SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549
                                 --------------

                                   Form 10-QSB
           (Mark One)
                [ X ] QUARTERLY REPORT UNDER SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

                  For the quarterly period ended June 28, 1997

                                       OR

              [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
                               OF THE EXCHANGE ACT

             For the transition period from _________ to __________

                         Commission file number 0-11880

                            HYTEK MICROSYSTEMS, INC.
        (Exact name of small business issuer as specified in its charter)

                    California                                94-2234140
          (State or other jurisdiction of                  (I.R.S. Employer
           incorporation or organization)                  Identification No.)

                 400 Hot Springs Road, Carson City, Nevada 89706
                    (Address of principal executive offices)

                    Issuer's telephone number: (702) 883-0820

 Check whether the issuer (1) filed all reports  required to be filed by Section
13 or 15(d) of the  Exchange  Act during the past 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 _____

As of June 28,  1997,  the issuer  had  outstanding  2,941,424  shares of Common
Stock, no par value.

<PAGE>

                              HYTEK MICROSYSTEMS, INC.
                         QUARTERLY REPORT ON FORM 10-QSB
                       FOR THE QUARTER ENDED JUNE 28, 1997

                                      INDEX
                                                                        Page
                                                                       Number
                                                                       ------

Part I.  FINANCIAL INFORMATION:

Item 1.  Financial Statements:

                  Balance Sheet at June 28, 1997 (unaudited) and
                  December 28, 1996  .  .  .  .  .  .  .  .  .   .  .  .    3

                  Statement of Income and Accumulated Deficit
                  (unaudited) for the Quarter and Six Months ended
                  June 28, 1997 and June 29, 1996  .  .  . .  .  .  . .  .  4

                  Statement of Cash Flows (unaudited) for the Quarter and
                  Six Months ended June 28, 1997 and June 29, 1996   .  . . 5

                  Notes to Interim Financial Statements (unaudited) .  .  . 6

Item 2.  Management's Discussion and Analysis of Financial
         Condition and Results of Operations . .  .  .  .  .  .  .  .  .  . 7


Part II. OTHER INFORMATION:

Item 4.  Submission of Matters to a Vote of Security Holders..  .  .  .  . 12

Item 6.  Exhibits and Reports on Form 8-K .  .    .  .  .  .  .  .  .  .   13

Signatures  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  14

Exhibit Index. .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  15

<PAGE>                     
          PART I. - FINANCIAL INFORMATION
<TABLE>


Item 1.    Financial Statements.


                                                                    HYTEK MICROSYSTEMS, INC.

                                                                          BALANCE SHEET


                                                                              June 28, 1997                    December 28, 1996
                             Assets                                            (Unaudited)
                                                                        ---------------------------       -------------------------
<S>                                                                     <C>                               <C>       

Current assets:

  Cash and cash equivalents                                             $       1,201,721                $     1,426,716

  Trade accounts receivable - net of

allowance for doubtful accounts
 of $50,000 at 12/28/96 and 6/28/97                                             1,436,033                      1,125,817
  Inventories                                                                   1,231,002                      1,268,881

  Prepaid expenses and deposits                                                    55,120                         42,503

                                                                          ---------------------------      -------------------------

     Total current assets                                                       3,923,876                      3,863,917


Deferred income taxes                                                             200,000                        200,000


 Plant and equipment, at cost, less

  accumulated depreciation and amortization                                       435,572                        370,362

                                                                          ---------------------------      -------------------------

Total  assets                                                             $     4,559,448                  $   4,434,279
                                                                          ---------------------------      -------------------------

                                                                          ---------------------------      -------------------------


Liabilities and Shareholders' Equity

Current liabilities:

  Accounts payable                                                        $       282,234                  $     268,462

  Accrued employee compensation and benefits                                      177,835                        349,498

  Accrued warranty, commissions and other                                         137,667                        169,376

