Exhibit 10(y)


                                 EMPLOYMENT AGREEMENT
                                 --------------------
          Agreement made as of the 23rd day of October, 1995, by and
          between MILTOPE GROUP INC., a Delaware corporation (the
          "Company"), having its principal office at 500 Richardson Road
          South, Hope Hull, Alabama 36043 and James Matthews residing at
          604 Stonehedge Drive, Vestal, New York 13850  (the "Employee").

                                      WITNESSETH
                                      ----------
          WHEREAS, the Company desires to retain the services of the
          Employee as Vice President, Finance, and Chief Financial Officer
          of the Company and the Employee desires to render such services;

          NOW, THEREFORE, in consideration of the representations,
          warranties and mutual covenants set forth herein, the parties
          agree as follows:

               1.   Employment.
                    ----------
          The Company hereby retains the Employee as Vice President,
          Finance and Chief Financial Officer of the Company and the
          Employee hereby accepts such employment, all upon and subject to
          the terms and conditions hereinafter set forth.

               2.   Term.
                    ----
          The term of employment under this Agreement shall be for a period
          commencing on or about November 13, 1995, and terminating on
          November 12, 1996, (the "Employment Term"), subject to the
          termination provisions in Section five below.

               3.   Duties.
                    ------
                    (a)  The Employee will render his services to the
          Company as Vice President, Finance and Chief Financial Officer
          and shall perform the duties and services incident to that
          position and such other duties as may be assigned to him from
          time to time by the President and Chief Executive Officer of the
          Company.  In addition, the Employee will hold, without additional
          compensation therefor, such other offices and directorships in
          the Company or any subsidiary of the Company to which, from time
          to time, he may be appointed or elected.

                    (b)  During the term of his employment hereunder, the
          Employee will devote his full working time to the business of the
          Company, and, without the prior written consent of the President
          and Chief Executive Officer of the Company, will not (i) actively
          engage in any other business or business activity or (ii)
          directly or indirectly have any financial interest, as
          shareholder, partner, or otherwise, in any proprietorship,
          partnership, corporation or other entity in competition with the
          Company or its affiliates, except for securities issued by a
          publicly traded corporation to the extent that the Employee does
          not own more than 5% of any class of voting securities of such
          publicly traded corporation.

               4.   Compensation Benefits.
                    ---------------------
                    (a)  In consideration of the services to be rendered by
          the Employee hereunder, including, without limitation, any
          services rendered by him as an officer or director of the Company
          or of any subsidiary of the Company, the Company agrees to pay to
          the Employee, and the Employee agrees to accept as compensation
          (which payments shall be made by Miltope Group) a salary at the
          annual rate of $120,000.00 per annum (the "Salary"), payable in
          accordance with the Company s normal payroll policies.
          Additionally, the Employee will receive a monthly automobile
          allowance of $575.00, a gasoline credit card and membership to
          the Capital City Club. In the event that, for any reason, the
          Company is unable to make the compensation payments set forth in
          the Section 4(a), hereof Miltope Group Inc. shall be responsible
          for making such payments to the Employee.  In addition, the
          Employee: 

                    (i)  Shall participate in the Company s Executive Bonus
          Plan and the Executive Insurance Coverage Program, as currently
          in effect, and as amended from time to time by the Board of
          Directors of the Company; and

                    (ii) Shall receive a stock option on the date of
          commencement of employment to purchase an aggregate of 20,000
          shares of the Company s Common Stock, $0.1 par value, ("Common
          Stock"), under the Company s 1995 Stock Option and Performance
          Award Plan of the Company (the "Plan") at such price and upon
          such conditions as are contained in a stock option agreement
          prepared in accordance with the "Plan" and approved by the
          committee of the Board of Directors of the Company, which
          administers the "Plan" and;

                    (b)  During the term of his employment hereunder, the
          Employee shall be entitled to the following employment benefits:

                    (i)  Vacations in accordance with the Company s
          policies from time to time in effect for officers and employees
          of the Company, to be taken on reasonable prior notice and at a
          time and in a manner designed not to interfere with the proper
          operation of the business of the Company.  The Employee shall
          begin employment with ten (10) days of vacation available for
          use.  Additional vacation shall accrue at the rate of 1.25 days
          per month of employment, beginning January 13, 1995.

                    (ii) Sick leaves in accordance with the Company s
          policies from time to time in effect for officers and employees
          of the  Company.

                    (iii) Participation, subject to qualification
          requirements, in all medical and hospitalization plans, health
          benefit and life insurance, pension, profit sharing, fringe
          benefit and other employee benefit programs of whatever nature to
          the extent that such programs are available generally to
          executive officers of the Company.

