<PAGE>   1

                                                                EXHIBIT 10.5

                               SERVICES AGREEMENT


         This SERVICES AGREEMENT is made and entered into as of this 21st day of
March, 1997, by and between ODETICS, INC., a Delaware corporation ("Odetics")
and ATL PRODUCTS, INC., a Delaware corporation ("ATL").

                                 R E C I T A L S

         WHEREAS, Odetics and ATL have entered into a Separation and
Distribution Agreement which sets forth the principal transactions between
Odetics and ATL as a result of ATL's recent issuance of additional shares of its
authorized but unissued Class A Common Stock in a registered and underwritten
initial public offering of less than 20% of its outstanding shares and Odetics'
proposed distribution to its stockholders pursuant to a tax free spinoff under
Internal Revenue Code ss. 355 of the Class A Common Stock of ATL which it owns
(the "Distribution"); and

         WHEREAS, ATL desires Odetics to perform certain business, information
and facilities services on ATL's behalf following the Distribution;

         NOW, THEREFORE, the parties hereto do hereby agree as follows:

         1. Business Services. During the term of this Agreement, Odetics shall
provide to ATL the services set forth in Exhibit A attached hereto (the
"Services") in substantially the same manner and to the same extent as currently
and heretofore provided.

         2. Performance of Services.

                  2.1 Services to be provided by Odetics may, at Odetics's sole
         discretion, be provided, in whole or in part, by affiliates of Odetics.
         Odetics shall not be obligated to acquire new or additional assets, or
         hire new or additional employees, to perform the Services. In addition,
         Odetics may contract with one or more third parties for the performance
         of all or any part of the Services provided (i) the costs to ATL for
         the services to be provided by the third party do not exceed the
         amounts that would have been charged by Odetics, (ii) the level of
         service provided by the third party is at least substantially
         equivalent to that provided by Odetics hereunder, and (iii) such third
         party is reasonably acceptable to ATL. It is currently contemplated
         that the Services will generally continue to be provided by the
         organization that is providing such Services as of the date hereof. ATL
         agrees that all third parties currently providing any Services are
         acceptable third parties to provide Services.

                  2.2 The Services to be provided by Odetics shall be provided
         to ATL as appropriate to reflect the organizational and operational
         structure of ATL; provided,



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         however, that Odetics shall not be required to provide any Services to
         the extent that the performance of such Services becomes more expensive
         for Odetics as a result of an organizational or operations change by
         ATL.

                  2.3 ATL shall provide to Odetics on a timely basis any and all
         information which is reasonably necessary for Odetics to provide the
         Services. ATL shall be solely responsible for the timely delivery of
         such information, and the accuracy and completeness thereof. ATL shall
         have no right to obtain any confidential or proprietary information of
         Odetics, and any such information so obtained by ATL shall be deemed to
         be confidential and treated in accordance with the provisions of
         Section 7 hereof.

         3. Limitation of Services.

                  3.1 Odetics shall not be required to provide a level of
         service which is higher than that provided currently, at the date of
         this Agreement.

                  3.2 Odetics shall not be required to perform any information
         system services to the extent such services would result in the breach
         of any software license or other applicable contract. If Odetics
         believes it is unable to provide any information systems services
         pursuant to the foregoing, Odetics shall promptly notify ATL. If
         requested by ATL, Odetics shall use reasonable efforts to obtain the
         rights necessary to provide such information system services, including
         obtaining any appropriate consents from third parties. ATL shall be
         responsible for all additional costs and expenses incurred by Odetics
         in order to allow Odetics to provide such information system services.

                  3.3 Odetics shall not be required to provide any Services to
         the extent the performance of such Services becomes impractical as a
         result of a cause or causes outside the reasonable control of Odetics
         or to the extent the performance of such Services would require Odetics
         to violate any applicable laws, rules or regulations.

                  3.4 ODETICS MAKES NO REPRESENTATIONS OR WARRANTIES, EXPRESS OR
         IMPLIED, AND ODETICS SPECIFICALLY DISCLAIMS ANY IMPLIED WARRANTIES OF
         MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO
         THE SERVICES TO BE PROVIDED HEREUNDER.

         4.  Fees.

                  4.1 ATL shall pay to Odetics, as fees for the Services
         performed by Odetics pursuant to this Agreement, the amounts set forth
         in Exhibit A, which amounts are intended to represent the fair market
         value of such services. Such fees shall be adjusted throughout the term
         of this Agreement, so that they will reflect fair market value at all
         times. In addition, ATL shall reimburse Odetics for all direct third
         party costs incurred by Odetics in connection with providing the
         Services, provided that such third party costs have been approved in
         advance by ATL.