  Customer deposits                                                                64,785                        172,080

  Current obligations under capital lease                                          33,990                         33,990

                                                                          ---------------------------      -------------------------

     Total current liabilities                                                    696,511                        993,406


Long-term obligations under capital lease                                          48,151                         67,979


Shareholders' equity:

   Common Stock, no par value: 7,500,000 shares

      authorized, 2,941,424 shares issued and

      outstanding at June 28, 1997 and 2,933,091                                4,974,677                      4,962,677

      at December 28, 1996

  Accumulated deficit                                                         (1,159,891)                    (1,589,783)

                                                                          ---------------------------      -------------------------

     Total shareholders' equity                                                 3,814,786                      3,372,894

                                                                          ---------------------------      -------------------------

                                                                          $     4,559,448                  $   4,434,279
                                                                          ---------------------------      -------------------------

                                                                          ---------------------------      -------------------------

                                                                See accompanying notes.

</TABLE>

<PAGE>
<TABLE>

                                                       HYTEK MICROSYSTEMS, INC.


                                 STATEMENT OF INCOME AND ACCUMULATED DEFICIT (Unaudited)


                              Quarters and six months ended June 28, 1997 and June 29, 1996


                                                   Quarter ended                            Six months ended

                                           6/28/97              6/29/96              6/28/97                6/29/96

                                       -----------------    ----------------     ----------------     --------------------
<S>                                    <C>                  <C>                  <C>                  <C>   

Net revenues                       $          2,181,844 $         2,628,372 $          3,768,639 $              4,665,551

Costs and expenses:
  Cost of sales                               1,480,574           1,791,961            2,624,847                3,184,672
  Engineering and development                   183,848             141,897              358,409                  289,380
  Selling, general and
    administrative                              174,348             175,231              332,400                  317,539
                                       -----------------    ----------------     ----------------     --------------------
    Total costs and expenses                  1,838,770           2,109,089            3,315,656                3,791,591
                                       -----------------    ----------------     ----------------     --------------------

Operating income                                343,074             519,283              452,983                  873,960

Interest income                                   7,744                 324               19,756                      621
Interest expense                                    871               1,163                2,847                    1,864
                                       -----------------    ----------------     ----------------     --------------------
Income before provision
  for income taxes                              349,947             518,444              469,892                  872,717
Provision for income taxes                       15,000                   -               40,000                        -
                                       -----------------    ----------------     ----------------     --------------------

Net income                         $            334,947             518,444 $            429,892                  872,717


Accumulated deficit:
    Beginning of period            $        (1,494,838) $       (3,162,155) $        (1,589,783) $            (3,516,428)
                                       -----------------    ----------------     ----------------     --------------------

    End of period                  $        (1,159,891) $       (2,643,711) $        (1,159,891) $            (2,643,711)
                                       -----------------    ----------------     ----------------     --------------------

                                                                                 ----------------     --------------------
                                       -----------------    ----------------

Net income per share               $                .11 $               .17 $                .14 $                    .28
                                       -----------------    ----------------     ----------------     --------------------

                                       -----------------                         ----------------     --------------------
                                                            ----------------


Common and common equivalent
  shares used in per share                    3,075,538           3,081,420            3,083,361                3,084,724
calculations


                               See accompanying notes.
                                    

</TABLE>

<PAGE>
<TABLE>

                                                                   HYTEK MICROSYSTEMS, INC. 
                                                              STATEMENT OF CASH FLOWS (unaudited)

                                                Quarters and Six Months Ended June 28, 1997 and June 29, 1996

                                                     Increase (decrease) in cash and cash equivalents

                                                                    Quarter Ended                          Six Months Ended

                                                          ---------------- -----------------    ------------------ -----------------
                                                           June 28, 1997     June 29, 1996         June 28, 1997       June 29, 1996
                                                          ---------------- -----------------    ------------------ -----------------
<S>                                                       <C>              <C>                  <C>                <C>  
Cash flows from operating activities:                 
                                                        
