<PAGE>   1
                                                                   EXHIBIT 10.13


                              EMPLOYMENT AGREEMENT

        THIS EMPLOYMENT AGREEMENT ("Agreement") is entered into by and between
Don Scifres ("Scifres") and Spectra Diode Laboratories, Inc. (the "Company"),
and is effective as of the 17th day of July, 1992.
        The parties hereby agree as follows:

        1.     Period of Employment.

               The company will employ Scifres to render services to the company
in the position and with the duties and responsibilities described in Section 2,
for the compensation specified in Sections 3 and 4 and for the period commencing
on the effective date of this Agreement and ending on termination as provided in
Section 5.

        2.     Position and Duties.

               Scifres accepts employment with the Company as its President,
Chief Executive Officer and Chairman of the Board of Directors. As such, Scifres
shall have overall responsibility for the management and operations of the
Company, subject to the supervision and responsibilities of the Board of
Directors. In addition, Scifres shall have the duties and responsibilities of
the foregoing positions as set forth in the Bylaws of the Company. Any change in
Scifres' position and/or duties hereunder or a change in the location at which
he is to perform services hereunder which results in a commute for Scifres from
his current residence in excess of 25 miles shall constitute a termination of
this Agreement by the Company. Scifres shall report directly to the Board of
Directors.

<PAGE>   2

        3.     Compensation.

               (a)    Base Salary. Scifres shall receive a base salary of
                      $170,684 per year, payable in equal installments in
                      accordance with the Company's current practices. The
                      foregoing base salary shall be subject to annual increases
                      on January 1 of each year during the term of this
                      Agreement, as determined by the Board of Directors in its
                      sole discretion.

               (b)    Bonuses. The Board of Directors shall approve an annual
                      operating plan for the Company. Scifres shall receive cash
                      bonuses in connection with each audit of the Company's
                      results of operations conducted by the Company's
                      independent certified public accountants. Such audits
                      shall be conducted at least annually. Scifres' bonuses
                      shall be computed as follows, adjusted pro rata to reflect
                      any audit period less than twelve (12) months (provided
                      that the first audit conducted after the effective date of
                      this Agreement shall be deemed to exclude the period
                      October 1, 1991 0 December 31, 1991):

                      (i)    18.75% of Scifres' then-current base salary if the
                             Company achieves at least 100% of the revenues
                             specified in the operating plan(s) for the fiscal
                             period covered by the audit;

<PAGE>   3

                      (ii)   18.75% of his then-current base salary if the
                             Company achieves at least 100% of the operating
                             income before interest and taxes (excluding
                             extraordinary items) specified in the operating
                             plan(s) for the fiscal period covered by the audit;

                      (iii)  12.5% of his then-current base salary in the sole
                             discretion of the Board of Directors. The Company's
                             results of operations shall be determined by the
                             Company's independent certified public accountants
                             in accordance with generally accepted accounting
                             principles applied consistent with the practice for
                             prior periods and shall be accompanied by an audit
                             report of such accountants, which shall be
                             reasonably acceptable to the Company's Board of
                             Directors. Such bonuses shall be calculated and
                             paid within thirty (30 days following delivery of
                             the audit report. If the Company achieves revenues
                             and/or net income before taxes (excluding
                             extraordinary items) of at least 70% of the levels
                             specified in the operating plan(s) for the fiscal
                             period covered by the audit, the foregoing bonuses
                             shall be paid, reduced on a straight-line basis to
                             a zero bonus at 70% of plan. Bonuses shall be
                             deemed earned with respect to each fiscal year (or
                             portion thereof) during which Scifres has been
                             employed hereunder as of the end of the fiscal
                             period covered by the audit; such bonuses shall
                             thereafter be paid on the dates set forth above,
                             subject only to the determination of the Company's
                             results of operations, whether or not employment
                             hereunder has terminated.

