U. S. Securities and Exchange Commission
                             Washington, D. C. 20549
                                  First Amended
                                  Form 10-KSB/A
                              Dated August 22, 2005


(Mark One)

(X)  ANNUAL REPORT UNDER SECTION 13 OR 15 (d) OF THE SECURITIES  EXCHANGE ACT OF
     1934 (Fee Required)

                   For the fiscal year ended November 30, 2004


( )  TRANSITION REPORT UNDER SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT
     OF 1934 (No Fee Required)

               For the transition period from ________ to ________
                          Commission file number 0-5109

                            MICROPAC INDUSTRIES, INC.

          DELAWARE                                               75-1225149
          --------                                               ----------
(State or other jurisdiction of                               (I.R.S. Employer
incorporation or organization)                               Identification No.)

905 E. WALNUT STREET                                                75040
GARLAND, TEXAS                                                   (Zip Code)

                    Issuer's telephone number (972) 272-3571

          Securities to be registered under Section 12 (b) of the Act:

  Title of each class                  Name of each exchange on which registered

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

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



          Securities to be registered under Section 12 (g) of the Act:

                           COMMON STOCK $.10 par value

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
                                                             ---   ---

Check if there is no  disclosure of  delinquent  filers  pursuant to Item 405 of
Regulation S-K contained in this form, and no disclosure  will be contained,  to
the best of  registrant's  knowledge,  in any  definitive  proxy or  information
statements  incorporated  by  reference  in Part III of this Form  10-KSB or any
amendment to this Form 10-KSB. [ ]

Revenues for its most recent fiscal year:  $15,356,000


Based on  approximately  22,544 shares publicly traded during November 2004, the
aggregate  market  value  of the  common  stock  held by  non-affiliates  of the
registrant  (based on the  average of the bid and asked  prices  reported on the
Over-the-Counter  ("OTC")  Bulletin  Board  system  on  November  30,  2004  was
approximately $2,660,000.  Due to the low reported trading volume of the Company
shares, the Company disclaims any representation that this amount represents the
market value of the Company's  common stock.  For purposes of such  calculation,
shares of Common Stock held by each  executive  officer and director and by each
person who owns more than 5% of the outstanding  Common Stock have been excluded
in that such  persons  may be deemed to be  affiliates.  This  determination  of
affiliate  status  is not  necessarily  a  conclusive  determination  for  other
purposes.


                   (APPLICABLE ONLY TO CORPORATE REGISTRANTS)
The  number of shares  outstanding  of each of the  issuer's  classes  of common
equity, as of the latest practicable date was 2,578,315 as of November 30, 2004.

                          DOCUMENTS INCORPORATED BY REFERENCE

Portions of the  Registrant's  definitive Proxy Statement dated January 28, 2005
for the Annual Meeting of  Shareholders  to be held on March 4, 2005 (the "Proxy
Statement") are incorporated by reference into Part III of this Form 10-KSB.


<PAGE>

                                EXPLANATORY NOTE


Micropac Industries,  Inc. (the "Company") is filing this Amendment No. 1 to its
Annual  Report on Form  10-KSB for the year ended  November  30, 2004 (which was
filed with the Securities and Exchange Commission on January 31, 2005) to expand
disclosures, add items that were incorporated by reference, and add exhibits. No
changes  have  been  made  to the  Company's  consolidated  balance  sheets  and
statements of operations, stockholders' equity and cash flows.


For  convenience  and ease of  reference,  we are filing the amended 2004 Annual
Report in its entirety.  This Amendment No. 1 does not reflect events  occurring
after the original filing of the 2004 Annual Report.


                                     PART I

Item 1. Description of Business
-------------------------------

INTRODUCTION
------------

Micropac Industries, Inc. (the "Company"), a Delaware corporation,  manufactures
and distributes various types of hybrid  microelectronic  circuits,  solid state
relays,  power  operational  amplifiers,   and  optoelectronic   components  and
assemblies.  The  Company's  products are used as components in a broad range of
military,  space and industrial systems,  including aircraft instrumentation and
navigation systems,  power supplies,  electronic  controls,  computers,  medical
devices, and high-temperature (200o C) products.

The Company's  facilities  are certified and qualified by Defense  Supply Center
Columbus  (DSCC) to  MIL-PRF-38534  (class K-space  level);  MIL-PRF-19500  JANS
(space  level),  MIL-PRF-28750  (class K space  level) and is  certified  to ISO
9001-2002.   Micropac   is  a  NASA  core   supplier,   and  is   certified   to
AS9100-Aerospace Industry standard for supplier certification.

The business was started in 1963 as a sole proprietorship. On March 3, 1969, the
Company was incorporated  under the name of "Micropac  Industries,  Inc." in the
state of Delaware.  The stock was publicly held by 559  shareholders on November
30, 2004.

PRODUCTS AND TECHNOLOGIES

The Company's  products are either custom (being  application  specific circuits
designed  and  manufactured  to meet  the  particular  requirements  of a single
customer)  or  standard,   proprietary   components   such  as  catalog   items.
Custom-designed components are estimated to account for approximately 50% of the
Company's  sales for the fiscal year ended  November 30, 2004, and 52% in fiscal
2003;  standard components are estimated to account for approximately 50% of the
Company's  sales for the fiscal year ended November 30, 2004, and 48% for fiscal
2003.

Micropac Industries, Inc. provides microelectronic and optoelectronic components
and assemblies along with contract electronic  manufacturing services and offers
a wide range of products sold to the industrial,  medical,  military,  aerospace
and space markets.

The Company's  core  technology is the packaging and  interconnect  of miniature
electronic  components,  utilizing thick film and thin film substrates,  forming
microelectronics  circuits.  Other technologies include light emitting and light
sensitive  materials and products,  including  light emitting diodes and silicon
phototransistors   used  in  the  Company's   optoelectronic   components,   and
assemblies. The Company's basic products and technologies include:
     Custom design hybrid microelectronic circuits
     Solid state relays and power controllers
     Custom optoelectronic assemblies and components
     Optocouplers
     Light-emitting diodes
     Hall-Effect devices
     Displays
     Power operational amplifiers
     Fiber optic components and assemblies
     High temperature (200(0) C) products

Micropac's  products are  primarily  sold to original  equipment  manufacturer's
(OEM) who serve the following major markets:

     Military/Aerospace  - aircraft  instrumentation,  guidance and  navigations
     systems, control circuitry, power supplies, laser positioning
     Space - control circuitry, power monitoring and sensing
     Industrial - power control equipment, robotics

<PAGE>

     Medical

The  Company  has  no  patents,  licenses,  franchises,   concessions,   royalty
agreements or labor contracts.  The Company's trademark "MII" is registered with
the U.S. Patent and Trademark Office.

Sales of our products  internationally  are subject to  government  regulations,
including  export  control  regulations  of the U.S.  Department  of  State  and
Department  of Commerce.  Violation of these  regulations  by the company  could
result in monetary penalties and denial of export  privileges.  We are not aware
of any violations of export control regulations.

The  Company is not  currently  impacted  by export  restrictions  on  sensitive
technology.  Five  (5) of  the  Company's  principal  product  families  require
government approval.  Further, a significant portion of our business is military
and is dependent on maintaining  our facility  certifications to  MIL-PRF-38534,
MIL-PRF-19500 and MIL-PRF-28750.  We expect to maintain these certifications and
qualifications;  however, the loss of any of these  ceritifications would have a
significant impact on our business.

Government  regulations impose certain controls on chemicals used in electronics
and  semiconductor  manufacturing.  Micropac  has  obtained  all  the  necessary
environmental  permits, and routinely monitors and reports the wastewater stream
results  to the  local  governing  agency.  Micropac  is  classified  as a small
generator  of  hazardous  waste,  and the  annual  cost of  complying  with  the
regulations is minimal.

In  2004,  the  Company's   investment  in  technology   through   research  and
development,  which was expensed,  totaled  approximately  $438,000 ($303,000 in
2003).  The  Company's  research  and  development  expenditures  were  directed
primarily toward long-term  specific customer  requirements,  some of which have
future potential as Micropac proprietary  products,  and product development and
improvement associated with the Company's space level and other high reliability
programs.

The Company  introduced new Solid State Power controllers as the next generation
of solid state relays with enhanced  ruggedness and voltage and current carrying
capabilities.  Micropac's SSPCs feature both an instantaneous  over current trip
as well as I^2T which  compares  power used over time.  These devices range from
28VDC to 400VDC and from 5A to 40Amps.  The SSPC Product Family is fully capable
of being Class K screened per MIL-PRF 38534 and come in a Rad Tolerant  version.
Micropac  strives to provide the greatest  power density per package  volume and
strives to meet the stringent  efficiency  requirements  of customers in today's
market.

In addition to the  Company's  investment in research and  development,  various
customers paid the Company approximately $1,500,000 in non-recurring engineering
costs   associated   with  the  development  of  custom  products  for  specific
applications.

The  Company  provides  a one year  warranty  from the date of  shipment  to the
original  purchaser.  The  Company is  obligated  under this  warranty to either
replace  or repair  defective  goods or refund  the  purchase  price paid by the
buyer.

CUSTOMERS
---------

The Company's products are marketed  throughout the United States and in Western
Europe, through a direct technical sales staff, independent  representatives and
independent  stocking  distributors.  Approximately  25% of the sales for fiscal
year  2004  (17% in 2003)  were to  international  customers.  Sales to  Western
European   customers  are  made  by   independent   representatives   under  the
coordination of the Company's  office in Bremen,  Germany.  One major industrial
customer  has opened an operation in China and during 2004 moved a major part of
their domestic  operations to China. This customer,  Advanced Energy Industries,
Inc., accounted for 22% of international sales, and their contract  manufacturer
in China,  Celestica,  accounted for 41% of  international  sales.  During 2004,
these  two  customers  accounted  for 9% and 10% of the  Company's  total  sales
compared to 12% and 7% for the year ended November 30, 2003. Advanced Energy has
been a major customer since 1996 and averaged 18% of the Company's  sales during
this  10 year  period  from a high of 20% to a low of  14%.  The  Company  has a
document of  understanding  with Advanced  Energy which is reviewed on an annual
basis  unless  terminated  by either party per the terms of the  agreement.  The
Company is required to maintain a formal cost reduction program and any material
or labor cost savings shall be shared  equally  between the Company and Advanced
Energy. The cost savings are reflected in pricing reductions to the customer.

