Exhibit 10.1

   Document of Understanding Between Advanced Energy Industries and Affiliates
                            MicroPac Industries Inc.
                              Contract Number: 1009


1. PREAMBLE

This  agreement  is made as of this  01st day of  February  2003 by and  between
Advanced  Energy  Industries,  Inc. &  Affiliates  (hereinafter  referred  to as
"Buyer") and MicroPac  Industries  Inc.  (hereinafter  referred to as "Seller"),
under which services shall be performed.  Affiliates  shall mean any person,  or
entity directly or indirectly controlled by, controlling or under common control
with  Advanced  Energy  Industries,  Inc.  This  contract will be reviewed on an
annual basis and unless  terminated by either party,  as provided for in Section
19, shall continue to be in force.


2. TERMS AND CONDITIONS

No terms and  conditions  other than the terms and  conditions set forth in this
document  in  conjunction  with the  general  terms  and  conditions  placed  on
http:\\www.advanced-energy.com/terms   &  conditions  shall  be  binding  unless
specifically  accepted  by both  the  Buyer's  authorized  Purchasing  Agent  or
Commodity  Manager and the Seller's  authorized  agent. Any terms and conditions
set forth in any  document  attached to or  incorporated  by  reference  in this
contract  shall be binding  unless  specifically  accepted  by both the  Buyer's
authorized  Purchasing  Agent or Commodity  Manager and the Seller's  Authorized
agent.  This  contract is intended as the complete  and final  agreement of both
parties and exclusive statement of its terms and may not be changed,  altered or
modified, except in writing by agreement of both parties.

3. WARRANTY

The Seller  warrants the goods and materials  furnished  under this Contract for
workmanship,  material and compliance with all  specifications,  for a period of
twelve (12) months. The Seller shall comply with all applicable  Colorado State,
Federal and local  laws,  rules and  regulations.  The  exclusive  venue for any
litigation  concerning this matter shall be in the Larimer County District Court
in Fort Collins, Colorado.

4. LIABILITY

The Seller agrees that the  relationship  established by this order  constitutes
the Seller as an  independent  contractor  and that, no tax  assessment or legal
liability of the Seller or of his agents or employees becomes, by reason of this
order, an obligation of the Buyer.

5. REMEDY

Seller will not be responsible for incidental or consequential damages. Seller's
entire remedy will be the value of the product sold to Buyer.

6. BUYER CHANGES

Buyer shall have the right to make changes to existing  orders.  Purchase  order
changes  will be allowed only if  authorized  by Buyer.  If such change  affects
delivery,  quality or amount to be paid by Buyer,  Seller  shall notify Buyer of
such changes in writing.

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<PAGE>

     Document of Understanding Between Advanced Energy Industries and Affiliates
                            MicroPac Industries Inc.
                              Contract Number: 1009

7. ENGINEERING CHANGE ORDERS AND BUYER CHANGES

All engineering  change orders will be communicated to Seller via an Engineering
Change Order (ECO). If such change affects delivery, quality or the amount to be
paid by Buyer,  Seller  shall notify  Buyer  immediately.  The charges for scrap
and/or rework resulting from any change submitted via Buyer's ECO process, shall
be  limited  to the  materials  in  process at the time of the change and within
Seller's manufacturing cycle, as defined in the related addendum.  These charges
will be communicated in their entirety in writing, to Buyer, within fifteen (15)
working  days of receipt of ECO.  Buyer  will not be  responsible  for any costs
associated  with the change  order which are not  identified  within the fifteen
(15) working day window.

8. DELIVERY

Seller is to schedule  non-Kanban  part  shipments,  as defined in the addendum,
such that  deliveries are received no more than 3 days earlier than the due date
and zero (0) days late. The date specified in a purchase  order,  or required in
an  addendum,  is the date  due in  house.  A Kanban  part,  as  defined  in the
addendum,  may be delivered  only after the supplier is signaled in the business
system software. Kanban parts may be delivered anytime prior to the due date and
zero (0) days late,  where the due date is defined  in the  addendum.  Seller is
responsible for all costs  associated  with expedited  delivery when the need to
expedite is due to the  Seller's  inability  to meet  Buyer's  demand.  The only
exception is when Buyer pulls in demand within Seller's lead-time window.


