EXHIBIT 10.19

                                   CREE, INC.
                            MANAGEMENT INCENTIVE PLAN

                              Fiscal Year 2002 Plan


     The following is a summary of the  management  incentive  plan (the "Plan")
adopted by Cree, Inc. (the "Company") for its fiscal year ending June 30, 2002.

     1.  Purpose:  The purpose of the Plan is to motivate  and reward  excellent
performance,  to attract and retain outstanding senior management personnel,  to
create a strong  link  between  strategic  and  corporate  operating  plans  and
individual performance,  to achieve greater corporate performance by focusing on
results,  not activities,  and to encourage teamwork at the highest level within
the organization.  The Plan rewards participants with a cash bonus payment based
on their  contribution  towards  the  attainment  of  corporate  and  individual
performance  goals.  The bonus  payment is  calculated  as a percentage  of base
salary and the target award percentage varies according the position level.

     2. Eligibility:  Eligible participants include the Executive Chairman,  the
Chief Executive Officer and President,  and senior level managers of the Company
(or a  consolidated  subsidiary)  who  report  directly  to the Chief  Executive
Officer and President.

     3. Plan Awards:

     3.1 Target Award Levels:  The target award level  represents  the award for
100% achievement of objectives.  The target awards are expressed as a percentage
of salary and vary based on the position of the  participant.  The actual target
award amount is determined by multiplying the  participant's  base salary by the
target  award  percentage.  The target  award is  calculated  on the base annual
salary as of the payout date.  Based on actual  performance,  a participant  can
earn between 0% to 100% of their target award.

     3.2  Determination of Awards:  For the positions of Executive  Chairman and
Chief  Executive  Officer  and  President,  awards are based  100% on  achieving
predetermined  corporate  goals.  Awards for all other  eligible  positions  are
determined based on performance  against  measures in two categories:  Corporate
and Individual.  Corporate  goals are weighted at 60% of the  individuals  total
award payout.  Individual  goals are weighted at 40% of the  individual's  total
award payout.

     3.3   Corporate   Measures:   The   Corporate   performance   measures  and
corresponding  goals are based on meeting or exceeding  revenue  targets for the
current  fiscal  year and meeting or  exceeding  net profit  targets  (excluding
goodwill)  for the current  fiscal year.  This is measured and paid  annually to
coincide with the fiscal year end.

     3.4 Individual Measures: Individual performance measures are established at
the beginning of each fiscal quarter. For each performance measure a performance
goal (as a  percentage)  is  determined.  Performance  goals are  standards  for
evaluating  success  associated  with a  specific  performance  measure  and are
expressed as either Minimum or Target goals.  Minimum  performance goals are the
lowest  level  of  competent   performance  that  is  eligible  for  the  award.
Performance at the minimum performance level will yield an award which is 25% of
the  target  award.   Target   performance  goals  are  the  expected  level  of
performance.  Performance  at the target  performance  level will yield an award
which is equal to the target award.  Performance  below the minimum  performance
level will not be eligible for an award. Each  participant,  in conjunction with
the Chief Executive  Officer and President,  will develop a minimum of three (3)
performance measures specific to their unit's performance.
<PAGE>
     4. Other Provisions:

     4.1 Performance Threshold: In order to be eligible for an award performance
thresholds as determined by the Chief  Executive  Officer and President  must be
met. Without limiting the foregoing,  the  corporate-level  incentive  component
will not be paid if revenue  and net profit  targets for the fiscal year are not
met.

     4.2  Termination of Employment:  If a participant's  employment  terminates
prior to the end of an award  period on account of death,  disability  under the
Company's Long-Term Disability Plan, or retirement, the award will be calculated
on a pro rata basis based on the number of months employed during the period. If
a  participant  terminates  during the award period for other reasons that those
stated  above,  no award  will be made.  Any  participant  whose  employment  is
terminated  for cause after the end of the award period but prior to the payment
of an award will forfeit any unpaid award.

     4.3 New Hires:  Participants  who  participate for part of the award period
will  receive a pro rata  portion of the award  based on the number of months of
employment with the Company.

     4.4  Exceptions:  Calculated  awards to  participants  can be  increased or
decreased at the  discretion  of the Chief  Executive  Office and President in a
manner that will ensure that the Company's best interests are met.

     4.5  Amendment:  The Plan can be amended,  modified,  or  terminated at any
time,  without  prior notice to the  participant,  including any award (prior to
payment) or any factors used to calculate awards.