The  Company's  major  customers  include   contractors  to  the  United  States
government with fixed price  contracts.  Sales to these customers for Department
of  Defense  (DOD) and  National  Aeronautics  and Space  Administration  (NASA)
contracts  accounted for  approximately 64% of the Company's fiscal net sales in
2004 compared to 62% in 2003.

The Company's major customers are Lockheed  Martin,  Northrop  Grumman,  Boeing,
Raytheon,  BAE,  Honeywell,  Rockwell Int'l,  Newport,  Advanced Energy, and St.
Jude.

BACKLOG
-------

At November  30,  2004,  the Company had a backlog of unfilled  orders  totaling
approximately  $9,292,000  compared to approximately  $3,799,000 at November 30,
2003.  The Company  expects to complete  and ship most of its  November 30, 2004
backlog during fiscal 2005.

<PAGE>

EMPLOYEES
---------

At November 30, 2004, the Company had 121 full-time  employees  (compared to 112
at November 30, 2003), of which 28 were executive and managerial  employees,  24
were   engineers   and   quality-control   personnel,   20  were   clerical  and
administrative  employees,  and  49  were  production  personnel.  None  of  the
Company's employees were covered by collective bargaining agreements.

The Company is an Equal  Opportunity  Employer.  It is the  Company's  policy to
recruit,  hire, train and promote personnel in all job classifications,  without
regard to race, religion,  color,  national origin, sex or age. Above and beyond
non-discrimination, we are committed to an Affirmative Action Program, dedicated
to the hiring,  training,  and advancement  within the Company of minority group
members, women and handicapped individuals.

COMPETITION
-----------

The Company  competes  with two or more  companies  with  respect to each of its
major products,  including custom hybrid  microcircuits,  solid state relays and
power controllers, optocouplers,  light-emitting diodes, light sensitive silicon
phototransistors and diodes,  hall-effect devices,  displays,  power operational
amplifier,  custom optoelectronic components and assemblies.  These products and
technologies are sold into various markets, including military/aerospace, space,
industrial and medical.  Some of these  competitors  are larger and have greater
capital   resources  than  the  Company.   Management   believes  the  Company's
competitive  position is favorable  with regard to our product  reliability  and
integrity,  past  performance,  customer  service  and  responsiveness,   timely
delivery and pricing;  however,  no assurance  can be given that the Company can
compete successfully in the future.

The hybrid  microcircuits  product line, including custom  microcircuits,  solid
state relays,  power operational  amplifiers and regulators accounted for 53% of
the Company's business in 2004, and the  Optoelectronics  product line accounted
for 47% of the Company's business in 2004.

There  are  approximately  46  independent  hybrid  microcircuit   manufacturing
companies  who are  certified  to  supply  microcircuits  to  MIL-PRF-38534,  in
addition to OEM's,  who  manufacture  hybrid  microcircuits  for their  internal
needs. Micropac may compete with all of these for hybrid microcircuit  business.
Some of the Company's primary  competitors are Teledyne  Industries,  Inc., M.S.
Kennedy, Aeroflex, Agilent, and Optek.

SUPPLY CHAIN
------------

The parts and raw materials for the Company's  products are generally  available
from more than one  source.  Except for  certain  optoelectronic  products,  the
Company does not  manufacture the basic parts or materials used in production of
its  products.  From time to time,  the Company has  experienced  difficulty  in
obtaining  certain  materials  when needed.  The  Company's  inability to secure
materials for any reason could have adverse effects on the Company's  ability to
deliver  products  on a  timely  basis.  The  Company  uses  capacitors,  active
semiconductor  devices  (primarily  in chip form),  hermetic  packages,  ceramic
substrates, resistor inks, conductor pastes, precious metals and other materials
in its manufacturing  operations.  However,  the Company has not been materially
affected by such  shortages.  The Company's  delivery  commitments  to customers
allow for adequate lead times for production of the products including lead time
for order and receipt from the supply chain.

Some of the Company's  primary  suppliers are  International  Rectifier,  Sussex
Semiconductors,  Semi-Dice, Accumet Eng. Corp, NTK Technologies, Electrovac, and
Aborn Electronics.


CAUTIONARY STATEMENTS - RISK FACTORS
------------------------------------

This Form 10-KSB contains  forward-looking  statements that are made pursuant to
the safe harbor  provisions of the Private  Securities  Litigation Reform Act of
1995.  Actual  results  could  differ  materially.  Investors  are  warned  that
forward-looking  statements involve risks and unknown factors including, but not
limited to, customer cancellation or rescheduling of orders,  problems affecting
delivery  of  vendor-supplied   raw  materials  and  components,   unanticipated
manufacturing problems and availability of direct labor resources.

Such  risks  and  uncertainties  include,  but are  not  limited  to  historical
volatility  and  cyclicality  of the  semiconductor  and  semiconductor  capital
equipment  markets that are subject to significant and often rapid increases and
decreases in demand. In addition, the Company produces silicon  phototransistors
and light  emitting diode die for use in certain  military,  standard and custom
products.  Fabrication  efforts sometimes may not result in successful  results,
limiting the  availability of these  components.  Competitors  offer  commercial
level  alternatives and our customers may purchase our competitors'  products if
the Company is not able to manufacture the products using these  technologies to
meet the customer demands.

<PAGE>

The  Company  disclaims  any   responsibility  to  update  the   forward-looking
statements contained herein, except as may be required by law.

Majority shareholder ability to control the election of the Board of Directors

The  majority  shareholder  has the  ability  to  control  the  election  of the
Company's Board of Directors and elect  individuals who may be more  sympathetic
to such majority  shareholders'  desires and not necessarily  sympathetic to the
desires of  minority  shareholders  as to the  policies  and  directions  of the
Company.  However, the ability to control the election of the Board of Directors
does not modify the fiduciary  duties of the Board of Directors to represent the
interests of all shareholders

Pricing pressures from customers for reduction in selling prices

The Company continues to experience  pricing pressures from some of its original
equipment  manufacturer (OEM) customers.  In some cases, the Company's customers
request the review of pricing for possible  reduction in selling price on future
orders.  This  requires the Company to improve its  productivity  and to request
similar  price  reductions  from  its  supplier  chain.  If one or  both  of the
approaches  by the Company  does not succeed,  the Company  could be required to
reduce the selling price on future orders reducing the product gross margins and
affecting the Company's net earnings in order to receive  future orders from the
customer. However, the Company has no agreement that requires a reduction in the
selling  price on any  current  customer  order.  All  contracts  are firm fixed
pricing.

Insurance coverage and exposure to substantial claims or liabilities

The Company operates manufacturing facilities in Garland, Texas and subcontracts
some  manufacturing  to  a  contract  manufacturer  in  Juarez,   Mexico.  These
facilities  use  industrial  machines and chemicals  that could provide risks of
personal  injury and/or  property  damage.  There is no assurance that accidents
will not  occur.  If  accidents  do  occur,  the  Company  could be  exposed  to
substantial  liability.  The Company has no liability for the Mexico operations.
The Company  maintains  worker's  compensation  insurance and general  liability
insurance for  protection  of its employees and for  protection of the Company's
assets in  Garland,  Texas.  In addition to the basic  policies  mentioned,  the
Company maintains an umbrella policy. The Company reviews all insurance coverage
on an annual basis, and makes any necessary adjustments based on risk assessment
and changes in its  business.  In the opinion of the Company's  management,  and
its'  insurance  advisors,  the  Company is  adequately  insured;  however,  the
Company's  financial position could be materially affected by claims not covered
or exceeding coverage currently carried by the Company.

The  Company is  subject to  numerous  environmental  regulations  or changes in
government Policy

The  Company is  subject  to  governmental  regulations  pertaining  to the use,
storage,  handling and disposal of hazardous  substances used in connection with
its manufacturing  activities.  Failure of the Company to control all activities
dealing  with  hazardous  chemicals  could  subject the  Company to  significant
liabilities or could cause the Company to cease its manufacturing activities.

The Company could be adversely  affected by changes in laws and regulations made
by U.S. and non U.S.  governments and agencies  dealing with foreign  shipments.
Changes by regulatory  agencies dealing with  environmental  issues could affect
the cost of the  Company's  products and make it hard for a small  company to be
competitive with larger companies.

Product liability claims

The use of the Company's  products in commercial or government  applications may
subject the Company to product  liability  claims.  Although the Company has not
experienced any product  liability  claims,  the sale of any product may provide
risk of such claims.  Product liability claims brought against the Company could
have a material adverse effect on the Company's  operating results and financial
condition.

Component  shortages or  obsolescence  from  suppliers  could affect  ability to
manufacture or delay shipments of products

The Company relies on suppliers to deliver quality raw materials in a timely and
cost  effective  manner.  Most of the  materials  and  components  are generally
available  from  multiple  sources;  however,  from time to time  vendors do not
deliver  the  product  as needed due to  manufacturing  problems  or  possibly a
decision not to furnish that product in the future.  Such interruption of supply
or price  increases  could  have a  material  adverse  effect  on the  Company's
operation;  however,  the  Company  is  not  currently  materially  impacted  by
materials shortages.

The ability to develop new products and technologies used in the military, space
or aerospace markets

The Company's  base products and  technologies  generally have long life cycles.
The  Company's  products  are  primarily  used in  military,  space or aerospace
applications,  which also have long life cycles.  There can be no assurance that
the  Company  will be able to  define,  develop  and  market  new  products  and
technologies  on a timely  and cost  effective  basis.  Failure  to  respond  to
customer's  requirements and to competitors'  progress in technological  changes
could have a material adverse effect on the Company's business.

<PAGE>

Item 2. Properties
------------------

The  Company  occupies   approximately  36,000  square  feet  of  manufacturing,
engineering and office space in Garland,  Texas.  The Company owns 31,200 square
feet of that space and leases an  additional  4,800  square  feet.  The  Company
considers its facilities adequate for its current level of operations.