9. PACKAGING

Identification of the goods shall occur when they are placed in the hands of the
Carrier.  Title shall pass to Buyer upon  delivery to Carrier.  Seller agrees to
insure that  shipments are properly  packaged and  described in accordance  with
specifications and/or applicable carrier regulations.  Seller is responsible for
packing any shipment  correctly based on the  carrier/mode  utilized.  Seller is
responsible  for all  shipments  that are  damaged  in transit  due to  improper
packaging,  improper  judgment,  or any other  act of  omission  of the  seller.
Charges for packing and crating shall be deemed part of the purchase price,  and
no  additional  charges will be made unless  specifically  requested by Advanced
Energy.  Seller agrees to ship via the carrier  specified by Advanced Energy. If
no carrier is specified by Advanced Energy,  then the seller will ship best way.
Shipments will be made at the lowest freight charges. All Kanban or PC shipments
received  shall have either a copy of the AE Kanban  signal or PC enclosed  with
the packing slip or the following information listed on the outside of the box:

      .     AE Part Number
      o     # of parts in shipment
      o     box # of total boxes (i.e. 3 of 5)
      o     Indicate type KB for Kanbans of PC for Purchase Orders
      o     Kanban Bin Size
      o     Container #


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<PAGE>

   Document of Understanding Between Advanced Energy Industries and Afiliates
                            MicroPac Industries Inc.
                              Contract Number: 1009


10. SHIPPING

The goods described herein shall be delivered FOB Garland TX. Buyer's Purchasing
Agent or Commodity Manager shall authorize means of shipment.  If seller chooses
alternative  method  of  shipment  without  Buyer's  authorization,   Seller  is
responsible for any incremental shipping charges.


11. KANBAN PULL PROCESS

Seller will  participate in a Kanban pull process for  specifically  agreed upon
part  numbers,  as listed in  addendum.  This list will be  updated as parts are
added to or deleted from the Kanban  program,  with agreement  between Buyer and
Seller.

Buyer's authorized  Purchasing Agent or Commodity Manager and Seller shall agree
on the Kanban quantity and replenishment  strategy for each part number.  Kanban
quantities  for all part  numbers  will be  reviewed  by Buyer on an as required
basis and  adjusted  accordingly.  Buyer's  quantity of  Finished  Goods Bins is
subject  to change  dependent  upon  Seller's  ability  to reduce  manufacturing
lead-time.  Changing the quantity of Finished Goods Bins at the buyer's facility
does not  necessitate  re-negotiation  of this  contact.  Seller  agrees that no
shipments will be made to Buyer unless authorized by Buyer.

12. PURCHASE ORDER

Buyer  will also be  entitled  to issue  purchase  orders for  individual  items
separate  from the Kanban Pull process and the Schedule  Agreement  Process,  as
quoted by Seller and agreed to in writing by Buyer.

13. SCHEDULE AGREEMENT

Schedule  Agreements  will be issued  with  agreement  by Buyer and Seller for a
specific time frame, by part number, negotiated price and estimate annual usage.
Buyer shall provide  Seller with demand  information as part of the planning and
forecasting  process,  to be updated  periodically  as agreed  upon by Buyer and
Seller.  This report is for use as a planning tool only.  Seller is  responsible
for any and all material purchased beyond the agreed upon liabilities, as stated
in addendum.

14. LIMITATION OF MATERIAL LIAB1LITY

The extent and limitation of Buyer's liability for materials purchased by Seller
are as defined in the  addendum.  On all  standard  or non-NCNR  parts,  AE will
assume

No liability. When the size of a bin is reduced, the inventory liability will be
a  function  of the old bin size  minus  pulls.  The goal is to  consume  excess
inventory  driven  by the old bin size  down to the new bin size  liability.  At
which point,  this would become the contractual  addendum amount AE is liable to
purchase.  AE's  expectation  is that the  seller's  supply  chain be  decreased
accordingly and consistently.