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                  4.2 Odetics shall submit to ATL, on a monthly basis, Odetics's
         invoice for Services performed under this Agreement in the preceding
         month. Each invoice shall be payable net thirty (30) days after the
         date of the invoice; however, in the event that ATL, in good faith,
         questions any invoiced item, payment of that item shall be made only
         after the satisfactory resolution of those questions. ATL shall pay a
         service charge of 1% per month for all overdue amounts, other than
         amounts which ATL has, in good faith, questioned.

         5.  Term.

                  5.1 Unless terminated earlier as provided in this Section,
         this Agreement shall terminate as of a date eighteen (18) months after
         the date of this Agreement.

                  5.2 ATL may terminate any of the Services, in whole or in
         part, upon 30 days written notice to Odetics.

                  5.3 This Agreement may be terminated at any time upon the
         mutual consent of the parties.

                  5.4 Either party may terminate this Agreement if the other
         party is in material default under this Agreement and fails to correct
         such default within 30 days after receiving written notice of such
         default.

                  5.5 The parties acknowledge that the purpose of this Agreement
         is to provide the Services on an interim basis to permit ATL to obtain
         alternative sources for the Services. ATL shall use its best efforts to
         obtain alternative sources for the Services as soon as practicable.

         6.  Indemnification.

                  6.1 ATL shall indemnify and hold harmless Odetics, its
         affiliates, and their officers, directors, employees, and agents from
         and against all claims, liabilities, obligations, suits, causes of
         action, or expenses (including reasonable attorneys fees) (collectively
         "Claims") claimed to have resulted, directly or indirectly, in
         connection with the performance of Services by Odetics, provided,
         however, that ATL shall not be required to indemnify or hold harmless
         any indemnitee to the extent the Claims are caused by the gross
         negligence or willful misconduct of such indemnitee.

                  6.2 An indemnitee shall provide written notice to ATL of any
         Claims with respect to which it seeks indemnification, and ATL shall
         assume the defense of such Claims with counsel reasonably satisfactory
         to the indemnitee. If such defense is assumed by ATL with counsel so
         selected, ATL will not be subject to any liability for



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         any settlement of such Claims made by an indemnified party without
         ATL's consent (such consent to not be unreasonably withheld or
         delayed). No indemnified party will be subject to any liability for any
         settlement of such Claims made by ATL without such party's consent
         (which consent is not to be unreasonably withheld), and such settlement
         shall include an unconditional release of all indemnitees from all
         liability on such Claims. If an indemnified party desires to retain
         separate counsel, such indemnified party shall have the right to do so,
         but ATL will not be obligated to pay the fees and expenses of such
         separate counsel. The parties hereto agree to cooperate fully with each
         other in connection with the defense, negotiation or settlement of any
         legal proceeding, claim or demand and to engage in no action that would
         result in or increase liability on the part of another party.

                  6.3 The provisions of this Section 6 shall survive termination
         of the Agreement.

         7.  Confidentiality.

                  7.1 In the course of performance of this Agreement, either
         party ("Receiving Party") may acquire information the other party
         ("Disclosing Party") deems confidential, including trade secrets and
         unpublished technical or business related information and data to which
         the Disclosing Party (or companies affiliated with the Disclosing
         Party) has proprietary rights. Confidential information shall also
         include information of a third party which the Disclosing Party is
         under an obligation to maintain in confidence. All such information is
         referred to hereinafter as "Disclosed Information."

                  7.2 The Receiving Party shall retain Disclosed Information in
         strict confidence and shall not communicate it to others without the
         Disclosing Party's prior written agreement. Notwithstanding the
         foregoing, Odetics shall be allowed to disclose Disclosed Information
         of ATL to third parties as necessary to perform the Services, provided
         such third parties have undertaken confidentiality obligations
         substantially similar to those set forth in this Section 7.

                  7.3 Nothing in this Agreement shall prevent the communication
         to others of any Disclosed Information which the Receiving Party can
         show was known to it or its representatives prior to its receipt
         hereunder, was lawfully received by the Receiving party and its
         representatives other than directly or indirectly from the Disclosing
         Party or became public knowledge through no fault of the Receiving
         Party.

                  7.4 The provisions of this Section 7 shall survive termination
         of this Agreement for a period of three years.



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<PAGE>   5

         8.  Miscellaneous.

                  8.1 Notices. All notices required or permitted to be given
         under this Agreement shall be in writing and shall be sent by facsimile
         transmission or mailed by registered or certified mail addressed to the
         party to whom such notice is required or permitted to be given. All
         notices shall be deemed to have been given when transmitted if given by
         facsimile and confirmation of receipt is received or, if mailed, 48
         hours after mailed as evidenced by the postmark at the point of
         mailing.