Net income                                               $   334,947 $           518,444 $              429,892    $        872,717


Adjustments to reconcile net income to

cash flow provided by (used in) operations:

Depreciation and amortization                                 31,516              14,886                 61,400              24,330
Accounts receivable                                           70,587            (66,695)              (310,216)           (179,926)
Inventories                                                  428,168             144,020                 37,879           (215,126)
Prepaid expenses and deposits                                (6,992)               4,643               (12,617)             (3,487)
Accounts payable                                           (328,675)           (402,776)                 13,772            (65,786)
Accrued employee compensation and benefits                    77,344             139,382              (171,663)              95,647
Accrued warranty, commissions and other                        1,516              13,543               (31,709)            (26,242)
Customer pre-payments                                       (57,932)              76,444              (107,295)              57,054
                                                       --------------     ---------------    -------------------     ---------------
  Net cash provided by (used in) operating activities        550,479             441,891               (90,557)             559,181

Cash flows from investing activities:

 Purchases of equipment                                     (98,386)            (29,005)              (126,610)           (125,778)

                                                       --------------     ---------------    -------------------     ---------------

  Net cash used in investing activities                     (98,386)            (29,005)              (126,610)           (125,778)

Cash flows from financing activities:

Repayment of short-term borrowings                                 -            (50,000)                      -

Payment of capital lease obligations                         (5,665)                   -               (19,828)                   -

Proceeds from exercise of stock options                            -              22,532                 12,000              48,871

                                                       --------------     ---------------    -------------------     ---------------
  Net cash used in financing activities                      (5,665)            (27,468)                (7,828)              48,871

Net increase (decrease) in cash and cash equivalents         446,428             385,418              (224,995)             482,274

Cash and cash equivalents at beginning of period             755,293             189,851              1,426,716              92,995

                                                       --------------     ---------------    -------------------     ---------------

Cash and cash equivalents at end of period            $    1,201,721 $           575,269 $            1,201,721    $        575,269

                                                      ----------------    ----------------    ------------------    ----------------

                                        
                                                      ----------------    ----------------    ------------------    ----------------

See accompanying notes.


</TABLE>

<PAGE>


                            HYTEK MICROSYSTEMS, INC.
                      NOTES TO INTERIM FINANCIAL STATEMENTS
                                  JUNE 28, 1997
                                   (Unaudited)

         1. In the opinion of management,  the accompanying  unaudited financial
statements  include  all  adjustments   (consisting  of  only  normal  recurring
adjustments)  that are  necessary  in order  to make  the  financial  statements
contained herein not misleading.  These financial statements, notes and analyses
should be read in conjunction with the financial  statements for the fiscal year
ended December 28, 1996, and notes thereto, which are contained in the Company's
Annual  Report on Form 10-KSB for such fiscal year.  The results for the quarter
and six months ended June 28, 1997 are not necessarily indicative of the results
that may be expected  for the entire year  ending  January 3, 1998.  The Company
operates on a 52/53 week fiscal year, which approximates the calendar year.

         2. The Company leases its Carson City facility pursuant to a continuing
lease  expiring in 2005. The aggregate  future minimum rental  commitments as of
June 28, 1997 for this lease were:

                                    1997                    $  78,846
                                    1998                      160,056
                                    1999                      164,856
                                    2000                      169,800
                                    2001 - 2005               828,678
                                                              -------
                                                           $1,402,236
                                                           ----------

         3. Inventories  are stated at the lower of cost (determined  using  the
first-in,first-out method)or market.At June 28,1997, inventories consisted of:

                  Raw Material                              $730,058
                  Work-In-Process                            474,090
                  Finished Goods                              26,854
                                                           ---------
                                                          $1,231,002
                                                          ----------

         4.  Plant  and  equipment  are  stated  at cost  and  depreciated  on a
straight-line  basis over the  estimated  useful life of the  assets,  generally
three to eight years.