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<PAGE>

   Document of Understanding Between Advanced Energy Industries and Affiliates
                            MicroPac Industries Inc.
                              Contract Number: 1009



15. PRICING

Buyer and Seller agree to the price(s)  set forth in the  appropriate  addendum.
Any  change in the  contracted  price  must have  written  approval  by  Buyer's
Commodity  Manager or Purchasing  Agent,  prior to  implementation.  Seller will
establish a cost reduction  program,  which will be reviewed on an annual basis.
Cost changes will be reflected in price  adjustments  and a revised  addendum to
this document.

16. PAYMENT TERMS

Terms of payment are net 30 days for each shipment  invoiced,  unless  otherwise
expressly provided for and confirmed in writing by the Seller. Method of payment
for goods  receipt is  electronic  receipt  settlement  (ERS).  Seller shall use
standard invoicing for charges on any items that do not require a goods receipt.

17. PROPRIETARY INFORMATION

It is  understood  that the Buyer may  provide  proprietary  information  to the
Seller,  likewise,  Seller may provide  proprietary  information to Buyer in the
performance  of this  contract.  "Proprietary  Information"  shall be  deemed to
include all  information  conveyed by one party to the other  party  orally,  in
writing, by demonstration or by magnetic or other media. If the disclosure is in
other  than  written  form,  the  information  shall not be  deemed  Proprietary
Information  after  thirty  (30) days unless  within that period the  disclosing
party has identified it as such in written summary communicated to the receiving
party.  Proprietary  Information may also include, by way of example but without
limitations, data, know-how, formulas, algorithms,  processes, design, sketches,
photographs,  plans, drawings,  specifications,  samples,  reports, customer and
distributor  names,  pricing  information,  market  definitions,  inventions and
ideas.

Proprietary  Information  shall not  include  information,  which can be clearly
demonstrated to be:

      a)    generally  known  or  available  to the  public,  through  no act of
            omission on the part of the receiving party; or
      b)    known  to  the  receiving  party  prior  to  disclosure  under  this
            agreement; or
      c)    provided  to the  receiving  party  by a  third  party  without  any
            restriction  on disclosure  and without  breach of any obligation of
            confidentiality to a party.

Both  parties to this  agreement,  agree to return to the  forwarding  party all
documents containing  propriety  information and to retain no copies thereof. In
addition,  ownership and  possession of all product  assembly and test fixtures,
tooling, test programs,  Non-Recurring Engineering (NRE) tooling, test equipment
and consigned  equipment,  shall revert to Buyer.  Both parties to the agreement
agree that the obligation to protect  proprietary  information  shall be ongoing
and shall riot cease upon completion or termination of this contract.




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<PAGE>

   Document of Understanding Between Advanced Energy Industries and Affiliates
                            MicroPac Industries Inc.
                              Contract Number: 1009



18. COPY EXACT

Technical expectation for Design Confrol and Change Management

Design  Changes and  Resolution
o A supplier shall not make changes to a design that alters the  specifications,
manufacturing  process,  form, fit, or function of such items. A supplier may be
allowed to submit a change request to an item using Advanced  Energy's  Supplier
Callback Process (FPOO16).  This change cannot be implemented until the supplier
has received  written  approval from Advanced Energy via Supplier  Callback Form
(QFOO6O).

Process Changes and Resolution
o The supplier  shall obtain  approval  from  Advanced  Energy of any process or
sub-tier  suppliers'  changes,  including without  limitation any changes in the
manufacturing process of a sub-tier supplier, even when specifications are being
met The supplier must receive  approval in writing from  Advanced  Energy before
implementing such changes. If required by Advanced Energy, the supplier must use
special process suppliers from the list of approved suppliers.

Suppliers Subcontracts
o A supplier shall not  sub-contract  any components  and/or  processes  without
Advanced Energy's prior written approval.



19. SUPPLIER CERTIFICATION

The Commodity Team will grade the Seller on a Quarterly  basis as part of the AE
Supplier  Certification  Program.  The Seller's performance will be graded based
upon their Quality, Delivery, Cost, and Service. If the Seller meets the minimum
scores  in each  category,  the  Seller  will be  classified  as a AE  Certified
Supplier for a period of 1 year.


