,368
------- -------

Net income $ 3,092 $ 1,889
======= =======

Earnings per share
-Basic $ 0.35 $ 0.24
======= =======
-Diluted $ 0.28 $ 0.19
======= =======

Weighted average common shares outstanding
-Basic 8,907 8,013
-Diluted 12,005 11,842
</TABLE>

See accompanying Notes to Unaudited Consolidated Financial Statements.

4
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MICROSEMI CORPORATION AND SUBSIDIARIES
Unaudited Consolidated Statements of Retained Earnings
(amounts in 000's)

13 Weeks Ended 13 Weeks Ended
December 28, 1997 December 29, 1996
----------------- -----------------
<S> <C> <C>
Retained earnings at beginning
of period $23,965 $12,931

Net income 3,092 1,889

Translation loss from foreign currency (30) (3)
------- -------

Retained earnings at end of period $27,027 $14,817
======= =======
</TABLE>

See accompanying Notes to Unaudited Consolidated Financial Statements.

5
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MICROSEMI CORPORATION AND SUBSIDIARIES
Unaudited Consolidated Statements of Cash Flows
(amounts in 000's)

13 Weeks Ended 13 Weeks Ended
December 28, 1997 December 29, 1996
----------------- -----------------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITITES:
Net income $ 3,092 $ 1,889
Adjustments to reconcile net income to net
cash provided from operating activities
Depreciation and amortization 1,071 882
Increase (decrease) in allowance for doubtful accounts (51) 40
Changes in assets and liabilities, net of acquisition:
Accounts receivable (68) 3,482
Inventories (452) (1,796)
Other current assets 2,329 (206)
Other assets (172) (129)
Accounts payable (1,458) (827)
Accrued liabilities 209 (1,564)
Income taxes payable 458 (97)
Other (30) (3)
------- -------
Net cash provided from operating activities 4,928 1,671
------- -------

CASH FLOWS FROM INVESTING ACTIVITIES:
Payment for acquisition - (2,200)
Investment in an unconsolidated affiliate (1,000) -
Purchases of property and equipment (1,734) (1,276)
------- -------
Net cash used in investing activities (2,734) (3,476)
------- -------

CASH FLOWS FROM FINANCING ACTIVITIES:
Increase (decrease) in notes payable to banks and others (2,283) 1,714
Proceeds from issuance of long-term debt - 655
Payments of long-term debt (472) (355)
Reduction of other long-term liabilities (16) (68)
Exercise of employee stock options 185 49
------- -------
Net cash provided from (used in) financing activities (2,586) 1,995
------- -------

Net increase (decrease) in cash and cash equivalents (392) 190
Cash and cash equivalents at beginning of period 6,145 4,059
------- -------

Cash and cash equivalents at end of period $ 5,753 $ 4,249
======= =======
</TABLE>

See accompanying Notes to Unaudited Consolidated Financial Statements.

6
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MICROSEMI CORPORATION AND SUBSIDIARIES
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
December 28, 1997

1. PRESENTATION OF FINANCIAL INFORMATION

The financial information furnished herein is unaudited, but, in the opinion of
the management of Microsemi Corporation, includes all adjustments (all of which
are normal, recurring adjustments) necessary for a fair presentation of the
results of operations for the periods indicated. The results of operations for
the first quarter of the current fiscal year are not necessarily indicative of
the results to be expected for the full year.

The accompanying unaudited consolidated financial statements have been prepared
in accordance with the instructions to Form 10-Q and, therefore, do not include
all information and footnotes necessary for a fair presentation of financial
position, results of operations and cash flows in conformity with generally
accepted accounting principles. The unaudited consolidated financial statements
and notes should be read in conjunction with the financial statements and notes
thereto in the Annual Report on Form 10-K for the fiscal year ended September
28, 1997.

2. INVENTORIES

For interim reporting purposes, cost of goods sold and inventories are estimated
based upon the use of the gross profit method applied to each product line.

Inventories used in the computation of cost of goods sold were:

December 28, 1997 September 28, 1997
----------------- ------------------
(amounts in 000's)

<S> <C> <C>
Raw materials $17,019 $15,954
Work in process 21,771 23,774
Finished goods 14,910 13,520
------- -------
$53,700 $53,248
======= =======
</TABLE>

3. ACCRUED LIABILITIES

Accrued liabilities consist of:

December 28, 1997 September 28, 1997
----------------- ------------------
(amounts in 000's)
<S> <C> <C>
Accrued payroll, profit sharing,
benefits and related taxes $ 7,283 $ 9,016
Accrued interest 3,241 2,641
Other accrued liabilities 5,627 4,285
------- -------
$16,151 $15,942
======= =======
</TABLE>

7
<PAGE>

4. BORROWINGS

Long-term debt consisted of:

December 28, 1997 September 28, 1997
----------------- ------------------
(amounts in 000's)
<S> <C> <C>
City of Broomfield, Colorado, Industrial Development Bond-bearing
interest at 7.875% due in installments from 1996 to 2000; secured
by a first deed of trust $ 2,520 $ 2,520

City of Santa Ana, California, Industrial Development Revenue
Bond-bearing interest at 6.75% due in installments from 1998 to
2005; secured by a first deed of trust 5,350 5,350

Convertible Subordinated Debentures-bearing interest at
5.875% due 2012 33,259 33,261

Convertible Subordinated Notes-bearing interest at 10% due in 1999 - 750

Equipment lease due to GE Capital Public Finance, Inc., bearing
interest at 5.93%, payable in monthly installments through July
2002 2,475 2,700

Notes payable (PPC acquisition) bearing interest at 7% due monthly
through September 2009 2,303 2,370

Notes payable-bearing interest at rates in ranges of 5% - 10% due
between January 1998 and September 2002 4,064 4,244
------- -------
49,971 51,195
Less current portion (3,577) (3,574)
------- -------
$46,394 $47,621
======= =======
</TABLE>

A $2,520,000 Industrial Revenue Bond, due to the City of Broomfield, Colorado,
carries an interest rate of 7.875% per annum. The terms of the bond require
principal payments of $215,000 in 1998, $230,000 in 1999 and $2,075,000 in 2000.

A $5,350,000 Industrial Development Revenue Bond was originally issued in April
1985, through the City of Santa Ana for the construction of improvements and new
facilities at the Santa Ana plant. It was remarketed in 1995 and carries an
average interest rate of 6.75% per annum. The terms of the bond require
principal payments of $1,050,000 in 1998, $100,000 annually from 1999 to 2004
and $3,700,000 in 2005. A $5,557,000 letter of credit is carried by a bank to
guarantee the repayment of this bond. There are no compensating balance
requirements, however, the letter of credit agreement requires the Company to
make collateral payments of $350,000 on February 1, 1996, 1997 and 1998,
totaling $1,050,000 to assure the payment of principal scheduled for February 1,
1998. The payment of $1,050,000 has been made as required. An annual
commitment fee of 2% is charged on this letter of credit. In addition, the
agreement contains provisions regarding net worth and working capital. The
Company was in compliance with the aforementioned covenants at December 28,
1997.

In February 1987, the Company sold $40,250,000 of 5.875% convertible
subordinated debentures due 2012. The debentures are convertible into common
stock at $13.55 per share. As of September 28, 1997

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they are redeemable at 100% of par plus accrued interest. Deferred debt issuance
costs of $1,128,000 are included in other assets and are being amortized over
the life of the debentures on a straight-line basis. In fiscal years 1987, 1988,
1989 and 1991, the Company repurchased a total of $6,969,000 of these debentures
due to favorable market conditions. In the first quarter of fiscal year 1998,
$2,000 was converted into 147 shares of common stock. Commencing in March 1997,
the debentures require annual sinking fund payments in the amount of 5% of the
principal amount thereof, less the principal amount of converted or redeemed
debentures. As of December 28, 1997, the amount of redeemed and converted
debentures would have satisfied this requirement through March 1, 1999. (See
Note 8.)

In June 1992, the Company of 10% Convertible Subordinated Notes, due in 1999, to
an officer and two existing shareholders to finance a portion of an acquisition
completed in fiscal year 1992. The notes were converted, at $1.875 per share,
into 53,333; 613,331 and 400,000 shares of common stock in fiscal years 1996,
1997 and 1998, respectively.

In June 1997, the Company entered into a $2,700,000 equipment lease agreement
with GE Capital Public Finance, Inc., providing for monthly payments through
July 2002 of $45,000 plus interest at 5.93% per annum.

In September 1999, the Company issued notes of $2,370,000, related to the PPC
acquisition, payable to the former owners, bearing an interest rate of 7%, due
in monthly installments through September 2009.

The Company maintains a revolving credit facility with a domestic bank which
will continue through September 1999. Under the credit facility the Company can
borrow up to $15,000,000. The credit line has an interest rate of prime and is
secured by substantially all of the assets of the Company. In addition, the
credit agreement contains provisions regarding net worth and working capital.
The Company is in compliance with the aforementioned covenants at December 28,
1997. At December 28, 1997, $2,065,000 was borrowed under this credit facility.