The Company also  subcontracts  some  manufacturing  to Inmobiliaria San Jose De
Ciuddad Juarez S.A. DE C.V, a maquila contract  manufacturer in Juarez,  Mexico.
The Company owns all equipment and inventory  with  temporary  importation  into
Mexico under the maquila rules of Mexico.  The Company does not lease or own any
real property in Mexico.

The  Company  employs an  International  Sales  Manager in Bremen,  Germany  who
coordinates   sales  to  Western   European   customers   made  by   independent
representatives. The sales manager maintains an office in her private residence.
The Company  does not lease or own any real  property  in Germany,  or any other
foreign country.

Item 3. Legal Proceedings
-------------------------

The  Company  is  not  involved  in  any  material   current  or  pending  legal
proceedings.


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

No matters were submitted to vote of the Company's  security holders through the
solicitation  of proxies by the Company  during the fourth quarter of the fiscal
year ended November 30, 2004.


                                     PART II

Item 5.  Market  for the  Registrant's  Common  Equity and  Related  Stockholder
Matters

On November 30, 2004, there were approximately 559 shareholders of record of the
Company's  common  stock.  The  stock  of the  Company  is  closely  held;  and,
therefore,  the majority shareholder has the ability to significantly  influence
decisions. Our common stock is quoted on the OTC Bulletin Board under the symbol
"MPAD.OB". The following sets forth the high and low bid prices for each quarter
during the last two fiscal years:

                                                         High              Low

Fiscal Year Ended November, 30, 2004
      Fourth Quarter                                    $4.20             $3.50
      Third Quarter                                     $4.50             $3.25
      Second Quarter                                    $3.75             $2.05
      First Quarter                                     $2.50             $1.77

Fiscal Year Ended November 30, 2003
      Fourth Quarter                                    $1.90             $1.54
      Third Quarter                                     $1.62             $1.47
      Second Quarter                                    $1.66             $1.45
      First Quarter                                     $1.90             $1.57


During the three (3) month period  ending on November  30,  2004,  approximately
84,780  shares  of the  Company's  common  stock  was  reportedly  traded in the
over-the-counter  market at a reported  price range of $3.75 to $4.20 per share.
For the two (2) year period  ending  November  30, 2004,  approximately  727,090
shares  of  the   Company's   common   stock  was   reportedly   traded  in  the
over-the-counter  market  at  prices  ranging  from a low of  $1.47 to a high of
$4.50.  Due to this average  monthly  volume of  approximately  30,295 shares of
common stock being  publicly  bought and sold during this two year  period,  the
Company does not believe this share trading  volume  represents the market value
of the Company's common stock held by non-affiliates.

Our stock prices  quoted on the OTC Bulletin  Board  represent  over-the-counter
market  quotations and reflect  inter-dealer  prices,  without  retail  mark-up,
mark-down or commission and may not represent actual transactions.

On December  29,  2004,  the Board of  Directors  of Micropac  Industries,  Inc.
approved the payment of a $.12 per share dividend to all  shareholders of record
on January 25, 2005.  The dividend  payment will be paid to  shareholders  on or
about February 8, 2005.

On January 8, 2004, the Board of Directors of Micropac Industries, Inc. approved
the  payment  of a special  dividend  of $.05 per share to all  shareholders  of
record on January 30, 2004.  The dividend  payment was paid to  shareholders  on
February 13, 2004.

<PAGE>

On August 27, 2003, the Company purchased 548,836 shares of the Company's common
stock pursuant to the terms of an agreement dated February 5, 2001,  between the
Company and Nicholas Nadolsky,  former Chairman of the Board and Chief Executive
Officer  ("Agreement").  The  Agreement  obligated  the Company to purchase  any
shares of the  Company's  common stock owned by Mr.  Nadolsky at the fair market
value  thereof  (but in no event less than the book value of such shares) in the
event of his death,  permanent  disability or  termination  of  employment.  Mr.
Nadolsky's  employment  terminated  on May 1, 2003.  By letter  dated August 15,
2003, Mr. Nadolsky requested that the Company purchase the 548,836 shares of the
Company's  common  stock he owned  pursuant  to the  requirements  of the  above
agreement  and agreed that the fair value of each share of his common  stock was
$2.68. The Company paid Mr. Nadolsky a total purchase price of $1,470,880. These
shares were subsequently retired.

In determining the purchase price to be offered for Mr. Nadolsky's  shares,  the
Board of Directors considered numerous factors,  including the Company's balance
sheets,   the  small  number  of  shares   publicly   bought  and  sold  in  the
over-the-counter  market,  the  number  of  shares  owed by Mr.  Nadolsky  and a
valuation opinion from an independent third party.


Item 6. Management's  Discussion and Analysis of Financial Condition and Results
of Operations
--------------------------------------------------------------------------------

Liquidity and Capital Resources
-------------------------------


The  Company  currently  has an  existing  line of credit  with a Texas  banking
institution.  The line of  credit  agreement  provides  the  Company  with up to
$3,000,000  for  normal  operation  of the  Company.  The  interest  rate on any
borrowings  against this credit  agreement is equal to the prime rate less 1/4%.
The line of credit requires the Company to maintain  certain  financial  ratios,
including  quick  ratio  of at least  1:1,  maintain  a  tangible  net  worth of
$6,250,000   plus   75%  of   future   net   income,   and   maintain   a  total
liabilities-to-tangible-net-worth  of  less  that  1.25:1.  The  Company  is  in
compliance with these  covenants.  The Company has not, to date, used any of the
available line of credit.  The Company expects to continue to generate  adequate
amounts  of cash to meet its  liquidity  needs  from the  sale of  products  and
services and the collection thereof.

The Company  realized  $908,000 net in cash flows from  operations in 2004. Cash
influx came primarily from the  combination of net income  totaling  $1,408,000;
recovery of depreciation totaling $222,000,  increase of accrued compensation of
$249,000,  increase  in other  accrued  liabilities  of  $272,000,  increase  in
accounts  payable of $79,000,  and an increase in tax  liabilities  of $196,000.
Cash was used to increase inventory $911,000,  accounts receivables increased by
$449,000,  deferred  tax benefit  increased  $139,000 and an increase in prepaid
expense of $19,000. Inventories increased due to the purchase of long lead items
for shipments within the first half of 2005. Day's sales in accounts receivables
totaled  approximately 53.0 days as of November 30, 2004,  compared to 52.0 days
at November 30, 2003.

The Company used $182,000 in cash for  investment  in  additional  manufacturing
equipment,  computers and facility  improvements in 2004 compared to $181,000 in
2003.

As of November 30, 2004, the Company had $1,239,000 in cash and cash equivalents
and $2,507,000 in short term investments compared to $2,337,000 in cash and cash
equivalents and $812,000 in short term investments on November 30, 2003.

On December  29,  2004,  the Board of  Directors  of Micropac  Industries,  Inc.
approved  the  payment  of a special  dividend  $.12 per share  dividend  to all
shareholders of record on January 25, 2005. The dividend payment will be paid to
shareholders  on or about  February 8, 2005. The Company may not continue to pay
any dividends.

On January 8, 2004, the Board of Directors of Micropac Industries, Inc. approved
the  payment  of a special  dividend  of $.05 per share to all  shareholders  of
record on January 30, 2004.  The dividend  payment was paid to  shareholders  on
February 13, 2004. The Company may not continue to pay any dividends.

On August 27, 2003, the Company purchased 548,836 shares of the Company's common
stock pursuant to the terms of an agreement dated February 5, 2001,  between the
Company and Nicholas Nadolsky,  former Chairman of the Board and Chief Executive
Officer  ("Agreement").  The  Agreement  obligated  the Company to purchase  any
shares of the  Company's  common stock owned by Mr.  Nadolsky at the fair market
value  thereof  (but in no event less than the book value of such shares) in the
event of his death,  permanent  disability or  termination  of  employment.  Mr.
Nadolsky's  employment  terminated  on May 1, 2003.  By letter  dated August 15,
2003, Mr. Nadolsky requested that the Company purchase the 548,836 shares of the
Company's  common  stock he owned  pursuant  to the  requirements  of the  above
agreement  and agreed that the fair value of each share of his common  stock was
$2.68. The Company paid Mr. Nadolsky a total purchase price of $1,470,880. These
shares were subsequently retired.

Company management believes it will meet its 2005 capital  requirements  through
the use of cash  derived  from  operations  for the  year  and/or  usage  of the
Company's  short-term   investments.   There  were  no  significant  outstanding
commitments for equipment purchases or improvements at November 30, 2004.

<PAGE>

Results of Operations 2004 vs. 2003
-----------------------------------

                                 Three Months Ended         Twelve Months Ended
                                11/30/04     11/30/03      11/30/04     11/30/03

Net Sales                         100.0%       100.0%        100.0%       100.0%

Cost of sales                      57.1%        67.6%         65.0%        69.8%
R & D                               5.3%         2.4%          2.9%         2.4%
S, G, & A                          18.7%        17.4%         17.6%        20.7%
  Total Cost & Exp                 81.1%        87.4%         85.5%        92.9%

Operating Income                   18.9%        12.6%         14.5%         7.1%

Interest Income                     0.3%         0.3%          0.2%         0.4%

Income Before Income Taxes         19.2%        12.3%         14.7%         7.5%

Provision for taxes                 7.2%         3.8%          5.6%         2.6%

Net Income                         12.0%         8.5%          9.1%         4.9%

Sales in 2004 were approximately $15,356,000, an increase of 22.9% or $2,866,000
compared to 2003 sales.  Approximately 44% of the increase in sales is primarily
attributable  to improved  business  conditions  in the  company's  major market
segments,  combined with the  introduction of new products,  which accounted for
approximately 56% of the increase.

New orders for fiscal year 2004 totaled $20,946,000  compared to $11,191,000 for
fiscal 2003. The increase in new orders is attributable to increased  funding on
certain military programs, combined with higher demand for some of the Company's
standard products sold through distribution  channels, and increased penetration
in the medical and  industrial  markets.  Approximately  $11,732,000  of the new
orders  received  in 2004  was  delivered  to  customers  in  2004,  along  with
approximately  $3,624,000 of the Company's $3,799,000 ending backlog on November
30, 2003.