         5.  In February 1997, the Financial  Accounting Standards  Board issued
Statement  No.  128,  Earnings  per Share,  which is  required  to be adopted on
December  31,  1997.  At that time,  the Company  will be required to change the
method  currently  used to compute  earnings  per share and to restate all prior
periods.  Under the new requirements for calculating primary earnings per share,
the dilutive  effect of stock options will be excluded.  This impact is expected
to result in a one cent increase in the net income per share for the quarter and
six  months  ended  June  28,  1997  and a  one  cent  and  two  cent  increase,
respectively, for the quarter and six months ended June 29, 1996.

<PAGE>

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

         For the purposes of the following discussion,  dollar amounts have been
rounded to the  nearest  $1,000  and all  percentages  have been  rounded to the
nearest 1%.

         This interim  report on Form 10-QSB  contains  certain  forward-looking
statements  within the meaning of Section 27A of the  Securities Act of 1933 and
Section 21E of the Securities  Exchange Act of 1934. Actual results could differ
materially from those projected in the forward-looking statements as a result of
various  factors,  including  the risk factors set forth below.  The Company has
attempted  to  identify  forward-looking   statements  by  placing  an  asterisk
immediately  following  the sentence or phrase  containing  the  forward-looking
statement(s).

RESULTS OF OPERATIONS
---------------------

         Net revenues for the quarter ended June 28, 1997 decreased 17% from net
revenues for the quarter ended June 29, 1996. Net revenues for the quarter ended
June 28, 1997 were  $2,182,000,  as compared to $2,628,000 for the quarter ended
June 29, 1996. Net revenues for the six months ended June 28, 1997 decreased 19%
from net revenues  for the six months ended June 29, 1996.  Net revenues for the
six months ended June 28, 1997 were $3,769,000 as compared to $4,666,000 for the
six months ended June 29, 1996. The decrease in net revenues for the quarter and
six months ended June 28, 1997 over the  comparable  period of the prior year is
attributable  to a reduced  demand for product from  Chesapeake  Sciences  Corp.
("Chesapeake"),  the Company's  largest  customer  during each of these periods.
Chesapeake accounted for 42% of net revenues for both the quarter and six months
ended June 28, 1997.

         The  Company's  backlog of customer  orders was  $6,052,000 at June 28,
1997 as compared to $5,095,000 at June 29, 1996,  and $6,474,000 at December 28,
1996. Approximately  $2,046,000,  or 34% of the total backlog, relates to orders
from  Chesapeake.  Because  customers  may place  orders for delivery at various
times  throughout  the year, and due to the  possibility of customer  changes in
delivery  schedules  or  cancellation  of orders with little or no penalty,  the
Company's  backlog as of any  particular  date may not be  indicative  of actual
future sales.*
<PAGE>

         Cost of sales was $1,481,000,  or 68% of net revenues,  for the quarter
ended June 28, 1997, as compared to $1,792,000,  or 68% of net revenues, for the
quarter ended June 29, 1996.  Both quarters  contained  large customer  programs
with a high materials cost content per revenue dollar. Cost of sales for the six
months ended June 28, 1997 was $2,625,000,  or 70% of net revenues,  as compared
to $3,185,000,  or 68% of net revenues,  for the six months ended June 29, 1996.
This  increase in cost of sales as a  percentage  of net revenues is primarily a
result of spreading fixed costs over a smaller revenue base.

