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                                                                   Exhibit 10.13

                                 SEMICONDUCTOR
                              DEVELOPMENT AGREEMENT

                                    between

                        MULTILINK TECHNOLOGY CORPORATION

                                      and

                  INTERNATIONAL BUSINESS MACHINES CORPORATION

IBM/MTC CONFIDENTIAL

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                      SEMICONDUCTOR DEVELOPMENT AGREEMENT

     This Semiconductor Development Agreement ("Agreement") is entered into as
of May 18, 2000 (the "Effective Date") by and between International Business
Machines Corporation, a corporation incorporated under the laws of the State of
New York, having an office for the transaction of business at 1580 Route 52,
Hopewell Junction, NY ("IBM"), and Multilink Technology Corporation, a
corporation incorporated under the laws of California and having an office for
the transaction of business at 2850 Ocean Park Boulevard, Suite 335, Santa
Monica, CA 90405 ("MTC"). ("IBM" and "MTC" are hereinafter jointly referred to
as the "Parties" or individually as a "Party").

     Preamble: This Agreement is shall provide MTC with early Access (as defined
below) to one or more of IBM's unqualified and unfinished [*] and [*]
fabrication processes solely for early development of prototypes and does not
cover manufacture and sale of completed products.

     NOW, THEREFORE, in consideration of the premises and mutual covenants
herein contained, and for good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the Parties agree as follows:

1.   DEFINITIONS
     -----------

1.1  "Access" means the activities specified in Task 1 and Task 3B of Section
2.2 hereof.

1.2  "Affiliate" of a Party means a Person: (a) at least fifty percent (50%) of
whose outstanding shares or securities (representing the right to vote for the
election of directors or other managing authority) or (b) if the Person does not
have outstanding shares or securities, other ownership interest (representing
the right to make the decisions for such Person) are, now or hereafter, owned or
controlled, directly or indirectly, by such Party hereto, but such corporation,
company or other entity shall be deemed to be an Affiliate only so long as such
percentage of ownership or interest remains at least fifty percent (50%).

1.3  "Change of Control" means a change in ownership or control of a Person
effected through any of the following transactions:

     (i)  a merger, consolidation or reorganization approved by the Person's
     equity holder unless securities representing more than sixty percent (60%)
     of the total combined voting power of the voting securities of the
     successor entity are immediately thereafter beneficially owned, directly or
     indirectly and in substantially the same proportion, by the persons
     beneficially owned such Person's outstanding voting securities immediately
     prior to such transaction,

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                Exchange Commission. Asterisks denote omissions.

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     (ii)   any transfer or other disposition of all or substantially all of the
     Person's assets, or

     (iii)  the acquisition, directly or indirectly by any person or related
     group of persons (other than the Person that is the subject of a Change of
     Control or an Affiliate of such Person) or any Person currently owning,
     beneficially or of record, equity securities of such Person), of beneficial
     ownership (within the meaning of Rule 13d-3 of the Securities Exchange Act
     of 1934, as amended) of securities possessing more than forty percent (40%)
     of the total combined voting power of the Person's outstanding securities.

1.4  "Confidential Information" means IBM Confidential Information, MTC
Confidential Information, or both if the context so indicates.

1.5  "Design Review" shall mean a meeting between IBM and MTC, either at an IBM
facility or a MTC facility, or via telecon, lasting for up to two (2) days, to
be attended by up to four (4) IBM Employees, who will review MTC's Prototype
designs with MTC Employees to help MTC conform its Prototype designs to the
applicable IBM Fabrication Process.

1.6  "Disclosing Party" means either Party hereunder that discloses its
Confidential Information to the other Party.

1.7  "Fabrication Process" for a particular RIT hereunder shall mean IBM's
unqualified (as of the Effective Date) [*] IC fabrication process, or IBM's
unqualified (as of the Effective Date) [*] IC fabrication process, or the next
follow-on to IBM's [*] IC fabrication process, or IBM's unqualified (as of the
Effective Date) [*] IC and [*] IC fabrication process, if and when they become
available during the term of this Agreement.

1.8  "IBM Confidential Information" means any and all information and items
disclosed or delivered by IBM to MTC hereunder, that is identified by IBM as
confidential, whether written, oral or both, in whatever form disclosed or
delivered, whether tangible or intangible (including software). With respect to
the IBM Confidential Information referenced in the preceding sentence, IBM
agrees (i) to coordinate and control the disclosure thereof with MTC's Technical
Coordinator, (ii) if such IBM Confidential Information is disclosed in tangible
form, IBM will stamp or otherwise clearly mark such information as IBM
Confidential Information, and (iii) if such Confidential Information is
disclosed orally, IBM agrees to identity the Confidential Information as
confidential at the time of disclosure, and provide to MTC written confirmation
thereof within thirty (30) days after such disclosure. Notwithstanding the
foregoing, the term "IBM Confidential Information" shall also include the
following information and items disclosed hereunder, whether or not identified
by IBM as confidential, whether written, oral or both, in whatever form
disclosed or delivered, whether tangible or intangible (including software): all
product or circuit designs (including schematics, GDS II data, net lists, VHDL
code, RTL code, block diagrams and simulation techniques), deliverables,
manufacturing processes and techniques, and product plans.

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               Exchange Commission. Asterisks denote omissions.

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1.9  "IBM Deliverable Items" shall mean those items prepared by IBM as a part of
the scope of work performed pursuant to a Task, and which items are defined with
respect thereto.

1.10 "Integrated Circuit" or "IC" means an integral unit including a plurality
of active and passive circuit elements formed at least in part of semiconductor
material arranged on or in a single chip.

1.11 "Invention" means any idea, design, concept, technique, invention,
discovery or improvement, whether or not patentable, made solely or jointly by
one or more Representatives of either IBM or MTC, provided that either the
conception or reduction to practice occurs in the performance of work hereunder
and during the term of this Agreement.

1.12 "Joint invention" means any idea, design, concept, technique, invention,
discovery or improvement, whether or not patentable, made jointly by one or more
Employees of IBM with one or more Representatives of MTC, provided that either
the conception or reduction to practice occurs in the performance of work
hereunder.

1.13 "Person" shall mean any individual, corporation, partnership, joint
venture, trust, limited liability company, business association, governmental
entity or other entity.

1.14 "Product" shall mean the completed ("production-ready") version of any IC
manufactured in a qualified IBM fabrication process having three (3) levels of
metal, wire bond pads, and non-military, non-medical and non-nuclear uses,
designed by MTC as part of the scope of the work performed pursuant to Task 3.
"Product" may also include the additional and/or different features listed in
Attachment B. "Product" does not include Prototypes.

1.15 "Prototype" shall mean a preliminary version of a Product under development
by MTC, fabricated by IBM using the Fabrication Process, which may or may not be
functional.

1.16 "Mask" shall mean a glass reticle containing a series of related images
having or representing the predetermined pattern of metallic, insulating or
semiconductor material present in or removed from a Prototype, and in which
series the relation of the images to one another is that each image has the
pattern of the surface of one form of the Prototype.

1.17 "Mask Set" shall mean a complete set of Masks necessary to manufacture a
Prototype in the Fabrication Process.

1.18 "MTC Confidential Information" means any and all information and items
disclosed or delivered by MTC to IBM hereunder, that is identified by MTC as
confidential, whether written, oral or both, in whatever form disclosed or
delivered, whether tangible or intangible (including software). With respect to
the MTC Confidential Information referenced in the preceding sentence, MTC
agrees (i) to coordinate and control the disclosure thereof with IBM's Technical
Coordinator, (ii), such MTC Confidential Information is disclosed in tangible
form, MTC will stamp or otherwise clearly mark such information as MTC
Confidential Information, and (iii) if such Confidential

IBM/MTC CONFIDENTIAL

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Information is disclosed orally, MTC agrees to identity the Confidential
Information as confidential at the time of disclosure, and provide to IBM
written confirmation thereof within thirty (30) days after such disclosure.
Notwithstanding the foregoing, the term "MTC Confidential Information" shall
also include the following information and items disclosed hereunder, whether or
not identified by MTC as confidential, whether written, oral or both, in
whatever form disclosed or delivered, whether tangible or intangible (including
software): all product or circuit designs (including schematics, GDS II data,
net lists, VHDL code, RTL code, block diagrams and simulation techniques),
deliverables, manufacturing processes and techniques and product plans, cost
data relating to a Joint Project.

1.19 "MTC Deliverable items" shall mean those items prepared by MTC as part of
the scope of work performed pursuant to a Task, and which items are defined with
respect thereto.

1.20 "Multi-Project Wafer (MPW) Run" shall refer to a RIT which allows for
design verification, circuit evaluation and testing by multiple customer designs
on the same Wafer in IBM's Fabrication Process. Each Wafer from a MPW Run
consists of multiple Sandbox sites and MTC shall be provided one (1) such
Sandbox site. All Prototypes on each Wafer from a MPW Run shall include up to
five (5) levels of metal and wire bond pads. However, the number of levels of
metal associated with each MPW Run will be defined solely and exclusively by IBM
prior to that run.

1.21 "Person" shall mean any individual, corporation, partnership, joint
venture, trust, limited liability company, business association, governmental
entity or other entity.

1.22 "Receiving Party" means either Party hereunder that receives the other
Party's Confidential Information.

1.23 "Representative" means, with respect to a Party, that Party's agents,
representatives and employees (including attorneys, accountants, consultants,
contract employees and advisors).

1.24 "Sandbox" shall refer to a circuit evaluation site on an Wafer from a MPW
Run that can accept single or multiple experimental customer designs with very
minimal release support from IBM.

1.25 "RIT" shall mean a procedure in which: (1) MTC provides IBM error-free GDS2
formatted data representing a Prototype design; (2) IBM fabricates, or has
fabricated, a Mask Set corresponding to the error-free GDS2 formatted data; (3)
IBM schedules a corresponding set of [*] Wafer Starts; and (4) IBM processes
Wafers as described in Task 3 of Section 2.2.

1.26 "Task" shall mean a development activity defined in Section 2.2.

1.27 "Wafer" shall mean an eight inch (8") wafer as required for the Fabrication
Process.

1.28 "Wafer Start" shall mean the release of one (1) Wafer to the Fabrication
Process for processing.

IBM/MTC CONFIDENTIAL

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               Exchange Commission. Asterisks denote omissions.

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1.29 "$" shall mean United States dollars.

2.   STATEMENT OF WORK
     -----------------

2.1  Objectives
     ----------

     This Agreement relates only to development activities for Prototypes to be
     manufactured in the Fabrication Process.

2.2  Development Activities (Tasks)
     ------------------------------

     The development program to be conducted by IBM and MTC under this Agreement
     will be conducted by executing the following Tasks. In the case of MTC, all
     work performed in connection with these Tasks shall be performed solely and
     exclusively by Representatives of MTC. In the case of IBM, all work
     performed in connection with these Tasks shall be performed solely and
     exclusively by Representative of IBM. The description of Tasks below
     includes work items and prime responsibility therefor. Although prime
     responsibility is assigned to one Party, the other Party will participate
     and use commercially reasonable efforts to cooperate fully in any
     particular work item as required by the relevant Task.

Task 1:   IBM shall provide MTC with models and design kits created by IBM for
          use in conjunction with the Fabrication Process, but only for the
          purposes of evaluating the technology, assessing future product
          development by MTC and developing and designing Prototypes to be
          manufactured solely by IBM if MTC elects to have such Prototypes
          manufactured. Such models and design kits are hereby licensed to MTC
          under the terms of the IBM Design Kit License attached hereto as
          Exhibit A. IBM may modify or alter the models and design kits and/or
          the Fabrication Process. IBM will promptly notify MTC of any such
          modifications or alterations to the design kits. Modifications or
          alterations to IBM's Fabrication Process may cause the corresponding
          Prototype designs to be unuseable for the manufacture of Products.

Task 2A:  MTC shall use the models and design kits provided by IBM solely to
          evaluate the technology, assess future product development by MTC and
          develop Prototype designs adapted to the Fabrication Process and
          Prototypes to be manufactured solely by IBM if MTC elects to have such
          Prototypes manufactured. MTC shall use commercially reasonable efforts
          to develop designs which take advantage of the unique attributes of
          the Fabrication Process in order to maximize performance and
          manufacturing yield and to minimize manufacturing cost.

Task 2B:  IBM shall provide MTC with up to a cumulative total of   [*]   RITs,
          [*]  per contract year, subject to the payment provisions in sections
          3.2 and attachment B. In addition, MTC, at its sole option, can
          substitute a RIT for a MPW Run, subject to availability from IBM. As
          part of the Prototype design(s) developed, MTC shall perform all

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               Exchange Commission. Asterisks denote omissions.

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         needed circuit design and modeling functions to produce GDS2 formatted
         data containing such circuits to be fabricated in the Fabrication
         Process. Fabrication of Prototypes having the additional and/or
         different features listed in Attachment B shall be subject to the
         additional payments listed therein. The Parties shall hold a Design
         Review in connection with each RIT. These Design Reviews will address
         electrical and physical design issues and release procedures.

         In connection with each RIT, IBM will accept from MTC's Technical
         Coordinator (as identified in Section 6.2) a GDS2 formatted data set
         produced by MTC during the term of this Agreement. IBM will perform
         additional ground rule checking and may provide consultation to MTC as
         to where optimization for the Fabrication Process may be possible.
         Should changes to any such GDS2 formatted data be required to correct
         ground rule errors or to optimize the Fabrication Process (pattern
         density, for example), MTC will make these changes and resubmit the
         GDS2 formatted data set. Under no circumstances will IBM make any
         (intentional) changes to any GDS2 formatted data set submitted by MTC.

         Should MTC request IBM to fabricate a Mask Set corresponding to any of
         the GDS2 formatted data sets, IBM will forward all corresponding,
         required data and supporting documentation to an internal or third
         party, where a Mask Set, will be created. Should changes to any GDS2
         formatted data set submitted by MTC be required to conform to Mask
         fabrication rules, MTC will make these changes and resubmit the GDS2
         formatted data set. Under no circumstances will IBM make any
         (intentional) changes to any GDS2 formatted data set submitted by MTC.

         Upon completion of the fabrication of each Mask Set for Prototype
         design(s) by or on behalf of IBM, IBM will schedule [*] Wafer Starts.
         IBM will use commercially reasonable efforts to complete their
         manufacture. Upon request by MTC for each RIT (and not for any MPW
         Run), just prior to the passivation and metallization steps associated
         with each such set of [*] Wafer Starts, IBM will hold up to [*] Wafers
         and complete the processing of the rest. At the request of MTC, IBM
         will then (a) scrap the held Wafers; or (b) process the held Wafers in
         the same manner as those previously processed; or (c) MTC will submit
         new GDS2 formatted data set for the wiring layers, IBM will create or
         have created a corresponding Mask Set (subject to the payments
         discussed immediately hereafter), and IBM will then process the held
         Wafers using this Mask Set. In step (c), if MTC so requests, IBM will
         modify wiring masks (not transistor masks) in any Mask Set, subject to
         a payment for the modified masks plus a one-time engineering payment
         for the corresponding RIT as referenced in Attachment B.