The Company's  backlog as of November 30, 2004,  was  approximately  $9,292,000,
compared to  approximately  $3,799,000 on November 30, 2003. The increase in the
Company's  backlog is  attributable to strong bookings of new orders in the last
half of the year for deliveries in 2005.

Custom-designed components are estimated to account for approximately 50% of the
Company's  sales for the fiscal year ended  November 30, 2004, and 52% in fiscal
2003;  standard components are estimated to account for approximately 50% of the
Company's  sales for the fiscal year ended November 30, 2004, and 48% for fiscal
2003.

Approximately  25% of the sales  for  fiscal  year  2004  (17% in 2003)  were to
international  customers.  Sales  to  Western  European  customers  are  made by
independent  representatives  under the  coordination of the Company's office in
Bremen,  Germany. One major industrial customer has opened an operation in China
and during 2004 moved a major part of their domestic  operations to China.  This
customer,  Advanced Energy Industries,  Inc., accounted for 22% of international
sales, and their contract manufacturer in China, Celestica, accounted for 41% of
international sales.

The  Company's  major  customers  include   contractors  to  the  United  States
government with fixed price  contracts.  Sales to these customers for Department
of  Defense  (DOD) and  National  Aeronautics  and Space  Administration  (NASA)
contracts  accounted for  approximately 64% of the Company's fiscal net sales in
2004 compared to 62% in 2003.

During 2004,  two  customers  accounted  for 9% and 10% of the  Company's  sales
compared to 12% and 7% for the year ended  November 30, 2003.  The customers are
Advanced  Energy  Industries,  Inc. and their  contract  manufacturer  in China,
Celestica. Advanced Energy has been a major customer since 1996 and averaged 18%
of the Company's sales during this 10 year period from a high of 20% to a low of
14%.

Sales for 2004 compared to 2003 increased 16% in the commercial  market,  22% in
the military market, and 50% in the space market.

<PAGE>

Cost of sales, as a percentage of net sales, was 65.0% in 2004 compared to 69.8%
in 2003.  The cost of goods  sold  decrease  of 4.8% is  attributable  to stable
operating  expense on higher  sales  volume;  changes in product  mix, and yield
improvements  on certain  products.  In actual  dollars cost of sales  increased
$1,253,000 for 2004,  versus 2003. Cost of sales decreased $84,000 in the fourth
quarter of 2004, compared to the same period of 2003.

Expenses for  research  and  development  totaled  $438,000 in 2004  compared to
$303,000  in  2003.  Most  of  the  research  and   development   expenses  were
concentrated  on expanding the Company's line of solid state power  controllers,
high-temperature  couplers,   detectors,   hall-effect  devices;  and  enhancing
manufacturing processes to improve the Company's competitive position.  Selling,
general,  and  administrative  expenses  totaled  17.6%  of net  sales  in 2004,
compared to 20.7% in 2003, based on higher sales. In dollars expensed,  selling,
general and  administrative  expenses  totaled  $2,709,000  in 2004  compared to
$2,581,000 in 2003, an increase of $128,000,  attributable to higher commissions
on increased sales and increased selling expense.

Interest income for fiscal 2004 totaled  $32,000  compared to $50,000 for fiscal
2003.  The  decrease  is  related  to  lower  interest  rates  on the  Company's
investments.

Income before taxes for fiscal 2004 was approximately $2,265,000 or 14.7% of net
sales,  compared  to $933,000  or 7.5% of net sales in fiscal  2003.  Net income
after taxes  totaled  approximately  $1,408,000 or $.55 per share in 2004 versus
2003 net income of  $611,000 or $.21 per share.  Net income  after taxes in 2004
increased $797,000 compared to 2003.

New Accounting Standards
------------------------

None

Item 7.  Financial Statements
-----------------------------

The  financial  statements  listed  below  appear on pages 16 through 25 of this
Report.  The Company is not required to furnish the Supplementary  Data required
by Item 302 of Regulation S-K.

     Page No.
     --------

         16       Report of Independent Registered Public Accounting Firm

         17       Balance Sheets as of November 30, 2004 and 2003

         18       Statements of Income for the years ended November 30, 2004 and
                  2003

         19       Statements  of  Shareholders'   Equity  for  the  years  ended
                  November 30, 2004 and 2003

         20       Statements of Cash Flows for the years ended November 30, 2004
                  and 2003

         21-25    Notes to Financial Statements for the years ended November 30,
                  2004 and 2003

Item  8.  Changes  in and  Disagreements  with  Accountants  on  Accounting  and
Financial Disclosure
--------------------------------------------------------------------------------

None

Item 8A. Controls and Procedures
--------------------------------

The Chief Executive Officer and Chief Financial Officer of the Company evaluated
the Company's  disclosure  controls and  procedures  (as defined in Exchange Act
Rules  13a-15  (e) as of  November  30,  2004  and,  based  on this  evaluation,
concluded that the Company's  disclosure controls and procedures are functioning
in an effective  manner to ensure that the information  required to be disclosed
by the Company in the reports that it files or submits  under the Exchange  Act,
is  recorded,  processed,  summarized  and  reported,  within  the time  periods
specified  in the  SEC's  rules  and  forms.  There  has been no  change  in the
Company's internal control over financial  reporting during the Company's fiscal
year ended  November 30, 2004 that has  materially  affected,  or is  reasonably
likely to materially  affect,  the  Company's  internal  control over  financial
reporting.

<PAGE>

                                    PART III

In  accordance  with  General  Instruction  G(3) of Form 10-K,  the  information
required by this Part III is incorporated  by reference to Micropac  Industries,
Inc.'s  definitive  proxy  statement  relating  to its 2005  Annual  Meeting  of
Stockholders,  as set forth below.  The 2005 Proxy  Statement will be filed with
the Securities and Exchange Commission on or about January 15, 2005.


Item 9.  Directors & Executive Officers of The Registrant

The  information  set  forth in the 2005  Proxy  Statement  under  the  headings
"Election of  Directors",  and  "Principal  Stockholders  and  Stockholdings  of
Management", is incorporated herein by reference.

                                   Position(s) With
Name                   Age           the Company                  Director Since
----                   ---           -----------                  --------------

H. Kent Hearn           68      Director and Member of Audit
                                Committee                         February 1983

Heinz-Werner Hempel     76      Director and Member of Audit
                                Committee                         February 1997

James K. Murphey        62      Director and Member of Audit
                                Committee                         March 1990

Nicholas Nadolsky       71      Director and Member of Audit
                                Committee                         May 2004

Connie Wood             65      Director, CEO, President and
                                Member of Audit Committee         May 2002

Patrick Cefalu          47      CFO, Vice President

Mark King               50      COO, Vice President


Mr. Hearn is currently employed as a stockbroker by Milkie/Ferguson Investments,
Inc. Mr. Hearn was formerly employed by Harris Securities, Dallas, Texas.

Mr. Hempel is the Chief Operating Officer of Hanseatische Waren-Gesellschaft MBH
& Co, KG, Bremen Germany.

Mr. Murphey is an attorney and member of the law firm Glast,  Phillips & Murray,
P.C. in Dallas, Texas. Glast, Phillips & Murray, P.C. serves as legal counsel to
the company. Prior to 2001, Mr. Murphey was a member of the law firm of Secore &
Waller, L.L.P. in Dallas, Texas.

Mr. Nadolsky served as the Company's Chief Executive Officer and Chairman of the
Board  until his  medical  leave of absence  beginning  May 2002.  Mr.  Nadolsky
retired from the Company in May 2003.

Ms. Wood is the Chief Executive  Officer and President of the Company.  Ms. Wood
was elected as Chief Executive  Officer in May 2002. Prior to May 2002, Ms. Wood
was President and Chief Operating Officer of the Company.

Mr. Cefalu is the Chief Financial Officer and Vice President of the Company. Mr.
Cefalu  joined the  Company in July of 2001 and was  elected as Chief  Financial
Officer in February of 2002. Prior to July 2002, Mr. Cefalu held numerous senior
financial positions at Lucent Technologies.

Mr. King is the Chief Operating  Officer and Vice President of the Company.  Mr.
King  joined the company in  November  of 2002 as the Chief  Operating  Officer.
Prior to November  2002, Mr. King was President and Chief  Operating  Officer of
Lucas Benning Power Electronics.

The Company has adopted a Code of Ethics for  Principal  Executive  Officers and
Senior Financial Officers,  pursuant to the Sarbanes-Oxley Act of 2002. The Code
of Ethics is  published  on the  Company's  web  site,  www.micropac.com  on the
Investor page.

<PAGE>

The Board of Directors  does not have  nominating or  compensation  committee or
committees performing similar functions.  The Board of Directors formed an audit
committee on May 13, 2002. The members of the Audit Committee are the members of
the Board of Directors.

The  Board of  Directors  has  discussed  with  management  and the  independent
auditors  the  quality and  adequacy of the  Company's  internal  controls.  The
Directors have considered and reviewed with the independent auditors their audit
plans, the scope of the audit, and the identification of audit risks.

The Board of Directors has reviewed the Company's audited  financial  statements
for the fiscal year ended November 30, 2004, and discussed them with  management
and the Company's  independent  auditors.  Management has the responsibility for
the  preparation  and integrity of the Company's  financial  statements  and the
independent  auditors  have  the  responsibility  for the  examination  of those
statements.  Based on this and  discussions  with management and the independent
auditors,  the Board of Directors has  recommended  that the  Company's  audited
financial  statements  be included  in its Annual  Report on Form 10-KSB for the
fiscal year ended November 30, 2004, for filing with the Securities and Exchange
Commission.  It is not the duty of the Directors to plan or conduct  audits,  to
determine that the Company's financial  statements are complete and accurate and
are in accordance with accounting  principles  generally  accepted in the United
States.   Those   responsibilities   belong  to  management  and  the  Company's
independent  auditors.  In giving its recommendations,  the Directors considered
(a)  management's  representation  that  such  financial  statements  have  been
prepared  with  integrity and  objectivity  and in  conformity  with  accounting
principles  generally  accepted in the United States,  and (b) the report of the
Company's independent auditors with respect to such financial statements.