5. EARNINGS PER SHARE

In February 1997, the Financial Accounting Standards Board issued SFAS No. 128,
"Earnings Per Share". This Statement establishes standards for computing and
requires the presentation of basic and diluted earnings per share (EPS). The
Company has adopted this statement in the current period and has restated the
EPS for the prior year period as required.

Basic earnings per share have been computed based upon the weighted average
number of common shares outstanding during the respective periods. Diluted
earnings per share have been computed, when the result is dilutive, using the
treasury stock method for stock options outstanding during the respective
periods and based upon the assumption that the convertible subordinated debt had
been converted into common stock as of the beginning of the respective periods,
with a corresponding increase in net income to reflect a reduction in related
interest expense, net of applicable taxes.

9
<PAGE>

Earnings per share for the quarters ended December 28, 1997 and December 29,
1996 were calculated as follows:

December 28, 1997 December 29, 1996
----------------- -----------------
<S> <C> <C>
BASIC

Net income $ 3,092 $ 1,889
======= =======

Weighted-average common shares outstanding 8,907 8,013
======= =======

Basic earnings per share $ 0.35 $ 0.24
======= =======

DILUTED

Net income $ 3,092 $ 1,889
Interest savings from assumed conversions
of convertible debt, net of income
taxes 310 321
------- -------

Net income assuming conversions $ 3,402 $ 2,210
======= =======

Weighted-average common shares outstanding 8,907 8,013

Stock options 375 401
Convertible debt 2,723 3,428
------- -------

Weighted-average common
shares outstanding on a diluted basis 12,005 11,842
======= =======

Diluted earnings per share $ 0.28 $ 0.19
======= =======
</TABLE>

10
<PAGE>

6. STATEMENT OF CASH FLOWS

For purposes of the unaudited Consolidated Statements of Cash Flows, the Company
considers all short-term, highly liquid investments having a maturity of three
months or less at the date of acquisition to be cash equivalents.

Supplementary information
- -------------------------
13 weeks ended 13 weeks ended
December 28, 1997 December 29, 1996
----------------- -----------------
(amounts in 000's)
<S> <C> <C>
Cash paid during the period for:
Interest $ 373 $ 289
====== ======
Income taxes $1,502 $1,198
====== ======

Non-cash financing activities:
Conversion of subordinated debt
into 400,147 and 240,000
shares of common stock
(See Note 4) $ 752 $ 450

Business acquired in purchase
transaction:
Fair values of assets acquired $ - $2,900
Less debt issued - (700)
------ ------
Cash paid for acquisition $ - $2,200
====== ======
</TABLE>

7. CONTINGENCY

In Broomfield, Colorado, the owner of a property located adjacent to a
manufacturing facility owned by a subsidiary of the Company had filed suit
against the subsidiary and other parties, claiming that contaminants migrated to
his property, thereby diminishing its value. In August 1995, the subsidiary
together with the former owners of the manufacturing facility, agreed to settle
the claim and to indemnify the owner of the adjacent property from remediation
costs. Although contaminants previously used at the facility are present in
soil and groundwater on the subsidiary's property, the Company vigorously
contests any assertions that the subsidiary is the cause of the contamination;
however, there can be no assurance that recourse will be available against third
parties. State and local agencies in Colorado are reviewing current data and
considering study and cleanup options, and it is not yet possible to predict
costs for remediation or the allocation thereof among potentially responsible
parties.

8. SUBSEQUENT EVENTS

On December 31, 1997, the Company sold General Microcircuits, Inc., a wholly
owned subsidiary in Mooresville, North Carolina, for $5,000,000 in cash and
$2,000,000 in a note receivable. Microsemi does not expect any material gain or
loss from this transaction.

On January 21, 1998, the Company and BKC Semiconductors Incorporated (BKC),
Lawrence, Massachusetts, jointly announced a definitive agreement whereby
Microsemi will acquire all of the common stock of BKC for approximately
$13,400,000 in cash. Microsemi intends to finance this acquisition with cash on
hand and borrowings under its existing credit facilities. BKC is a publicly
held

11
<PAGE>

company. It manufactures discrete semiconductors with sales of approximately
$11,000,000 for the fiscal year ended September 28, 1997. The acquisition will
be accounted for under the purchase method.

On January 26, 1998, the Company announced that it intends to redeem its 5.875%
convertible subordinated debentures as of February 12, 1998. The holders may
convert their debentures into common stock of the Company, at any time prior to
5 p.m. Pacific Standard Time, February 12, 1998. The Company expects that most
of the $33,259,000 outstanding debentures will be converted and has previously
received notices from holders of $26,826,000 in face value of debentures,
indicating their intention to convert their debentures into Common Stock.

12
<PAGE>

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

This Quarterly Report on Form 10-Q includes forward looking statements, the
realization of which may be impacted by certain important factors discussed
below under "Important Factors Related to Forward-Looking Statements and
associated Risks" and in Form 10-K for the fiscal year ended September 28, 1997.

Introduction
- ------------

Microsemi Corporation is a multinational supplier of high reliability power
semiconductors, surface mount and custom diode assemblies for the electronics,
computer, telecommunications, defense/aerospace and medical markets. The
Company's semiconductor products include diodes, transistors and silicon
controlled rectifiers (SCR's) which can be used in virtually all electrical and
electronic circuits. Typical functions include solid state switching, signal
processing, voltage and power regulation, circuit protection and absorption of
electrical surges and transient voltage spikes. Technologies for these devices
range from the very mature mesa rectifier diodes, still used in all types of
power supply applications, to the newly designed micro-miniature transient
absorbers, which are mounted within the cables used to connect computer or
telecommunications equipment.

Capital Resources and Liquidity
- -------------------------------

Microsemi Corporation's operations in the three months ended December 28, 1997
were funded with internally generated funds and borrowings under the Company's
line of credit. In September 1997, the Company renewed its credit line with a
bank. Under the current line of credit, the Company can borrow up to
$15,000,000. As of December 28, 1997, $2,065,000 was borrowed under this credit
facility. At December 28, 1997, the Company had $5,753,000 in cash and cash
equivalents.

A $5,350,000 Industrial Development Revenue Bond was originally issued in April
1985, through the City of Santa Ana Industrial Development Authority for the
construction of improvements and new facilities at the Santa Ana plant. It was
remarketed in 1995 and carries an average interest rate of 6.75% per annum. The
terms of the bond require principal payments of $1,050,000 in 1998, $100,000
annually from 1999 to 2004 and $3,700,000 in 2005. A $5,557,000 letter of credit
is carried by a bank to guarantee the repayment of this bond. The principal
payment of $1,050,000, consisting of $350,000 in cash and $700,000 in matured
certificates of deposit, scheduled for February 1, 1998 has been made as
required.

Based upon information currently available, the Company believes that it can
meet its current operating cash and debt service requirements with internally
generated funds together with its available borrowings.

In October 1996, Microsemi purchased certain assets and the right to manufacture
a selected group of products of the high-reliability portion of SGS Thomson's
Radio Frequency (RF) Semiconductor business in Montgomeryville, Pennsylvania
(the RF Products acquisition). In September 1997, Microsemi PPC, Inc. (PPC),
formerly known as Micro PPC Acquisition Corp., a wholly owned subsidiary of the
Company, purchased substantially all of the assets and assumed certain
liabilities of PPC Products Corp., Technett Seals Inc., and Semiconductors, Inc.
(collectively referred to as PPC Products). PPC Products is a supplier of power
transistors, fixed and adjustable linear regulators, and

13
<PAGE>

power rectifiers and is located in Riviera Beach, Florida. The aggregate
purchase price for both entities included approximately $5,201,000 in cash and
$3,070,000 in notes payable.

The Company's 5.875% Convertible Subordinated Debentures due 2012 require
semiannual interest payments of approximately $977,000. The Debentures are
callable at 100% of face value and are convertible at the option of the holder
into Common Stock at a conversion price of $13.55 per share. On January 26,
1998, the Company announced that it intends to redeem the debentures. (See note
8.)

On December 31, 1997, the Company sold General Microcircuits, Inc., a wholly
owned subsidiary in Mooresville, North Carolina, for $5,000,000 in cash and
$2,000,000 in a promissory note. Microsemi does not expect any material gain or
loss from this transaction.

On January 29, 1998, the Company announced that it has made an equity investment
of approximately $1,000,000 in Xemod, Inc. Xemod was founded in 1994 and
headquartered in Sunnyvale, California. It designs, manufacturers and markets
power amplifier semiconductor components targeted at the cellular and wireless
communication markets.

The Company has no other significant capital commitments.

The average collection period of accounts receivable was 52 days for the current
quarter compared to 59 days for the same period of fiscal year 1997. The
improvement was due to higher sales and a better collection effort.

The average days sales of products in inventories was 152 for the three months
ended December 28, 1997 compared to 171 days for the corresponding period of
fiscal year 1997. The decrease was primarily due to higher shipments in the
current period and an effort to control inventories.

RESULTS OF OPERATIONS FOR THE QUARTER ENDED DECEMBER 28, 1997 COMPARED TO THE
QUARTER ENDED DECEMBER 29, 1996.