          Upon Wafer run completion, IBM shall initially test certain test
          structures on processed Wafers and shall thereafter deliver Prototypes
          to MTC in Wafer form or diced if requested by MTC in addition to a
          copy of data from the test structures which IBM, in

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               Exchange Commission. Asterisks denote omissions.

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          its sole discretion, deems appropriate to disclose to MTC. MTC shall
          perform all Prototype test and characterization measurements specific
          to MTC's unique circuit designs.

Task 3:   IBM and MTC shall each provide a Technical Coordinator to coordinate
          development activities under this Agreement. The responsibilities of
          these Technical Coordinators are listed in Section 6.1 and their
          identities are given in Section 6.2.

Task 4:   MTC and IBM will meet to assess MTC's technology requirements relative
          to the Fabrication Process for the purpose of discussing future plans
          and providing inputs to the technology development plan. The further
          purpose of these meetings is to provide feedback on the technology and
          to exchange technical ideas for the development of the technology. Any
          MTC Confidential Information received under this Task 4 (i) may be
          used by IBM in the Fabrication Process; including future versions
          thereof, for any purpose, (ii) may be disclosed by IBM to licensees of
          the Fabrication Process, including future versions thereof and (iii)
          shall include the unrestricted, royalty-free right of IBM to grant
          licenses thereunder to licensees of the Fabrication Process, including
          future versions thereof.

2.3    Uncertainty of Results
       ----------------------

       Although IBM and MTC will use reasonable efforts in performing the
       development activities under this Agreement, each Party acknowledges that
       the results of the work to be performed hereunder are uncertain and
       cannot be guaranteed by either Party. The Parties also acknowledge that
       any key milestones and other checkpoint dates made in connection with
       such work are target dates only and failure to achieve any such target
       dates shall not constitute a breach of this Agreement.

2.4    Shipment and Use of Prototypes
       ------------------------------

2.4.1  IBM shall ship all items to be delivered to MTC under this Agreement FOB
       plant of manufacture.

2.4.2  MTC agrees to use all Wafers delivered by IBM to MTC under this Agreement
       for internal testing, evaluation and demonstration purposes only. MTC may
       deliver Prototypes derived from such Wafers to MTC's customers at MTC's
       discretion for testing, evaluation and demonstration purposes only,
       provided that: (i) MTC notifies such customers in writing that the
       Prototypes are preliminary versions of a Product and are intended for
       internal testing, evaluation and demonstration purposes only.

2.5    Progress Reviews
       ----------------

IBM/MTC CONFIDENTIAL

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     Reviews of the activities in this Section 2 will be held quarterly and will
     be scheduled by the Technical Coordinators set forth in Section 6.2.

2.6  MTC agrees that no Prototypes delivered to IBM hereunder shall be work
     product jointly created by IBM and MTC.

3.   PAYMENT
     -------

3.1  Compensation
     ------------

     In consideration for IBM's development efforts and for Access to the
     Fabrication Process as described in Section 2, MTC agrees to perform its
     development efforts described in Section 2, and to make the payments set
     forth in Section 3.2 below.

     In addition, in consideration of IBM entering into this Agreement with MTC,
     concurrently upon the execution of this Agreement by the Parties, MTC shall
     issue to IBM a warrant in the form of Attachment C attached hereto and made
     a part hereof by this reference (the "Warrant"). The Warrant shall be
     exercisable upon the terms and subject to the conditions set forth therein,
     including, but not limited to, payment of the exercise price set
     forththerein for the shares of capital stock issuable thereunder; provided,
     that the Warrant shall not under any circumstances be subject to forfeit by
     IBM prior to its exercise or expiration accordance with its terms.

3.2  Schedule of Payments
     --------------------

     For each RIT or MPW Run MTC requests, MTC shall pay the fees listed in
     Attachment B.

3.3  Method of Payment
     -----------------

     For the payments listed in Section 3.2, MTC shall submit a corresponding
     purchase order to IBM, identifying the RIT and option requested. Any such
     purchase order shall be subject to IBM's acceptance, which shall not be
     unreasonably withheld. If IBM accepts any such purchase order, then IBM
     shall submit a corresponding invoice to MTC, which MTC shall pay within
     sixty (60) days of receipt. All payments shall be made by electronic funds
     transfer in United States dollars, to the following bank wire address.
     Payments shall be made free all banking charges.

                    IBM, Director of Licensing
                    The Bank of New York
                    1 Wall Street
                    New York, New York 10286
                    United States of America

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                    Credit Account No. [*]
                    ABA No. [*]

     The following information should be included in the wire detail:

          IBM/MULTILINK SEMICONDUCTOR DEVELOPMENT AGREEMENT
          Reason for Payment: MULT1LINK Development Services

3.4  Delinquencies
     -------------

     If MTC's account becomes in arrears IBM, in addition to its right to hold
     MTC in default under the terms of Section 11.1 of this Agreement, may
     notify MTC in writing of such arrears and MTC will cure the condition
     within thirty (30) days. If not cured within such period, IBM reserves the
     right to stop shipment to MTC until MTC's account is again current, or to
     terminate this Agreement pursuant to Section 11.1

3.5  Taxes
     -----

     Each Party shall bear and pay any and all taxes imposed on such Party by
     any jurisdiction in which such Party is operating.

4.   TERM
     ----

     This Agreement shall commence on the Effective Date and will continue for
     [*]  years thereafter, unless earlier terminated pursuant to Section 11.

5.   NOTICES
     -------

5.1  Any notice or other communication required or permitted to be made or given
to either Party hereto pursuant to this Agreement shall be sent to such Party by
facsimile (with written mailed confirmation), or by certified or registered
mail, postage prepaid, addressed to the person named below and shall be deemed
to have been made, given or provided on the date of facsimile transmission or
mailing.

     IBM: Steve Woodham
          IBM Microelectronics Division
          1000 River Street
          Department W0MA 29
          Essex Junction, VT 05452
          Tel: (802) 769- [*]
          Fax: (802) 769- [*]
          E-mail:         [*]
          With a copy to:

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              IBM Corporation
              Drop 92B
              1580 Route 52
              Hopewell Junction, NY 10533
              Fax:  (914)-892-[*]
              Attention:  Division Counsel, Microelectronics Division

     MTC:  MultiLink Technology Corporation
           300 Atrium Drive
           Somerset, NJ 08873
           Fax: (732) 805-[*]
           Attention:  President

          With a copy to:

              Allen Matkins Leck Gamble & Mallory LLP
              1999 Avenue of the Stars, Suite 1800
              Los Angeles, CA 90067
              Fax: (310) 788-2410
              Attention: Mark J. Kelson

5.2   A Party hereto may change its address for the purposes of this Section 5
by giving ten (10) days prior written notice of such change of address to the
other Party.

6.    TECHNICAL COORDINATORS
      ----------------------

6.1   Responsibilities
      ----------------

      Work done under this Agreement, including day-to-day activities, shall be
      under the general direction of the Technical Coordinators who shall be
      responsible for:

6.1.1 in the case of MTC's Technical Coordinator, providing monthly forecasts of
      RITs to be requested of IBM;

6.1.2 overseeing work pursuant to the statement of work as set forth in Section
      2, including objectives, technical specifications, delivery and receipt of
      all IBM and MTC Deliverable Items, performance of responsibilities,
      milestones, Tasks, development schedules, and acceptance dates and
      criteria; and in the case of the Technical Coordinator for MTC, the
      collection of design data from MTC, verifying its adherence to all IBM
      design rules delivered to MTC by IBM;

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6.1.3  identifying new IBM and MTC technical goals related to the Tasks,
       prioritizing such goals and approving desired changes to the statement of
       work;

6.1.4  approving any change to work, including extensions of time which do not
       affect payment due under Section 3.2 or the term of this Agreement;

6.1.5  establishing the initiation date of a Task and advising the other Party's
       Technical Coordinator in writing of the completion of a Task;

6.1.6  communicating, for each item delivered by one Party to the other Party,
       whether such item meets any applicable acceptance criteria;

6.1.7  reviewing current progress reports;

6.1.8  coordinating Wafer shipments from IBM to MTC pursuant to Section 2.3;

6.1.9  communicating together on a regular basis to satisfy their obligations
       hereunder and preparing minutes of each meeting; such meetings shall be
       subject to mutual agreement in terms of frequency, location,
       participants, etc., and each Party shall bear its related costs; and

6.1.10 managing the proper exchange of Information pursuant to Section 8.4.

All the above-listed actions or decisions shall be duly recorded in a document
by each Technical Coordinator. If the Technical Coordinators are unable to reach
a unanimous decision on any of the above-listed matters, they will promptly
refer such matter to the following contact executives:

     For IBM:                                    For MTC
      Ms. Chris King                                 Dr. Richard Nottenburg
      Vice President, Wired Communications           President
      Drop 92X                                       300  Atrium Drive
      1580 Route 52                                  Somerset, NJ 08873
      Hopewell Junction, NY 12533                    Phone (732)-537-3700
      Phone 914-892- [*]                             Fax: (732) 805- [*]
      Fax:(914)892-  [*]

6.2  Technical Coordinators
     ----------------------

     The Technical Coordinators for the Parties are:

          For IBM:                   For  MTC:

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           Exchange Commission. Asterisks denote omissions.

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       Jack Taylor                           Bill Reinisch
       IBM Microelectronics Division         300 Atrium Drive
       1000 River Street                     Somerset, NJ 08873
       Department WZ4A 29                    Phone: (732) 537-[*]
       Essex Junction, VT 05452              Fax: (732) 537- [*]
       Tel: (802) 769- [*]                      E-mail: [*]
       Fax: (802) 769- [*]
       E-mail: [*]

Each Party may change its Technical Coordinator at any time and from time to
time during the term of this Agreement by notifying the Technical Coordinator
for the other Party in writing at the designated address. Such change is
effective upon receipt of the notice of change.

7.     TRADEMARK
       ---------

Nothing in this Agreement grants either Party any rights to use any trademark(s)
or trade name(s), directly or indirectly, of the other Party in connection with
any product, service, promotion or publication without prior written approval of
the trademark owner.

8.     INTELLECTUAL PROPERTY RIGHTS AND CONFIDENTIALITY
       ------------------------------------------------

8.1    Copyrights, Mask Works Rights and Prototype or Product Designs
       --------------------------------------------------------------

8.1.1  MTC shall own all copyrights and Mask work rights associated with, and
       all circuitry and all Prototype design information generated by MTC in
       connection with, its performance of Tasks and with Prototypes, their
       design, development or manufacture, including but not limited to the MTC
       Deliverable Items subject to IBM's rights as specified in Section 8.2.2
       of this Agreement.

8.1.2  IBM or its licensors shall own all copyrights associated with, and all
       circuitry design components furnished to MTC by IBM in connection with,
       its performance of Tasks and with Prototypes, their design, development
       or manufacture, including, but not limited to: (i) the IBM Deliverable
       Items; (ii) all base array layers; (iii) all IBM-furnished library
       elements (including without limitation, any megafunctions or macrocells);
       and (iv) all IBM-furnished modifications of any such library elements.
       IBM shall have custody of any Masks provided by MTC and any Masks made by
       or on behalf of IBM using tangible netlist tape(s), and tangible GDS2
       tape(s) received from MTC hereunder, but shall use such tapes and any
       Masks made therefrom only to manufacture for the benefit of MTC. IBM
       shall own all copyrights associated with the

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       Fabrication Process, including the IBM Deliverable Items developed by or
       on behalf of IBM and delivered to MTC under this Agreement.

8.2    Invention Rights
       ----------------

8.2.1  Representatives of IBM or MTC performing Tasks under this Agreement who
       make an Invention, whether solely or jointly with others, agree to make
       and shall promptly make a complete written disclosure to their employer
       for patent review of such Invention, in the normal course, specifically
       pointing out those features or concepts believed to be new or different.

       Each Party agrees to promptly submit to the other Party copies, marked as
       IBM Confidential Information or MTC Confidential Information, as the case
       may be, of any written disclosures pertaining to Joint Inventions
       submitted exclusively to it, which submissions shall be subject to the
       provisions of Section 8.3 of this Agreement. Also, MTC shall promptly
       submit to IBM copies of all written disclosures submitted exclusively to
       MTC relating to the Fabrication Process.

8.2.2  Each Invention, other than a Joint Invention, shall be the property of
       the Party whose Representatives made the Invention.

8.2.3  Joint Inventions shall be jointly owned, title to all patents issued
       thereon shall be joint, all expenses incurred in obtaining and
       maintaining such patents, except as provided hereinafter, shall be shared
       equally and each Party shall have the unrestricted right to license third
       parties thereunder without accounting to the other Party. In the event
       that one Party elects not to see patent protection for any Joint
       Invention in any particular country or not to share equally in the
       expense thereof with the other Party, the other Party shall have the
       right to seek or maintain such protection at its own expense in such
       country and shall have full control over the prosecution and maintenance
       thereof even though title to any patent issuing therefrom shall be joint.

8.2.4  Each Party shall give the other Party all reasonable assistance in
       obtaining patent protection and in preparing and prosecuting any patent
       application filed by the other Party, and shall cause to be executed
       assignments and all other instruments and documents as the other Party
       may consider necessary or appropriate to carry out the intent of this
       Section 8.2.

8.2.5     All MTC Inventions relating to the Fabrication Process shall be owned
       by MTC, subject to a worldwide, irrevocable, perpetual, nonexclusive,
       nontransferable, fully paid-up and royalty-free license which MTC hereby
       grants to IBM under all such Inventions. This license includes the
       right of IBM to make, have made, use, have used, lease, import, offer to
       sell, sell and/or otherwise transfer, any apparatus, and to practice and
       have practiced any method. This license further includes the right of IBM
       to sublicense third parties to do any or all of the foregoing. MTC agrees
       that for a period of [*] years from the Effective Date of this Agreement,
       MTC shall treat such MTC Inventions relating to the Fabrication process
       as

IBM/MTC CONFIDENTIAL

    Confidential materials omitted and filed separately with the Securities
             and Exchange Commission. Asterisks denote omissions.

Page 14
<PAGE>

       Confidential Information and shall not license such MTC Inventions
       relating to the Fabrication Process to any other entity.