The Board of  Directors  has received and  reviewed  written  disclosures  and a
letter from the independent  accountants required by the Independence  Standards
Board Standard No. 1, entitled "Independence  Discussions with Audit Committee,"
as amended to date, and has discussed  with the  independent  accountants  their
independence from management.

The Board of  Directors  held  eight (8) board  meetings  during  the year ended
November 2004.  Directors  receive a fee of $500.00 for each meeting.  Ms. Wood,
Mr. Hearn and Mr. Murphey attended all of the meetings.  Mr. Hempel attended two
of the meetings. Mr. Nadolsky attended five of the meetings.

The Audit  Committee  held four (4) meetings  during the year ended November 30,
2004. Members of the Audit Committee received a fee of $500.00 for each meeting.
Ms. Wood, Mr. Hearn and Mr. Murphey attended all of the meetings. Mr. Hempel and
Mr. Nadolsky attended two of the meetings.

With  the  exception  of Mr.  Hearn,  members  of the  Audit  Committee  are not
considered as independent members under applicable United States statutes.

The Board of Directors has evaluated the credentials of Nicholas  Nadolsky,  and
has determined that Mr. Nadolsky is an "audit committee financial expert" within
the meaning of 401(e) of Regulation S-B.

The Board does not have a nominating  committee due to the Company's small size.
The Board does not provide a process for security holders to send communications
to the Board of Directors due to the infrequent nature of such communications.



<PAGE>
<TABLE>
<CAPTION>

Item 10.  Executive Compensation
--------------------------------

The  information  set  forth in the  2005  Proxy  Statement  under  the  heading
"Management Remuneration and Transactions", is incorporated herein by reference.

The following  table shows as of November 30, 2004, all cash  compensation  paid
to, or accrued  and vested for the account of Ms.  Connie  Wood,  President  and
Chief Executive  Officer,  and Mr. Mark King, Vice President and Chief Operating
Officer. Ms. Wood and Mr. King received no non-cash compensation during 2004.

The company does not have any equity compensation plans.

                                           Annual Compensation

Name and                                 Annual                       Other            All Other
Principal Position            Year       Salary       Bonus     Annual Compensation   Compensation
                                                                      (1)                  (2)
<S>                           <C>     <C>            <C>           <C>                 <C>
Connie Wood,                  2004    $172,394.28    $10,000       $6,000              $27,194.25
President and                 2003    $156,000.00    $10,000       $3,500              $18,490.51
Chief Executive               2002    $153,461.66        -0-          -0-              $12,839.70
Officer (3)

Mark King,                    2004    $155,333.82    $2,000           -0-              $10,225.38
Vice President and            2003    $150,000.00       -0-           -0-               $6,467.79
Chief Operating Officer (4)
</TABLE>

     (1)  Reflects fees for Board meetings and Audit Committee meetings
     (2)  Reflects  amounts  contributed  by Micropac  Industries,  Inc.,  under
          Micropac's  401(k)  profit  sharing  plan;  unused  vacation  pay; and
          reimbursement  for medical  expenses under  Micropac's  Family Medical
          Reimbursement Plan.
--------------------------------------------------------------------------------

     (3)  Effective May 1, 2002,  the Company and Connie Wood entered into a two
          (2) year  employment  agreement at an annual  salary of $156,000.  The
          employment  agreement  was amended  effective  May 1, 2004 to increase
          Mrs.  Wood's salary to $180,000 and to extend the term for a period of
          three years from said date.
     (4)  Effective  February 1, 2004, Mark King and Patrick Cefalu entered into
          a two (2) year employment agreement.

Amounts  included in other annual  compensations  relating to director and audit
committee fees

The Board of  Directors  held  eight (8) board  meetings  during  the year ended
November  2004.  Directors  receive a fee of $500.00 for each meeting.  Ms. Wood
received  fees  of  $4,000  which  amount  is  included  in  the  "Other  Annual
Compensation" column.

The Audit  Committee  held four (4) meetings  during the year ended November 30,
2004. Members of the Audit Committee received a fee of $500.00 for each meeting.
Ms. Wood received Audit Committee fees of $2,000 which amount is included in the
"Other Annual Compensation" column.

Amounts included in all other compensation relating to employee benefit plans

The Company maintains a Family Medical Reimbursement Plan for the benefit of its
executive  officers  and their  dependents.  The Plan is funded  through a group
insurance policy issued by an independent carrier and provides for reimbursement
of 100% of all bona fide  medical  and dental  expenses  that are not covered by
other medical  insurance plans.  During the fiscal year ended November 30, 2004,
Ms. Wood received $7,104.58 and Mr. King received  $1,804.57,  which amounts are
included  in  the  "All  Other  Compensation"  column  shown  in  the  preceding
remuneration table.

In July 1984,  the Company  adopted a Salary  Reduction Plan pursuant to Section
401(k) of the Internal  Revenue Code.  The Plan's  benefits are available to all
Company  employees who are at least 18 years of age and have  completed at least
six months of service to the Company as of the  beginning  of a Plan year.  Plan
participants  may elect to defer up to 15% of their total  compensation as their
contributions,  subject to the  maximum  allowed by the  Internal  Revenue  code
401(k),  and the Company  matches their  contributions  up to a maximum of 6% of
their total  compensation.  A  participant's  benefits vest to the extent of 20%
after two years of eligible  service and become  fully  vested at the end of six
years.

During the fiscal year ended November 30, 2004,  the Company made  contributions
to the Plan for Ms.  Wood in the amount of  $10,772.37  and for Mr.  King in the
amount of $8,421.31,  which amounts are included in the "All Other Compensation"
column shown in the preceding remuneration table.

<PAGE>

Ms. Wood's  employment  agreement  provides that she may elect to carry over any
unused  vacation time to subsequent  periods or elect to be paid for such unused
vacation  time.  In 2004,  Ms.  Wood  elected  to be paid for all  prior  unused
vacation  time in the amount of  $9,317.30,  which is included in the "All Other
Compensation" column shown in the preceding remuneration table.

On January 15,  2001,  the Board of Directors  adopted the Micropac  Industries,
Inc.  2001  Employee  Stock Option Plan.  To date,  no options have been granted
under the Plan.


Item 11.  Security Ownership of Certain Beneficial Owners and Management

The  information  set  forth in the  2005  Proxy  Statement  under  the  heading
"Principal  Stockholders and Stockholdings of Management" is incorporated herein
by reference.

The following  table shows the number and  percentage of shares of the Company's
common stock  beneficially  owned (a) by each person known by the Company to own
5% or more of the  outstanding  common stock,  (b) by each director and nominee,
and (c) by all present officers and directors as a group.

Name and Address                          Number of Shares            Percent
of Beneficial Owner                      Beneficially Owned         of Class(1)

Heinz-Werner Hempel (2)(3)                   1,952,577                 75.7%
Hanseatische Waren-Gesellschaft
         MBH & Co., KG
Am Wall 127
28195 Bremen 1 Germany

H. Kent Hearn (3)                                3,500              Less than .2
1409 Briar Hollow
Garland, Texas 75043

James K. Murphey (3)                               -0-                    -
2290 One Galleria Tower
13355 Noel Road, L.B.75
Dallas, Texas 75240

Nicholas Nadolsky (3)                              -0-                    -
1322 Briar Hollow
Garland, Texas 75043

Connie Wood (3)                                  6,000             Less than .2%
106 Cedarview
Rockwall, Texas 75087

Mark King                                          -0-                    -
2905 Wyndham Lane
Richardson, Texas 75082

Patrick Cefalu                                     -0-                    -
8706 Arborside
Rowlett, Texas 75089

All officers and directors                   1,962,077                 76.1%
  as a group (7 Persons)
-----------------------

(1)  Calculated on the basis of the 2,578,315  outstanding shares.  There are no
     options, warrants, or convertible securities outstanding.

(2)  The  Company  and Mr.  Heinz-Werner  Hempel  are  parties  to an  Ancillary
     Agreement  entered into in March 1987.  The Ancillary  Agreement  primarily
     obligates the Company to register Mr.  Hempel's stock and allows Mr. Hempel
     to participate in any sale of stock by the Company.

(3)  A director of the Company.  Each incumbent  director has been nominated for
     re-election at the Annual Meeting.

<PAGE>

Item 12.  Certain Relationships and Related Transactions
--------------------------------------------------------

The  information  set  forth in the  2005  Proxy  Statement  under  the  heading
"Management Remuneration and Transactions is incorporated herein by reference.

On August 27, 2003, the Company purchased 548,836 shares of the Company's common
stock pursuant to the terms of an agreement dated January 15, 2001,  between the
Company  and Mr.  Nicholas  Nadolsky,  former  Chairman  of the  Board and Chief
Executive Officer ("Agreement"). The Agreement obligated the Company to purchase
any shares of the  Company's  common  stock  owned by Mr.  Nadolsky  at the fair
market  value  thereof (but in no event less than the book value of such shares)
in the event of his death,  permanent  disability or  termination of employment.
Mr. Nadolsky's  employment terminated on May 1, 2003. By letter dated August 15,
2003, Mr. Nadolsky requested that the Company purchase the 548,836 shares of the
Company's  common  stock he owned  pursuant  to the  requirements  of the  above
agreement  and agreed that the book value of each share of his common  stock was
$2.68.  The Company paid Mr.  Nadolsky a total purchase price of  $1,470,880.48.
These shares were subsequently  retired. In determining the purchase price to be
offered for Mr. Nadolsky's  shares, the Board of Directors  considered  numerous
factors,  including the  Company's  balance  sheets,  the small number of shares
publicly bought and sold in the  over-the-counter  market,  the number of shares
owed by Mr. Nadolsky and a valuation opinion from an independent third party.

Since  1980,  the  Company  has  leased a 4,800  square-foot  building  from Mr.
Nadolsky  which  is used  primarily  for  manufacturing.  The  lease  originally
provided for a monthly  rental of $1,900 (an amount  based upon a January  1984,
independent  appraisal  of the  building's  value)  and was to have  expired  on
January 1, 1987.  Since 1987,  the Company has  extended  the term of this lease
from time to time.  The last renewal of the lease was on July 1, 1999 for a five
(5) year  period.  The rental  paid to Mr.  Nadolsky  pursuant to this lease was
$39,000 for the fiscal year ended  November 30, 2004.  In April 2004,  the lease
was  renewed for three (3) years at the same  rental  rate  provided  for in the
original  lease subject to increase  based upon  increases in the Consumer Price
Index.