<PAGE>   4


               (c)    Stock Option Grants. Scifres will be granted stock options
under the Company's 1992 Stock Option Plan as follows: options for 183,550
shares of Common Stock vesting in equal monthly installments over one year from
the date of consummation of the transaction described in Section 5(d); and
options for 100,000 shares of Common Stock vesting in equal monthly installments
over four years from such date; provided, however, that the number or four-year
options shall be increased, in the event all one-year options budgeted by the
Company (487,320 shares) are not awarded, by an amount (rounded to the nearest
whole share) equal to 24.61% of the one-year options not awarded, up to a
maximum of 22,500 additional shares. The foregoing options will have an exercise
price of an exercise price of $1.75 per share and will otherwise have the terms
and conditions prescribed under the Company's 1992 Stock Option Plan.

        4.     Benefits.

               (a)    General. Scifres will continue to receive all employee
benefits to which he is currently entitled, consisting of (i) those benefits
made generally available to the Company's employees, and (ii) the benefits
described in the attachments to the letter dated January 3, 1991 from Scifres to
Frank Squires (a copy of which is attached hereto). In addition, Scifres shall
receive in the future any and all benefits generally made available to the
Company's executive personnel. The foregoing shall include, without limitation,
stock purchase and stock option plan grants, with the number of shares, if any,
covered by such grants determined by the Board of Directors in its sole
discretion. The Company shall reimburse Scifres for reasonable travel and other
business expenses incurred by him in the performance of his duties hereunder in
accordance with the Company's policies in this regard.

               (b)    Life Insurance. During the term of this Agreement and for
a period of twenty-four (24) months thereafter (subject to reduction as provided
in section 5), the Company will maintain an insurance policy on Scifres' life in
an

<PAGE>   5

amount equal to two (2) times his then-current base salary. The proceeds of the
foregoing insurance policy shall be payable to such beneficiaries as Scifres may
designate from time to time or, in the absence of a designation, to his estate.

               (c)    Board Seat. During the term of Scifres' employment
hereunder, Scifres shall be entitled to serve as a member of the Company's Board
of Directors pursuant to the terms of the Voting Agreement of even date
herewith.

               (d)    Post-Termination. For a period of twenty-four (24) months
(subject to reduction as provided in Section 5) following the termination of
Scifres' employment pursuant to this Agreement: (i) during the COBRA period, the
Company will reimburse Scifres (including a gross-up to compensate Scifres for
any taxes payable with respect to such reimbursement) for all amounts payable by
Scifres to retain medical benefits under COBRA, provided that during the COBRA
period Scifres will (as defined below), Scifres shall be entitled to the
following benefits (subject to reduction as provided below):

<PAGE>   6

                      (i)    A lump sum payment (payable within thirty (30) days
of termination) of twenty-four (24) months' salary based on his then-current
base salary;

                      (ii)   Acceleration of vesting, by twenty-four (24)
additional months from such date of termination, under all outstanding stock
options and stock purchase, stock appreciation and similar rights then held by
Scifres; and

                      (iii)  An amount, payable for twenty-four (24) months
commencing on the effective date of termination of Scifres' employment, equal to
4.1666% of his then-current base salary.

               For each full month occurring after the effective date of this
Agreement and prior to the first anniversary thereof, the time periods in
clauses (i), (ii) and (iii) above and in Sections 4(b) and 4(d) shall each be
reduced by one (1) month. As a result of this Agreement, the time periods in
clauses (i), (ii) and (iii) above and in Sections 4(b) and 4(d) shall be reduced
to twelve (12) months. The reduction in the time periods set forth in the
preceding sentence to twelve (12) months shall also come effect as of the
closing of the Company's initial underwritten offering of shares of its Common
Stock to the general public.

               (c)    Subsequent to the termination of Scifres' employment
thereunder, the payments and benefits provided for in

<PAGE>   7

Sections 4 (b) and 4 (d) and subsection 5 (b) (iii) shall terminate at such
time, if any, as Scifres commences full-time employment whereby he can obtain
group health and disability benefits (including coverage for preexisting
conditions) and life insurance benefits comparable to those to which he is
entitled hereunder. The Company's obligations and Scifres' rights under
subsections 5 (b) (i) and 5 (b) (ii) shall not be affected by Scifres'
commencement of new employment.