8.2.6  No license, immunity or other right is granted herein to either Party,
       whether directly or by implication, estoppel or otherwise, with respect
       to any other patent, trademark, copyright, mask work, trade secret or
       other intellectual property right of the other Party,

8.3    Confidential Information:
       -------------------------

       8.3.1 For a period of seven (7) years from the date of disclosure of
       Confidential Information, the Receiving Party agrees to use the same
       degree of care and discretion to keep the Disclosing Party's Confidential
       Information confidential as it uses with its own similar information that
       it wishes to keep confidential. The Confidential Information received by
       a Receiving Party shall not be used for any purpose other than in
       connection with exercising the rights and licenses granted to it under
       this Agreement, subject to the obligation of confidentiality and subject
       to the terms and conditions of the licenses granted herein. Each Party
       agrees to inform its Representatives of the confidential nature of the
       other Party's Confidential Information, and each of such Representatives
       shall agree in writing to act in accordance with the terms and provisions
       of this Article 6. Each Receiving Party shall be responsible for any
       breach of this Agreement by any of its Representatives.

       8.3.1.1 Either Receiving Party may use the "Residuals" of the Disclosing
       Party's Confidential Information for any purpose, royalty-free, subject
       to the obligation of confidentiality. "Residuals" means the ideas,
       concepts, know-how and techniques, related to the Receiving Party's
       business activities, which are contained in the Disclosing Party's
       Confidential Information and retained in the unaided memories of the
       Receiving Party's employees who have had rightful access to the
       Disclosing Party's Confidential Information pursuant to this Agreement.

       8.3.2 The Receiving Party may disclose the Confidential Information of
       the Disclosing Party only to: the Receiving Party's Representatives on a
       need-to-know basis, subject to the requirements of Section 8.3.

       8.3.3 Notwithstanding any other provisions of this Agreement, the
       nondisclosure and use obligations specified herein shall not apply to any
       Confidential Information which:

       8.3.3.1 is already lawfully in the possession of the Receiving Party
       prior to being furnished the Receiving Party by the Disclosing Party,
       provided that the source of such information was not and does not become
       known, prior to disclosure, by the Receiving Party to be prohibited from
       disclosing the information to the Receiving Party by legal, contract or
       fiduciary obligation to the Disclosing Party;

IBM/MTC CONFIDENTIAL

Page 15
<PAGE>

     8.3.3.2 is independently developed by employees (without use of
     Confidential Information) of the Receiving Party or any of its
     Subsidiaries;

     8.3.3.2 becomes generally publicly available without breach of this
     Agreement;

     8.3.3.3 is rightfully received by the Receiving Party on a nonconfidential
     basis from a third party that is not known by the Receiving Party to be
     prohibited from disclosing the information to the Receiving Party by legal,
     contract or fiduciary obligation to the Disclosing Party;

     8.3.3.4 is released for disclosure by the Disclosing Party with its written
     consent; or

     8.3.3.6 is inherently and appropriately disclosed in the use, lease,
     marketing, sale, or other distribution of Prototypes, or Products, as the
     case may be and publicly available supporting documentation therefor by or
     for the Receiving Party or any of its Affiliates.

     8.3.4 Disclosure of Confidential Information shall not be precluded if such
     disclosure is:

     8.3.4.1 in response to a valid order of a court or other governmental body;
     provided, however, that the Receiving Party shall first promptly provide
     the Disclosing Party prompt notice of the order and provide the Disclosing
     Party the opportunity to make a commercially reasonable effort to obtain a
     protective order or other appropriate remedy; provided that if such
     protective order is not obtained, or if the Disclosing Party waives
     compliance with the provisions of this Section 8.3.4.1 in writing, the
     Receiving Party will furnish only that part of the Confidential Information
     that the Receiving Party is legally required to be so disclosed and the
     Receiving Party shall exercise its best commercially reasonable efforts to
     obtain reasonable assurance that confidential treatment will be accorded to
     the Confidential Information so disclosed; or

     8.3.4.2 otherwise required by law (prior to such disclosure, however, the
     Receiving Party will provide written notification to the Disclosing Party,
     signed by an executive of the Receiving Party, stating that the Receiving
     Party believes in good faith that the disclosure is required by law); or

     8.3.4.3 necessary to establish the Receiving Party's rights under this
     Agreement.

     8.3.4.5 If any Confidential Information falls under an exception set forth
     in Sections 8.3.4.1 through 8.3.4.6 the Receiving Party shall not disclose
     that the Disclosing Party hereto was the source of that Confidential
     Information.

     8.3.4.6 All Confidential Information not reasonably necessary or useful for
     the Receiving Party to exercise the rights and licenses granted in this
     Agreement shall be returned to the Disclosing Party or destroyed by the
     Receiving Party upon termination of this Agreement. Any

IBM/MTC CONFIDENTIAL

Page 16
<PAGE>

     oral Confidential Information shall continue to be kept confidential and
     subject to the terms of this Agreement.

9.   LIMITATION OF LIABILITY
     -----------------------

9.1  In no event shall either Party be liable to the other Party for incidental
damages, lost profits, lost savings or any other consequential damages,
regardless of whether the claim is for breach of contract, warranty, tort
(including negligence), failure of a remedy to accomplish its purpose or
otherwise, even if such Party has been advised of the possibility of such
damages.

9.2  In no event shall either Party be liable to the other Party for actual
damages resulting from any claim relating to this Agreement in excess of $ [*]
regardless of the form of action, provided that this limitation will not apply
to claims for bodily injury or damage to real property or tangible personal
property for which the Party is legally liable.

9.3  Neither Party will be liable for any damages claimed by the other Party
based on any third party claim.

10.  WARRANTIES
     ----------

10.1 Subject to Section 2.2, any item, including any products, services,
information or technology furnished by one Party to the other Party, and any
Wafers furnished by IBM to MTC, pursuant to this Agreement, are furnished on an
"AS IS" basis without warranty of any kind

10.2 Neither Party warrants that any products, services or deliverable items
provided to the other Party under this Agreement is free of infringement of
third-party intellectual property rights.

10.3 THE FOREGOING WARRANTIES ARE LIMITED AND ARE IN LIEU OF ALL OTHER
WARRANTIES EXPRESS OR IMPLIED, INCLUDING THE IMPLIED WARRANTY OF MERCHANTABILITY
OR FITNESS OR USEFULNESS FOR A PARTICULAR PURPOSE.

11.  TERMINATION
     -----------

11.1 Material Breach, Either Party Either Party may terminate this Agreement
     -----------------------------
for material breach of this Agreement by the other, provided that the Party in
breach is given written notice of and fails to cure such breach within thirty
(30) days, or in the event:

     11.1.1 the other Party files a petition in bankruptcy, undergoes a
     reorganization pursuant to a petition in bankruptcy, is adjudicated a
     bankrupt, becomes insolvent, becomes dissolved or liquidated, files a
     petition for dissolution or liquidation, makes an assignment for the
     benefit of creditors, or has a receiver appointed for its business.

IBM/MTC CONFIDENTIAL

   Confidential materials omitted and filed separately with the Securities and
               Exchange Commission. Asterisks denote omissions.

Page 17
<PAGE>

11.2 Material Breach, IBM If IBM materially breaches this Agreement and the
     --------------------
Agreement is terminated by MTC pursuant to Section 11.1, then MTC's payment
obligations pursuant to Section 3 due after the effective date of said
termination shall cease.

11.3 Material Breach, MTC If MTC materially breaches this Agreement and the
     --------------------
Agreement is terminated by IBM pursuant to Section 11.1, MTC shall make all
payments due or past due and payments associated with any work in progress, and
IBM shall be entitled to retain all payments made by MTC.

11.4 IBM shall have the right to immediately terminate this Agreement by giving
     written notice of termination to MTC if MTC undergoes a Change of Control
     and MTC shall have the right to immediately terminate this Agreement by
     giving written notice of termination to IBM if the IBM Microelectronics
     Division undergoes a Change of Control.

11.5 Effect of Expiration or Termination Upon the earlier of MTC's written
     -----------------------------------
request or within a reasonable period of time (as solely determined by IBM)
after expiration or termination of this Agreement, IBM will destroy all Masks
fabricated by or on behalf of IBM, or provided by MTC to IBM, under this
Agreement. Notwithstanding the above, if, MTC has not requested IBM to destroy
the masks, and, in IBM's judgement there is a reasonable likelihood that any
such Masks might be used by IBM to manufacture Product for MTC under a separate
contract, to be negotiated between the Parties, then IBM may retain such Masks
for such use and may then destroy such Masks within a reasonable period of time
after expiration or termination of said separate contract.

Unless otherwise agreed to by the Technical Coordinators of Record, IBM will
stop all work in process for MTC upon expiration or termination of this
Agreement and deliver the same to MTC "AS IS".

12.  MISCELLANEOUS
     -------------

12.1 Nothing contained in this Agreement shall be construed as conferring any
right to use in advertising, publicity or other promotional activities any name,
trade name, trademark or other designation of any Party hereto (including any
contraction, abbreviation or simulation of any of the foregoing); and each Party
hereto agrees not to disclose to other than its Affiliates the existence of or
the terms and conditions of this Agreement, except as required by law or
government rule or regulation, without the express written consent of the other
Party except as may be required by law or government rule or regulation, or to
establish its rights under this Agreement; provided, however that if one Party
is seeking to disclose such information for reasons not requiring written
consent, then the Disclosing Party shall limit the disclosure to the extent
required, shall allow the other Party, to review the information to be disclosed
prior to such disclosure, and shall apply, where available, for confidentiality,
protective orders, and the like. Such review under this Section shall not be
construed to make the reviewing Party responsible for the contents of the
disclosure, and the Disclosing Party shall remain solely responsible for such
contents.

IBM/MTC CONFIDENTIAL

Page 18
<PAGE>

12.2 Nothing contained in this Agreement shall be construed as conferring on any
Party any license or other right to copy the exterior design of any product of
the other Party.

12.3 No license or immunity is granted by this Agreement by either Party to the
other Party, either directly or by implication, estoppel, or otherwise, under
any patent or other intellectual property right now owned or hereafter obtained,
except as expressly provided herein.

12.4 Neither this Agreement nor any activities hereunder will impair any right
of IBM or MTC to design, develop, manufacture, market, service or otherwise deal
in, directly or indirectly, any products or services. Each Party may pursue
activities independently with any third party even if similar to the activities
under this Agreement.

12.5 Each Party is an independent contractor and is not an agent of the other
Party for any purpose whatsoever. Neither Party will make any warranties or
representations on the other Party's behalf, and it will not assume or create
any obligation on the other Party's behalf.

12.6 IBM may, upon written notice to MTC, assign its rights or obligations to a
third party without the prior written consent of MTC only in connection with a
merger or a sale of all or substantially all of the assets of IBM relating to
the subject matter of this Agreement. In all other instances, neither Party
shall assign its rights or delegate or subcontract its obligations under this
Agreement without prior written permission from the other Party and any attempt
to do so without such permission shall be null and void.

12.7 Each Party will comply with all applicable federal, state and local laws,
regulations and ordinances of the U.S. Government including, but not limited to,
the regulations of the U.S. Government authorities relating to the export of
commodities and technical data insofar as they relate to activities under this
Agreement. Each Party agrees that Deliverables, design information, test results
and any other technical data provided under this Agreement may be subject to
restrictions under the export control laws and regulations of the United States
of America, including but not limited to the U.S. Export Administration Act and
the U.S. Export Administration Regulations. Neither Party shall export any
design information or other technical data without appropriate government
documents and approvals.

12.8 All monetary amounts that become due hereunder are in U.S. dollars.

12.9 This Agreement will not be binding upon the Parties until it has been
signed herein below by or on behalf of each Party, in which event it shall be
effective as of the date first written above. This Agreement and its Attachments
constitute the entire agreement between the Parties with respect to the subject
matter hereof and shall supersede all previous communications, representations,
understandings and agreements, whether oral or written, between the Parties or
any officer or representative thereof with respect to the subject matter of this
Agreement. No amendment or modification of this Agreement shall be valid or
binding upon the Parties unless made in writing and signed on

IBM/MTC CONFIDENTIAL

Page 19
<PAGE>

behalf of each Party by their respective representatives thereunto duly
authorized. The requirement of written form may only be waived in writing.

12.10 Any waiver by either Party of any breach of, or failure to enforce at any
time, any of the provisions of this Agreement, shall not be construed as or
constitute a continuing waiver of such provision, or a waiver of any other
provision of this Agreement, nor shall it in any way affect the validity of this
Agreement or any part thereof, or the right of either Party thereafter to
enforce each and every provision of this Agreement.

12.11 If any provision of this Agreement is found by competent authority to be
invalid, illegal or unenforceable in any respect for any reason, the
availability, legality and enforceability of any such provision in every other
respect and the remainder of this Agreement shall continue in effect so long as
it still expresses the intent of the Parties. If it no longer expresses the
intent of the Parties, the Parties will negotiate a satisfactory alternative to
such provision; if, after reasonable efforts, such alternative cannot be found,
this Agreement shall be terminated.

12.12 This Agreement and all exhibits or attachments hereto shall be executed in
English, and such English text shall prevail over any translation thereof. All
notices referred to hereunder shall also be written in English, or joined to an
English translation made under the sender's responsibility and at its cost,
which English translation shall then prevail over the corresponding original,
each Party being entitled to disregard any document sent under this Agreement in
any language other than English.

12.13 No action, regardless of form, arising out of this Agreement may be
brought by either Party more than [*] years after the later of the date the
cause of action has arisen or termination of this Agreement, except with respect
to a claim for payment.

12.14 Either Party hereto shall be excused from the fulfillment of any
obligation under this Agreement with the exception of payment obligations for so
long as and to the extent such fulfilment may be hindered or prevented by any
circumstance of force majeure, such as but not limited to, acts of God, war
whether declared or not, riot, lockout, fire, shortages of materials or
transportation, power failures, national or local government regulations, or any
other circumstances outside its control.

12.15 Headings used in this Agreement are for convenience of reference only and
are not intended to be part of, or to affect the meaning or interpretation of
this Agreement. References to any given section of this Agreement are intended
by the Parties to include any subsections of such section.

12.16 This Agreement may be executed in two (2) counterparts, each of which
shall deemed an original, but both of which together shall constitute one and
the same agreement.

                  ARTICLE 13 - GOVERNING LAW AND JURISDICTION
                  -------------------------------------------

IBM/MTC CONFIDENTIAL

   Confidential materials omitted and filed separately with the Securities and
               Exchange Commission. Asterisks denote omissions.

Page 20
<PAGE>

This Agreement shall be construed, and the legal relations created herein
between the Parties shall be determined, in accordance with the laws of the
United States of America and, specifically, the State of Delaware, as if said
agreement were executed in, and to be fully performed within, the State of
Delaware. Any proceeding to enforce or to resolve disputes relating to this
Agreement shall be brought before a court of competent jurisdiction in the
United States. In any proceedings no Party shall assert that such a court lacks
jurisdiction over it or the subject matter of the proceeding. The Parties
hereby expressly waive any right to a jury trial and agree that any proceeding
hereunder shall be tried by a judge without a jury.

IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be executed by their duly authorized representatives as of the
day and year first above written.

<TABLE>
<S>                                                 <C>
INTERNATIONAL BUSINESS MACHINES                     MULTILINK (TECHNOLOGY CORPORATION
CORPORATION

By: /s/ Christine King                              By: /s/ Richard N. Nottenburg
   -----------------------------------                 -------------------------------------
Name: Christine King                                Name: Richard N. Nottenburg
     ---------------------------------                   -----------------------------------
Title: VP Networking and Optical Communications     Title:  President and CEO
      --------------------------------                    ----------------------------------
Date:   5/18/00                                     Date:  May 12, 2000
      --------------------------------                    -----------------------------------
</TABLE>

IBM/MTC CONFIDENTIAL

Page 21
<PAGE>

                                 ATTACHMENT A
                                 ------------

                          (A&MS Design Kit License)

This IBM Design Kit License ("Attachment A") is an attachment to the Silicon-
Germanium Development Agreement ("Agreement"), dated as of March 31, 2000
between International Business Machines Corporation ("IBM") and Multilink
Technology Corporation ("MTC), (collectively the "Parties") and sets forth the
terms and conditions applicable to the IBM Design Kit, as defined below.

The Parties agree that the following terms and conditions will apply to any IBM
Design Kit provided to MTC under the Agreement. Capitalized terms used herein
that are not herein defined shall have the meaning set forth in the Agreement.

The IBM Design Kit is licensed and not sold. IBM retains all the right and title
to all copies of any IBM Design Kit provided to MTC and any copy that MTC makes.

The term "IBM Design Kit" includes the following information and materials as
may be listed in a separate document accompanying the IBM Design Kit:

 .  design automation software, and related support documentation (individually
   and collectively "ASIC Tool Kit");
 .  design-tool specific logical and physical design data and design rules (e.g.,
   NDR, EDIF, GL/1, or GDS2 models) for all library and data path elements,
   macros, hard cores, soft cores, synthesizable cores, and MTC Licensed
   Products of such soft cores and synthesizable cores, and related support
   documentation (individually and collectively "ASIC Model Kit"); materials
   sent to MTC separately as documented in one or more Addendum's to the IBM
   Design Kit License ("Addendum"); and
 .  machine-readable and printed related materials, including training materials,
   and listings as may be provided by IBM to MTC under this Agreement.

The "IBM Design Kit" includes all copies and derivatives of such IBM Design Kit;
and may include information, materials, and/or designs owned or provided by
third parties, including but without limitation SSM. The "IBM Design Kit" also
includes any semiconductor manufacturing process information and any
semiconductor packaging information delivered to MTC pursuant to the Agreement.

"SSM" shall mean Swift Simulation Models or any portion which is an output of a
Verilog Foundry Model tool (a Synopsys, Inc. product).

"Use", when referring to the machine-readable portion of the IBM Design Kit,
means copying any portion of the IBM Design Kit into a machine for processing,
transmitting it to a machine for processing, or performing such processing; and
when referring to the printed portion of the IBM Design Kit, means use solely in
furtherance of the Licensed Use set forth below.

LICENSE

IBM/MTC CONFIDENTIAL

Page 22
<PAGE>

The IBM Design Kit is provided to MTC as an IBM customer solely for MTC's Use.
Under IBM's intellectual property rights in the IBM Design Kit, (including know-
how, trade secrets, and other information, copyrights and mask works, but
excluding patents, trademarks and trade names), IBM hereby grants to MTC a non-
exclusive, non-transferable, revocable, limited license to use, perform,
display, and make copies of the IBM Design Kit, solely and exclusively in
accordance with this Agreement.

MTC may:

   .  use the IBM Design Kit only for purposes of(i) conducting an evaluation of
     the IBM Design Kit solely for the purpose of determining whether or not to
     carry out the design activities of (ii) below, and/or (ii) designing MTC
     Prototypes to be manufactured solely by IBM (both(i) and (ii) collectively
     referred to hereafter as "Licensed Use");
   . create MTC Prototypes of any soft cores or synthesizable cores provided to
     MTC as part of an ASIC Model Kit, solely for the purpose of creating a
     derivative design to be included in MTC Prototypes to be manufactured
     solely by IBM; and
   .  copy or translate the IBM Design Kit's machine-readable portion into any
     machine-readable or printed form to provide sufficient copies only to
     support MTC's Licensed Use as well as reasonable storage and backup of the
     IBM Design Kit, and copy the printed related materials to support MTC's
     Licensed Use.

MTC may not

   . reverse assemble or reverse compile any portion of any machine-readable
     representation of the IBM Design Kit elements without IBM's prior written
     consent;
   . create any derivatives of the IBM Design Kit other than the derivative soft
     cores or synthesizable cores as set forth above; nor
   . sublicense, lease, or otherwise distribute the IBM Design Kit to any other
     persons, including other licensees, without IBM's prior written consent.

MTC acknowledges that IBM retains all ownership rights in and to the
intellectual property licensed pursuant to this Attachment A, and that no
license, immunity, or other right is hereby granted under any IBM intellectual
property rights, express or implied, other than as specifically set forth
herein.

SUPPORT AND SUBSEQUENT RELEASES

IBM may provide support to MTC by answering reasonable technical questions MTC
may have regarding the IBM Design Kit. Such support is not applicable to any
derivative soft cores or synthesizable cores MTC creates pursuant to this
Attachment. All such questions should be coordinated through the IBM contact
person designated by IBM for this purpose.

IBM/MTC CONFIDENTIAL

PAGE 23
<PAGE>

IBM may make a subsequent IBM Design Kit release available to MTC for MTC's
Licensed Use. While MTC may continue Licensed Use of a previous release, IBM may
not continue support for previous releases of the IBM Design Kit.

PROTECTION AND SECURITY, CONFIDENTIALITY

Any information required to be exchanged in connection with the performance of
this Agreement which either party desires to have treated as confidential shall
be exchanged and treated in accordance with the terms and conditions of Section
X of the Agreement.

Notwithstanding the foregoing, MTC agrees that any logical and physical design
data, design rules, macros, hard cores, soft cores, synthesizable cores, MTC's
derivatives of such soft cores and synthesizable cores, and training materials
supplied to MTC by IBM are IBM Confidential, and MTC agrees to protect such
information and materials for seven (7) years from the date of disclosure to MTC
as provided in Section X of the Agreement.

MTC agrees to use the training materials provided by IBM with the IBM Design Kit
only for MTC's internal training requirements and for those Respresentatives who
require training in order to carry out MTC's Licensed Use. The training
materials shall not be used to train any other third party in the use and
operation of the IBM Design Kit.

MTC agrees that SSM and information in SSM provided under this Agreement may
contain or be derived from information or portions of materials owned or
provided by a third party supplier, and shall be treated as IBM Confidential.
MTC acknowledges and agrees that Synopsys as such a third party supplier is an
intended third party beneficiary of this Agreement, having all the rights to
enforce the terms and conditions of this Agreement that govern the use and
protection of Synopsys' intellectual property rights contained in the SSM.

MTC agrees that it will not make IBM Confidential materials available to any
third party. In addition, MTC agrees to take the following precautions with
respect to the IBM Design Kit components licensed under this Agreement:

 .  MTC will take appropriate action, by instruction, agreement or otherwise,
   with any persons permitted access to any IBM Design Kit, to satisfy its
   obligations under this Attachment.
 .  MTC will reproduce and include the copyright notices and any other legend on
   all copies, modifications or portions merged into any other IBM Design Kit;
   no such copyright notices, legend, or other marking or in any materials
   distributed under this Attachment shall be tampered with or removed from any
   licensed item, and
 .  MTC will ensure, before disposing of any media, that the IBM Design Kit or
   any portion contained thereon has been erased or destroyed.

For purposes specifically related to MTC's Licensed Use of the IBM Design Kit,
MTC may make the IBM Design Kit available to any of the following: (1) its
Affiliates; (2) Representatives off MTC or MTC Affiliates; (3) Subcontractors of
MTC or its Affiliates; and (4) IBM's Representatives (a) during the period they
are

IBM/MTC CONFIDENTIAL

 Page 24
<PAGE>

on MTC's premises, or (b) whom MTC authorizes to have remote access to the IBM
Design Kit. For purposes of this paragraph, "Subcontractors" shall mean, and
shall be limited to, those persons who are contractually engaged full time on a
temporary basis by MTC to perform the same semiconductor device design services
as MTC's regular employees who have rightful access to the IBM Design Kit(s)
hereunder and who perform such services only on the premises of MTC or its
Affiliates.

Before making the IBM Design Kit available, all such employees, Affiliates, and
Subcontractors must be obligated to protect the IBM Design Kit(s) according to a
prior written agreement of confidentiality with MTC having terms which are no
less restrictive than set forth herein.

TERM

The license granted herein is effective for so long as the Agreement is in
effect. Upon termination or expiration of the Agreement, the licenses set forth
herein shall terminate. MTC agrees upon such termination to destroy (and certify
to such destruction) the IBM Design Kit together with all elements (including
SSM), copies, modifications and merged portions in any form.

IBM/MTC CONFIDENTIAL

Page 25
<PAGE>

                                 Attachment B
                                 ------------
                             (RIT and MPW Charges)

    Year 2000 charges RIT and MPW's (200mm wafers, wire bond)

     [*]
          RIT:
          3LM: $ [*]
              4LM: $ [*]
              5LM: $ [*]
              C4:  $ [*] additional charge
              RITB mask Charges: $ [*]/mask
              RITB one time engineering charges: $ [*]
          MPW:

              5LM: $ [*]

         Target Cycle Time: [*]

    BiCMOS 7HP
          RIT:

              4LM: $  [*]
              5LM: $  [*]
              C4:  $  [*] additional charge
              RITB mask Charges: $[*] /mask
              RITB one time engineering charges: $ [*]
          MPW:

               5LM: $ [*]

          Target Cycle Time:  [*]

         [*] and Follow-on [*] Process Prices to be determined at a later time

IBM/MTC CONFIDENTIAL

  Confidential materials omitted and filed separately with the Securities and
               Exchange Commission. Asterisks denote omissions.

Page 27<PAGE>

IBM/MULTILINK CONFIDENTIAL
JOINT DEVELOPMENT AGREEMENT

                                                                   EXHIBIT 10.14

                          JOINT DEVELOPMENT AGREEMENT

                                    BETWEEN

                INTERNATIONAL BUSINESS MACHINES CORPORATION AND
                       MULTILINK TECHNOLOGY CORPORATION

<PAGE>

IBM/MULTILINK CONFIDENTIAL
JOINT DEVELOPMENT AGREEMENT

                               TABLE OF CONTENTS

<TABLE>
 <S>           <C>
  ARTICLE 1:   DEFINITIONS
  ARTICLE 2:   JOINT PROJECTS: MANAGEMENT AND STRUCTURE
  ARTICLE 3:   MANUFACTURE AND SUPPORT
  ARTICLE 4:   ROYALTIES AND AUDIT RIGHTS
  ARTICLE 5:   RIGHTS AND LICENSES
  ARTICLE 6:   CONFIDENTIALITY
  ARTICLE 7:   INVENTIONS AND WORKS OF AUTHORSHIP
  ARTICLE 8:   TERM AND TERMINATION
  ARTICLE 9:   REPRESENTATIONS AND WARRANTIES
  ARTICLE 10:  LIMITATION OF REMEDIES
  ARTICLE 11:  NOTICES
  ARTICLE 12:  GENERAL
  ARTICLE 13:  GOVERNING LAW AND JURISDICTION

  EXHIBIT A, STATEMENTS OF WORK
  EXHIBIT B, IBM DESIGN KIT LICENSE AGREEMENT
  EXHIBIT C, CERTIFICATE OF ORIGINALITY,
</TABLE>

<PAGE>

IBM/MULTILINK CONFIDENTIAL
JOINT DEVELOPMENT AGREEMENT
                                                                          PAGE 1

                          JOINT DEVELOPMENT AGREEMENT
                          ---------------------------

     This Joint Development Agreement is made effective as of May 18, 2000 (the
"Effective Date"), and is by and between International Business Machines
Corporation, a corporation incorporated under the laws of the State of New York,
having an office for the transaction of business at 2070 Route 52, Hopewell
Junction, NY 12533 ("IBM"), and Multilink Technology Corporation, a corporation
incorporated under the laws of California and having an office for the
transaction of business at 2850 Ocean Park Boulevard, Suite 335, Santa Monica,
CA 90405 ("MTC"). (IBM and MTC may be referred to herein individually as a
"Party" or collectively as the "Parties").

     Whereas the Parties have certain complimentary expertise in silicon
germanium technology design and production and in microcontroller designs and
technologies for Transport Layer Applications (as defined below).

     Now, therefore, the Parties are entering into this Agreement which will set
forth the terms and conditions under which the Parties may engage in certain
joint development activities, as may be agreed by the Parties from time to time
pursuant to the procedures set forth herein.

                            ARTICLE 1: DEFINITIONS
                            ----------------------

     Unless expressly defined and used with an initial capital letter in this
Agreement, words shall have their normally accepted meanings. The word "shall"
is mandatory, the word "may" is permissive, the word "or" is not exclusive, the
words "includes" and "including" are not limiting, and the singular includes the
plural. The following terms shall have the described meanings:

1.1 "Affiliate" of a Party means a Person at least fifty percent (50%) of whose
(a) outstanding shares or securities (representing the right to vote for the
election of directors or other managing authority) or (b) if the Person does not
have outstanding shares or securities, other ownership interest (representing
the right to make the decisions for such Person) are now or hereafter owned or
controlled, directly or indirectly, by such Party hereto, but such corporation,
company or other entity shall be deemed to be an Affiliate only so long as such
percentage of ownership or interest remains at least fifty percent (50%).

1.2 "Agreement" means the terms and conditions of this Joint Development
Agreement together with any exhibits or attachments hereto including but not
limited to any SOWs signed by both Parties and referring to this Joint
Development Agreement, which are incorporated herein by this reference.

1.3 "Change of Control" means a change in ownership or control of a Person
effected through any of the following transactions:

<PAGE>

IBM/MULTILINK CONFIDENTIAL                                                PAGE 2
JOINT DEVELOPMENT AGREEMENT

     (i)   a merger, consolidation or reorganization approved by the Person's
     equity holders, unless securities representing more than sixty percent
     (60%) of the total combined voting power of the voting securities of the
     successor entity are immediately thereafter beneficially owned, directly or
     indirectly and in substantially the same proportion, by the persons who
     beneficially owned such Person's outstanding voting securities immediately
     prior to such transaction,

     (ii)  any transfer or other disposition of all or substantially all of the
     Person's assets, or

     (iii) the acquisition, directly or indirectly, by any person or related
     group of persons other than the Person that is the subject of a Change of
     Control or an Affiliate of such Person or any Person currently owning,
     beneficially or of record, equity securities of such Person), of beneficial
     ownership (within the meaning of Rule 13d-3 of the Securities Exchange Act
     of 1934, as amended) of securities possessing more than forty percent (40%)
     of the total combined voting power of the Person's outstanding securities.