                    (c)  The Employee shall be reimbursed for reasonable
          and necessary expenses incurred by the Employee in performing his
          employment hereunder, provided such expenses are adequately
          documented in accordance with the Company s policies.

                    (d)  The Employee shall receive a one-time sign-on
          bonus (the "Bonus") in the amount of $15,000.  The Bonus shall be
          paid when requested by the Employee, but in any event no earlier
          than November 13, 1995, and no later than May 30, 1996.  If for
          whatever reason, the Employee decides to leave the Company at his
          own volition, prior to November, 1996, the Employee shall repay
          in full the subject sign-on bonus.

               5.   Termination in Case of Disability, Death or for Cause
                    -----------------------------------------------------
                    (a)  If the Employee, due to physical or mental injury,
          illness, disability or incapacity, shall fail to render the
          services provided for in this Agreement for a consecutive period
          of three (3) months, or an aggregate of three (3) months in any
          six (6) month period, the Company may, at its option, terminate
          the Employee s employment hereunder upon fourteen (14) days 
          written notice to the Employee; provided, however, that if the
          Employee has accrued sick time, as described in the Miltope
          Corporation Employee Handbook, in excess of the respective
          periods referred to above, the Company may not terminate the
          Employee s employment pursuant to this Section 5(a) until the
          completion of such sick time.

                    (b)  If the Employee shall die during the term of this
          Agreement, this Agreement and the Employee s employment hereunder
          shall terminate immediately upon the Employee s death.

                    (c)  Notwithstanding anything to the contrary in this
          Agreement, the Company, upon notice to the Employee, may
          terminate this Agreement and the employment of the Employee
          hereunder for cause, which, for purposes of this agreement shall
          mean (i) the continued and repeated failure or refusal by the
          employee to perform specific directives of the Board of Directors
          of the Company, which directives are consistent with the scope
          and nature of the employee s duties and responsibilities, (ii)
          embezzlement or any offense involving misuse or misappropriation
          of money or other property of the Company, (iii) conviction of
          any felony, (iv) any act of dishonesty, disloyalty or other
          conduct that is materially injurious to the company, or (v)
          material breach by the Employee of any of the terms of this
          Agreement other than those contained in this Section 5.

               6.   Severance Compensation.
                    ----------------------
          In the event the Employee s employment hereunder is terminated by
          the Company for any reason, including the expiration of the
          Employment Term without renewal thereof, and other than for
          cause, death or disability, the Company shall pay to the Employee
          Severance Compensation (as defined below).  For purposes of this
          Agreement, the term "Severance Compensation" shall mean:

                    (a)  In the event the Employee s employment hereunder
          is terminated by the Company for any reason, other than for
          cause, death or disability, and other than the expiration of the
          Employment Term without renewal thereof, an amount equal to the
          greater of six (6) months Salary or the balance of the Salary due
          hereunder during the remainder of the Employment Term.  Severance
          Compensation shall also include a continuation of the benefits
          described in Section 4(b) (iii) hereof, to which the Employee is
          then entitled and participating, for a period equal to the longer
          of six (6) months or the balance of the Employment Term hereunder
          following the date of such termination.

                    (b)  In the event that the Employee s employment
          hereunder is terminated because of the expiration of the
          Employment Term without renewal thereof, an amount equal to six
          (6) months  Salary.  Severance Compensation shall also include a
          continuation of the benefits described in Section 4(b) (iii)
          hereof, to which the Employee is then entitled and participating,
          for a period of six (6) months following the expiration of the
          Employment Term.

                    In the event the Employee receives Severance
          Compensation under this Section 6, the Employee shall not be
          entitled to receive any other compensation or benefits under this
          Agreement after the termination of the Employee s employment
          hereunder and, as a condition to receiving such Severance
          Compensation, the Employee hereby agrees that he shall have no
          other claim against the Company by reason of this Agreement or
          otherwise.

               7.   Disclosure and Assignment of Discoveries.
                    ----------------------------------------
                    (a)  The Employee shall (without any additional
          compensation) promptly disclose in writing to the Board of
          Directors of the Company all ideas, processes, devices and
          business concepts (hereinafter referred to collectively as
          "discoveries"), whether or not patentable or copyrightable, which
          he, while employed by the Company, conceives, develops, acquires
          or reduces to practice, whether alone or with others and whether
          during or after usual working hours, and which are related to the
          Company s business or interests, or are used or usable by the
          Company, or arise out of or in connection with the duties
          performed by him hereunder; and the Employee hereby transfers and
          assigns to the Company all rights, title and interest in and to
          such discoveries.  Upon the request of the Company, the Employee
          shall (without any additional compensation), from time to time
          during or after the expiration or termination of his employment,
          execute such further instruments and do all such other acts and
          things as may be deemed necessary or desirable by the Company to
          protect and/or enforce its rights in respect of such discoveries.