         Engineering  and  development  expenses  were  $184,000,  or 8% of  net
revenues, for the quarter ended June 28, 1997, as compared to $142,000, or 5% of
net revenues for the quarter ended June 29, 1996.  Engineering  and  development
expenses  for the six months  ended June 28, 1997 were  $358,000,  or 10% of net
revenues,  as compared to $289,000,  or 6% of net  revenues,  for the six months
ended June 29,  1996.  This  increase in the dollar  amount of  engineering  and
development  expenses  for the  quarter and  six-month  periods is the result of
increased  staffing  levels  required to meet  customer  delivery and  technical
requirements.  The  Company is  continuing  its  efforts  to develop  additional
standard  products,  and has released two additional  versions of its High Speed
Laser Diode  Driver  during the past six months.  The  increase in research  and
development  expenses as a percentage  of net  revenues is a combined  result of
spreading  such  expenses  over a  smaller  revenue  base and  increased  actual
expenditures.

         Selling, general and administrative expenses remained relatively stable
in amount at $174,000,  or 8% of net  revenues,  for the quarter  ended June 28,
1997, as compared to $175,000, or 7% of net revenues, for the quarter ended June
29, 1996. Selling,  general and administrative expenses for the six months ended
June 28, 1997 were $332,000,  or 9% of net revenues, as compared to $318,000, or
7% of net  revenues,  for the six months  ended June 29,  1996.  The increase in
selling,  general  and  administrative  expense  for  the  six-month  period  is
primarily  the  result of  increases  in  expenditures  for  recruitment,  audit
expense, data processing and investor relations and shareholder related expenses
such as annual  reports and  transfer  agent fees,  partially  offset by reduced
compensation costs resulting from an unexpected loss of personnel.  The increase
in selling,  general and administrative expenses as a percentage of net revenues
is primarily due to the spreading of such expenses over a smaller revenue base.

<PAGE>

         The Company had an operating  profit of $343,000 for the quarter  ended
June 28, 1997, as compared to operating profit of $519,000 for the quarter ended
June 29,  1996.  The Company  had an  operating  profit of $453,000  for the six
months ended June 28, 1997,  as compared to an operating  profit of $874,000 for
the six months ended June 29, 1996.  The  decrease in  quarterly  and  six-month
profit was primarily attributable to decreased sales volume.

         Net interest  income was $7,000 for the quarter and $17,000 for the six
months  ended June 28, 1997 as compared  to net  interest  expense of $1,000 for
each of the  comparable  prior year periods.  This increase  results from larger
cash balances available for interest-bearing investment.

         Federal  income tax expense of $15,000 and $40,000,  respectively,  was
recognized  in the quarter and six months ended June 28, 1997 as a result of the
alternative  minimum  tax.  There was no income  tax  expense  in the prior year
periods. The Company has remaining net operating loss carrryforwards for federal
income tax purposes at December 28, 1996 of  approximately  $4.3 million.  These
carryforwards will expire between 2004 and 2008.

LIQUIDITY AND CAPITAL RESOURCES
-------------------------------

         The Company had  $1,202,000  in cash at June 28,  1997,  as compared to
$1,427,000  at December 28,  1996.  This  decrease of $225,000  from year end is
comprised  of  $91,000  used in  operating  activities,  $127,000  used  for the
purchase of capital equipment and $8,000 used in financing activities.

         Accounts  receivable  were  $1,436,000 at June 28, 1997, as compared to
$1,126,000 at December 28, 1996. This increase is the result of higher levels of
shipments  at the end of the  second  quarter  of 1997 as  compared  to the 1996
fiscal year end.

         Inventories  remained relatively stable at $1,231,000 on June 28, 1997,
as compared to $1,269,000 at December 28, 1996. However, raw materials increased
to $730,000 at June 28, 1997 as compared to $279,000 at fiscal 1996 year end due
to the reduced level of shipments to Chesapeake Sciences Corp.

         Accounts  payable  were  $282,000  at June 28,  1997,  as  compared  to
$268,000 at December 28, 1996.

<PAGE>

         Accrued  employee  compensation  and  benefits was $178,000 at June 28,
1997,  as compared to $349,000 at December 29, 1996.  This decrease is primarily
the result of reduced amounts  currently accrued for employee profit sharing due
to lower net income levels in the first half of 1997.