1.4  "Confidential Information" means IBM Confidential Information, MTC
Confidential Information, or both if the context so indicates.

1.5  "Custom Sales Agreement" means the agreement so titled executed by and
between the Parties concurrently with this Agreement.

1.6  "Design Completion" means the completion of the development of a Joint
Product as evidenced by the written agreement of the PEC.

1.7  "Design Costs" means the actual incurred direct expenses associated with
developing a Joint Product from Design Start until Design Completion and any
other expenses mutually agreed to by the Project Team on a case by case basis.
Design Costs shall include the compensation costs of either Party's employees
who are assigned to a Joint Project at a per-person-year rate to be agreed upon
by the parties in each SOW.

1.8  "Design Start" means the start of the design of a Product as evidenced by
the execution of a Statement of Work applicable thereto by the Parties.

1.9  "Disclosing Party" means either Party hereunder that discloses its
Confidential Information to the other Party.

1.10 "Error Correction" means any correction to the functional operation of a
Joint Product, as described in the applicable Statement of Work or in the
specifications developed pursuant to such Statement of Work, and any correction
of a fundamental design flaw that causes an abnormally high level of failures in
manufacturing or in customer systems using such Joint Product in a normal
manner. The term Error

<PAGE>

IBM/MULTILINK CONFIDENTIAL                                                PAGE 3
JOINT DEVELOPMENT AGREEMENT

Correction also includes any screens or tests developed by a Party to detect an
error or to verify the correction of an error in a Joint Product.

1.11 "Financial Coordinators" means the individuals referenced in Section
2.8.

1.12 "IBM Confidential Information" means any and all information and items
disclosed or delivered by IBM to MTC hereunder, that is identified by IBM as
confidential, whether written, oral or both, in whatever form disclosed or
delivered, whether tangible or intangible (including software). With respect to
the IBM Confidential Information referenced in the preceding sentence, IBM
agrees (i) to coordinate and control the disclosure thereof with MTC's Technical
Coordinator, (ii) if such IBM Confidential Information is disclosed in tangible
form, IBM will stamp or otherwise clearly mark such information as IBM
Confidential Information, and (iii) if such Confidential Information is
disclosed orally, IBM agrees to identify the Confidential Information as
confidential at the time of disclosure, and provide to MTC written confirmation
thereof within thirty (30) days after such disclosure. Notwithstanding the
foregoing, the term "IBM Confidential Information" shall also include the
following information and items disclosed by IBM to MTC hereunder, whether or
not identified by IBM as confidential, whether written, oral or both, in
whatever form disclosed or delivered, whether tangible or intangible (including
software): all product or circuit designs (including schematics, GDS II data,
net lists, VHDL code, RTL code, block diagrams and simulation techniques),
deliverables, manufacturing processes and techniques, IBM Technology, Joint
Technology, product and marketing plans, cost data relating to a Joint Project.

1.13 "IBM Design Kit" shall have the meaning set forth in the IBM Design Kit
License Agreement attached hereto as Exhibit B and shall also include any
semiconductor manufacturing process information and any semiconductor packaging
information delivered to MTC pursuant to this Agreement.

1.14 "IBM Licensed Patent Claims" means the claims, other than claims covering a
semiconductor manufacturing process, of any patent:

     1.14.1 which are necessarily infringed in the manufacture or sale or other
     transfer of Joint Products and/or MTC Licensed Products, but with respect
     to MTC Licensed Products to the extent, and only to the extent, that such
     MTC Licensed Products are based on designs contained in the IBM Technology
     and/or the Joint Technology; and

     1.14.2 under which patents, claims or the relevant patent applications
     therefore, IBM has the right to grant licenses to MTC of the scope granted
     in Section 5.8 below, without such grant or the exercise of rights
     thereunder resulting in the payment of royalties or other consideration by
     IBM to third parties. The term "IBM Licensed Patent Claim" shall also
     include the corresponding claims of any reissued or reexamined patents
     containing any of the aforesaid claims provided they continue to meet the
     aforesaid criteria.

<PAGE>

IBM/MULTILINK CONFIDENTIAL                                                PAGE 4
JOINT DEVELOPMENT AGREEMENT

1.15 "IBM Licensed Product" means any integrated circuit, chip set, module, or
other item, including packages and control software therefor, having all or any
portion of its design based on or derived from MTC Technology or the Joint
Technology but which IBM Licensed Product is not itself a Joint Product.

1.16 "IBM Technology" means (i) the information listed in a Statement of Work as
being provided by and that is actually provided by IBM (ii) any other
information IBM provided by IBM pursuant to a Statement of Work, including
technical information, know-how, trade secrets, maskworks and other information
including maskwork rights and copyrights therefor, if any, and (iii) any Error
Corrections provided by IBM hereunder; but only to the extent such information
described in (i), (ii) and (iii), above, is owned or controlled by IBM or
licensed to IBM independently of a Joint Project and IBM has the free right to
grant a license or a non-assertion right to the extent necessary for the
implementation of said Joint Project. IBM Technology shall not include IBM Tools
and IBM Design Kits.

1.17 "IBM Tools" means software which is not commercially available and is
either owned by IBM or under which IBM has the right to grant royalty-free
licenses, and is used for the development, maintenance or implementation of an
IBM deliverable in a Statement of Work.

1.18 "Integrated Circuit" means an integral unit including a plurality of active
and passive circuit elements formed at least in part of semiconductor material
arranged on or in a single chip.

1.19 "Invention" means any idea, design, concept, technique, invention,
discovery or improvement, whether or not patentable, made solely or jointly by
one or more employees or consultants of either IBM or MTC, provided that either
the conception or reduction to practice occurs in the performance of work under
a Joint Project.

1.20 "Joint Invention" means any idea, design, concept, technique, invention,
discovery or improvement, whether or not patentable, made jointly by one or more
employees or consultants of IBM with one or more employees or consultants of
MTC, provided that either the conception or reduction to practice occurs in the
performance of work under a Joint Project.

1.21 "Joint Product" means an Integrated Circuit, chip set, module or board or
any other item specified on a Statement of Work to be jointly developed by the
Parties hereunder.

1.22 "Joint Project" means joint development work described in a Statement of
Work.

1.23 "Joint Technology" means, unless specified otherwise in a Statement of
Work, those Inventions or other materials consisting of the specific results of
the Parties' partial or completed design and development work pursuant to Joint
Projects, as embodied in all tangible, written, graphic, and other documentary
forms as well as the

<PAGE>

                                                                          PAGE 5
IBM/MULTILINK CONFIDENTIAL
JOINT DEVELOPMENT AGREEMENT

intangible forms, and shall include but not be limited to the following: program
material, design information, engineering notes, Joint Project design
databases, simulation models, functional test vectors, design tool and design
methodology information, semiconductor chip databases and topographies, and
designs and any tools developed as part of a Joint Product (but not including
any part of any IBM Tools or MTC Tools).

1.24 "MTC Confidential Information" means any and all information and items
disclosed or delivered by MTC to IBM hereunder, that is identified by MTC as
confidential, whether written, oral or both, in whatever form disclosed or
delivered, whether tangible or intangible (including software). With respect to
the MTC Confidential Information referenced in the preceding sentence, MTC
agrees (i) to coordinate and control the disclosure thereof with IBM's Technical
Coordinator, (ii), if such MTC Confidential Information is disclosed in tangible
form, MTC will stamp or otherwise clearly mark such information as MTC
Confidential Information, and (iii) if such Confidential Information is
disclosed orally, MTC agrees to identify the Confidential Information as
confidential at the time of disclosure, and provide to IBM written confirmation
thereof within thirty (30) days after such disclosure. Notwithstanding the
foregoing, the term "MTC Confidential Information" shall also include the
following information and items disclosed by MTC to IBM hereunder, whether or
not identified by MTC as confidential, whether written, oral or both, in
whatever form disclosed or delivered, whether tangible or intangible (including
software): all product or circuit designs (including schematics, GDS II data,
net lists, VHDL code, RTL code, block diagrams and simulation techniques),
deliverables, manufacturing processes and techniques, MTC Technology, Joint
Technology, product and marketing plans, cost data relating to a Joint Project.

1.25 "MTC Licensed Patent Claims" means the claims, other than claims covering a
semiconductor manufacturing process, of any patent:

     1.25.1 which are necessarily infringed in the manufacture or sale or other
     transfer of Joint Products and/or IBM Licensed Products, but with respect
     to IBM Licensed Products, to the extent, and only to the extent, that such
     IBM Licensed Products are based on designs contained in the MTC Technology
     and/or the Joint Technology; and

     1.25.2 under which patents, claims or the relevant patent applications
     therefore, MTC has the right to grant licenses to IBM of the scope granted
     in Section 5.9 below, without such grant or the exercise of rights
     thereunder resulting in the payment of royalties or other consideration by
     MTC to third parties. The term "MTC Licensed Patent Claim" shall also
     include the corresponding claims of any reissued or reexamined patents
     containing any of the aforesaid claims provided they continue to meet the
     aforesaid criteria.

1.26 "MTC Licensed Product" means any Integrated Circuit, chip set, module, or
other item, including packages and control software therefor, having all or any
portion of its design based on or derived from IBM Technology or Joint
Technology but which MTC Licensed Product is not itself a Joint Product.

<PAGE>

IBM/MULTILINK CONFIDENTIAL                                                PAGE 6
JOINT DEVELOPMENT AGREEMENT

1.27 "MTC Technology" means (i) the information listed in a Statement of Work as
being provided by and that is actually provided by MTC, (ii) any other
information provided by MTI pursuant to a Statement of Work including technical
information, know-how, trade secrets, maskworks, and other information,
including maskwork rights and copyrights therefor, if any, and (iii) any Error
Corrections provided by MTC hereunder; but only to the extent such information
described in (i), (ii) and (iii), above, is owned or controlled by MTC or
licensed to MTC independently of a Joint Project and MTC has the free right to
grant a license or a non-assertion right to the extent necessary for the
implementation of said Joint Project. MTC Technology shall not include MTC
Tools.

1.28 "MTC Tools" means software which is not commercially available and is
either owned by MTC or under which MTC has a right to grant royalty-free
licenses, and is used for the development, maintenance or implementation of a
MTC deliverable in a Statement of Work.

1.29 "Net Selling Price" for each Product means the net revenue recorded by a
Party with respect to that Product sold, leased, or otherwise transferred by the
Selling Party, less (a) shipping, (b) insurance, and (c) sales, value added, use
or excise taxes, to the extent to which they are actually paid or allowed, and
less allowances to the extent they are actually allowed as determined
in accordance with generally accepted accounting principles consistently
applied. If a Product is sold, leased, or otherwise transferred in a higher
level of assembly or in the course of a transaction that includes other products
or services with no separate bona fide price charge for the Product, the
applicable Net Selling Price for the purpose of calculating royalties shall be
the fair market value of the Product itself without the rest of the assembly but
not less than the average Net Selling Price of all such Products sold, leased,
or otherwise transferred to a third party by such Party during the preceding
calendar quarter (or if there are no sales in such preceding calendar quarter as
determined in good faith by the PEC).

1.30 "PDT Leader" means the individual appointed initially by IBM and
subsequently by the PEC pursuant to Section 2.6 to ensure that appropriate
development processes are followed for the Joint Projects.

1.31 "Party(ies)" means MTC and/or IBM.

1.32 "Person" shall mean any individual, corporation, partnership, joint
venture, trust, limited liability company, business association, governmental
entity or other entity.

1.33 "Product" means a MTC Licensed Product, IBM Licensed Product, or Joint
Product.

1.34 "Project Executive Committee" or "PEC" means the committee established by
the Parties pursuant to Section 2.3 to oversee the work to be conducted under
this Agreement.

<PAGE>

IBM/MULTILINK CONFIDENTIAL                                                PAGE 7
JOINT DEVELOPMENT AGREEMENT

1.35 "Project Executive Director" means the individual appointed initially by
MTC and subsequently by the PEC pursuant to Section 2.5 to provide day-to-day
oversight of the Joint Projects.

1.36 "Project Team" means a working team, consisting of personnel of the Parties
and, as specifically set forth in Section 2.10 hereof, which shall manage and
implement Joint Projects as defined in a Statement of Work.

1.37 "Receiving Party" means either Party hereunder that receives the other
Party's Confidential Information.

1.38 "Representative" means, with respect to a Party, that Party's agents,
representatives and employees (including attorneys, accountants, consultants,
contract employees and advisors).

1.39 "Statement or Work" or "SOW" means a written agreement executed by both
Parties describing a Joint Project in substantially the form set forth in
Exhibit A.

1.40 "Technical Coordinators" means the individuals referenced in Section 2.7.

1.41 "Term" means the period from  [*]  through  [*].

1.42 "Transport Layer Application" means high performance transceivers
connecting data communications and telecommunications equipment to a fiber optic
infrastructure. Examples include  [*],  [*], and  [*]  applications.

             ARTICLE 2 - JOINT PROJECTS: MANAGEMENT AND STRUCTURE
             ----------------------------------------------------

2.1 The Parties agree to cooperate on Joint Projects for the design of certain
Joint Products useful in Transport Layer Applications. Each Joint Project or
other development work to be performed by the Parties hereunder shall be the
subject of a Statement of Work which shall be an attachment hereto. Each
Statement of Work will establish the specifications for the Joint Product(s), a
detailed plan for the conduct of the work and the schedule for task completion,
a staffing commitment for each Party, the deliverables, including technology,
to be provided by each Party for use in the Joint Project, and the documentation
and other output requirement for the Joint Project results. Each Statement of
Work will set forth a budget for the Design Costs for the Joint Project
described therein. The actual Design Costs will be shared by the Parties
equally. In the event of a conflict between the provisions of a Statement of
Work and the provisions of this Joint Development Agreement, the provisions of
the Statement of Work will prevail.

2.2 The initial Joint Projects are described in the Statements of Work attached
hereto as Exhibits A-1 - A._. Future Joint Projects, if any, will be documented
in a similar manner and will become a part of this Agreement upon signature by
the PEC member

  Confidential materials omitted and filed separately with the Securities and
               Exchange Commission. Asterisks denote Omissions.
<PAGE>

IBM/MULTILINK CONFIDENTIAL                                                PAGE 8
JOINT DEVELOPMENT AGREEMENT

of each Party. Neither Party will be obligated with respect to any proposed
Joint Project until and unless a Statement of Work with respect thereto is
signed by both Parties. Neither Party has an obligation to agree to any
additional Statements of Work. Joint Projects are expected to be performed by
teams made up of employees of both Parties and are expected to be performed at
one or more of a Party's locations. The location(s) at which such work will be
performed will be specified in the applicable Statement of Work.