                  All notices to Odetics shall be addressed as follows:

                  Odetics, Inc.
                  1515 South Manchester Avenue
                  Anaheim, California 92802-2907
                  Attn: Joel Slutzky

                  All notices to ATL shall be addressed as follows:

                  ATL Products, Inc.
                  2801 Kelvin Avenue
                  Irvine, California 92614
                  Attn: Kevin C. Daly, Ph.D.


         Either party may, by written notice to the other, designate a new
address to which notices to the party giving the notice shall thereafter be
mailed.

                  8.2 Force Majeure. Odetics shall not be liable for any delay
         or failure of performance to the extent such delay or failure is caused
         by circumstances beyond its reasonable control and that by the exercise
         of due diligence it is unable to prevent, provided that the party
         claiming excuse use its best efforts to overcome the same.

                  8.3 Limitation of Liability. In no event shall Odetics be
         liable to ATL for indirect, consequential, incidental or special
         damages, including but not limited to lost profits, arising from or
         relating to any breach of this Agreement, regardless of any notice of
         such damages. Nothing in this Section is intended to limit or restrict
         the indemnification rights or obligations of either party.

                  8.4 Entirety of Agreement. This Agreement sets forth the
         entire agreement and understanding of the parties relating to the
         subject matter contained herein and merges all prior discussions
         between them, and neither party shall be bound by any representation
         other than as expressly stated in this Agreement, or by a written
         amendment to this Agreement signed by authorized representatives of
         both parties.



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<PAGE>   6

                  8.5 Waiver. The failure of either party in any one or more
         instances to insist upon strict performance of any of the terms and
         conditions of this Agreement shall not be construed as a waiver or
         relinquishment, to any extent, of the right to assert or rely upon any
         such terms or conditions on any future occasion.

                  8.6 Disclaimer of Agency. This Agreement shall not constitute
         either party the legal representative or agent of the other, nor shall
         either party have the right or authority to assume, create, or incur
         any third-party liability or obligation of any kind, express or
         implied, against or in the name of or on behalf of the other party
         except as expressly set forth in this Agreement. The relationship of
         Odetics and ATL shall be solely that of contracting parties and no
         partnership, joint venture or other arrangement of any nature shall be
         deemed to be created hereby.

                  8.7 Severability. In the event any term of this Agreement is
         or becomes or is declared to be invalid or void by any court of
         competent jurisdiction, such term or terms shall be null and void and
         shall be deemed deleted from this Agreement, and all the remaining
         terms of the Agreement shall remain in full force and effect.

                  8.8 Governing Law. The validity, performance and construction
         of this Agreement shall be governed by the laws of California without
         regard to principles of conflicts of laws.

                  8.9 Assignment. Except as provided in Section 2, neither party
         shall delegate duties of performance or assign, in whole or in part,
         rights or obligations under this Agreement without the prior written
         consent of the other party, and any attempted delegation or assignment
         without such written consent shall be of no force or effect. Subject to
         the restrictions contained in the preceding sentence, this Agreement
         shall be binding upon the successors and assigns of both parties.

                  8.10 Amendment. This Agreement shall be amended as mutually
         agreed by Odetics and ATL in order to comply with any requirements
         imposed by the Internal Revenue Service in order to issue a ruling
         pursuant to Section 355 of the Internal Revenue Service Code of 1986,
         as amended.

         This Agreement is executed by the parties as of the date indicated 
above.

ATL PRODUCTS, INC.                             ODETICS, INC.

By:  /s/  Kevin C. Daly                        By:  /s/  Joel Slutzky
    -------------------------------                -----------------------------
     Kevin C. Daly, Ph.D.                            Joel Slutzky,
     Chief Executive Officer                         Chief Executive Officer



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                                   EXHIBIT A

                               ATL PRODUCTS, INC.
                ODETICS CORPORATE SERVICES TO BE PROVIDED TO ATL
                        FOR THE PERIOD 4/1/97 - 3/31/98