               (d)    In the event the Company terminates Scifres' employment
pursuant to subsection (a) above for cause, the Company's repurchase rights
under the stock option (183,550 shares) with a one-year vesting period
referenced in Section 3 (c) shall lapse in full. "Cause" shall be limited solely
to (i) Scifres' gross abdication of his duties hereunder (other than due to
illness or personal family problems), which conduct remains uncured for a period
of at least 30 days following written notice thereof to Scifres.

               (e)    This Agreement shall terminate upon Scifres' death or
permanent disability. In such event, and in addition to all other benefits to
which Scifres is then entitled under this Agreement or the Company's benefits
plans, Scifres (or his estate) shall be entitled to receive the benefits
provided for under Section 5 (b).

<PAGE>   8
               (f)    In  the event there is a "change of control" of the
Company, and if Scifres shall thereafter terminate this Agreement, Scifres shall
be entitled to receive the benefits provided for under Section 5 (b). For
purposes of this Section 5 (d), a "change of control" of the Company shall be
deemed to have occurred if, after the effective date of this Agreement, any
person or entity, including a "group" as defined in Section 13 (d) (3) of the
Securities Exchange Act of 1934, as amended, becomes the beneficial owner of
more than 50% of the securities of the Company having the right to vote for the
election of directors. Neither (a) the acquisition by Sprout Group and/or
Brinson Partnars, Inc., or their affiliates or entities managed or advised by
them (the "Investors"), of securities of the Company in accordance with the
Letter of Intent dated June 22, 1992, nor (b) the transfer of such shares to the
limited or general partners or shareholders, as applicable, of any of the
Investors shall be deemed to be a "change of control" of the Company. The
provisions of this section 5 (f) shall terminate on the closing of the Company's
initial underwritten offering of shares of its Common Stock to the general
public.

6.  Miscellaneous.

        (a)  Notices under this Agreement shall be in writing and shall be
             deemed given when delivered in person or three (3) days following
             deposit in the United States Mail, postage prepaid, certified or
             return receipt requested, and addressed as follows:

<PAGE>   9


           If to Scifres:      XXXXXXXXXXX

           If to the Company:  80 Rose Orchard Way
                               San Jose, California  95134
                               Attention: Corporate Secretary

The foregoing addresses may be changed by notice in accordance with this
subsection (a).

        (b)  The prevailing party in any action to enforce the terms of this
             Agreement shall be entitled to reimbursement from the other party
             for its costs and expenses (including reasonable attorneys' fees)
             in connection therewith.

        (c)  The terms of this Agreement are intended by the parties to be the
             final expression of their agreement with respect to the employment
             of Scifres by the Company and may not be contradicted by evidence
             of any prior or contemporaneous agreement. The offer letter dated
             June 13, 1983 is superseded by this Agreement and shall be of no
             further force or effect. The parties further intend that this
             Agreement shall constitute the complete and exclusive statement of
             its terms (except that Scifres shall be bound by his Invention and
             Confidential Information Agreement with the Company in accordance
             with its terms) and that no extrinsic evidence whatsoever may be
             produced in any legal proceeding involving this Agreement. This
             Agreement may be amended, and the observance of any of its terms
             may be waived, only by a writing signed by the party to be charged
             with such amendment or waiver.

<PAGE>   10

        (d)  If any prevision of this Agreement, or the application thereof to
             any person, place or circumstance, shall be held by a court of
             competent jurisdiction to be invalid, unenforceable or void, the
             remainder of this Agreement and such provisions as applied to other
             persons, places and circumstances shall remain in full force and
             effect.

        (e)  The validity, interpretation, enforceability and performance of
             this Agreement shall be governed by and construed in accordance
             with the laws of the State of California, without regard to its
             rules regarding conflicts of laws.

        IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the date first set forth above.

EMPLOYEE                                SPECTRA DIODE LABORATORIES, INC.