Net sales for the first quarter of fiscal year 1998 increased $8,293,000 to
$44,052,000, from $35,759,000 for the first quarter of fiscal year 1997; this
increase was primarily due to strong demand for the space market related
products, higher shipments of the Powermite and the addition of PPC Products,
which was acquired in September 1997.

Gross profit increased $2,275,000 to $12,019,000 or 27.3% of sales for the
current quarter of fiscal year 1998 from $9,744,000 or 27.2% of sales for the
first quarter of fiscal year 1997. The increase of gross profit was due to
higher sales.

Operating expenses for the current quarter of fiscal year 1998 increased
$647,000 compared to that of the corresponding period of the prior year;
primarily due to the addition of the PPC subsidiary.

The effective tax rates of 38% and 42% in the first quarters of fiscal years
1998 and 1997 were the combined result of taxes computed on foreign and domestic
income. The prior year tax rate was higher due to certain non-deductible losses,
a less favorable mix of worldwide income and other adjustments.

14
<PAGE>

Important factors related to forward-looking statements and associated risks
- ----------------------------------------------------------------------------

This Form 10-Q contains certain forward-looking statements that are based on
current expectations and involve a number of risks and uncertainties. The
forward-looking statements included herein are based on, among other items,
current assumptions that the Company will be able to meet its current operating
cash and debt service requirements with internally generated funds and its
available line of credit, that it will be able to successfully resolve disputes
and other business matters as anticipated, that competitive conditions within
the semiconductor, surface mount and custom diode assembly industries will not
change materially or adversely, that the Company will retain existing key
personnel, that the Company's forecasts will reasonably anticipate market demand
for its products, and that there will be no materially adverse change in the
Company's operations or business. Other factors that could cause results to
vary materially from current expectations are discussed elsewhere in this Form
10-Q. Assumptions relating to the foregoing involve judgments that are difficult
to predict accurately and are subject to many factors that can materially affect
results. Forecasting and other management decisions are subjective in many
respects and thus susceptible to interpretations and periodic revisions based on
actual experience and business developments, the impact of which may cause the
Company to alter its forecasts, which may in turn affect the Company's results.
In light of the factors that can materially affect the forward-looking
information included herein, the inclusion of such information should not be
regarded as a representation by the Company or any other person that the
objectives or plans of the Company will be achieved.

The unaudited consolidated financial statements and notes should be read in
conjunction with the financial statements and notes thereto in the Annual Report
in Form 10-K for the fiscal year ended September 28, 1997. Additional factors
that could cause results to vary materially from current expectations are
discussed under the heading "Important factors related to forward-looking
statements and associated risks" in the Company's annual report in Form 10-K as
filed December 29, 1997 with the Securities and Exchange Commission, and
elsewhere in that Form 10-K.

Order Backlog
- -------------

The Company's consolidated order backlog was $67,000,000 as of December 28,
1997, compared to $64,000,000 at December 29, 1996 and $67,000,000 at September
28, 1997. Backlog of General Microcircuits, Inc., has been eliminated from the
previously published amounts. (See note 8.)

The Company's backlog as of any particular date may not be representative of
actual sales for any succeeding period because lead times for the release of
purchase orders depend upon the scheduling practices of individual customers,
the delivery times of new or non-standard products can be affected by scheduling
factors and other manufacturing considerations, the rate of booking new orders
can vary significantly from month to month, and the possibility of customer
changes in delivery schedules or cancellations of orders.

15
<PAGE>

PART II - OTHER INFORMATION

Item 1. Legal Proceedings
-----------------

Inapplicable

Item 2. Changes in Securities
---------------------

Inapplicable

Item 3. Defaults Upon Senior Securities
-------------------------------

Inapplicable

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

(a) Inapplicable

(b) Inapplicable

(d) Inapplicable

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

(a) Exhibits:

Exhibit 10.82 Change of Control Agreement with Mr. Philip
Frey, Jr.

Exhibit 10.83 Change of Control Agreement with Mr. David R.
Sonksen.

Exhibit 10.84 Supplemental Executive Retirement Plan

Exhibit 27 Unaudited Financial Data Schedule for the three
months ended December 28, 1997.

(b) Reports on Form 8-K:

None

16
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SIGNATURES

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

MICROSEMI CORPORATION

By: /s/ DAVID R. SONKSEN
-----------------------------------
David R. Sonksen
Vice President-Finance and
Chief Financial Officer
(Principal Financial Officer and
Chief Accounting Officer and duly
authorized to sign on behalf of the
Registrant)

DATED: February 6, 1998

<PAGE>

EXHIBIT 10.82

AGREEMENT

by and between

MICROSEMI CORPORATION

and

Philip Frey, Jr.
<PAGE>

TABLE OF CONTENTS
-----------------

<TABLE>
<S> <C>
1. Term.................................................................. 3
2. Terminations by Executive............................................. 3

a. Termination by Executive for "Good Reason"........................ 3
b. Change of Control................................................. 4
c. Voluntary Termination by Executive................................ 4

3. Executive's Benefits Following Termination............................ 5

a. Executive's Benefits in Termination by Executive without "Good
Reason" following Change in Control............................... 5

(i) Salary..................................................... 5
(ii) Incentive Compensation..................................... 5
(iii) Car Allowance.............................................. 5
(iv) Stock Options.............................................. 5
(v) Medical Insurance.......................................... 5
(vi) Retirement Plans; Unvested Company Contribution............ 6
(vii) Vacation and Sick Leave.................................... 6
(viii) General.................................................... 6

b. Executive's Benefits in Termination by Executive for "Good Reason"
or by Company following Change in Control......................... 6

(i) Salary..................................................... 6
(ii) Incentive Compensation..................................... 7
(iii) Car Allowance.............................................. 7
(iv) Stock Options.............................................. 7
(v) Medical and Life Insurance................................. 7
(vi) Retirement Plans; Unvested Company Contribution............ 7
(vii) Vacation and Sick Leave.................................... 8
(viii) General.................................................... 8

4. Other Benefits Following Termination.................................. 8
5. Excise Taxes.......................................................... 8
6. Indemnification....................................................... 9
7. Obligatory Restrictions on Executive.................................. 9

a. Non-Competition................................................... 10
b. No Solicitation of Employees...................................... 10
c. Consideration..................................................... 10

8. Termination of Certain Benefits Following New Employment.............. 10
9. No Mitigation by Executive Required................................... 11
10. Binding Agreement..................................................... 11
11. No Attachment......................................................... 11
12. Assignment and Other Rights........................................... 12
</TABLE>
<PAGE>

<TABLE>
<S> <C>
13. Waiver................................................................ 12
14. Notice................................................................ 12
15. Governing Law......................................................... 13
16. Costs................................................................. 13
17. Severability.......................................................... 13
18. Arbitration........................................................... 13
19. Entire Agreement...................................................... 14
20. Separate Counsel...................................................... 15
</TABLE>

2
<PAGE>

AGREEMENT

THIS AGREEMENT dated as of November 18, 1997 is made by and between Philip
Frey, Jr. ("Executive") and MICROSEMI CORPORATION, a Delaware corporation
("Company")

NOW, THEREFORE, for good and valuable considerations, receipt and
sufficiency of which are hereby acknowledged, the parties agree as follows:

1. Term. The term of this Agreement shall commence on the date hereof.
The term of this Agreement shall be renewed automatically on a daily basis so
that the outstanding term is always two (2) years after the date on which notice
of non-renewal or termination of this Agreement is given by the Executive to the
Company or by the Company to the Executive. This Agreement relates to
Executive's employment with the Company, or any subsidiary, successor, assign or
affiliate of the Company, under any written or oral agreement. For purposes of
the following provisions "Date of Termination" means the effective date of
termination of Executive's employment with any of the entities described above,
after notice and lapse of the notice period as required herein.