Item 13.  Principal Accountant Fees and Services
------------------------------------------------

The  information  set  forth in the  2005  Proxy  Statement  under  the  heading
"Independent  Public  Accountants"  and "Audit Fees" is  incorporated  herein by
reference.

KPMG  LLP was  selected  as the  independent  accountants  in 2002  and has been
responsible  for the  Company's  financial  audit  for the  fiscal  years  ended
November 30, 2002 through November 30, 2004.

Management  anticipates that a  representative  from KPMG LLP will be present at
the Annual  Meeting and will be given the  opportunity to make a statement if he
or she desires to do so. It is also anticipated that such representative will be
available to respond to appropriate questions from stockholders.

KPMG LLP fee for professional  services for the audit of the Company's financial
statements for 2004 and the review of the interim financial  statements included
in the Quarterly Reports is $78,000.

In addition to the audit fees, KPMG LLP fee for tax advisory and 2004 tax return
preparation services will be $24,500.

<PAGE>

Item 14.  Exhibits and Reports on Form 8-K
------------------------------------------

     (a)  Exhibits

          10.1 Document of Understanding  between Advanced Energy Industries and
               affiliates.

          10.2 Promissory Note

          10.3 Employment Agreement Of Chief Executive Officer

          10.4 Employment Agreement of Chief Financial Officer

          10.5 Employment Agreement of Chief Operating Officer

          10.6 Code of Conduct for Officers For Principal Executive Officers and
               Senior Financial Officers

          10.7 Shareholder Agreement

          10.8 Ancillary  Agreement  dated  March 13,  1997,  by and between the
               Company, the Hempels and the Proxy Holders (1)

          10.9 Micropac Industries, Inc. 2001 Employee Stock Option Plan (2)


          31.1 Certification of Chief Executive  Officer pursuant to Section 302
               of the Sarbanes- Oxley Act of 2003

          31.2 Certification of Chief Accounting Officer pursuant to Section 302
               of the Sarbanes- Oxley Act of 2003

          32.1 Certification  of Chief Executive  Officer  pursuant to 18 U.S.C.
               section  1350,  as  adopted   pursuant  to  section  906  of  the
               Sarbanes-Oxley act of 2003.

          32.2 Certification  of Chief  Accounting  Officer pursuant to U. S. C.
               section  1350,  as  adopted   pursuant  to  section  906  of  the
               Sarbanes-Oxley act of 2003.

          (1)  Incorporated  by  reference  to the  Registrant's  Report on Form
               10-KSB for the year ended  November  30, 1987 (File No.  0-5109),
               filed February 12, 1988.

          (2)  Incorporated by reference to the Registrant's  Form S-8 (File No.
               333-67560), filed August 16, 2001.



     (b)  Form 8K -

               On  December  29,  2004,  the  Board  of  Directors  of  Micropac
               Industries,  Inc.  approved  the  payment  of a  $.12  per  share
               dividend to all  shareholders  of record on January 25, 2005. The
               dividend  payment  will  be  paid  to  shareholders  on or  about
               February 8, 2005.

               On  January  8,  2004,   the  Board  of   Directors  of  Micropac
               Industries,  Inc.  approved the payment of a special  dividend of
               $.05 per share to all shareholders of record on January 30, 2004.
               The  dividend  payment was paid to  shareholders  on February 13,
               2004.

               At a Board of Directors  meeting held on May 11, 2004,  the Board
               of  Directors  unanimously  elected  Mr.  Nicholas  Nadolsky as a
               Member  and  Chairman  of the Board,  to serve in such  positions
               until  the next  annual  meeting  of  shareholders  or until  his
               earlier death,  resignation  or removal from office.  There is no
               employment agreement between Mr. Nadolsky and the Company.  Since
               1980, the Company has leased a 4800 square foot building from Mr.
               Nadolsky, at a current annual rental of $39,600.

               The Company  submitted a FORM 8-K to the United States Securities
               and  Exchange  Commission  on  August  27,  2003.  The  following
               disclosure was included in the FORM 8-K:

               On August 27, 2003, the Company  purchased  548,836 shares of the
               Company's  common  stock  pursuant  to the terms of an  agreement
               dated  February 5, 2001,  between  the  Company and Mr.  Nadolsky
               ("Agreement").  The  Agreement  obligated the Company to purchase


<PAGE>

               any shares of the Company's common stock owned by Mr. Nadolsky at
               the fair market value thereof (but in no event less than the book
               value  of such  shares)  in the  event  of his  death,  permanent
               disability  or   termination  of   employment.   Mr.   Nadolsky's
               employment terminated on May 1, 2003.

               By letter dated August 15, 2003, Mr. Nadolsky  requested that the
               Company purchase the 548,836 shares of the Company's common stock
               he owned pursuant to the  requirements of the above agreement and
               agreed that the fair value of each share of his common  stock was
               $2.68.  The Company paid Mr.  Nadolsky a total  purchase price of
               $1,470,880.48.





                                   SIGNATURES


Pursuant to the  requirements of Section 13 or 15(d) of the Securities  Exchange
Act of 1934,  the  registrant  has duly  caused  this report to be signed on its
behalf by the undersigned, thereunto duly authorized.


                                      MICROPAC INDUSTRIES, INC.



                                      By: /s/ Connie Wood
                                         ---------------------------------------
                                         Connie Wood, President
                                         and Chief Executive Officer
                                         (Principal Executive Officer)


                                      By:  /s/ Patrick Cefalu
                                         ---------------------------------------
                                         Patrick Cefalu, CFO and
                                         Principal Accounting Officer

Dated:  01/31/2005

Pursuant to the  requirements  of the Securities and Exchange Act of 1934,  this
report  has  been  signed  below  by the  following  persons  on  behalf  of the
registrant and in the capacities indicated on 01/31/2005

 /s/ Connie Wood                                    /s/ H. Kent Hearn
-----------------------------                      -----------------------------
Connie Wood, Director                              H. Kent Hearn, Director

 /s/ James K. Murphey
-----------------------------                      -----------------------------
James K. Murphey, Director                         Heinz-Werner Hempel, Director


-----------------------------
Nicholas Nadolsky, Director



<PAGE>

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM


The Board of Directors and Shareholders
Micropac Industries, Inc.:

We have audited the accompanying balance sheets of Micropac Industries,  Inc. as
of  November  30,  2004  and  2003,  and  the  related   statements  of  income,
shareholders'  equity,  and cash flows for the years then ended. These financial
statements   are  the   responsibility   of  the   Company's   management.   Our
responsibility  is to express an opinion on these financial  statements based on
our audits.

We conducted our audits in accordance  with the standards of the Public  Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement.  An audit includes examining, on a
test basis,  evidence  supporting  the amounts and  disclosures in the financial
statements.  An audit also includes assessing the accounting principles used and
significant  estimates  made by  management,  as well as evaluating  the overall
financial  statement  presentation.   We  believe  that  our  audits  provide  a
reasonable basis for our opinion.

In our opinion,  the financial  statements  referred to above present fairly, in
all material respects, the financial position of Micropac Industries, Inc. as of
November 30, 2004 and 2003, and the results of its operations and its cash flows
for the years then ended in conformity with U.S. generally  accepted  accounting
principles.


                                                        KPMG LLP

Dallas, Texas,
January 20, 2005



<PAGE>
<TABLE>
<CAPTION>

                            MICROPAC INDUSTRIES, INC.
                                 BALANCE SHEETS
                        AS OF NOVEMBER 30, 2004 AND 2003
                    (Dollars in thousands except share data)

                                 ASSETS                                2004        2003
                                                                     --------    --------
<S>                                                                  <C>         <C>
CURRENT ASSETS:
    Cash and cash equivalents                                        $  1,239    $  2,337
    Short-term investments                                              2,507         812
    Receivables, net of allowance for doubtful accounts
        of  $121 for 2004 and $89 for 2003                              2,326       1,877
    Inventories
        Raw materials and supplies                                      1,354         692
        Work-in-process                                                 1,346       1,097
                                                                     --------    --------
                  Total inventories                                     2,700       1,789

    Deferred income taxes                                                 528         386
      Prepaid expenses and other assets                                    90          71
                                                                     --------    --------
                  Total current assets                                  9,390       7,272

PROPERTY, PLANT, AND EQUIPMENT, at cost:
    Land                                                                   80          80
    Buildings                                                             498         498
    Facility improvements                                                 796         797
    Machinery and equipment                                             5,200       5,027
    Furniture and fixtures                                                479         489
                                                                     --------    --------
        Total property, plant, and equipment                            7,053       6,891
    Less- accumulated depreciation                                     (6,091)     (5,889)
                                                                     --------    --------
        Net property, plant, and equipment                                962       1,002
                                                                     --------    --------


                  Total assets                                       $ 10,352    $  8,274
                                                                     ========    ========

                      LIABILITIES AND SHAREHOLDERS' EQUITY

CURRENT LIABILITIES:
    Accounts payable                                                 $    387    $    308
    Accrued compensation                                                  488         239
    Accrued professional fees                                              11          23
    Income taxes payable                                                  306         110
    Property taxes                                                         66          65
    Commissions payable                                                    46          48
    Deferred revenue                                                      404         115
    Other accrued liabilities                                              17          21
                                                                     --------    --------
                  Total current liabilities                             1,725         929

DEFERRED INCOME TAXES                                                      72          69
COMMITMENTS AND CONTINGENCIES (Note 5)
SHAREHOLDERS' EQUITY:
    Common stock, $.10 par value, authorized 10,000,000 shares
       3,078,315 issued 2,578,315 outstanding at November 30, 2004
       and November 30, 2003                                              308         308
    Paid-in capital                                                       885         885
    Treasury stock, at cost, 500,000 shares                            (1,250)     (1,250)
    Retained earnings                                                   8,612       7,333
                                                                     --------    --------
                  Total shareholders' equity                            8,555       7,276
                                                                     --------    --------

                  Total liabilities and shareholders' equity         $ 10,352    $  8,274
                                                                     ========    ========
</TABLE>

                See accompanying notes to financial statements.