         Accrued  warranty,  commissions  and  other  accrued  liabilities  were
$138,000 at June 28, 1997,  as compared to $169,000 at December  28, 1996.  This
reduction  is the net  effect of normal  ongoing  accruals  for sales  commision
expense,  legal and audit fees and shareholder  related expenses,  combined with
the payment during the first six months of 1997 of expenses accrued in 1996.

          Customer  pre-payments  were  reduced to  $65,000 at June 28,  1997 as
compared to $172,000  at December  28, 1996 as a result of the  delivery of 
pre-paid products to customers.

           At June 28,  1997,  the  Company had  long-term  lease obligations of
$48,000  outstanding on its Continuing  Master  Equipment  Lease  Agreement with
SierraWest Bank. This lease  agreement,  entered into in December 1996, bears an
annual  interest  rate of 10.75%  and has a term of three  years.  This lease is
secured by the related equipment.

         The  Company  also has a line of credit for  $100,000  with  SierraWest
Bank,  which expires in December 1997 and bears  interest at the prime rate plus
2%. At June 28, 1997, the Company was in compliance with all of the covenants of
this loan agreement and no amounts were outstanding.

FUTURE OUTLOOK
--------------

         During the quarter and six months  ended June 28,  1997,  revenues  and
earnings  declined  from the  prior  year  period  as had been  anticipated  and
previously  disclosed.  This decline was the result of customer initiated delays
in delivery to Chesapeake  Sciences Corp.  However,  during the second  quarter,
Chesapeake delivery rates were increased by approximately 40% over first quarter
levels. In addition, recent orders received from Eaton Corp. and other customers
are, to a significant  extent,  deliverable  during the remainder of the current
year.*  Current  projections  indicate  that the Company may be able to increase
both  revenues  and earnings in the latter half of 1997 as compared to the first
half of 1997.*

<PAGE>

         Management  believes  that ongoing  operations  during the remainder of
1997,  together  with the unused  portion of its line of  credit,  will  provide
sufficient  cash to meet normal  operating  needs without  additional  financing
activities through the remainder of the current fiscal year.* However, since the
Company  desires  to expand  its  technological  base and  production  capacity,
investments  in  resources  requiring  additional  new  equity  or debt,  may be
necessary.* In such case,  there can be no assurance that such financing will be
available on terms acceptable to the Company or at all.

         The Company's backlog of unfilled orders increased  slightly during the
six months ended June 28, 1997. Orders from Chesapeake  Sciences Corp.  continue
to  represent  the  largest  portion  of  the  Company's  current  backlog.  Any
cancellation  or delayed  delivery of orders by, or disruption of operations at,
Chesapeake Sciences Corporation or any other major customer,  would have a major
adverse impact on the Company's future operating results.

         The foregoing  discussion contains statements that are forward-looking.
Actual results could differ  materially.  The primary factors that could cause a
material   difference  in  actual  results  include  customer   cancellation  or
rescheduling of orders and problems affecting  delivery of  vendor-supplied  raw
materials and components. The Company disclaims any responsibility to update the
forward-looking statements contained herein, except as may be required by law.

<PAGE>

                           PART II - OTHER INFORMATION


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

         (a)      The Annual Meeting of Shareholders of the Company was held  on
                  May  16,   1997   (the "Meeting").