2.3  The Parties hereby create a Project Executive Committee, which shall
consist of two (2) members, one appointed by each Party, to propose or review
any new Joint Projects, review the progress of the Joint Projects to ensure that
the Joint Projects remain in line with the Parties' objectives, propose, review
or approve any needed adjustments in the various tasks to be performed by the
Parties and the time schedule, review whether any of the Joint Projects should
be extended, changed or terminated, and attempt to resolve in good faith any
issues arising with respect to this Agreement or any Joint Project.

2.4  The PEC is comprised initially of the following individuals:

          (i)  for MTC:  Richard Nottenburg

          (ii) for IBM:  Chris King

Each Party may change its members of the PEC by written notice to the other
Party. The PEC will conduct regular meetings on dates and at locations as the
members mutually shall determine. Meetings of the PEC may be held in person, by
teleconference or by video conference.

2.5  MTC will appoint a Project Executive Director to provide day-to-day
oversight and coordination of the Joint Projects. The Project Executive Director
may be changed by written agreement of the members of the PEC.

2.6  IBM will appoint a PDT Leader who will work with the Project Executive
Director, the Project Team leaders and the Project Teams to ensure that
appropriate development processes are being followed for all of the Joint
Projects. The PDT Leader may be changed by written agreement of the members of
the PEC.

2.7  Each Party shall appoint a Technical Coordinator to oversee its technical
contributions to the Joint Projects and to interface with the Technical
Coordinator of the other Party to help ensure that the Project Teams have
appropriate technology and that the Parties' respective technical contributions
across the Joint Projects are balanced. The Technical Coordinators jointly must
approve any additional material technology contributions to a Joint Project by
either Party which are not referenced in the applicable Statement of Work. The
Technical Coordinators may agree upon changes to the technical aspects of a
Statement of Work, provided that such changes do not materially alter the
schedules or the deliverables and do not result in an uneven contribution of

<PAGE>

IBM/MULTILINK CONFIDENTIAL                                                PAGE 9
JOINT DEVELOPMENT AGREEMENT

resources or division of Design Costs associated with the Statement or Work. All
other changes must be approved by the PEC and memorialized in a written
amendment to this Agreement or the Statement of Work which is signed by
authorized representatives of each Party. The Technical Coordinators shall also
interface regularly with the Project Executive Director and Project Teams and
advise the PEC on any necessarily or helpful modifications to signed Statements
of Work as well as potential technical contributions to Statements of Work under
consideration. With respect to copyrightable materials contained in any IBM
Tools or MTC Tools delivered pursuant to a Joint Project, upon request from the
receiving Technical Coordinator, the Technical Coordinator of the Party who
delivered such materials shall provide the Technical Coordinator making such
request with a Certificate of Originality for such materials in the form
attached hereto as Exhibit C. Each Party shall retain their copyrights in any
IBM Tools or MTC Tools, respectively.

2.8  Each Party will appoint a Financial Coordinator to monitor the budgets and
spending for the Joint Projects to interface with the Financial Coordinator of
the other Party and the PEC, the Project Executive Director and the Project
Teams to help ensure that the spending on the Joint Projects is appropriate, as
determined by the Parties in good faith.

2.9  Individual(s) appointed by each Party pursuant to Sections 2.5, 2.6, 2.7,
and 2.8 may, at the appointing Party's sole discretion, simultaneously hold any
of the other positions appointed by such Party pursuant thereto.

2.10 Upon execution of each Statement of Work, the PEC will establish a Project
Team leader and a Project Team to perform the activities of the Joint Project
described therein. The responsibilities of a Project Team relating to any Joint
Project will be further detailed in the applicable Statement of Work and shall
include:

     (i)    submission of adjustments to any Statement of Work to the Project
     Executive Director for review and agreement prior to being submitted to the
     PEC for consideration and then to the Parties for appropriate amendment of
     the applicable Statement of work;

     (ii)   making regular presentations to the PDT Leader, the Project
     Executive Director and, if requested, the PEC of the progress of any Joint
     Project;

     (iii)  performing the development as described in the Statement of Work and
     working with the PDT Leader to ensure that appropriate development
     processes are being followed; and

     (iv)   generation of all deliverables as described in the SOW which shall
     include all engineering documentation and specifications for the
     development, design, simulation, verification, manufacture, and test of a
     Joint Product.

<PAGE>

IBM/MULTILINK CONFIDENTIAL                                               PAGE 10
JOINT DEVELOPMENT AGREEMENT

2.11  A Project Team shall be comprised of the number of employees of the
Parties set forth in the applicable Statement of Work which will also set forth,
among other things, the required professional level and experience of such
employees. The Parties intend for each Party to assign an equal number of
employees to the Joint Projects. If the assignment of employees to a Joint
Project by each Party becomes significantly disproportionate, as determined in
good faith by the PEC, the PEC will endeavor in good faith to find a way to
level the Parties' respective overall contributions to the Joint Projects.
Unless otherwise expressly agreed in writing by the Parties to the contrary,
each Party shall pay all of the expenses (including wages, benefits, travel, and
lodging) of its own employees or agents. The PEC may agree in writing to
increase or decrease the number of employees of the Parties to be allocated to
specific tasks on a Project Team.

2.12  Each Party agrees that its employees shall comply in all material respects
with all reasonable personnel, human resources, security and safety rules,
procedures and guidelines of the other Party applicable to contractors resident
at or visiting the premises of such Party while such employees are on the other
Party's premises. Each Party shall provide to the other a set of documents
setting forth all such rules, procedures and guidelines.

2.13  Personnel supplied by each Party are employees of the supplying Party and
shall not for any purpose be considered employees or agents of the other Party.
Each Party shall be responsible for the supervision, direction and control,
payment of salary (including withholding of taxes), worker's compensation
insurance, disability benefits and the like of its own employees while engaged
in any Joint Project in accordance with the law of the state or states wherein a
Joint Project is to be performed.

2.14  To the extent permitted by law, during the Term and for one year
thereafter, MTC and the Microelectronics Division of IBM each agrees neither to
solicit nor hire the employees of the other Party performing services hereunder
without the prior written consent of the other Party.

2.15  Each Party (a "Hosting Party") allowing employees of the other Party (an
"Assigning Party") to work on its premises assumes no liability to the Assigning
Party for any injury, (including death) to persons or damage to or loss of
property suffered on or about the such Hosting Party's premises or in connection
with work under this Agreement unless caused by the willful misconduct or gross
negligence of the Hosting Party, its employees or invitees (other than employees
of the Assigning Party). Each Hosting Party makes no representation or warranty,
written or oral, of any kind as to the condition of or the fitness for any
purpose of its premises.

          ARTICLE 3 - MANUFACTURING AND SUPPORT AND UPDATES OF JOINT
          ----------------------------------------------------------
                                   PRODUCTS
                                   --------

<PAGE>

IBM/MULTILINK CONFIDENTIAL                                               PAGE 11
JOINT DEVELOPMENT AGREEMENT

3.1  IBM will manufacture or have manufactured the Joint Products for MTC
pursuant to the terms of the Custom Sales Agreement. MTC agrees that for the
term of this Agreement, IBM will be the sole provider of Joint Products to MTC
and will be given an opportunity to be a provider of MTC Licensed Products to
MTC. IBM agrees that for the term of this Agreement, IBM will sell all Joint
Products and MTC Licensed Products manufactured by IBM for MTC under a foundry
arrangement to MTC at foundry prices pursuant to the Custom Sales Agreement.

3.2  The Parties will work together on a plan to jointly promote the Joint
Products. Neither Party will be obligated to perform any promotional activities
unless it expressly agrees in writing to do so.

3.3  The Parties will engage in the cross training and support activities for
Joint Projects as provided in the applicable Statement of Work.

3.4  During the period in which this Agreement is in effect and for one year
thereafter, each Party will promptly notify the other Party of any errors in
Joint Products which it becomes aware of and will provide the other Party with
any and all Error Corrections it makes to the Joint Products promptly after such
Error Corrections are developed.

                    ARTICLE 4 - ROYALTIES AND AUDIT RIGHTS
                    --------------------------------------

4.1  In consideration of the licenses granted by IBM herein, MTC agrees to pay
IBM a royalty of:

     (a)  [*] percent ([*]%) of the Net Selling Price of each Joint Product sold
     or otherwise transferred by MTC, its Affiliates, distributors, or
     sublicensees to a third party;

     (b)  [*]    percent ([*]%) of the Net Selling Price of each MTC Licensed
     Product sold or otherwise transferred by MTC, its Affiliates, distributors,
     or sublicensees to a third party if the percentage of the total Integrated
     Circuit surface area (excluding areas occupied solely by memory functions)
     occupied by the IBM Technology or the Joint Technology, or a combination
     thereof, is greater than [*] percent ([*]%); and

     (C) [*]     percent ([*]%) of the Net Selling Price of each MTC Licensed
     Product sold or otherwise transferred by MTC, its Affiliates, distributors,
     or sublicensees to a third party, if the percentage of the total Integrated
     Circuit surface area (excluding areas occupied solely by memory functions)
     occupied by the IBM Technology or the Joint Technology, or a combination
     thereof, is [*] percent ([*]%) or less.

     (d)  For clarity, since MTC may purchase Joint Products and MTC Licensed
     Products from IBM under a foundry arrangement at foundry prices pursuant to
     the Custom Sales Agreement, the royalties specified in Sections 4.1(a),
     4.1(b), and 4.1(c) shall apply to Joint Products and MTC Licensed Products
     sold or otherwise transferred by MTC, its Affiliates, distributors, or
     sublicensees to a third party either

  Confidential materials omitted and filed separately with the Securities and
               Exchange Commission. Asterisks denote omissions.
<PAGE>

                                                                         PAGE 12

IBM/MULTILINK CONFIDENTIAL
JOINT DEVELOPMENT AGREEMENT

     as a stand alone product or in a higher level of assembly, even if such
     Products were purchased by MTC from IBM.

4.2  In consideration of the licenses granted by MTC herein, IBM agrees to pay
MTC a royalty of:

     (a)  [*] percent ([*]%) of the Net Selling Price of each Joint Product sold
     or otherwise transferred by IBM, its Affiliates, distributors, or
     sublicensees to a third party,

     (b)  [*]   percent ([*]%) of the Net Selling Price of each IBM Licensed
     Product sold or otherwise transferred by IBM, its Affiliates, distributors,
     or sublicensees to a third party if the percentage of the total Integrated
     Circuit surface area (excluding areas occupied solely by memory functions)
     occupied by the MTC Technology or the Joint Technology, or a combination
     thereof, is greater than [*] percent ([*]%), and

     (c) [*]            percent ([*]%) of the Net Selling Price of each IBM
     Licensed Product sold or otherwise transferred by IBM, its Affiliates,
     distributors, or sublicensees to a third party, if the percentage of
     the total Integrated Circuit surface area (excluding areas occupied solely
     by memory functions) occupied by the MTC Technology or the Joint
     Technology, or a combination thereof, is [*] percent ([*]%) or less.

     (d)  For clarity, the royalties specified in Sections 4.2(a), 4.2(b), and
     4.2(c) shall apply to Joint Products and IBM Licensed Products sold or
     otherwise transferred by IBM, distributors of Persons that are Affiliates
     as of the date hereof, or sublicensees to a third party either as a stand
     alone product or in a higher level of assembly, even if such Products were
     purchased by IBM from MTC.

4.3  Royalty Exceptions: Neither Party has any royalty obligation for:

     a.   Products used for such Party's, or its Subsidiaries', distributors',
     or sublicensees' internal use, development, maintenance or support
     activities, marketing demonstrations, customer testing, prototypes, or
     product training or education,

     b.   Documentation provided with a Product,

     c.   Products sold by IBM to MTC pursuant to a Custom Sales Agreement, and

     d.   Products transferred as warranty replacements.

4.4  End of Royalties: Each Party's royalty obligations hereunder with respect
to a Product shall be paid-up [*]    years after the first sale of such Product
by such Party, its Affiliate, its distributor or sublicensee. Notwithstanding
the previous sentence, in no event shall either Party owe any royalties under
this Agreement for Products sold or otherwise transferred more than [*]    years
after termination or expiration of this Agreement.

  Confidential materials omitted and filed separately with the Securities and
               Exchange Commission. Asterisks denote omissions.
<PAGE>

IBM/MULTILINK CONFIDENTIAL                                               PAGE 13
JOINT DEVELOPMENT AGREEMENT

4.5  All royalties owed hereunder shall be paid within sixty (60) days after the
end of each calendar quarter. All payments shall be made by wire transfer to the
applicable account listed below, shall be free of all banking charges, and shall
be paid in U.S. Dollars.

     For Payments to MTC:

     Multilink Technology Corporation
     IMPERIAL BANK
     2015 Manhattan Beach Blvd.
     Redondo Beach, CA 90278
     Account No. [*]
     ABA Routing No. [*]
     SWIFT No.       [*]
     Bank Telephone: (800) 505-0534

     For Payments to IBM:

     IBM Corporation
     Director of Licensing
     The Bank of New York
     48 Wall Street
     New York, NY 10286
     Account No.      [*]
     ABA Routing No.       [*]
     IBM Bank Contact: John Maguire
              [*]

     Include the following information in the wire detail:

                  Company Name
                  Reason for Payment
                  License Reference No.

4.6  Except as expressly provided in this Article 4 "ROYALTIES AND AUDIT
RIGHTS", as expressly provided in a Statement of Work, neither Party shall be
entitled to any further payment, cost reimbursement, or other compensation from
the other for services, deliverables and rights granted to the other Party
hereunder. Unless otherwise specified in the Statement of Work, each party
shall bear all its own expenses incurred in negotiating and rendering
performance, including facilities, work space, computers and computer time,
utilities, management, clerical reproduction services, supplies, and the like.