                    (b)  For purposes of this Section 7 and the following
          Section 8, the term "Company" shall mean and include all
          subsidiaries, parents and affiliated corporations of the Company
          in existence from time to time.

               8.   Non-Disclosure of Confidential Information and
                    ----------------------------------------------
                    Competition.
                    ------------

                    (a)  The Employee represents that he has been informed
          that it is the policy of the Company to maintain as secret and
          confidential all information (i) relating to the products,
          processes and/or business concepts used by the Company and (ii)
          relating to the customers and employees of the Company
          ("Confidential Information"), and the Employee further
          acknowledges that such Confidential Information is of great value
          to the Company and is the property of the Company.  The parties
          recognize that the services to be performed by the Employee are
          special and unique, and that by reason of his employment by the
          Company, he will acquire Confidential Information as aforesaid. 
          The parties confirm that it is reasonably necessary to protect
          the Company s goodwill that the Employee agree, and accordingly
          the Employee does hereby agree, that he will not directly or
          indirectly (except where authorized by the Board of Directors of
          the Company for the benefit of the Company):

               A.   at any time during his employment hereunder or after he
          ceases to be employed by the Company, divulge to any persons,
          firms or corporations, other than the Company (hereinafter
          referred to collectively as "third parties") or use or cause to
          authorize any third parties to use, any such Confidential
          Information, or any other information regarded as confidential
          and valuable by the Company which he knows or should know is
          regarded as confidential and valuable by the Company (whether or
          not any of the foregoing information is actually novel or unique
          or is actually known to others); or

               B.   at any time during his employment hereunder and for a
          period of one (1) year after he ceases to be employed by the
          Company, solicit or cause or authorize, directly or indirectly,
          to be solicited, for or on behalf of himself or third parties,
          any business from third parties who were, at any time within one
          year prior to the cessation of his employment hereunder,
          customers of the Company with respect to computer peripheral
          products or services for military, rugged or other specialized
          applications; or

               C.   at any time during his employment hereunder and for a
          period of one (1) year after he ceases to be employed by the
          Company, accept or cause or authorize, directly or indirectly, to
          be accepted, for or on behalf of himself or third parties, any
          such business from any customers of the Company; or

               D.   at any time during his employment hereunder and for a
          period of one (1) year after he ceases to be employed by the
          Company, solicit or cause or authorize, directly or indirectly,
          to be solicited for employment, for or on behalf of himself or
          third parties, any persons who were at any time within one (1)
          year prior to the cessation of his employment hereunder,
          employees of the Company; or

               E.   at any time during his employment hereunder and for a
          period of one (1) year after he ceases to be employed by the
          Company, employ or cause or authorize, directly or indirectly, to
          be employed, for or on behalf of himself or third parties, any
          such employees of the Company; or

               F.   at any time during his employment hereunder and for any
          period during which the Employee is receiving severance pay and
          benefits after he ceases to be employed by the Company, unless
          agreed to by the Company in writing, the Employee will not accept
          employment with or participate, directly or indirectly, as owner,
          stockholder, director, officer, manager, consultant or agent, or
          otherwise use his special, unique or extraordinary skills or
          knowledge with respect to the business of the Company or of any
          affiliate of the Company in or with any business, firm,
          corporation, partnership, association, venture or other entity or
          person which is engaged in the business of designing, developing
          and manufacturing computers, printers or computer peripheral
          equipment for rugged or other specialized applications, except
          that this paragraph F shall not be construed to prohibit the
          Employee from owning up to 5% of the securities or a corporation
          which are publicly traded on a national securities exchange or in
          the over-the-counter market.

               (b)  The Employee agrees that he will not, at any time,
          remove from the Company s premises any drawings, notebooks, data
          and other documents and materials relating to the business and
          procedures heretofore or hereafter acquired, developed and/or
          used by the Company without prior written consent of the
          President and Chief Executive Officer of the Company, except as
          reasonably necessary to the discharge of his duties hereunder;
          provided, however, that the removal of any such documents that
          are deemed sensitive must be handled by the Employee in
          accordance with the Company s United States Department of Defense
          Security Manual.

               (c)  The Employee agrees that upon the expiration of his
          employment by the Company for any reason, he shall forthwith
          deliver up to the Company any and all order-books, customer
          lists, logs, drawings, notebooks and other documents and
          material, and all copies thereof, in his possession or under his
          control relating to any Confidential Information or any
          discoveries or which is otherwise the property of the Company.