         (b)      The following directors were elected at the Meeting:

                  Shou-Chen Yih
                  Charles S. Byrne
                  Robert Boschert
                  Edward W. Moose
                  Edward Y. Tang

         (c)      The results of the vote on each matter submitted to the
                  shareholders at the Meeting were as follows:

                  Election of Directors:           For         Withheld
                           Shou-Chen Yih       2,521,359         13,050
                           Charles S. Byrne    2,521,359         13,050
                           Robert Boschert     2,521,359         13,050
                           Edward W. Moose     2,521,359         13,050
                           Edward Y. Tang      2,521,359         13,050

                  Approval of Amendment to 1991 Stock Option Plan:
                           For                         2,442,202
                           Against                        75,267
                           Abstained                       3,525
                           Broker Non-Votes               13,415

                  Ratification  of the  selection  of  Ernst & Young to serve as
                  auditors for fiscal 1997:
                           For -                       2,525,509
                                                       ---------
                           Against -                       4,600
                                                       ---------
                           Abstained -                     4,300
                                                           -----
                           Broker Non-Votes -                  0
                                                        --------

         (d)      Not applicable.

<PAGE>

The foregoing  matters are  described in more detail in the issuer's  definitive
proxy  statement  dated  April  8,  1997  relating  to  the  Annual  Meeting  of
Shareholders held on May 16, 1997.


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

         (a)      Exhibits.

                  10.1     Lease Addendum dated May 23, 1997 to Lease for
                           400 Hot Springs Road, Carson City, Nevada.

                  10.2     Incentive Compensation Agreement dated May 16,
                           1997 with Charles S. Byrne.

                  10.3     Incentive Compensation Agreement dated May 16,
                           1997 with Jon B. Presnell.

                  27.1     Financial Data Schedule

         (b)      Reports on Form 8-K.

                  No  Reports  on Form 8-K were filed  during the  quarter ended
                  June 28, 1997.

<PAGE>



                                   SIGNATURES



         In accordance with the requirements of the Exchange Act, the Registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.


                                                    HYTEK MICROSYSTEMS, INC.
                                                         (Registrant)



Date:  July 28, 1997                               By:  /s/ Charles S. Byrne
                                                        --------------------
                                                        Charles S. Byrne,
                                                        President,  Chief
                                                        Executive Officer and
                                                        Chief Financial Officer
                                                        (Principal Financial and
                                                        Accounting Officer)




<PAGE>


                            HYTEK MICROSYSTEMS, INC.


                         Quarterly Report on Form 10-QSB
                       for the Quarter ended June 28, 1997


                                  EXHIBIT INDEX
                                  -------------

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

10.1                                        Lease Addendum dated May 23, 1997.

10.2                                        Incentive Compensation Agreement
                                            with Charles S. Byrne.

10.3                                        Incentive Compensation Agreement
                                            with Jon B. Presnell.

27.1                                        Financial Data Schedule.




<PAGE>
                                                                   EXHIBIT 10.1

                            SECOND ADDENDUM TO LEASE
                            ------------------------

         THIS SECOND ADDENDUM TO LEASE ("Addendum") is dated for reference as of
May 23, 1997 and is made between  Rubin/Sadd  Development  ("Lessor")  and Hytek
Microsystems,  Inc. ("Lessee") and is to be a part of the original lease between
these parties dated March 28, 1990. This addendum is to become effective on July
1, 1997,  concerning  23,800  square feet of  property  located in the County of
Carson  City,  State of  Nevada,  commonly  known as 400 Hot  Springs  Road (the
"Premises").  Lessor and  Lessee  agree  that the Lease is hereby  modified  and
supplemented as follows:

1.   The term of this lease is hereby  extended  through June 30,  2005.  Lessor
     hereby  grants to  Lessee an option to extend  the term of the lease for an
     additional five (5) years, with Lessee to provide notice as required by the
     original lease

          
2.   Should the Lessor desire to sell or otherwise  divest of the premises,  the
     Lessee  shall be  informed  by Lessor of  Lessors  intent to divest and the
     price,  terms and conditions  that Lessor is offering.  Within fifteen (15)
     days of receipt of written notice by Lessee,  Lessee shall inform Lessor if
     they intend to purchase the subject  property  and  initiate  negotiations.
     After the  expiration  of  fifteen  days  Lessor  shall be free to sell the
     subject property or otherwise divest itself as it wishes.