<PAGE>
<TABLE>
<CAPTION>

                            MICROPAC INDUSTRIES, INC.
                              STATEMENTS OF INCOME
                        FOR THE YEARS ENDED NOVEMBER 30,
                            2004 AND 2003 (Dollars in
                          thousands except share data)



                                                               2004           2003
                                                           -----------    -----------
<S>                                                        <C>            <C>
NET SALES                                                  $    15,356    $    12,490

COSTS AND EXPENSES:
Cost of sales                                                    9,976          8,723
Research and development                                           438            303
Selling, general, and administrative expenses                    2,709          2,581
                                                           -----------    -----------

                  Total costs and expenses                      13,123         11,607

OPERATING INCOME BEFORE INTEREST AND INCOME TAXES                2,233            883

Interest income                                                     32             50
                                                           -----------    -----------
INCOME BEFORE INCOME TAXES                                       2,265            933

PROVISION (BENEFIT) FOR INCOME TAXES:
    Current                                                        996            387
    Deferred                                                      (139)           (65)
                                                           -----------    -----------

          Total provision for current and deferred taxes           857            322
                                                           -----------    -----------

NET INCOME                                                 $     1,408    $       611
                                                           ===========    ===========

BASIC AND DILUTED EARNINGS PER SHARE                       $       .55    $       .21
                                                           ===========    ===========

WEIGHTED AVERAGE NUMBER OF SHARES, basic and diluted         2,578,315      2,944,206
                                                           ===========    ===========
</TABLE>









                See accompanying notes to financial statements.


<PAGE>
<TABLE>
<CAPTION>

                            MICROPAC INDUSTRIES, INC.
                       STATEMENTS OF SHAREHOLDERS' EQUITY
                 FOR THE YEARS ENDED NOVEMBER 30, 2004 AND 2003
                             (Dollars in thousands)



                               Common      Paid-in    Treasury    Retained
                               Stock       Capital      Stock     Earnings      Total
                              --------    --------    --------    --------    --------
<S>                           <C>         <C>         <C>         <C>         <C>
BALANCE, November 30, 2002    $    363    $    885    $ (1,250)   $  8,450    $  8,448

    Common stock repurchase        (55)       --          --        (1,416)     (1,471)
    Dividend                      (312)       (312)
    Net income                    --          --          --           611         611
                              --------    --------    --------    --------    --------

BALANCE, November 30, 2003         308         885      (1,250)      7,333       7,276
                              --------    --------    --------    --------    --------

    Dividend                      --          --          --          (129)       (129)
    Net income                    --          --          --         1,408       1,408
                              --------    --------    --------    --------    --------

BALANCE, November 30, 2004    $    308    $    885    $ (1,250)   $  8,612    $  8,555
                              ========    ========    ========    ========    ========
</TABLE>





















                See accompanying notes to financial statements.

<PAGE>
<TABLE>
<CAPTION>

                            MICROPAC INDUSTRIES, INC.
                            STATEMENTS OF CASH FLOWS
                 FOR THE YEARS ENDED NOVEMBER 30, 2004 AND 2003
                             (Dollars in thousands)

                                                                         2004        2003
                                                                       --------    --------
<S>                                                                    <C>         <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
    Net income                                                         $  1,408    $    611
    Adjustments to reconcile net income to
        net cash provided by operating activities-
           Depreciation and amortization                                    222         230
           Deferred tax benefit                                            (139)        (65)
    Changes in certain current assets and liabilities-
              Increase in receivables, net                                 (449)        (76)
             (Increase)  decrease in inventories                           (911)        511
              Increase in prepaid expenses and other assets                 (19)        (15)
              Increase (decrease) in accounts payable                        79        (193)
              Increase (decrease) in accrued compensation                   249         (17)
              Increase in income taxes payable                              196           1
              Increase (decrease) in all other accrued liabilities          272         (10)
                                                                       --------    --------

                 Net cash provided by operating activities                  908         977

CASH FLOWS FROM INVESTING ACTIVITIES:
         Purchase of Investments                                         (1,695)     (1,400)
Sale of Investments                                                        --         3,428
         Additions to property, plant, and equipment                       (182)       (181)
                                                                       --------    --------
                 Net cash (used in) provided by investing activities     (1,877)      1,847


CASH FLOWS FROM FINANCING ACTIVITIES:
    Common stock repurchase                                                --        (1,471)
     Dividends paid                                                        (129)       (312)
                                                                       --------    --------

                 Net cash used in financing activities                     (129)     (1,783)
                                                                       --------    --------

NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS                     (1,098)      1,041

CASH AND CASH EQUIVALENTS, beginning of year                              2,337       1,296
                                                                       --------    --------

CASH AND CASH EQUIVALENTS, end of year                                 $  1,239    $  2,337
                                                                       ========    ========

SUPPLEMENTAL CASH FLOW DISCLOSURES:
      Cash paid for income taxes, net of refunds received              $    803    $    386
                                                                       ========    ========
</TABLE>




                See accompanying notes to financial statements.

<PAGE>

                            MICROPAC INDUSTRIES, INC.
                          NOTES TO FINANCIAL STATEMENTS
                           NOVEMBER 30, 2004 AND 2003



1.   BUSINESS DESCRIPTION:
     --------------------
Micropac Industries, Inc. (the "Company"), a Delaware corporation,  manufactures
and distributes various types of hybrid  microelectronic  circuits,  solid state
relays,  power  operational  amplifiers,   and  optoelectronic   components  and
assemblies.  The  Company's  products are used as components in a broad range of
military,  space and industrial systems,  including aircraft instrumentation and
navigation systems,  power supplies,  electronic  controls,  computers,  medical
devices, and high-temperature (200o C) products.


2.   SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
     ------------------------------------------

Revenue Recognition
-------------------

Revenues are recorded as  deliveries  are made based upon contract  prices.  Any
losses  anticipated on fixed price  contracts are provided for currently.  Sales
are recorded net of sales returns, allowances and discounts.

Short-Term Investments
----------------------

Short-term  investments include certificates of deposits with maturities greater
than  90  days.  These  investments  are  reported  at  historical  cost,  which
approximates  fair  market  value as of November  30, 2004 and 2003.  All highly
liquid  investments  with  maturities of 90 days or less are  classified as cash
equivalents. All short-term investments are securities which the Company has the
ability and positive intent to hold to maturity. All held-to maturity securities
mature within one year.

Inventories
-----------

Inventories  are stated at lower of cost or market  value and include  material,
labor and  manufacturing  overhead.  All  inventories  are valued using the FIFO
(first-in,  first-out)  method of inventory  valuation.  The Company provides an
allowance for obsolete and overstocked inventory.

Income Taxes
------------

The Company  accounts  for income  taxes using the asset and  liability  method.
Under this method the Company  records  deferred  income taxes for the temporary
differences  between the financial  reporting  basis and the tax basis of assets
and  liabilities at enacted tax rates expected to be in effect when such amounts
are realized or settled.  The resulting  deferred tax liabilities and assets are
adjusted to reflect  changes in tax law or rates in the period that includes the
enactment date.

Property, Plant, and Equipment
------------------------------

Property, plant, and equipment are carried at cost, and depreciation is provided
using the  straight-line  method at rates  based  upon the  following  estimated
useful lives (in years) of the assets:

     Buildings................................................................15
     Facility improvements..................................................8-15
     Machinery and equipment................................................5-10
     Furniture and fixtures..................................................5-8

The Company assesses long-lived assets for impairment under Financial Accounting
Standards board Statement of Financial  Accounting Standards No. 144, Accounting
for  the   Impairment  or  Disposal  of  Long-Lived   Assets.   When  events  or
circumstances  indicate  that  an  asset  may  be  impaired,  an  assessment  is
performed.  The estimated  future  undiscounted  cash flows  associated with the
asset are compared to the asset's net book value to determine if a write down to
market value or discounted cash flow value is required. The Company adopted SFAS
144 on December 1, 2003.  The adoption of SFAS 144 did not affect the  Company's
financial statements.

Repairs and maintenance are charged against income when incurred.  Improvements,
which extend the useful life of property, plant, and equipment are capitalized.

Research and Development Costs
------------------------------

Costs for the design and development of new products are expensed as incurred.

<PAGE>

Comprehensive Income
--------------------

Comprehensive income includes net income and other comprehensive income which is
generally  comprised  of  changes  in  the  fair  value  of   available-for-sale
marketable securities,  foreign currency translation adjustments and adjustments
to recognise additional minimum pension  liabilities.  For each period presented
in the accompanying statement of income, comprehensive income and net income are
the same amount.

Basic and Diluted Earnings Per Share
------------------------------------

Basic and  diluted  earnings  per share are  computed  based  upon the  weighted
average number of shares outstanding during the year. Diluted earnings per share
gives effect to all dilutive potential common shares.  During 2004 and 2003, the
Company had no dilutive potential common stock.

Use of Estimates
----------------

The preparation of financial statements in conformity with accounting principles
generally  accepted in the United States  requires  management to make estimates
and assumptions  that affect the reported  amounts of assets and liabilities and
disclosure of  contingent  assets and  liabilities  at the date of the financial
statements  and the  reported  amounts  of  revenues  and  expenses  during  the
reporting period. Actual results could differ from those estimates.


3.   NOTES PAYABLE TO BANKS:
     ----------------------

The  Company  currently  has an  existing  line of credit  with a Texas  banking
institution.  The line of  credit  agreement  provides  the  Company  with up to
$3,000,000  for  normal  operation  of the  Company.  The  interest  rate on any
borrowings  against this credit  agreement is equal to the prime rate less 1/4%.
The line of credit requires the Company to maintain  certain  financial  ratios,
including  quick  ratio  of at least  1:1,  maintain  a  tangible  net  worth of
$6,250,000   plus   75%  of   future   net   income,   and   maintain   a  total
liabilities-to-tangible-net-worth  of  less  that  1.25:1.  The  Company  is  in
compliance with these  covenants.  The Company has not, to date, used any of the
available line of credit.  The Company expects to continue to generate  adequate
amounts  of cash to meet its  liquidity  needs  from the  sale of  products  and
services and the collection thereof.