2. Terminations by Executive.

a. Termination by Executive for "Good Reason." Following a Change in
Control, Executive may terminate his active employment under his oral or written
employment agreement with the Company upon five (5) days' written notice to the
Company given within ninety (90) days following the date on which the Executive
becomes aware of any of the following events, each of which shall be deemed to
be good reason for termination by Executive:

(i) any reduction in, or limitation upon, the compensation,
reimbursable expenses or other benefits provided in this Agreement, other than
(A) as generally effected by valid public law or regulation or (B) as results
from change in the amount of the incentive compensation pool if not resulting
from changes in the incentive pool formula or allocations and not resulting from
accounting or operational effects of the acquisition;

(ii) any change in assignment of Executive's primary duties to a
work location more than 50 miles from the Company's principal executive office
at 2830 South Fairview Street, Santa Ana, California 92704, without Executive's
prior written consent;

(iii) any failure by the Company to obtain the assumption of this
Agreement by any successor or assign of the Company;

3
<PAGE>

(iv) any material breach by the Company of any provision of this
Agreement; or

(v) any action taken by the Board or a standing Committee of the
Board in connection with, or the formation of a special Committee of the Board
for the purpose of, effecting any of the events listed in subparagraphs (i)
through (iv) immediately above;

b. Change of Control. For purposes of this Agreement, "Change in
Control" means the occurrence of any of the following events:

(i) Any "person" (as such term is used in Sections 13(d) and
14(d) of the Securities Exchange Act of 1934, as amended) is or becomes the
"beneficial owner" (as defined in Rule 13d-3 under said Act), directly or
indirectly, of securities of the Company representing more than fifty percent
(50%) of the total voting power represented by the Company's then outstanding
voting securities;

(ii) Consummation of a merger or consolidation of the Company
with any other corporation, other than a merger or consolidation which would
result in the voting securities of the Company outstanding immediately prior
thereto continuing to represent (either by remaining outstanding or by being
converted into voting securities of the surviving entity) at least fifty-one
percent (51%) of the total voting power represented by the voting securities of
the Company or such surviving entity outstanding immediately after such merger
or consolidation, or the stockholders of the Company approving a plan of
complete liquidation of the Company or a consummation of the sale or disposition
by the Company of all or substantially all of the Company's assets.

c. Voluntary Termination by Executive. After a Change in Control,
without reason or for any reason other than one set forth in Section 2.a above,
Executive may voluntarily terminate his employment with the Company under any
oral or written employment agreement upon a minimum of one (1) month's written
notice to the Company.

3. Executive's Benefits Following Termination.

a. Executive's Benefits in Termination by Executive without "Good
Reason" following Change in Control. If this Agreement is terminated following a
Change in Control by Executive without "Good Reason":

4
<PAGE>

(i) Salary. Executive or his estate shall be entitled to
receive 100% of his latest base salary for a period of n months following the
Date of Termination (where n is equal to the sum of three (3) months plus a
number of months equal to the number of years elapsed from the Hire Date to the
date notice of termination is given).

(ii) Incentive Compensation. Executive or his estate will be
entitled to receive a prorated portion of the incentive compensation for the
partial year ending on the Date of Termination.

(iii) Car Allowance. The car allowance shall continue until the
expiration of n months after the Date of Termination (where n is equal to the
sum of three (3) months plus a number of months equal to the number of years
elapsed from the Hire Date to the date the Company gives notice of termination),
subject to termination as described in Section 7.

(iv) Stock Options. The restricted stock granted by the Company
to Executive under all plans and all stock options and general stock
appreciation rights granted by the Company to Executive will remain in
existence, and continue to vest and remain exercisable for a period ending n
months after the Date of Termination (where n is equal to the sum of three (3)
months plus a number of months equal to the number of years elapsed from the
Hire Date to the date the Company gives notice of termination), subject in
either case to the latest expiration date specified in the restricted stock or
option agreements.

(v) Medical and Life Insurance. Payment of premiums for
medical, dental and vision insurance and life insurance by the Company shall
continue on and subject to the terms of this Agreement for a period ending n
months after the Date of Termination (where n is equal to the sum of three (3)
months plus a number of months equal to the number of years elapsed from the
Hire Date to the date the Company gives notice of termination), subject to
termination under Section 7.

5
<PAGE>

shall not be required to pay Executive any amount of unvested Company
contributions credited to the Executive's account under any tax-qualified
employee benefit plan maintained by the Company as of the Date of Termination.
In the event that this paragraph should conflict with the provisions of any of
the Company's tax-qualified employee benefit plans and any other plan, program
or arrangement relating to deferred compensation, retirement or other benefits
including, without limitation, any profit sharing, 401(k), employee stock
ownership plan, or any plan established as a supplement to any of the
aforementioned plans, then the provisions of the plan shall govern.

(vii) Vacation and Sick Leave. The Company shall also pay
Executive, not later than the second day following the Date of Termination, a
pro rata amount of his base salary under his employment agreement, in effect on
the Date of Termination, for each day of vacation leave which has accrued as of
the Date of Termination, but which is unpaid as of such date, to which Executive
is entitled under the Company's vacation leave policy. The Company shall be
required to pay for sick leave days only to the extent that Executive has taken
sick leave on or prior to the Date of Termination to which Executive is entitled
under the Company's sick leave policy.

(viii) General. Executive or his estate shall also be entitled to
any other amounts then owing or accrued but unpaid to the Executive pursuant to
any plans or arrangements of the Company.

b. Executive's Benefits in Termination by Executive for "Good Reason"
or by Company following Change in Control. If this Agreement is terminated
following a Change in Control by Executive for "Good Reason" or by the Company:

(i) Salary. Executive or his estate shall be entitled to
receive 100% of his latest base salary for a period equal to the longer of (a) a
period of two (2) years following the Date of Termination or (b) a period ending
n months after the Date of Termination (where n is equal to the sum of three (3)
months plus a number of months equal to the number of years elapsed from the
Hire Date to the date the Date of Termination).

(ii) Incentive Compensation. Executive or his estate will be
entitled to receive incentive compensation of two (2) times the highest annual
incentive compensation amount paid during any of the preceding three (3) full
plan years.

(iii) Car Allowance. The car allowance shall continue for a
period equal to the longer of (a) a period of two (2) years following the Date
of Termination or (b) a period

6
<PAGE>

ending n months after the Date of Termination (where n is equal to the sum of
three (3) months plus a number of months equal to the number of years elapsed
from the Hire Date to the date the Date of Termination), in either case subject
to termination as described in Section 7.

(iv) Stock Options. The restriction or forfeiture period on any
restricted stock granted by the Company to Executive under all plans and all
stock options and general stock appreciation rights granted by the Company to
Executive shall lapse or accelerate, as the case may be, and become fully vested
and exercisable on the Date of Termination, and shall remain exercisable for a
period equal to the longer of (a) a period of two (2) years following the Date
of Termination or (b) a period ending n months after the Date of Termination
(where n is equal to the sum of three (3) months plus a number of months equal
to the number of years elapsed from the Hire Date to the date the Date of
Termination), subject in either case to the latest expiration date specified in
the restricted stock or option agreements.

(v) Medical and Life Insurance. Payment of premiums for
medical, dental and vision insurance and life insurance by the Company shall
continue on and subject to the terms of this Agreement for a period equal to the
longer of (a) a period of two (2) years following the Date of Termination or (b)
a period ending n months after the Date of Termination (where n is equal to the
sum of three (3) months plus a number of months equal to the number of years
elapsed from the Hire Date to the date the Date of Termination), in either case
subject to termination under Section 7.

(vi) Retirement Plans; Unvested Company Contribution. The
Executive shall be entitled to receive, not later than the fifteenth (15th) day
following the Date of Termination, all benefits payable to him under any of the
Company's tax-qualified employee benefit plans and any other plan, program or
arrangement relating to deferred compensation, retirement or other benefits
including, without limitation, any profit sharing, 401(k), employee stock
ownership plan, or any plan established as a supplement to any of the
aforementioned plans. The Company shall also pay Executive, not later than the
fifteenth (15th) day following the Date of Termination, an amount equal to all
unvested Company contributions credited to the Executive's account under any
tax-qualified employee benefit plan maintained by the Company as of the Date of
Termination. In the event that this paragraph should conflict with the
provisions of any of the Company's tax-qualified employee benefit plans and any
other plan, program or arrangement relating to deferred compensation, retirement
or other benefits including, without limitation, any profit sharing, 401(k),
employee stock ownership plan, or any plan established as a supplement to any of
the

7
<PAGE>

aforementioned plans, then the provisions of the plan shall govern, provided
that the Company's contribution shall vest pursuant to this Section.

(viii) General. Executive or his estate shall also be entitled to
any other amounts then owing or accrued but unpaid to the Executive pursuant to
any plans or arrangements of the Company.

4. Other Benefits Following Termination. Executive shall also be
entitled to the following additional benefits upon or following such
termination:

a. During the period following employment or benefits hereunder, to
the extent required by law, Executive shall have the rights under the
Consolidated Omnibus Budget Reconciliation Act ("COBRA"), or any successor
statute.

5. Excise Taxes. If all or any portion of the amounts payable to
Executive or on Executive's behalf under this Agreement or otherwise are subject
to the excise tax imposed by Section 4999 of the Internal Revenue Code of 1986,
as amended (or similar state tax and/or assessment), the Company shall pay to
Executive an amount necessary to place Executive in the same after-tax position
as Executive would have been had no such excise tax been imposed. The amount
payable pursuant to the preceding sentence shall be grossed-up to the extent
necessary to pay income and excise taxes due on such amount. The determination
of the amount of any such tax indemnity shall initially be made by the
independent accounting firm then employed by the Company. If at a later date it
is determined (pursuant to final regulations or published rulings of the IRS,
final judgment of a court of competent jurisdiction or otherwise) that the
amount of excise taxes payable by Executive is greater than the amount initially
so determined, then the Company (or its successor) shall pay Executive an amount
equal to the sum of (1) such additional excise taxes, (2) any interest, fines
and penalties resulting from such underpayment, plus (3) a gross-up amount

8
<PAGE>

necessary to reimburse Executive for any income, excise or other taxes payable
by Executive with respect to the amounts specified in (1) and (2) above, and the
reimbursement provided by this clause (3).