By   /S/ Don Scifres                    By    /S/ John Melton
   ---------------------------             ------------------------------

<PAGE>   11

                                    AMENDMENT

                                       TO

                              EMPLOYMENT AGREEMENT

               THIS AMENDMENT ("Amendment") is entered into with respect to the
Employment Agreement by and between Don Scifres and Spectra Diode Laboratories,
Inc., dated as of July 17, 1992 (the "Agreement").

        The parties hereby agree as follows:

        A.  Amendment. There is added to Section 3 (c) of the Agreement the
            following:

                  "In the event that the accelerated venting of Scifres' option
                  shares in connection with a change in the control of the
                  company (as defined in Section 5 (f) below), results in the
                  imposition of excise taxes on Scifres under Section 4999 of
                  the Internal Revenue Code ("Code") (and corresponding
                  provisions of applicable state tax law), the Company agrees to
                  pay Scifres a cash bonus calculated as follows: (a) if more
                  than 75% of the voting power of all outstanding stock of the
                  Company is held, as of the record date on which the approval
                  of the Company's shareholders is solicited with respect to
                  such transaction, by the Investors (as defined in Section 5
                  (f) below), then the cash bonus shall equal the excise taxes
                  imposed on Scifres under Section 4999 of Code (and
                  corresponding provisions of applicable state tax law) as a
                  result of the accelerated vesting of the option shares and
                  other "parachute payments" (as that term is defined by Code
                  Section 280G (b) (2)) received by Scifres in connection with
                  such change in control (including, without limitation, the
                  bonus provided for in this Section 3 (c)), or (b) if the
                  Investors hold 75% or less of the voting powers of all
                  outstanding stock of the company at that time, then the cash
                  bonus shall equal the lesser of (i) the amount determined
                  under clauses (a), or (ii) $100,000.

        2.  Continuing Effect. Except as provide in this Amendment, the
Agreement shall continue in full force and effect in accordance with its terms.

<PAGE>   12


               IN WITNESS WHEREOF, the parties hereto have caused this Amendment
to be duly executed as of February 17, 1993.


                                        SPECTRA DIODE LABORATORIES, INC.



                                        By:  /s/ John P. Melton
                                             -----------------------------------


                                             /s/ Don Scifres
                                        ----------------------------------------
                                                 Don Scifres

<PAGE>   13

                                SECOND AMENDMENT

                                       TO

                              EMPLOYMENT AGREEMENT

THIS SECOND AMENDMENT ("Amendment") is entered into with respect to the
Employment Agreement by and between Don Scifres and SDL, Inc., dated as of July
17, 1992, as amended as of February 1993 (as amended, the "Agreement").

        The parties hereby agree as follows:

        1.  Amendment. Section 3(b) of the Agreement is amended to read in its
            entirety as follows:

            "Bonuses. The Board of Directors shall approve an annual operating
            plan for the Company. Scifres has shall receive cash bonuses in
            connection with each audit of the Company's results of operations
            conducted by the Company's independent certified public accountants.
            Such audits shall be conducted at least annually. Scifres' bonuses
            shall be computed as provided in the matrix attached to this
            Amendment as Exhibit A, provided that (i) such bonuses shall be
            adjusted pro rata to reflect any audit period less than twelve (12)
            months, and (ii) with respect to Note 3 of Exhibit A, Scifres' bonus
            will be 50% of his then current base salary times the matrix factor.
            The Company's results of operations shall be determined by the
            Company's independent certified public accountants in accordance
            with general accepted accounting principles applied consistent with
            the practice for prior periods and shall be accompanied by an audit
            report of such accountants, which shall be reasonably acceptable to
            the Company's Board of Directors. Such bonuses shall be calculated
            and paid within thirty (30) days following delivery of the audit
            report. Bonuses shall be deemed earned with respect to each fiscal
            year (or portion thereof) during which Scifres has been employed
            hereunder as of the end of the fiscal period covered by the audit;
            such bonuses shall thereafter be paid on the dates set forth above,
            subject only to the determination of the company's results of
            operations, whether or not employment hereunder has terminated."