4.   RELATED PARTIES:
     ---------------

The Company leases a building from the Company's  Chairman of the Board. A lease
was  signed on July 1, 1999,  for a term of five (5) years and  renewed in April
2004 for three (3) years under similar terms and  conditions as the prior lease.
Amounts paid under the lease agreement approximated $39,000 in 2004 and 2003.

Glast,  Phillips & Murray, P.C. serves as the Company's legal counsel. Mr. James
K. Murphey, a director and member of the Company's audit committee,  is a member
of Glast, Phillips & Murray, P.C.

Effective May 13, 2003, the Company's Board of Directors  approved the formation
of an audit  committee  composed  of the five (5)  members of the  Board.  It is
possible  that the members of the audit  committee may resign from the committee
if future  Securities and Exchange  Commission  rules  establish a criteria that
such  individuals  are not  independent  due to  their  relationships  with  the
Company.  The Board of Directors held eight (8) board  meetings  during the year
ended  November 30, 2004.  Directors  receive a fee of $500.00 for each meeting.
The Audit  Committee  held four (4) meetings  during the year ended November 30,
2004. Members of the Audit Committee received a fee of $500.00 for each meeting.

On August 27, 2003, the Company purchased 548,836 shares of the Company's common
stock pursuant to the terms of an agreement dated February 5, 2001,  between the
Company and Mr. Nadolsky  ("Agreement").  The Agreement obligated the Company to
purchase any shares of the Company's  common stock owned by Mr.  Nadolsky at the
fair  market  value  thereof  (but in no event  less than the book value of such
shares)  in the event of his  death,  permanent  disability  or  termination  of
employment. Mr. Nadolsky's employment terminated on May 1, 2003. By letter dated
August 15, 2003, Mr.  Nadolsky  requested that the Company  purchase the 548,836
shares of the Company's  common stock he owned pursuant to the  requirements  of
the above agreement and agreed that the approximate  fair value of each share of
his common stock was $2.68. The Company paid Mr. Nadolsky a total purchase price
of $1,470,880. These shares were subsequently retired.


5.   PRODUCT WARRANTIES:
     ------------------

In November 2002, the FASB issued  Interpretation No. 45 ("FIN 45),  Guarantor's
Accounting  and  Disclosure  Requirements  for  Guarantees,  Including  Indirect
Guarantees of  Indebtedness of Others."  Currently,  the only applicable item of
FIN  45  relates  to the  impact  of  paragraph  14,  which  refers  to  product
warranties.

Because we do not have extended  warranties,  our exposure is limited to product
returns for defective products.  In general, we warrant that the products,  when
delivered,  will be free from defects in material  workmanship  under normal use
and  service.  Our  obligations  are limited to  replacing,  repairing or giving
credit for, at our option,  any products that are returned within one year after
the date of shipment.

<PAGE>

The Company reserves for potential warranty expense based on historical warranty
experience  claims.  While  management  considers  our process to be adequate to
effectively  quantify  its  exposure  to  warranty  claims  based on  historical
performance,  changes in warranty  claims on a specific or cumulative  basis may
require management to adjust its reserve for potential warranty costs.

Warranty  expense  to repair or replace  products  in 2004,  2003,  and 2002 was
$33,600, $28,100 and $31,800 respectively.



6.   LEASE COMMITMENTS:
     -----------------

Rent expenses for the years ended November 30, 2004 and 2003, was  approximately
$45,000 and $42,000  respectively  per year. The Company's  future minimum lease
payments under  non-cancellable  operating  leases  (including the related party
lease  described in note 4) for office and  manufacturing  space with  remaining
terms in excess of one year are approximately:

     2005                                                  $  40,000
     2006                                                  $  40,000
     2007                                                  $  20,000
                                                           ---------
                                          Total            $ 100,000


7.   EMPLOYEE BENEFITS:
     -----------------

The Company  sponsors an Employees'  Profit Sharing Plan and Trust (the "Plan").
Pursuant to section  401(k) of the Internal  Revenue Code, the Plan is available
to  substantially  all employees of the Company.  Employee  contributions to the
Plan are matched by the Company at amounts up to 6% of the participant's salary.
Contributions  made by the  Company  were  approximately  $131,000  in 2004  and
$138,000 in 2003. Employees become vested in Company  contributions at 20% after
two years, 40% after three years, 60% after four years, 80% after five years and
100% after six years.  If the employee  leaves the Company  prior to being fully
vested,  the unvested portion of the Company's  contributions  are forfeited and
such  forfeitures  are used to lower future Company  contributions.  The Company
does not offer other post retirement benefits to its employees at this time.

8.   NEW ACCOUNTING STANDARDS:
     ------------------------
None


9. INCOME TAXES:
   ------------

The income tax provision consisted of the following for the years ended November
30:

                                                            2004         2003
                                                         ---------    ---------
     Current Provision
         Federal                                         $ 854,000    $ 319,000
         State                                             142,000       68,000
                                                         ---------    ---------
                                                           996,000      387,000
     Deferred Benefit
         Federal                                          (139,000)     (65,000)
                                                         ---------    ---------

                  Total                                  $ 857,000    $ 322,000
                                                         =========    =========


The  provision  for income  taxes  differs  from that  computed  at the  federal
statutory corporate tax rate as follows:

                                                             2004        2003
                                                          ---------   ---------
     Tax at 34% statutory rate                            $ 770,000   $ 317,000
     State income taxes, net of federal benefit              82,000      45,000
     Adjustment to prior year estimates                       5,000     (40,000)
                                                          ---------   ---------


              Income tax provision                        $ 857,000   $ 322,000
                                                          =========   =========


<PAGE>
<TABLE>
<CAPTION>

The  components  and  changes in  deferred  tax assets and  liabilities  were as
follows:

                                               November 30, 2004   November 30, 2003
                                               -----------------   -----------------
     <S>                                       <C>                 <C>
     Current Deferred Taxes -
          Allowance for doubtful accounts      $          45,000   $          33,000
          Inventory                                      280,000             267,000
          Accrued liabilities and other                  203,000              86,000
                                               -----------------   -----------------
              Net current deferred tax asset   $         528,000   $         386,000
                                               -----------------   -----------------

     Non-current Deferred Taxes Liability
          Depreciation and other               $          72,000   $          69,000
                                               -----------------   -----------------

              Net deferred taxes               $         456,000   $         317,000
                                               =================   =================
</TABLE>



10.  SIGNIFICANT CUSTOMER INFORMATION:
     --------------------------------

The Company's primary line of business relates to the design,  manufacture,  and
sale of hybrid microcircuits and optoelectronic components and assemblies. Sales
result primarily from  subcontracts  with customers for ultimate  production and
delivery  to the United  States  government.  Sales to primary  contractors  for
defense and space related contracts accounted for 64% of total sales in 2004 and
62% of total sales in 2003. During 2004, two customers  accounted for 9% and 10%
of the Company's  sales  compared to 12% and 7% for the year ended  November 30,
2003.

11.  SHAREHOLDERS' EQUITY:
     --------------------

On November 30, 2004, there were approximately 559 shareholders of record of the
Company's  common  stock.  The  stock  of the  Company  is  closely  held;  and,
therefore,  certain shareholders/board members have the ability to significantly
influence decisions.

On January 8, 2004, the Board of Directors of Micropac Industries, Inc. approved
the payment of a special  dividend of $0.05 per share for shareholders of record
as of January 30, 2004. This dividend was paid to the Company's  shareholders on
February 13, 2004.

On August 27, 2003, the Company purchased 548,836 shares of the Company's common
stock pursuant to the terms of an agreement dated February 5, 2001,  between the
Company and Mr. Nadolsky  ("Agreement").  The Agreement obligated the Company to
purchase any shares of the Company's  common stock owned by Mr.  Nadolsky at the
fair  market  value  thereof  (but in no event  less than the book value of such
shares)  in the event of his  death,  permanent  disability  or  termination  of
employment. Mr. Nadolsky's employment terminated on May 1, 2003. By letter dated
August 15, 2003, Mr.  Nadolsky  requested that the Company  purchase the 548,836
shares of the Company's  common stock he owned pursuant to the  requirements  of
the above  agreement  and agreed that the fair value of each share of his common
stock was  $2.68.  The  Company  paid Mr.  Nadolsky  a total  purchase  price of
$1,470,880. These shares were subsequently retired.

On March 1, 2001,  the Company's  shareholders  approved the 2001 Employee Stock
Option Plan (the "Stock  Plan").  As of November  30,  2004,  there were 500,000
options  available  to be  granted;  however,  no  options  had been  granted at
year-end.

12.  SUBSEQUENT EVENTS:
     -----------------

On December  29,  2004,  the Board of  Directors  of Micropac  Industries,  Inc.
approved the payment of a $.12 per share dividend to all  shareholders of record
on January 25, 2005.  The dividend  payment will be paid to  shareholders  on or
about February 8, 2005.







<PAGE>

                             DIRECTORS AND OFFICERS
                             ----------------------
                                NOVEMBER 30, 2004


                                NICHOLAS NADOLSKY
                              Chairman of the Board
                            Micropac Industries, Inc

                                   CONNIE WOOD
                             Chief Executive Officer
                            Micropac Industries, Inc.

                               HEINZ-WERNER HEMPEL
                             Chief Operating Officer
       Hanseatishe Waren Handelsgesellschaft MBH & Co. KG, Bremen, Germany


                                  H. KENT HEARN
                                   Stockbroker
                          Milkie-Ferguson, Dallas, Tx.


                                JAMES K. MURPHEY
                               Corporate Attorney
                     Glast, Phillips and Murray, Dallas, Tx.


                                 PATRICK CEFALU
                             Chief Financial Officer
                            Micropac Industries, Inc.


                                    MARK KING
                             Chief Operating Officer
                            Micropac Industries, Inc.









LEGAL COUNSEL                                         TRANSFER AGENT & REGISTRAR
Glast, Phillips and Murray                            Securities Transfer
Dallas, Tx                                            Frisco, Texas