<TABLE>
<CAPTION>

                                ---------------------------------------------------------------------------------------------------
                                                         AMOUNT                                       ASSUMPTIONS
-----------------------------------------------------------------------------------------------------------------------------------
                                 QTR        QTR       QTR        QTR       FYE         QTR         QTR          QTR          QTR
-----------------------------------------------------------------------------------------------------------------------------------
                               Jun-97     Sep-97     Dec-97    Mar-98     Mar-98     Jun-97       Sep-97       Dec-97       Mar-98 
===================================================================================================================================
<S>                             <C>        <C>        <C>       <C>       <C>     <C>            <C>          <C>          <C>
                                                                                    40k sq ft   1.3k sq ft   1.3k sq ft  1.3k sq ft
RENT @ 1515 S Manchester        32,000      3,000      3,000     3,000    41,000       apr          mo           mo         mo
-----------------------------------------------------------------------------------------------------------------------------------
                                                                                    1.3 sq ft
                                                                                        mo      
-----------------------------------------------------------------------------------------------------------------------------------
Payroll preparation             16,600     16,600     16,600    16,600    66,400      .75MM        .75MM        .75MM       .75MM
-----------------------------------------------------------------------------------------------------------------------------------
All other accounting 
  support                       10,800     10,800     10,800    10,800    43,200      .25MM        .25MM        .25MM       .25MM
-----------------------------------------------------------------------------------------------------------------------------------
MIS Support
-----------------------------------------------------------------------------------------------------------------------------------
  MRP                            8,150      8,150      8,150     8,150    32,600      .25MM        .25MM        .25MM       .25MM
-----------------------------------------------------------------------------------------------------------------------------------
  Network security               8,150      8,150      8,150     8,150    32,600      .25MM        .25MM        .25MM       .25MM
-----------------------------------------------------------------------------------------------------------------------------------
  Alpha HW/SW 
    maintenance support         11,550     11,550     11,550    11,550    46,200        35%          35%          35%         35%
-----------------------------------------------------------------------------------------------------------------------------------
  Alpha lease payment            2,993      2,993      2,993     2,993    11,972        35%          35%          35%         35%
-----------------------------------------------------------------------------------------------------------------------------------
  Sun H/S Support                2,100      2,100      2,100     2,100     8,400        35%          35%          35%         35%
-----------------------------------------------------------------------------------------------------------------------------------
Phone Switch                         0          0          0         0         0        25%          25%            0           0
-----------------------------------------------------------------------------------------------------------------------------------
Facilities management            6,500      6,500          0         0    13,000      .25MM        .25MM            0           0
-----------------------------------------------------------------------------------------------------------------------------------
Associate Relations             30,000     30,000          0         0    60,000        1MM          1MM            0           0
-----------------------------------------------------------------------------------------------------------------------------------
Health/Insurance Benefits        7,700      7,700      7,700     7,700    30,800      .25MM        .25MM        .25MM       .25MM
-----------------------------------------------------------------------------------------------------------------------------------
CFO                              25,00     25,000          0         0    50,000       .5MM         .5MM            0           0
-----------------------------------------------------------------------------------------------------------------------------------
CEO Support                     22,250     22,250                         44,500      .25MM        .25MM            0           0
-----------------------------------------------------------------------------------------------------------------------------------
         TOTAL                 183,793    154,793     71,043    71,043   480,672
================================================================================
</TABLE>


<PAGE>   8
                              ATL PRODUCTS LIMITED
             OEL FACILITY COSTS AND SERVICES TO BE PROVIDED TO APL
                        FOR THE PERIOD 1/4/97 - 12/31/97

<TABLE>
<CAPTION>

                                --------------------------------------------------------------------------------------------------
                                                    AMOUNT                                  ASSUMPTIONS          
----------------------------------------------------------------------------------------------------------------------------------
                                QTR        QTR        QTR      QTR        FYE        QTR         QTR          QTR         QTR
----------------------------------------------------------------------------------------------------------------------------------
                               Jun-97     Sep-97     Dec-97   Mar-98     Mar-98     Jun-97      Sep-97       Dec-97      Mar-98
==================================================================================================================================
<S>                            <C>        <C>        <C>      <C>        <C>      <C>          <C>          <C>          <C>
RENT & RATES                   23,822     23,822     23,822    0         71,466   1.5k sq ft   1.5k sq ft   1.5k sq ft     N/A
----------------------------------------------------------------------------------------------------------------------------------
Utilities                       2,616      2,616      2,616    0          7,848   Water, Light, Heat, Cleaning             N/A
----------------------------------------------------------------------------------------------------------------------------------
Office equipment                2,450      2,450      2,450    0          7,350   fire, phone, copier, s/w, pc spt, etc    N/A
----------------------------------------------------------------------------------------------------------------------------------
Depreciation on Tls            11,550     11,550     11,550    0         34,650   Ref: Seymour memo 3/26/97                N/A
----------------------------------------------------------------------------------------------------------------------------------
Support
----------------------------------------------------------------------------------------------------------------------------------
  Warehousing                   2,549      2,549      2,549    0          7,647     1/3 MM        1/3 MM       1/3 MM      N/A
----------------------------------------------------------------------------------------------------------------------------------
  Accounting                    5,821      5,821      5,821    0         17,463     1/3 MM        1/2 MM       1/2 MM      N/A
----------------------------------------------------------------------------------------------------------------------------------
TOTAL                          48,808     48,808     48,808    0        146,424
===============================================================================
</TABLE>