               (d)  The Employee agrees that any breach or threatened
          breach or alleged breach or alleged threatened breach by him of
          any provision of this Section 8 shall entitle the Company, in
          addition to any other legal remedies available to it, to apply to
          any court of competent jurisdiction to enjoin such breach or
          threatened breach or alleged breach or alleged threatened breach. 
          The parties understand and intend that each restriction agreed to
          by the Employee herein shall be construed as separable and
          divisible  from every other restriction, and that the
          unenforceability, in whole or in part, of any other restriction,
          will not affect the enforceability of the remaining restrictions
          that one or more of all of such restrictions may be enforced in
          whole or in part as the circumstances warrant.  No waiver of any
          one breach of the restrictions contained in this Section 8 shall
          be deemed a waiver of any future breach.

               (e)  The Employee hereby acknowledges that he is fully
          cognizant of the restrictions put upon him by this Section 8.

               9.   Relocation Expenses
                    -------------------
                    a)  Subject to this Agreement, the Company shall pay
          the following actual expenses of the Employee incurred in
          connection with, or incidental to, the relocation of the Employee
          (the "Relocation"):  (i) all taxes, title and closing costs
          including up to two "points" in origination fees and prepaid
          interest expenses; (ii) reasonable legal and lenders fees; (iii)
          travel expenses including food and lodging, directly incurred in
          connection with the search for and purchase of a new primary
          residence in the Montgomery, Alabama, region which is within
          commuting distance to the Company s facilities; (iv) closing
          costs on the sale of the Employee s primary residence in Vestal,
          New York; (v) expenses for the movement of household goods from
          the Employee s primary residence in the Vestal, New York area, to
          a new permanent residence in the Montgomery, Alabama, area; and
          (vi) two trips (Employee & Spouse), to Montgomery, Alabama and
          return to current residence in New York by air for the purpose of
          looking for a primary residence.  All relocation expenses will be
          grossed up to cover applicable federal, state and local taxes.

               10.  Temporary Living Expenses.
                    -------------------------
          During the employment term and prior to the relocation of the
          Employee, but in no event to exceed a period of 180 days, the
          Employee shall be reimbursed for temporary living expenses
          incurred by the Employee in an amount not to exceed $2,000 per
          month, provided such expenses are adequately documented in
          accordance with the Company s policies.

               11.  Life Insurance.
                    --------------
          The Employee agrees that the Company may apply for and purchase
          one or more life insurance policies on the life of the Employee,
          and the Employee acknowledges that the Company has an insurable
          interest in the life of the Employee.  The Employee agrees to
          take all actions reasonably necessary for the Company to procure
          such policies, including, without limitation, the execution of
          any consents or applications and the undergoing of one or more
          physical examinations.

               12.  Notices.
                    -------
          All notices, requests, demands or other communications hereunder
          shall be deemed to have been given if delivered in writing
          personally or by certified mail to each party at the address set
          forth below, or at such other address as each party may designate
          in writing to the other:

          If to the Company:

               Miltope Group Inc.
               500 Richardson Road South
               Hope Hull, Alabama  36043

               with a copy to:

               Reid & Priest LLP
               40 West 57th Street
               New York, New York  10019
               Attention:  Leonard Gubar, Esq.

          If to the Employee:

               James Matthews
               604 Stonehedge Drive
               Vestal, New York 13850

               13.  Entire Agreement
                    ----------------
          This Agreement contains the entire understanding of the parties
          with respect to the subject matter hereof, supersedes any prior
          agreement between the parties, and may not be changed or
          terminated orally.  No change, termination or attempted waiver of
          any of the provisions hereof shall be binding unless in writing
          and signed by the party against whom the same is sought to be
          enforced.

               14.  Successors and Assigns.
                    ----------------------
          This Agreement shall be binding upon and shall inure to the
          benefit of the respective heirs, legal representatives,
          successors and assigns of the parties hereto.

               15.  Severability.
                    ------------
          In the event that any one or more of the provisions of this
          Agreement shall be declared to be illegal or unenforceable under
          any law, rule or regulation of any government having jurisdiction
          over the parties hereto, such illegality or unenforceability
          shall not affect the validity and enforceability of the other
          provisions of this Agreement.

               16.  Counterparts.
                    ------------
          This Agreement may be executed in one or more counterparts, each
          of which shall be deemed an original, but all of which together
          shall constitute one and the same instrument.

               17.  Governing Law.
                    -------------
          All matters concerning the validity and interpretation of and
          performance under this Agreement shall be governed by the laws of
          the State of Alabama.

          IN WITNESS WHEREOF, the parties hereto have executed this
          Agreement as of the date first above written.

                                             MILTOPE GROUP INC.,



          /s/ James Matthews                 by: /s/ George K. Webster
          -------------------------          -----------------------------
          James Matthews                     George K. Webster
                                             President and CEO