        2.  Effectiveness. The foregoing amendment of the Agreement shall be
            effective as of January 1, 1994.

<PAGE>   14

        3.  Continuing Effect. Except as provided in this Amendment, the
            Agreement shall continue in full force and effect in accordance with
            its terms.

           IN WITNESS WHEREOF, the parties hereto have caused this Amendment to
be duly executed as of July 29, 1994.


                                    SDL, INC.


                                    BY     /S/  John P. Melton
                                        ----------------------------------


                                    Don Scifres

                                           /S/ Don Scifres
                                    --------------------------------------

<PAGE>   15


<TABLE>
<S>      <C>   <C>   <C>    <C>   <C>   <C>    <C>   <C>   <C>    <C>   <C>   <C>    <C>
------------------------------------------------------------------------------------------
         80    84    88     92    96    100    104   108   112    116   120   124    128
------------------------------------------------------------------------------------------
70       0     0.1   0.2    0.3   0.4   0.5    0.6   0.7   0.7    0.7   0.7   0.7    0.7
------------------------------------------------------------------------------------------
76       0.1   0.2   0.3    0.4   0.5   0.6    0.7   0.8   0.9    0.9   0.9   0.9    0.9
------------------------------------------------------------------------------------------
82       0.2   0.3   0.4    0.5   0.6   0.7    0.8   0.9   1.0    1.1   1.1   1.1    1.1
------------------------------------------------------------------------------------------
88       0.3   0.4   0.5    0.6   0.7   0.8    0.9   1.0   1.1    1.2   1.3   1.3    1.3
------------------------------------------------------------------------------------------
94       0.4   0.5   0.6    0.7   0.8   0.9    1.0   1.1   1.2    1.3   1.4   1.5    1.6
------------------------------------------------------------------------------------------
100      0.5   0.6   0.7    0.8   0.9   1.0    1.1   1.2   1.3    1.4   1.5   1.6    1.7
------------------------------------------------------------------------------------------
106      0.6   0.7   0.8    0.9   1.0   1.1    1.2   1.3   1.4    1.5   1.6   1.7    1.8
------------------------------------------------------------------------------------------
112      0.7   0.8   0.9    1.0   1.1   1.2    1.3   1.4   1.5    1.6   1.7   1.8    1.9
------------------------------------------------------------------------------------------
118      0.7   0.9   1.0    1.1   1.2   1.3    1.4   1.5   1.6    1.7   1.8   1.9    2.0
------------------------------------------------------------------------------------------
124      0.7   0.9   1.1    1.2   1.3   1.4    1.5   1.6   1.7    1.8   1.9   2.0    2.1
------------------------------------------------------------------------------------------
130      0.7   0.9   1.1    1.3   1.4   1.5    1.6   1.7   1.8    1.9   2.0   2.1    2.2
------------------------------------------------------------------------------------------
136      0.7   0.9   1.1    1.3   1.5   1.6    1.7   1.8   1.9    2.0   2.1   2.2    2.3
------------------------------------------------------------------------------------------
142      0.7   0.9   1.1    1.3   1.5   1.7    1.8   1.9   2.0    2.1   2.2   2.3    2.4
------------------------------------------------------------------------------------------
148      0.7   0.9   1.1    1.3   1.5   1.7    1.9   2.0   2.1    2.2   2.3   2.4    2.5
------------------------------------------------------------------------------------------
154      0.7   0.9   1.1    1.5   1.5   1.7    1.9   2.1   2.2    2.3   2.4   2.5    2.6
------------------------------------------------------------------------------------------
</TABLE>


NOTE

1.  Payments will be made on a continuous linear scale between points to avoid
    trying to meet arbitrary increments in the above matrix.

2.  Operating income is defined as "Income Before Interest and Taxes" as Greg
    Lindholm has provided in the past (excluding non-operating expense, e.g.,
    stock option extension, comp. expense).

3.  Vice Presidents' bonus will be 15% of salary times the matrix factor and up
    to 10% of salary at the discretion of the Board.