6. Indemnification. For at least ten (10) years following the Date of
Termination for any reason, Executive shall continue to be indemnified under the
Company's Certificate of Incorporation and Bylaws at least to the same extent
indemnification was available prior to the Date of Termination and permitted by
law, and Executive shall be insured under the directors' and officers' liability
insurance, the fiduciary liability insurance and the professional liability
insurance policies that are the same as, or provide coverage at least equivalent
to, those applicable or made available by the Company to the then members of
senior management of the Company. Independent of such provision, if at any time
Executive is made, or threatened to be made, a party to any legal action or
proceeding, whether civil or criminal, by reason of the fact that Executive is
or was a director or officer of the Company or serves or served any other
corporation fifty percent (50%) or more owned or controlled by the Company in
any capacity at the Company's request, Executive shall be indemnified by the
Company, and the Company shall pay Executive's related expenses when and as
incurred, all to the full extent permitted by law.

7. Obligatory Restrictions on Executive. Executive agrees that during
the period of the commencing on the Date of Termination and extending the lesser
of two years or n months (where n is equal to the sum of three (3) months plus a
number of months equal to the number of years elapsed from the Hire Date to the
date notice of termination is given), except as provided below or with the
Company's written consent, he will be bound by the following restrictive
covenants:

a. Non-Competition. Following any involuntary termination following
a Change in Control or a termination by Executive for Good Reason following a
Change in Control, the restrictions in this paragraph, and any similar
restrictions under any employment agreement between the Company and Executive or
otherwise shall be of no force or effect. In the event of a voluntary
termination (other than for Good Reason) by Executive following a Change in
Control, Executive will not, directly or indirectly, engage for his own account
in, or own, manage, operate, control, be employed as an employee or consultant,
buy, participate in, or be connected in any manner with the ownership,
management, operation or control of any firm, corporation, association, or other
business entity which is in competition with the business of the Company;
provided that Executive may invest in a business competitive with the Company to
an extent not exceeding five percent (5%) of the total outstanding shares at the
time of such investment in each one or more

9
<PAGE>

companies. A business will be considered for this purpose in competition with
the Company if and only if the products of such business include more than one-
third of the Company's products as of immediately prior to the Change in
Control. In the event of a breach or threatened breach by Executive of the
provisions of this paragraph, the Company shall be entitled to an injunction
restraining Executive from violating the provisions of this paragraph.

b. No Solicitation of Employees. Executive will not solicit or, with
the exception of any persons related to Executive by blood, marriage, or
adoption, not more remote than first cousin, employ any current or future
employee of the Company and will not intentionally disparage the Company, its
management or its products.

c. Consideration. Executive's obligations are made partly in
consideration of the salary and other benefits paid or committed to be paid by
the Company following the Date of Termination. The restrictive covenants on the
part of Executive set forth in this Section 20 shall survive the termination of
this Agreement, and the existence of any claims or cause of action by Executive
against the Company, whether predicated on this Agreement or otherwise, shall
not constitute a defense in the enforcement of these covenants.

8. Termination of Certain Benefits Following New Employment. If
Executive accepts a substantial engagement or employment ("New Employment") with
any other corporation, partnership, trust, government or other entity at any
time during the term of benefit continuation referred to above, the Company may
elect that Executive cease to be entitled to car allowance or medical, dental or
vision insurance benefits effective upon the commencement of such other
engagement or employment. However, Executive shall nevertheless continue to be
entitled to the other benefits of this Agreement and shall continue to be bound
by the provisions of this Agreement for any remaining duration of any period
then applicable to Executive. For the purposes of this provision, "employment"
or "engagement" shall exclude (i) service as an officer or director of a
personal investment holding company, (ii) service as a director on the Board of
a corporation or nonprofit organization, (iii) engagement as a bona fide part-
time consultant, or (iv) self-employment or engagement as an officer or director
of an operating corporation or enterprise (as opposed to a personal investment
holding company) founded or controlled by Executive and which has (and only so
long as it continues to have) revenues of less than $25 million per year.

10
<PAGE>

9. No Mitigation by Executive Required. Company recognizes that because
of Executive's special talents, stature and opportunities in the electronics
industry, in the event of termination by the Company or Executive before the end
of the agreed term, the parties acknowledge and agree that the provisions of
this Agreement regarding further payment of base salary, bonuses, and the
exercisability of stock options and lapse of the restrictive or forfeiture
period on restricted stock constitute fair and reasonable provisions for the
consequences of such termination, do not constitute a penalty, and such payments
and benefits shall not be limited or reduced by amounts Executive might earn or
be able to earn from any other employment or ventures during the remainder of
the agreed term of this Agreement. Executive shall not be required to mitigate
the amount of any payment provided for in this Agreement by seeking other
employment or otherwise.

10. Binding Agreement. This Agreement shall be binding upon and inure to
the benefit of Executive, his heirs, distributees and assigns, and the Company,
its successors and assigns. Executive may not, without the express written
permission of the Company, assign or pledge any rights or obligations hereunder
to any person, firm or corporation. Such permission shall not be unreasonably
withheld. If the Executive should die while any amount would still be payable to
Executive if he had continued to live, all such amounts, unless otherwise
provided herein, shall be paid in accordance with this Agreement to the
Executive's estate.

11. No Attachment. Except as required by law, no right to receive
payments under this Agreement shall be subject to anticipation, commutation,
alienation, sale, assignment, encumbrance, charge, pledge or hypothecation or to
execution, attachment, levy or similar process or assignment by operation of
law, and any attempt, voluntary or involuntary, to effect any such action shall
be null, void and of no effect.

12. Assignment and Other Rights. The Company will require any successor
(whether direct or indirect, by operation of law, by purchase, merger,
consolidation or otherwise to all or substantially all of the business and/or
assets of the Company) to expressly assume and agree to perform this Agreement
in the same manner and to the same extent that the Company would be required to
perform it if no such succession had taken place. Failure of the Company to
obtain such assumption and agreement prior to the effectiveness of any such
succession shall be a breach of this Agreement and shall entitle Executive to
compensation from the Company in the same

11
<PAGE>

amount and on the same terms as the Executive would be entitled hereunder,
except that for purposes of implementing the foregoing, the date on which any
such succession becomes effective shall be the Date of Termination. As used in
this Agreement, "Company" shall mean the Company as defined above and any
successor to its business and/or assets that assumes and agrees to perform this
Agreement by operation of law, or otherwise.

13. Waiver. No term or condition of this Agreement shall be deemed to
have been waived, nor shall there be any estoppel against the enforcement of any
provision of this Agreement, except by written instrument of the party charged
with such waiver or estoppel. No such written waiver shall be deemed a
continuing waiver unless specifically stated therein, and each such waiver shall
operate only as to the specific term or condition waived and shall not
constitute a waiver of such term or condition for the future or as to any act
other than that specifically waived.

14. Notice. For the purposes of this Agreement, notices and all other
communications provided for in this Agreement shall be in writing and shall be
deemed to have been duly given when delivered or mailed by United States
registered mail, return receipt requested, postage prepaid, addressed to the
Executive at his home address appearing in the records of the Company, in the
case of the Executive, and in the case of the Company, to the attention of the
Chairman of the Board at the principal executive offices of the Company, or to
such other address as either party may have furnished to the other in writing in
accordance herewith, except that notice of change of address shall be effective
only upon receipt. Acceptance by Executive of benefits of participation shall
constitute a certification by Executive of his continued eligibility for
participation.

15. Governing Law. This Agreement shall be governed and construed in
accordance with the laws of the State of California.

16. Costs. Each of the parties shall pay its own expenses, including
attorneys' fees, in the negotiation and preparation of this Agreement.

17. Severability. If, for any reason, any provision of this Agreement is
held invalid, such invalidity shall not affect any other provision of this
Agreement not held so invalid, and each such other provision shall to the full
extent consistent with law continue in full force and effect. If

12
<PAGE>

any provision of this Agreement shall be held invalid in part, such invalidity
shall in no way affect the rest of such provision not held so invalid, and the
rest of such provision, together with all other provisions of this Agreement,
shall to the full extent consistent with law continue in full force and effect.
If this Agreement is held invalid or cannot be enforced, then to the full extent
permitted by law, any prior agreement between the Company (or any predecessor
thereof) and Executive shall be deemed reinstated as if this Agreement has not
been executed.

18. Arbitration.

a. Any disagreement, dispute, controversy or claim arising out of or
in any way related to this Agreement or the subject matter thereof or the
interpretation hereof or any arrangements relating hereto or contemplated herein
or the breach, termination or invalidity hereof shall be settled exclusively and
finally by arbitration.

b. The arbitration shall be conducted in accordance with the
Commercial Arbitration Rules (the "Arbitration Rules") of the American
Arbitration Association (the "AAA"). The arbitral tribunal shall consist of one
arbitrator.

c. The Company shall pay all of the fees, if any, and expenses of
such arbitration, and shall also pay all Executive's expenses, including
attorneys' fees, incurred in connection with the arbitration regardless of the
final outcome of such arbitration.

d. The arbitration shall be conducted in Orange County, California,
or in any other city or county in the United States of America as the parties to
the dispute may designate by mutual written consent.

e. Any decision or award of the tribunal shall be final and binding
upon the parties to the arbitration proceeding. The parties hereto hereby waive
to the extent permitted by law any rights to appeal or to review such award by
any court or tribunal. The parties hereto agree that the award may be enforced
against the parties to the arbitration proceeding or their assets wherever the
award may be entered in any court having jurisdiction thereof.

f. The parties stipulate that discovery may be held in any such
arbitration proceeding as provided in Section 1283.05 of the California Code of
Civil Procedure, as may be amended or revised from time to time.