4.7  Each Party owing royalties pursuant to this Agreement shall maintain a
complete, clear and accurate record of the number and type of Products, features
and/or systems

  Confidential materials omitted and filed separately with the Securities and
               Exchange Commission. Asterisks denote omissions.
<PAGE>

IBM/MULTILINK CONFIDENTIAL                                               PAGE 14
JOINT DEVELOPMENT AGREEMENT

shipped by it and other relevant information to the extent it is required to
determine whether such Party is paying the correct royalty amount hereunder. To
ensure compliance with the terms of this Agreement, the Party entitled to
receive royalties hereunder shall have the right to have an inspection and audit
of all the relevant accounting and sales books and records of the owing Party.
The audit will be conducted by an independent audit firm mutually acceptable to
both Parties, and shall be conducted following reasonable prior written notice
during regular business hours at the audited Party's offices and in such a
manner as not to interfere with the audited party's normal business activities.
In no event shall audits be made hereunder more frequently than every twelve
(12) months. If any audit should disclose any underpayment, the Party
underpaying shall promptly (but in any event within thirty (30) days) pay the
difference. The independent accountant referred to herein shall be under a
confidentiality agreement as required by the audited Party and shall not
disclose to the auditing Party any Confidential Information of the audited
Party. The independent audit firm's fee will be paid by the Party seeking the
audit unless the report of the audit firm determines that the audited Party has
underpaid royalties during the period of the audit in an amount exceeding the
greater of fifteen percent (15%) of the royalties owed or one hundred thousand
dollars ($100,000). In the event such an underpayment is reported, the audited
Party shall pay the audit firm's reasonable fee within thirty (30) days of the
receipt of the report or submit evidence to dispute the finding of such
underpayment. The independent audit firm referred to herein shall not be paid by
the auditing Party on a contingency fee basis.

                        ARTICLE 5 - RIGHTS AND LICENSES
                        -------------------------------

5.1  Unless otherwise agreed in a Statement of Work with respect a particular
Joint Project, subject to Section 5.2 below, all copyrightable materials
contained in the Joint Technology shall be the joint property of both IBM and
MTC, and both Parties shall own the copyright in all such materials jointly.
Such ownership right shall include all rights under copyright law, including the
right to use, execute, reproduce, display, perform, prepare derivative works
based upon, and distribute (internally and externally) copies of any and all
such materials and derivative works thereof, and to authorize others to do any
of the foregoing, without accounting, subject to the obligations with respect to
Confidential Information as set forth in Article 6 of this Agreement. Neither
Party shall have an obligation to file any copyright applications with respect
to any Joint Technology; however, any application voluntarily filed by either
Party shall state that the authors of such Joint Technology are IBM and MTC as
joint authors.

5.2  Notwithstanding Section 5.1, IBM will continue to own the IBM Technology
and MTC will continue to own the MTC Technology.

       5.2.1 With regard to copyrightable materials contained in IBM Technology
       other than those specified in Section 5.1, IBM hereby grants to MTC and
       its Affiliates an irrevocable, nonexclusive, worldwide and royalty-free
       license to all rights in such IBM Technology under the copyright laws,
       including to use, execute, reproduce, display, perform, prepare
       derivative works based upon, and distribute

<PAGE>

IBM/MULTILINK CONFIDENTIAL                                               PAGE 15
JOINT DEVELOPMENT AGREEMENT

       (internally and externally) copies of any and all such materials and
       derivative works thereof, and to authorize others to do any of the
       foregoing, subject to the obligations with respect to Confidential
       Information as set forth in Article 6 of this Agreement.

       5.2.2 With regard to copyrightable materials contained in MTC Technology
       other than those specified in Section 5.1, MTC hereby grants to IBM and
       IBM Affiliates an irrevocable, nonexclusive, worldwide and royalty-free
       license to all rights in such MTC Technology under the copyright laws,
       including to use, execute, reproduce, display, perform, prepare
       derivative works based upon, and distribute (internally and externally)
       copies of any and all such materials and derivative works thereof, and to
       authorize others to do any of the foregoing, subject to the obligations
       with respect to Confidential Information as set forth in Article 6 of
       this Agreement.

5.3 IBM hereby grants to MTC under the IBM Tools and MTC hereby grants to IBM
under the MTC Tools, an irrevocable, nonexclusive, worldwide and royalty-free
license to use, execute, display and perform such IBM Tools or MTC Tools, as the
case may be, only for the purpose of developing, maintaining, or implementing a
deliverable in a Statement of Work and for developing, maintaining and
implementing Joint Products, IBM Licensed Products and MTC Licensed Products, as
the case may be, subject to the obligations with respect to Confidential
Information as set forth in Article 6 of this Agreement.

5.4 MTC hereby grants to IBM under MTC Technology an irrevocable, worldwide,
nonexclusive, nontransferable (except to IBM Affiliates) license to make, have
made, use, lease and sell Joint Products and IBM Licensed Products, subject to
the royalty obligations set forth in Article 4.

5.5 The license granted to IBM in Section 5.4 shall include the right of IBM to
sublicense to IBM Affiliates and the right of such sublicensed Affiliates to
sublicense to other IBM Affiliates. Each such sublicensed Affiliate shall be
bound by the terms and conditions of this Agreement as if it were named herein
in the place of IBM. Any sublicense granted to an IBM Affiliate shall terminate
on the date such Affiliate ceases to be an Affiliate of IBM.

       5.5.1 Upon the termination or expiration of this Agreement, to the extent
       that MTC Technology is contained in the Joint Technology, the license
       granted to IBM in Section 5.4 shall include the right of IBM to grant
       revocable or irrevocable sublicenses to third parties, provided, however,
       that if this Agreement is terminated by MTC pursuant to the provisions of
       Section 8.5 hereof, such right to grant sublicenses shall not commence
       until [*] after such termination. The granting of any such third party
       sublicenses shall not in any way relieve IBM of its obligations under
       this Agreement.

  Confidential materials omitted and filed separately with the Securities and
               Exchange Commission. Asterisks denote omissions.
<PAGE>

IBM/MULTILINK CONFIDENTIAL                                               PAGE 16
JOINT DEVELOPMENT AGREEMENT

5.6  IBM hereby grants to MTC under IBM Technology an irrevocable, worldwide,
nonexclusive, nontransferable (except to MTC Affiliates) license to make, have
made, use, lease and sell Joint Products and MTC Licensed Products, subject to
the royalty obligations set forth in Article 4. With respect to any IBM Design
Kit included in a Statement of Work, IBM grants to MTC the license set forth in
the IBM Design Kit License, attached hereto as Exhibit B.

5.7  The license granted to MTC in Section 5.6 shall include the right of MTC to
sublicense its Affiliates and the right of such sublicensed Affiliates to
sublicense other Affiliates. Each sublicensed Affiliate shall be bound by the
terms and conditions of this Agreement as if it were named herein the place of
MTC. Any sublicense granted to an MTC Affiliate shall terminate on the date such
Affiliate ceases to be an Affiliate of MTC.

     5.7.1 Upon the termination or expiration of this Agreement, to the extent
     that IBM Technology is contained in the Joint Technology, the license
     granted to MTC in Section 5.6 shall include the right of MTC to grant
     revocable or irrevocable sublicenses to third parties, provided, however,
     that if this Agreement is terminated by IBM pursuant to the provisions of
     Section 8.5 hereof, such right to grant sublicenses shall not commence
     until [*] after such termination. The granting of any such third party,
     sublicenses shall not in any way relieve MTC of its obligations under this
     Agreement.

5.8  IBM hereby grants to MTC and its Affiliates a non-exclusive,
nontransferable, irrevocable license under the IBM Licensed Patent Claims to
make, have made, use, lease, sell, offer for sale, import, and otherwise
transfer Joint Products and MTC Licensed Products, solely to the extent
necessary to exercise its licensed rights as set forth in Section 5.6, subject
to the royalty obligations set forth in Article 4. MTC shall have no right to
grant licenses or sublicenses under this Section 5.8 to any entity. No license,
immunity or other right is granted under this Section 5.8 by IBM either
directly, by implication, estoppel, or otherwise:

     5.8.1 other than under the IBM Licensed Patent Claims; or

     5.8.2 with respect to any other product or item other than a Joint Product
     or an MTC Licensed Product, whether or not such other product or item is
     used in or in conjunction with a Joint Product or an MTC Licensed Product.

5.9  MTC hereby grants to IBM and its Affiliates a non-exclusive,
nontransferable, irrevocable license under the MTC Licensed Patent Claims to
make, have made, use, lease, sell, offer for sale, import, and otherwise
transfer Joint Products and IBM Licensed Products, solely to the extent
necessary to exercise its licensed rights as set forth in Section 5.4, subject
to the royalty obligations set forth in Article 4. IBM shall have no right to
grant licenses or sublicenses under this Section 5.9 to any entity. No license,
immunity or other right is granted under this Section 5.9 by MTC either
directly, by implication, estoppel, or otherwise:

  Confidential materials omitted and filed separately with the Securities and
               Exchange Commission. Asterisks denote omissions.
<PAGE>

IBM/MULTILINK CONFIDENTIAL                                               PAGE 17
JOINT DEVELOPMENT AGREEMENT

     5.9.1 other than under the MTC Licensed Patent Claims; or

     5.9.2 with respect to any other product or item other than a Joint Product
     or an IBM Licensed Product, whether or not such product or item is used in
     or in conjunction with a Joint Product or an IBM Licensed Product.

5.10 Each Party agrees that it will not assert against the other Party any
patent claims covering a semiconductor manufacturing process, to the extent and
only to the extent that such semiconductor manufacturing process is used to
manufacture a Joint Product, an IBM Licensed Product or an MTC Licensed Product,
as the case may be.

                     ARTICLE 6 - CONFIDENTIAL INFORMATION
                     ------------------------------------

6.1  For a period of seven (7) years from the date of disclosure of Confidential
Information, the Receiving Party agrees to use the same degree of care and
discretion to keep the Disclosing Party's Confidential Information confidential
as it uses with its own similar information that it wishes to keep confidential.
The Confidential Information received by a Receiving Party shall not be used for
any purpose other than in connection with exercising the rights and licenses
granted to it under this Agreement, subject to the obligation of
confidentiality and subject to the terms and conditions of the licenses granted
herein. Each Party agrees to inform its Representatives of the confidential
nature of the other Party's Confidential Information, and each of such
Representatives shall agree in writing to act in accordance with the terms and
provisions of this Article 6. Each Receiving Party shall be responsible for any
breach of this Agreement by any of its Representatives.

     6.1.1 Either Receiving Party may use the "Residuals" of the Disclosing
     Party's Confidential Information for any purpose, royalty-free, subject to
     the obligation of confidentiality. "Residuals" means the ideas, concepts,
     know-how and techniques, related to the Receiving Party's business
     activities, which are contained in the Disclosing Party's Confidential
     Information and retained in the unaided memories of the Receiving Party's
     employees who have had rightful access to the Disclosing Party's
     Confidential Information pursuant to this Agreement.

6.2  The Receiving Party may disclose the Confidential Information of the
Disclosing Party only to: the Receiving Party's Representatives on a need-to-
know basis, subject to the requirements of Section 6.1.

6.3  Notwithstanding any other provisions of this Agreement, the nondisclosure
and use obligations specified herein shall not apply to any Confidential
Information which:

<PAGE>

IBM/MULTILINK CONFIDENTIAL                                               PAGE 18
JOINT DEVELOPMENT AGREEMENT

     6.3.1 is already lawfully in the possession of the Receiving Party prior to
     being furnished to the Receiving Party by the Disclosing Party, provided
     that the source of such information was not and does not become known by
     the Receiving Party, prior to disclosure by the Receiving Party, to be
     prohibited from disclosing the information to the Receiving Party by legal,
     contract or fiduciary obligation to the Disclosing Party;

     6.3.2 is independently developed by employees (without use of Confidential
     Information) of the Receiving Party or any of its Subsidiaries;

     6.3.2 becomes generally publicly available without breach of this
     Agreement;

     6.4.3 is rightfully received by the Receiving Party on a nonconfidential
     basis from a third party that is not known by the Receiving Party to be
     prohibited from disclosing the information to the Receiving Party by legal,
     contract or fiduciary obligation to the Disclosing Party;

     6.3.4 is released for disclosure by the Disclosing Party with its written
     consent; or

     6.3.6 is inherently and appropriately disclosed in the use, lease,
     marketing, sale, or other distribution of Joint Products and MTC Licensed
     Products, or IBM Licensed Products, as the case may be and publicly
     available supporting documentation therefor by or for the Receiving Party
     or any of its Affiliates.

6.4  Disclosure of Confidential Information shall not be precluded if such
disclosure is:

     6.4.1 in response to a valid order of a court or other governmental body;
     provided, however, that the Receiving Party shall first promptly provide
     the Disclosing Party prompt notice of the order and provide the Disclosing
     Party the opportunity to make a commercially reasonable effort to obtain a
     protective order or other appropriate remedy; provided that if such
     protective order is not obtained, or if the Disclosing Party waives
     compliance with the provisions of this Section 6.4.1 in writing, the
     Receiving Party will furnish only that part of the Confidential Information
     that the Receiving Party is legally required to be so disclosed and the
     Receiving Party shall exercise its best commercially reasonable efforts to
     obtain reasonable assurances that confidential treatment will be accorded
     to the Confidential Information so disclosed; or

     6.4.2 otherwise required by law (prior to such disclosure, however, the
     Receiving Party will provide written notification to the Disclosing Party,
     signed by an executive of the Receiving Party, stating that the Receiving
     Party believes in good faith that the disclosure is required by law); or

     6.4.3 necessary to establish the Receiving Party's rights under this
     Agreement.

<PAGE>

IBM/MULTILINK CONFIDENTIAL                                               PAGE 19
JOINT DEVELOPMENT AGREEMENT

6.5  If any Confidential Information falls under an exception set forth in
Sections 6.4.1 through 6.4.6 the Receiving Party shall not disclose that the
Disclosing Party hereto was the source of that Confidential Information.

6.6  All Confidential Information not reasonably necessary or useful for the
Receiving Party, but only to exercise the rights and licenses granted in this
Agreement shall be returned to the Disclosing Party or destroyed by the
Receiving Party upon termination of this Agreement. Any oral Confidential
Information shall continue to be kept confidential and subject to the terms of
this Agreement.

                            ARTICLE 7 - INVENTIONS
                            ----------------------

7.1  Employees of IBM or MTC performing services under this Agreement who make
an Invention, whether solely or jointly with others, shall agree to make and
shall-promptly make a complete written disclosure to their employer for patent
review of such Invention, in the normal course, specifically pointing out those
features or concepts believed to be new or different. Each Party agrees to
promptly submit to the other Party copies, marked as IBM Confidential
Information or MTC Confidential Information as the case may be, of any written
disclosures pertaining to Joint Inventions submitted exclusively to it, which
submissions shall be subject to the confidentiality provisions of Article 6 of
this Agreement.

7.2  Each Invention, other than a Joint Invention, shall be the property of the
Party whose employees made the Invention (hereinafter "Owning Party") subject to
a license which the Owning Party hereby grants to the other Party under such
Invention and any patent protection obtained therefor. Upon request, the Owning
Party shall advise the other Party of those countries, if any, wherein it
intends to seek patent protection at its expense. The other Party may propose
countries for filing in addition to those selected by the Owning Party. The
Owning Party shall promptly notify the other Party, as to each proposed country,
whether patent protection will be sought. For any proposed country wherein
patent protection is not to be sought by the Owning Party, the other Party may
elect to seek patent protection, at its own expense, but the Owning Party shall
have title to any resulting patent, subject to the grant of a license to the
other Party pursuant to the terms set forth in Section 7.6.

