VALPEY FISHER CORP
EXHIBIT 10.5
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<TYPE>EX-10.5
<SEQUENCE>6
<FILENAME>a5398623ex105.txt
<DESCRIPTION>EXHIBIT 10.5
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                                                                    Exhibit 10.5

                                                       April 4, 2007

Mr. Walt Oliwa
36 Marton Drive
Bedford, NH  03110

Dear Walt:

     This letter will confirm the agreement between Valpey-Fisher Corporation
(the "Company") and you concerning a retention bonus payable to you under
certain circumstances.

     As you are aware, the Company is currently exploring strategic alternatives
which could include merger or sale. As an incentive for your continued
employment with the Company, and your efforts on behalf of the strategic
alternatives, the Company hereby agrees to pay you a bonus of one times your
current base salary in the event of a change in control of the Company prior to
September 30, 2008. Payment of the bonus will be made immediately following the
change in control. The payment is contingent on your continued employment with
the Company through, and immediately following any change in control on or
before, September 30, 2008.

     For the purposes of this letter, a change in control of the Company shall
occur:

          a) if any "Person", as such term is used in Section 13(d) and 14(d) of
     the Securities Exchange Act of 1934, as amended (the "exchange Act")
     (provided that the term "Person" shall not include Theodore Valpey, Jr.,
     the Company, any trustee or other fiduciary holding securities under an
     employee benefit plan of the Company or any corporation owned, directly or
     indirectly, by the stockholders of the Company in substantially the same
     proportions as their ownership of stock in the Company), becomes the
     "beneficial owner" (as defined in Rule 13d-3 under the Exchange Act),
     directly or indirectly, of securities of the Company representing 70% or
     more of the combined voting power of the Company's then outstanding
     securities;

          b) the stockholders of the Company approve a merger or consolidation
     of the Company with any other corporation; other than (i) a merger or
     consolidation which would result in the voting securities of the Company
     outstanding immediately prior thereto continuing to represent (either by
     remaining outstanding or by being converted into voting securities of the
     surviving entity) 30% or more of the combined voting power of the voting
     securities of the Company or such surviving entity outstanding immediately
     after such merger or consolidation or (ii) a merger or consolidation
     effected to implement a re-capitalization of the Company (or similar
     transaction) in which no "Person" (as hereinabove defined) acquires 70% or
     more of the combined voting power of the Company's then outstanding
     securities; or

          c) the stockholders of the Company approve a plan of complete
     liquidation of the Company or an agreement for the sale or disposition by
     the Company of all or substantially all of the Company's assets.

     Please indicate your agreement by signing this letter in the space provided
below.

                                                       Sincerely,

                                                       VALPEY-FISHER CORPORATION


                                                       By /s/ Ted Valpey Jr.
                                                          ------------------
                                                          Ted Valpey, Jr.
                                                          Chairman


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AGREED AND ACCEPTED:

/s/ Walt Oliwa
--------------
Walt Oliwa

Date: 4/4/07
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