13
<PAGE>

g. During the period until the dispute is finally resolved in
accordance with this Section, the Company will continue to pay the Executive his
full compensation in effect when the notice giving rise to the dispute was given
(including, but not limited to, base salary) and continue the Executive as a
participant in all compensation, employee benefit and insurance plans, programs,
arrangements and perquisites in which the Executive was participating or
entitled when the notice giving rise to the dispute was given, until the dispute
is finally resolved in accordance with this paragraph (c). Amounts paid under
this paragraph (c) shall be repaid to the Company or be offset against or reduce
any other amounts due the Executive under this Agreement, as appropriate, only
upon the final resolution of the dispute.

19. Entire Agreement. As of the date hereof, all previous agreements
relating to the employment of Executive, however styled, are hereby superseded
to the extent inconsistent herewith, and, excepting Executive's present
participation in Company stock and/or other benefit plans or programs and the
agreements thereunder, which are hereby reaffirmed in all respects by both
parties thereto except as expressly modified by this Agreement, this Agreement
embodies all agreements, contracts, and understandings by and between the
parties hereto. In addition, this Agreement supersedes and amends any subsequent
employment agreement between Executive and the Company except to the extent such
subsequent agreement expressly provides or provides benefits in excess of those
herein provided. Should any other agreement, plan or arrangement between Company
and Executive or other officers or employees of the Company provide for greater
benefits upon a change in control, the terms of such other agreement, plan or
arrangement shall apply to Executive on a "most favored" basis. This Agreement
may not be changed orally, but only by an agreement in writing signed by the
party against whom enforcement of any waiver, change, modification, extension,
or discharge is sought.

20. Separate Counsel. The Company has been represented by Stradling,
Yocca, Carlson & Rauth in the negotiation and execution of this Agreement. The
Executive has been invited and given opportunity to engage counsel to review or
negotiate this Agreement, and Executive has either done so or chosen not to
engage counsel.

14
<PAGE>

IN WITNESS WHEREOF, the parties have executed this Employment Agreement as
of the day and year first above written.

EXECUTIVE: COMPANY:

MICROSEMI CORPORATION

/s/ Philip Frey, Jr. By: /s/ Martin H. Jurick
- ---------------------------- ----------------------------------
Martin H. Jurick,
Chairman of the Compensation Committee

<PAGE>

EXHIBIT 10.83

AGREEMENT

by and between

MICROSEMI CORPORATION

and

David R. Sonksen
<PAGE>

TABLE OF CONTENTS
-----------------
<TABLE>

<S> <C>
1. Term.................................................................. 3
2. Terminations by Executive............................................. 3

3. Executive's Benefits Following Termination............................ 5

a. Executive's Benefits in Termination by Executive without
"Good Reason" following Change in Control......................... 5

b. Executive's Benefits in Termination by Executive for "Good Reason"
or by Company following Change in Control......................... 6

</TABLE>
<PAGE>

<TABLE>

<S> <C>
13. Waiver............................................................. 12
14. Notice............................................................. 12
15. Governing Law...................................................... 13
16. Costs.............................................................. 13
17. Severability....................................................... 13
18. Arbitration........................................................ 13
19. Entire Agreement................................................... 14
20. Separate Counsel................................................... 15

</TABLE>

2
<PAGE>

AGREEMENT

THIS AGREEMENT dated as of November 18, 1997 is made by and between Philip
Frey, Jr. ("Executive") and MICROSEMI CORPORATION, a Delaware corporation
("Company")

NOW, THEREFORE, for good and valuable considerations, receipt and
sufficiency of which are hereby acknowledged, the parties agree as follows:

2. Terminations by Executive.

(iii) any failure by the Company to obtain the assumption of
this Agreement by any successor or assign of the Company;

3
<PAGE>

(iv) any material breach by the Company of any provision of this
Agreement; or

b. Change of Control. For purposes of this Agreement, "Change in
Control" means the occurrence of any of the following events:

3. Executive's Benefits Following Termination.

a. Executive's Benefits in Termination by Executive without "Good
Reason" following Change in Control. If this Agreement is terminated following
a Change in Control by Executive without "Good Reason":

4
<PAGE>

(i) Salary. Executive or his estate shall be entitled to receive
100% of his latest base salary for a period of n months following the Date of
Termination (where n is equal to the sum of three (3) months plus a number of
months equal to the number of years elapsed from the Hire Date to the date
notice of termination is given).

(ii) Incentive Compensation. Executive or his estate will be
entitled to receive a prorated portion of the incentive compensation for the
partial year ending on the Date of Termination.

(iv) Stock Options. The restricted stock granted by the Company to
Executive under all plans and all stock options and general stock appreciation
rights granted by the Company to Executive will remain in existence, and
continue to vest and remain exercisable for a period ending n months after the
Date of Termination (where n is equal to the sum of three (3) months plus a
number of months equal to the number of years elapsed from the Hire Date to the
date the Company gives notice of termination), subject in either case to the
latest expiration date specified in the restricted stock or option agreements.

(v) Medical and Life Insurance. Payment of premiums for medical,
dental and vision insurance and life insurance by the Company shall continue on
and subject to the terms of this Agreement for a period ending n months after
the Date of Termination (where n is equal to the sum of three (3) months plus a
number of months equal to the number of years elapsed from the Hire Date to the
date the Company gives notice of termination), subject to termination under
Section 7.

5
<PAGE>

(viii) General. Executive or his estate shall also be
entitled to any other amounts then owing or accrued but unpaid to the Executive
pursuant to any plans or arrangements of the Company.

(ii) Incentive Compensation. Executive or his estate will
be entitled to receive incentive compensation of two (2) times the highest
annual incentive compensation amount paid during any of the preceding three (3)
full plan years.

(iii) Car Allowance. The car allowance shall continue for
a period equal to the longer of (a) a period of two (2) years following the Date
of Termination or (b) a period

6
<PAGE>

(iv) Stock Options. The restriction or forfeiture period
on any restricted stock granted by the Company to Executive under all plans and
all stock options and general stock appreciation rights granted by the Company
to Executive shall lapse or accelerate, as the case may be, and become fully
vested and exercisable on the Date of Termination, and shall remain exercisable
for a period equal to the longer of (a) a period of two (2) years following the
Date of Termination or (b) a period ending n months after the Date of
Termination (where n is equal to the sum of three (3) months plus a number of
months equal to the number of years elapsed from the Hire Date to the date the
Date of Termination), subject in either case to the latest expiration date
specified in the restricted stock or option agreements.

(v) Medical and Life Insurance. Payment of premiums for
medical, dental and vision insurance and life insurance by the Company shall
continue on and subject to the terms of this Agreement for a period equal to the
longer of (a) a period of two (2) years following the Date of Termination or (b)
a period ending n months after the Date of Termination (where n is equal to the
sum of three (3) months plus a number of months equal to the number of years
elapsed from the Hire Date to the date the Date of Termination), in either case
subject to termination under Section 7.

(vi) Retirement Plans; Unvested Company Contribution.
The Executive shall be entitled to receive, not later than the fifteenth (15th)
day following the Date of Termination, all benefits payable to him under any of
the Company's tax-qualified employee benefit plans and any other plan, program
or arrangement relating to deferred compensation, retirement or other benefits
including, without limitation, any profit sharing, 401(k), employee stock
ownership plan, or any plan established as a supplement to any of the
aforementioned plans. The Company shall also pay Executive, not later than the
fifteenth (15th) day following the Date of Termination, an amount equal to all
unvested Company contributions credited to the Executive's account under any
tax-qualified employee benefit plan maintained by the Company as of the Date of
Termination. In the event that this paragraph should conflict with the
provisions of any of the Company's tax-qualified employee benefit plans and any
other plan, program or arrangement relating to deferred compensation, retirement
or other benefits including, without limitation, any profit sharing, 401(k),
employee stock ownership plan, or any plan established as a supplement to any of
the

7
<PAGE>

aforementioned plans, then the provisions of the plan shall govern, provided
that the Company's contribution shall vest pursuant to this Section.

(viii) General. Executive or his estate shall also be
entitled to any other amounts then owing or accrued but unpaid to the Executive
pursuant to any plans or arrangements of the Company.