3.   Rent:  On July 1,  1997 the  rent  shall  increase  three  percent  (3%) to
     $13,141.00 per ---- month.  On each  subsequent  July 1 through the term of
     the lease or any extension thereof the rent shall increase by three percent
     (3%) per annum.

         All other terms and conditions remain unchanged.

Lessor:                                              Lessee:

RUBIN/SADD DEVELOPMENT                               HYTEK MICROSYSTEMS, INC.
A Nevada corporation                                 A California corporation

By: s/s Adeeb G. Sadd                                By: s/s Charles S. Byrne
   ------------------                                   ---------------------

Name: Adeeb G. Sadd                                  Name: Charles S. Byrne
                                                     President
Date: May 23, 1997                                   Date: May 23, 1997

<PAGE>
                                                                   Exhibit 10.2



              INCENTIVE COMPENSATION AGREEMENT FOR CHARLES S. BYRNE

                   FOR THE FISCAL YEAR ENDING JANUARY 3, 1997


Upon completion of the audit for the fiscal year 1997 and  certification  of the
Company's  financial  statements  for the  year,  Hytek  will pay the  following
incentive to Charles S. Byrne based upon achievement of the following criteria:

Criteria                                                      Maximum Incentive
--------                                                      -----------------

1.  Achieve 1997  original forecast pre-tax profit
     of $730,000 :  $6,000

     Achieve additional $520,000 pre-tax profit for
     1997 (total $1,250,000): additional $3,000                        $9,000

2. Achieve additional revenue over the 1996
    forecast ($6,610K) of $2,000,000 payable
    in increments:
         Additional $1,000,000 = $3,000
         Additional $2,000,000 = $6,000                                $6,000

3.  Achieve reductions in inventory levels which
     equate to an annualized inventory turns ratio
     of 5.5 times.  (Said turns ratio to be verified
     by Ernst & Young.)                                                $3,000
     -                                                                 ------

                  Total Potential Incentive                           $18,000

Each  criteria  above is a  separate  item and will be  awarded  if such item is
achieved.  This incentive program is authorized by the Compensation Committee of
the Board of Directors as of May 16, 1997,  and is duly  recorded in the minutes
of such meeting.



s/s Charles S. Byrne
Secretary

<PAGE>


                                                                   Exhibit 10.3


              INCENTIVE COMPENSATION AGREEMENT FOR JON B. PRESNELL

                   FOR THE FISCAL YEAR ENDING JANUARY 3, 1997


Upon completion of the audit for the fiscal year 1997 and certification
of the Company's financial statements for the year, Hytek will pay the following
incentive to Jon B. Presnell based upon achievement of the following criteria:

Criteria                                                      Maximum Incentive
--------                                                      -----------------

1.  Achieve 1997 forecast confident bookings
     of $5,553,500.                                                    $2,500

2.  Book an additional $3,000,000 in business
     over the forecast confident bookings.  Payable
     in increments:
         Additional $2,000,000 = $4,000
         Additional $2,500,000 = $4,500
         Additional $3,000,000 = $5,000                                $5,000


3.  Achieve 1997 forecast sales of $6,610,000.                         $2,500

4.  Achieve 1997 forecast gross margin of
     $2,490,000.                                                       $2,500

5.  Successfully complete "MAX-MRP" implementation
     with system operational and producing desired
     results. (As determined by C. Byrne & E&Y)                        $2,500
                                                                       ------


                  Total Potential Incentive                           $15,000

Each  criteria  above is a  separate  item and will be  awarded  if such item is
achieved.  This incentive program is authorized by the Compensation Committee of
the Board of Directors as of May 16, 1997, an is duly recorded in the minutes of
such meeting.


By s/s Charles S. Byrne
  ---------------------
    Charles S. Byrne, Secretary

<PAGE>



                                  EXHIBIT INDEX

Exhibit
Number                              Exhibit Description


27.1                                Financial Data Schedule.