20. REVIEWS

Buyer and  Seller  agree to conduct  Quarterly  Business  Reviews,  at an agreed
venue.  Such  reviews  shall be conducted  by the Buyer's  Commodity  Manager or
authorized  Purchasing Agent.  Pricing will be reviewed annually,  by the Seller
and the Buyer's Commodity Manager or authorized  Purchasing Agent. Supplier will
establish and maintain a formal cost reduction  program.  Material or labor cost
savings  identified by the Seller shall be  implemented  immediately  and shared
equally between the Buyer and the Seller.

21. DEFECTIVE MATERIAL RETURN POLICY

The Buyer will issue a DMR to the Seller  prior to returning  failed  product to
the  Seller.  Seller  shall  acknowledge  Buyer  DMR with an RMA  number  within
twenty-four  (24) hours.  Seller shall repair or replace  failed  products under
warranty in 15 working days, at Seller's  discretion,  at Seller's expense.  The
Seller  will pay  freight on goods  returned  to the Buyer  which are covered by
warranty.


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<PAGE>

     Document of Understanding Between Advanced Energy Industries and Affiliates
                            MicroPac Industries Inc.
                              Contract Number: 1009


22. QUALITY ASSURANCE

All sold to  Advanced  Energy  by the  seller  will be  built  and  packaged  in
accordance  with the Advanced Energy  Workmanship  Manual Revision AA. All parts
and/or  materials may be subject to an incoming  inspection  criteria of AQL=1.5
C=0 to the applicable  manufacturer  and/or AE drawings  and/or  specifications.
Seller, when acting as a Distributor,  will ship only those parts listed on AE's
Approved   Vendor  List  (AVL).   Furthermore,   Seller   shall  meet   specific
qualification  requirements and agree to follow all quality procedures specified
in the AE material specifications.  Supplier shall o Participate in the Supplier
Certification  Program if  applicable o Allow annual  Supplier  Audits o Provide
within 10 working days a response to all  Supplier  Corrective  Action  Requests
(SCAR) o Generate  any  Supplier  Action  Plans  (SAPs) as requested by SQE/CE o
Utilize  Supplier Call Back  Procedure for any change request or issues o Ensure
that when verbal instructions are given, a Supplier Callback Form is sent with 5
working days to AE to document the  instructions o Comply with all first article
requirements listed in First Article Procedure (FP0125)

MicroPac Quality Contact is ______________.


23. COMPLETE AGREEMENT

This  contract is intended as the complete  and final  agreement of ~the parties
and exclusive statement of its terms. This contract may not be changed,  altered
or modified,  except in writing by the party against whom enforcement is sought.
Either  party  with  (thirty  (30))  days  written  notice  may  terminate  this
agreement. This clause is subject to review after one year.


24. MATERIAL PIPELINE REQUIREMENTS

The Seller is  responsible  setting up and  maintaining  a pipeline  of finished
goods for the items listed in the addendum that will meet the following demands:

      a.    Be able to provide product to the Buyer in the specified  quantities
            and delivery times set forth in the Kanban agreements
      b.    Be able to meet and sustain the demands of a 50% ramp immediately
      c.    Be able to meet and sustain the demands of a 100% ramp in 8 weeks.

The Seller is solely  responsible  for managing this pipeline and ensuring their
ability to meet the  requirements  listed above. The Buyer may at its discretion
audit the Seller's material pipeline if problems arise with the On Time Delivery
(OTD) or quantity of product delivered.








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<PAGE>

   Document of Understanding Between Advanced Energy Industries and Affiliates
                            MicroPac Industries Inc.
                              Contract Number: 1009




25. SIGNATURE PAGE:

Signature  attests that the parties have reviewed this agreement and concur with
the parameters:



Advanced Energy Industries, Inc.                             MicroPac Industries

By: /s/ Scott Burton                                         By: /s/ Connie Wood
--------------------------------                             -------------------
Scott Burton, SRVP of Operations                             Connie J. Wood,
                                                             CEO & President









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