4. Other Benefits Following Termination. Executive shall also be entitled
to the following additional benefits upon or following such termination:

8
<PAGE>

7. Obligatory Restrictions on Executive. Executive agrees that during the
period of the commencing on the Date of Termination and extending the lesser of
two years or n months (where n is equal to the sum of three (3) months plus a
number of months equal to the number of years elapsed from the Hire Date to the
date notice of termination is given), except as provided below or with the
Company's written consent, he will be bound by the following restrictive
covenants:

a. Non-Competition. Following any involuntary termination following a
Change in Control or a termination by Executive for Good Reason following a
Change in Control, the restrictions in this paragraph, and any similar
restrictions under any employment agreement between the Company and Executive or
otherwise shall be of no force or effect. In the event of a voluntary
termination (other than for Good Reason) by Executive following a Change in
Control, Executive will not, directly or indirectly, engage for his own account
in, or own, manage, operate, control, be employed as an employee or consultant,
buy, participate in, or be connected in any manner with the ownership,
management, operation or control of any firm, corporation, association, or other
business entity which is in competition with the business of the Company;
provided that Executive may invest in a business competitive with the Company to
an extent not exceeding five percent (5%) of the total outstanding shares at the
time of such investment in each one or more

9
<PAGE>

8. Termination of Certain Benefits Following New Employment. If Executive
accepts a substantial engagement or employment ("New Employment") with any other
corporation, partnership, trust, government or other entity at any time during
the term of benefit continuation referred to above, the Company may elect that
Executive cease to be entitled to car allowance or medical, dental or vision
insurance benefits effective upon the commencement of such other engagement or
employment. However, Executive shall nevertheless continue to be entitled to the
other benefits of this Agreement and shall continue to be bound by the
provisions of this Agreement for any remaining duration of any period then
applicable to Executive. For the purposes of this provision, "employment" or
"engagement" shall exclude (i) service as an officer or director of a personal
investment holding company, (ii) service as a director on the Board of a
corporation or nonprofit organization, (iii) engagement as a bona fide part-time
consultant, or (iv) self-employment or engagement as an officer or director of
an operating corporation or enterprise (as opposed to a personal investment
holding company) founded or controlled by Executive and which has (and only so
long as it continues to have) revenues of less than $25 million per year.

10
<PAGE>

11. No Attachment. Except as required by law, no right to receive payments
under this Agreement shall be subject to anticipation, commutation, alienation,
sale, assignment, encumbrance, charge, pledge or hypothecation or to execution,
attachment, levy or similar process or assignment by operation of law, and any
attempt, voluntary or involuntary, to effect any such action shall be null, void
and of no effect.

11
<PAGE>

15. Governing Law. This Agreement shall be governed and construed in
accordance with the laws of the State of California.

16. Costs. Each of the parties shall pay its own expenses, including
attorneys' fees, in the negotiation and preparation of this Agreement.

12
<PAGE>

18. Arbitration.

13
<PAGE>

14
<PAGE>

IN WITNESS WHEREOF, the parties have executed this Employment Agreement as
of the day and year first above written.

EXECUTIVE: COMPANY:

MICROSEMI CORPORATION

/s/ David R. Sonksen By: /s/ Martin H. Jurick
- ---------------------------- -------------------------------
Martin H. Jurick,
Chairman of the Compensation Committee

<PAGE>

Exhibit 10.84

MICROSEMI CORPORATION
SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN

Effective September 15, 1986 (the "Effective Date"), Microsemi Corporation
(the "Company") hereby establishes the Microsemi Corporation Supplemental
Executive Retirement Plan (the "Plan") for the benefit of those Participants and
their Beneficiaries set forth on Exhibit "A" attached to the Plan, and
incorporated herein by this reference.

ARTICLE I
PURPOSE OF THE PLAN

1.1 Plan Purpose. The Plan is established for the purpose of providing
------------
retirement benefits for a select group of management or highly compensated
employees of the Company and is intended to be an unfunded plan within the
meaning of the Employee Retirement Income Security Act of 1974 ("ERISA"). All
benefits under the Plan will be provided solely from the general assets of the
Company. It is intended that the Plan be exempt from Parts II, III and IV of
Title I of ERISA pursuant to ERISA Sections 201(2), 301(a)(3) and 401(a)(1).

ARTICLE II
PARTICIPATION

2.1 Eligibility. The Board of Directors of the Company (the "Board"), in its
-----------
sole discretion, has designated those individuals eligible to participate in the
Plan. Each individual so designated shall automatically become a participant
("Participant") as of the date determined by the Board. Each Participant who
has commenced participation in the Plan shall continue to be a Participant until
he or she terminates his or her employment with the Company by reason of his or
her retirement, death, disability, resignation, dismissal or otherwise.
Notwithstanding the foregoing, the Board expressly reserves the right to remove
any Participant under the Plan from participation in the Plan at any time for
cause prior to the Participant's Retirement Date. The persons designated as
Participants as of the Effective Date are those individuals set forth on Exhibit
"A" attached hereto and incorporated herein by this reference.

ARTICLE III
AMOUNT OF BENEFIT

3.1 Retirement Benefit. Commencing with the Commencement Date and
------------------
terminating on the first day of the 119th calendar month following the
Commencement Date (the "Pension Period"), the Company shall pay each Retiree an
amount equal to his Monthly Benefit. In the event that the Retiree dies after
the Commencement Date, the Monthly Benefit shall be paid to the Beneficiary for
the remainder of the Pension Period.

3.2 Death Benefit. In the event that a Participant dies while he or she is
-------------
an employee of the Company, commencing with the Beneficiary Commencement Date
and terminating on the first day of the 119th calendar month following the
Beneficiary Commencement Date (the "Death Benefit Period"), the Company shall
pay the Beneficiary an amount equal to the Monthly Death Benefit. In the event
that the Beneficiary dies after the Beneficiary Commencement Date, the Monthly
Death
<PAGE>

Benefit shall be paid to the Beneficiary's estate during the Death Benefit
Period.

3.3 Definitions. As used in this Agreement, the following defined terms
-----------
shall mean:

(a) Beneficiary. "Beneficiary" means:
-----------

(i) the Participant's surviving spouse;

(ii) If his or her surviving spouse is still alive, the Participant may
designate another person to be the Beneficiary only if his or her
spouse consents in writing to the designation of such person as the
Beneficiary and the consent acknowledges the effect of the
designation and is witnessed by an officer of the Company or a notary
public, or it is established to the satisfaction of an officer of the
Company that the consent required under this paragraph may not be
obtained because there is no spouse, the spouse cannot be located, or
such other circumstances as may be authorized by the Board.

(iii) In the case where a deceased Participant failed to designate a
Beneficiary, the Board is unable to locate a designated Beneficiary,
the Beneficiary predeceased the Participant, or the designation of
the Beneficiary by the Participant is legally ineffective, any
distribution on behalf of a Participant shall be paid to the person
or persons included in the highest priority category among the
following:

(A) The Participant's surviving Spouse;

(B) The Participant's surviving children, including adopted
children;

(D) The Participant's surviving brothers and sisters (whether
whole or half-blood); or

(E) The Participant's estate. In the event the Participant has
neither a surviving spouse nor a properly designated
Beneficiary, the remaining portion of his benefit shall be made
to his estate.

(b) Beneficiary Commencement Date. "Beneficiary Commencement Date" means the
-----------------------------
first day of the calendar month following the calendar month in which a
Participant dies.

(c) Commencement Date. "Commencement Date" means the first day of the calendar
-----------------
month following the calendar month in which a Participant attains his Retirement
Date.

(d) Monthly Benefit. "Monthly Benefit" means one-twelfth of a Participant's
---------------
Plan Benefit for the Plan Year in which the Participant commences retirement.

(e) Monthly Death Benefit. "Monthly Death Benefit" means one-twelfth of a
---------------------
Participant's Plan Benefit for the Plan Year in which the Participant dies.

(f) Plan Year. "Plan Year" means the calendar year, January 1 through
---------
December 31.

2
<PAGE>

(g) Retiree. "Retiree" means a Participant who has attained his Retirement
-------
Date.

(h) Retirement Date. "Retirement Date" means the date on which a Participant
---------------
terminates his employment with the Company after he or she has retired from
employment with the Company and has been designated as a Retiree by the Board of
Directors, in its sole and absolute discretion.

(i) Years of Service. "Years of Service" means a Plan Year in which the
----------------
Participant was employed on a full time basis by the Company on each business
day during the Plan Year.

3.4 Payees under Legal Disability. If the Board reasonably believes that any
-----------------------------
payee is legally incapable of giving a valid receipt and discharge for any
payment due him, the Board may have the payment, or any part of it, made to the
person (or persons or institution) whom it reasonably believes is caring for or
supporting such payee. Any such payment shall be a payment for the benefit of
the payee and shall, to the extent thereof, be a complete discharge of any
liability under the Plan to the payee.

3.5 Payment of Benefits. All payments under the Plan shall be delivered in
-------------------
person or mailed to the last address of the Participant (or, in the case of the
death of the Participant, to that of the Beneficiary determined under the rules
of Section 3.3). Each Participant shall be responsible for furnishing the
Committee with the Participant's correct current address and the correct current
name and address of the Beneficiary.

3.6 Claims Procedure. In the event a claim for benefit by either a
----------------
Participant, Retiree or Beneficiary is denied (in whole or in part), the denial
and the appeal of the decision shall be handled in accordance with the
provisions of Department of Labor Regulation 2560.503-1.

ARTICLE IV
BENEFITS UNFUNDED

4.1 Benefits Unfunded. The benefits under this Plan shall not be funded, but
-----------------
shall constitute an unsecured liability payable, when due, by the Company out of
its general assets.

4.2 Program to Satisfy Plan Obligations. Notwithstanding Section 4.1 above,
-----------------------------------
the Board may, in its sole discretion, elect to set aside amounts ("Reserves")
for the purpose of paying benefits under the Plan. Reserves, if any, may be in
an amount determined by the Board in its sole discretion. Reserves may be
invested or not invested in the manner determined by the Board in its sole
discretion. Should the Board decide to establish Reserves, the Reserves shall
remain assets of the Company. In no event shall any Participant, Retiree or
Beneficiary have any right to any specific asset designated to be Reserves under
this Section.

3
<PAGE>

ARTICLE V
VESTING OF BENEFITS

5.1 Vesting. Except as provided in this Article, all Participants are fully
-------
vested in their Accounts in the Plan.

5.2 Termination for Cause. In the event that a Participant's employment with
---------------------
the Company is terminated for cause by the Board, the Board, in its sole and
absolute discretion, may declare the benefits payable under Section 3.1 or 3.2
forfeited and may terminate the Company's obligation to pay future benefits to
that Participant, Retiree or Beneficiary under the Plan.

5.3 Unfair Trade Practices. Notwithstanding the provisions of Section 5.1,
----------------------
if a Participant, Retiree or Beneficiary either uses, divulges, furnishes or
makes accessible to anyone any knowledge or information with respect to any
confidential, proprietary or secret aspect of the business or any program of the
Company or engages in any act of unfair competition with the Company or accepts
employment or consults for a competitor of the Company, the Board, in its sole
and absolute discretion, may declare the benefits payable under Section 3.1 or
3.2 forfeited and may terminate the Company's obligation to pay future benefits
to that Participant, Retiree or Beneficiary under the Plan.

5.4 Limitation on Vesting. Notwithstanding the vesting of a Participant's
---------------------
benefits under this Article, a Participant's benefits under this Plan shall
remain an unsecured, unfunded promise to pay benefits by the Company. All
benefits under the Plan, whether fully vested, partially vested or unvested, are
payable only in accordance with Article VI.

ARTICLE VI
PLAN ADMINISTRATION

6.1 Plan Administration.
-------------------

(a) Authority to control and manage the operation and administration of the
Plan shall be vested in the Board. The Board shall have all powers necessary to
supervise the administration of the Plan and control its operations.

(b) In addition to any powers and authority conferred on the Committee
elsewhere in the Plan or by law, the Board shall have the following powers and
authority:

(i) To designate agents to carry out responsibilities relating to the
Plan;

(ii) To administer, interpret, construe and apply this Plan and to answer
all questions which may arise or which may be raised under this Plan
by the Participant, Retiree, Beneficiary or other person whatsoever;

(iii) To establish rules and procedures from time to time for the conduct
of its business and for the administration and effectuation of its
responsibilities under the Plan; and

(iv) To perform or cause to be performed such further acts as it may deem
to be

4
<PAGE>

necessary, appropriate, or convenient for the operation of the Plan.

(c) Any action taken in good faith by the Board in the exercise of authority
conferred upon it by this Plan shall be conclusive and binding upon the
Participant, Retiree and Beneficiaries. All discretionary powers conferred upon
the Board shall be absolute.

6.2 Limitation on Liability. No employee or member of the Board shall be
-----------------------
subject to any liability with respect to his duties under the Plan unless the
person acts fraudulently or in bad faith. To the extent permitted by law, the
Company shall indemnify each member of the Board, and any other employee of the
Company with duties under the Plan who was or is a party, or is threatened to be
made a party, to any threatened, pending or completed proceeding, whether civil,
criminal, administrative, or investigative, by reason of the person's conduct in
the performance of his duties under the Plan.

ARTICLE VII
MISCELLANEOUS MATTERS

7.1 Amendment and Termination. The Company expects the Plan to be permanent,
-------------------------
but since future conditions affecting the Company cannot be anticipated or
foreseen, the Company reserves the right to amend, modify, or terminate the Plan
at any time by action of the Board. Upon termination of the Plan, all benefits
shall become payable to the Participants and Beneficiaries and shall be subject
to the provisions of Section 4.1.

7.2 Benefits Not Alienable. Benefits under the Plan may not be assigned or
----------------------
alienated, whether voluntarily or involuntarily.

7.3 No Enlargement of Employee Rights. This Plan is strictly a voluntary
---------------------------------
undertaking on the part of the Company and shall not be deemed to constitute a
contract between the Company and the Participant or to be consideration for, or
an inducement to, or a condition of, the employment of the Participant. Nothing
contained in the Plan shall be deemed to give the right to the Participant to be
retained in the employ of the Company or to interfere with the right of the
Company to discharge the Participant at any time.

No person shall have any right to any benefits under this Plan, except to
the extent expressly provided herein.

7.4 Governing Law. To the extent not preempted by federal law, all legal
-------------
questions pertaining to the Plan shall be determined in accordance with the laws
of the State of California.

IN WITNESS WHEREOF, in order to record the adoption of the Plan, Microsemi
Corporation has caused this instrument to be executed by its duly authorized
officer to be effective January 1, 1994.

MICROSEMI CORPORATION

By: /s/ Philip Frey, Jr.
--------------------

Its: President, CEO
-----------------------------

5
<PAGE>

EXHIBIT "A"

SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN (SERP)
---------------------------------------------

<TABLE>
<CAPTION>
BENEFIT SERVICE
NAME *CATEGORY DATE
---- --------- --------
<S> <C> <C>
P. Frey 1 7/5/71
J. Sandera 1 11/15/71

J. McKnight 2 3/12/73
B. Brandt 2 2/12/73
R. Robinson 2 1/5/70
P. Kellogg 2 10/12/64
J. Lim 2 1/11/65
C. Schumacher 2 7/12/76
</TABLE>

* Benefit Category:

1 - 30% of annual salary, defined as the cumulative total salary paid during the
12 months prior to retirement (excluding all bonus, special allowances,
401(k) payments, and any other special non-salary payments), shall be paid
to the participant each year as an annual ONE LUMP SUM PAYMENT WHICH IS TO
BE PAID ON THE FIRST DAY OF THE SECOND MONTH AFTER RETIREMENT, and on each
anniversary thereafter for 10 payment years certain.

Should the participant die prior to the final payment of the 10 payments,
payments, up to the total of 10 such payments, are to be made to the estate
of the employee on each scheduled payment date.

Participants are fully vested and qualified for the benefits of the plan and
may take full advantage of the SERP immediately or at any future date
decided either by the Board of Directors or lacking such direction by the
Board, according to participant choice.

2 - 20% of 1994 salary (excluding all 401(k), bonus or other special non-salary
payments), shall be paid annually for 10 years certain, to the named
participants upon their retirement by either their choice or the choice of
the Company.

30% of the 1994 salary (excluding all 401(k) or other special non-salary
payments), shall be paid annually for 10 years certain to the named
participants upon their retirement by either their choice or the choice of
the Company, if they will have completed at least 30 years of credited
employment with the Company.
<PAGE>

For all employment years between 20 and 30, the percentage of 1994 salary
shall be a straight line interpolation, and for each month of employment
beyond 20, and additional .00833 fraction of their 1994 salary shall be
added to the 20% base of 20 years, up to a maximum of 30% after 30 years
(i.e., +1% per year up to 30 years).

The payments shall be made each month, starting upon the 1st day of the
second month after retirement, and continue for 120 months.

Should the participant die before payments have been completed, the
remainder of the payments will be made to the estate of the participant.

<PAGE>
<ARTICLE> 5
<MULTIPLIER> 1000

<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> SEP-27-1998
<PERIOD-START> SEP-29-1997
<PERIOD-END> DEC-28-1997
<CASH> 5,753
<SECURITIES> 0
<RECEIVABLES> 27,826
<ALLOWANCES> 2,614
<INVENTORY> 53,700
<CURRENT-ASSETS> 94,859
<PP&E> 72,219
<DEPRECIATION> 36,625
<TOTAL-ASSETS> 134,879
<CURRENT-LIABILITIES> 38,125
<BONDS> 46,394
0
0
<COMMON> 1,835
<OTHER-SE> 44,073
<TOTAL-LIABILITY-AND-EQUITY> 134,879
<SALES> 44,052
<TOTAL-REVENUES> 44,052
<CGS> 32,033
<TOTAL-COSTS> 32,033
<OTHER-EXPENSES> (20)
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 912
<INCOME-PRETAX> 4,987
<INCOME-TAX> 1,895
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<DISCONTINUED> 0
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<CHANGES> 0
<NET-INCOME> 3,092
<EPS-PRIMARY> .35
<EPS-DILUTED> .28

</TABLE>