7.3  With respect to each Invention, other than a Joint Invention, the Owning
Party upon request shall provide such other Party with a copy of the first
English-language patent application so filed, the filing particulars of any
corresponding foreign patent application, and, as may be requested by the other
Party, copies of any such corresponding foreign patent applications and all
official papers relating thereto. The Owning Party may also publish such
Invention subject to the options granted to the other Party in Section 7.2.

7.4  Joint Inventions shall be jointly owned, title to all patents issued
thereon shall be joint, all expense incurred in obtaining and maintaining such
patents, except as provided hereinafter, shall be jointly shared and each Party
shall have the unrestricted

<PAGE>

IBM/MULTILINK CONFIDENTIAL                                               PAGE 20
JOINT DEVELOPMENT AGREEMENT

right to license third parties thereunder without accounting. In the event that
one Party elects not to seek patent protection for any Joint Invention in any
particular country or not to share equally in the expense thereof with the other
Party, the other Party shall have the right to seek or maintain such protection
at its own expense in such country and shall have full control over the
prosecution and maintenance thereof even though title to any patent issuing
therefrom shall be jointly owned.

7.5  Each Party shall give the other Party all commercially reasonable
assistance in obtaining patent protection and in preparing and prosecuting any
patent application filed by the other Party, and shall cause to be executed
assignments and all other instruments and documents as the other Party may
consider reasonably necessary or appropriate to carry out the intent of this
Section 7.5.

7.6  All licenses granted under Section 7.2 shall be worldwide, irrevocable,
nonexclusive, nontransferable and royalty-free (except as set forth in Section 4
hereof); shall include the right to make, have made, use, have used, lease,
sell, and/or otherwise transfer any apparatus, and to practice and have
practiced any method. All such licenses shall include the right of the grantee
to grant revocable or irrevocable sublicenses to its Affiliates, such
sublicenses to include the right of the sublicensed Affiliates to
correspondingly sublicense their own Affiliates. The term of any license granted
under Section 7.2 shall extend for the full term of the licensed patent.

     7.6.1 Upon the termination or expiration of this Agreement, all such
     licenses shall further include the right of grantee to grant revocable or
     irrevocable sublicenses to third Parties only under the Joint Technology
     but not under any patents or patent applications based thereon provided,
     however, that if this Agreement is terminated by either Party pursuant to
     the provisions of Section 8.5 hereof, the non-terminating party's right to
     grant sublicenses shall not commence until one (1) year after such
     termination.

7.7  Except as provided in Sections 7.2, 7.6 and 7.8 of this Agreement, nothing
contained in this Section 7 shall be deemed to grant, either directly or by
implication, estoppel, or otherwise, any license under any patents or patent
applications arising out of any other inventions of either Party.

7.8  The Parties shall grant to each other and do hereby grant to each other
worldwide, irrevocable, non-exclusive, non-transferable and royalty-free
licenses (except as set forth in Section 4 hereof) necessary to make, use, sell,
display or otherwise exploit any Joint Products developed by the Parties
hereunder.

                       ARTICLE 8 - TERM AND TERMINATION
                       --------------------------------

8.1  The term of this Agreement shall begin on the Effective Date, and unless
previously terminated as hereinafter set forth, shall remain in force for the
Term.

<PAGE>

IBM/MULTILINK CONFIDENTIAL                                               PAGE 21
JOINT DEVELOPMENT AGREEMENT

8.2  The term of a Statement of Work shall begin on the date it is last signed
by IBM and MTC and continue until the expiration date stated in the Statement of
Work, termination of the Statement of Work or the date of termination or
expiration of this Agreement, whichever occurs first. Upon the agreement of the
PEC, a Statement of Work may be terminated without terminating this Agreement.

8.3  Either Party may terminate this Agreement without cause upon [*] written
notice to the other Party, provided that neither Party shall submit such a
written notice of termination prior to March 31, [*]   . Upon such termination,
all SOWs will also terminate, provided that if a particular SOW states that it
survives termination, then it shall survive.

8.4  A Party shall have the right to immediately terminate this Agreement with
cause by giving written notice of termination to the other Party, upon the
happening of any of the following events:

   8.4.1  A determination by a court of competent jurisdiction that makes it
   unlawful for the Parties to continue the relationship contemplated by this
   Agreement;

   8.4.2  If the other Party is in default of any of its material obligations
   under this Agreement and such default is not cured within thirty (30)
   days after receipt of a written notice from the notifying Party specifying
   such default; or

   8.4.3  The other Party sells substantially all of its assets or the assets
   required to fulfill its obligations under this Agreement, or ceases doing
   business, is adjudged bankrupt or insolvent or files a petition for
   bankruptcy.

8.5  IBM shall have the right to immediately terminate this Agreement by giving
written notice of termination to MTC if MTC undergoes a Change of Control and
MTC shall have the right to immediately terminate this Agreement by giving
written notice of termination to IBM if the IBM Microelectronics Division
undergoes a Change of Control.

8.6  Upon expiration or termination of this Agreement, both Parties shall end
all Joint Project(s) in process and the following shall apply:

   8.6.1  Neither Party shall be under any obligation to make further
   disclosures of technical information of any kind to the other Party.

   8.6.2  All royalty obligations set forth herein shall continue.

   Except as otherwise provided in this Section 8.6, neither Party shall be
   liable to the other for any expenses resulting from any termination of this
   Agreement without cause.

  Confidential materials omitted and filed separately with the Securities and
               Exchange Commission. Asterisks denote omissions.
<PAGE>

IBM/MULTILINK CONFIDENTIAL                                               PAGE 22
JOINT DEVELOPMENT AGREEMENT

8.7   Any licenses or rights granted pursuant to this Agreement shall continue
in perpetuity and shall survive any termination of this Agreement to permit each
of the Parties to manufacture, sell, distribute, use, display or otherwise
exploit any Joint Products, IBM Licensed Products and MTC Licensed Products
developed by the Parties hereunder. In addition, Sections 2.13, 2.14 and 2.16,
and Articles 4, 5, 6, 7, 8.3, 8.6, 8.7, 8.8, 9, 10, 11, 12 and 13 shall survive
and continue following any expiration or termination of this Agreement.

                  SECTION 9 - REPRESENTATIONS AND WARRANTIES
                  ------------------------------------------

9.1   Although the Parties will use all reasonable efforts in performing Joint
Projects, the Parties acknowledge that the results of the design and development
work to be performed are uncertain and cannot be guaranteed by either Party.
Therefore, if a Party has exerted its reasonable efforts in the performance of
its responsibilities under a Statement of Work, the failure to achieve schedules
within the Statement of Work shall not constitute a breach of this Agreement.
Further, neither Party warrants or assumes any liability in connection with the
implementation or completion of any Joint Project or that its work under this
Agreement will be error free. Any services provided by a Party shall be provided
on an "AS IS" basis without warranty of any kind.

9.2   Each Party represents that it has agreements, including confidentiality
agreements, with its employees and any other person with whom such agreement may
be necessary sufficient to meet its obligations under this Agreement.

9.3   NEITHER PARTY MAKES ANY WARRANTIES, EXPRESS OR IMPLIED, WITH RESPECT TO
THE JOINT PRODUCTS, THE TECHNOLOGY CONTRIBUTED, OR THE CONFIDENTIAL INFORMATION
DISCLOSED, INCLUDING, BUT NOT LIMITED TO, THE IMPLIED WARRANTIES OF
MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE.

                      ARTICLE 10 - LIMITATION OF REMEDIES
                      -----------------------------------

10.1  In no event shall either Party be liable to the other Party for incidental
damages, lost profits, lost savings or any other consequential damages,
regardless of whether the claim is for breach of contract, warranty, tort
(including negligence), failure of a remedy to accomplish its purpose or
otherwise, even if such Party has been advised of the possibility of such
damages.

10.2  In no event shall either Party be liable to the other Party for actual
damages resulting from any claim relating to this Agreement in excess of $ [*] ,
regardless of the form of action, provided that this limitation will not apply
to claims for royalty amounts due hereunder and claims for bodily injury or
damage to real property or tangible personal property for which the Party is
legally liable.

10.3  Neither Party will be liable for any damages claimed by the other Party
based on any third party claim.

  Confidential materials omitted and filed separately with the Securities and
                Exchange Commission. Asterisks denote omissions.
<PAGE>

IBM/MULTILINK CONFIDENTIAL                                               PAGE 23
JOINT DEVELOPMENT AGREEMENT

                             ARTICLE 11 - NOTICES
                             --------------------

11.1  Any notice or other communication required or permitted to be made or
given to either Party hereto pursuant to this Agreement shall be sent to such
Party by facsimile, or by certified or registered mail, postage prepaid,
addressed to the person named below and shall be deemed to have been made, given
or provided on the date of facsimile transmission or mailing.

      IBM:  IBM Corporation
            Drop 92X
            1580 Route 52,
            Hopewell Junction, NY 12533
            Fax: (914) 892- [*]
            Attention: Ms. Chris King
            Vice President, Wired Communications
            IBM Microelectronics Division

            With a copy to:

                  IBM Corporation
                  Drop 92B
                  1580 Route 52
                  Hopewell Junction, NY 10533
                  Fax: (914)-892- [*]
                  Attention: Division Counsel, Microelectronics Division

      MTC:  Multilink Technology Corporation
            2850 Ocean Park Boulevard
            Santa Monica, CA 90405
            Fax: (310) 581- [*]
            Attention: President

            With a copy to:

                  Allen Matkins Leck Gamble & Mallory LLP
                  1999 Avenue of the Stars, Suite 1800
                  Los Angeles, CA 90067
                  Fax: (310) 788-2410
                  Attention: Mark J. Kelson

11.2  A Party hereto may change its address for the purposes of this Section 12
by giving ten (10) days prior written notice of such change of address to the
other Party.

                          ARTICLE 12 - MISCELLANEOUS
                          --------------------------

  Confidential materials omitted and filed separately with the Securities and
               Exchange Commission. Asterisks denote omissions.
<PAGE>

IBM/MULTILINK CONFIDENTIAL                                               PAGE 24
JOINT DEVELOPMENT AGREEMENT

12.1 Nothing contained in this Agreement shall be construed as conferring any
right to use in advertising, publicity or other promotional activities any name,
trade name, trademark or other designation of any Party hereto (including any
contraction, abbreviation or simulation of any of the foregoing); and each Party
hereto agrees not to disclose to other than its Affiliates the existence of or
the terms and conditions of this Agreement, without the express written consent
of the other Party except as may be required by law or government rule or
regulation, or to establish its rights under this Agreement; provided, however
that if one Party is seeking to disclose such information for reasons not
requiring written consent, then the Disclosing Party shall limit the disclosure
to the extent required, shall allow the other Party to review the information to
be disclosed prior to such disclosure, and shall apply, where available, for
confidentiality, protective orders, and the like. Such review under this Section
shall not be construed to make the reviewing Party responsible for the contents
of the disclosure, and the Disclosing Party shall remain solely responsible for
such contents.

12.2 Nothing contained in this Agreement shall be construed as conferring on any
Party any license or other right to copy the exterior design of any product of
the other Party.

12.3 No license or immunity is granted by this Agreement by either Party to the
other Party, either directly or by implication, estoppel, or otherwise, under
any patent or other intellectual property right now owned or hereafter obtained,
except as expressly provided herein.

12.4 Neither this Agreement nor any activities hereunder will impair any right
of IBM or MTC to design, develop, manufacture, market, service or otherwise deal
in, directly or indirectly, any products or services. Each Party may pursue
activities independently with any third party even if similar to the activities
under this Agreement.

12.5 Each Party is an independent contractor and is not an agent of the other
Party for any purpose whatsoever. Neither Party will make any warranties or
representations on the other Party's behalf, and it will not assume or create
any obligation on the other Party's behalf.

12.6 Each Party ("Assigning Party") may, upon written notice to the other Party,
assign its rights or obligations without the prior written consent of the other
Party only in connection with a merger or a sale of all or substantially all of
the assets of such Party relating to the subject matter of this Agreement to a
third party unless such merger or sale would constitute grounds for the other
            ------
Party to terminate this Agreement pursuant to the provisions of Section 8.5 and
the other Party does so terminate this Agreement within sixty (60) days after
having been notified in writing of the merger of sale by the Assigning Party. In
such event, the assignment may not occur until one (1) year after termination.
Each Party may freely assign its rights to receive payment hereunder to any
third party upon written notice the other Party. In all other instances, neither
Party shall assign its rights or delegate or subcontract its obligations under
this Agreement

<PAGE>

IBM/MULTILINK CONFIDENTIAL                                               PAGE 25
JOINT DEVELOPMENT AGREEMENT

without prior written permission from the other Party and attempt to do so
without such permission shall be null and void.

12.7  Each Party will comply with all applicable federal, state and local laws,
regulations and ordinances of the U.S. Government including, but not limited to,
the regulations of the U.S. Government authorities relating to the export of
commodities and technical data insofar as they relate to activities under this
Agreement. Each Party agrees that Joint Products, design information, test
results and any other technical data provided under this Agreement may be
subject to restrictions under the export control laws and regulations of the
United States of America, including but not limited to the U.S. Export
Administration Act and the U.S. Export Administration Regulations. Neither Party
shall export any Joint Product, design information or other technical data
without appropriate government documents and approvals.

12.8  All monetary amounts that become due hereunder are in U.S. dollars.

12.9  This Agreement will not be binding upon the Parties until it has been
signed herein below by or on behalf of each Party, in which event it shall be
effective as of the date first written above. This Agreement and its Exhibits
constitute the entire agreement between the Parties with respect to the
subject matter hereof and shall supersede all previous communications,
representations, understandings and agreements, whether oral or written, between
the Parties or any officer or representative thereof with respect to the subject
matter of this Agreement. No amendment or modification of this Agreement shall
be valid or binding upon the Parties unless made in writing and signed on behalf
of each Party by their respective representatives thereunto duly authorized. The
requirement of written form may only be waived in writing.

12.10 Any waiver by either Party of any breach of, or failure to enforce at any
time, any of the provisions of this Agreement, shall not be construed as or
constitute a continuing waiver of such provision, or a waiver of any other
provision of this Agreement, nor shall it in any way affect the validity of this
Agreement or any part thereof, or the right of either Party thereafter to
enforce each and every provision of this Agreement.

12.11 If any provision of this Agreement is found by competent authority to be
invalid, illegal or unenforceable in any respect for any reason, the
availability, legality and enforceability of any such provision in every other
respect and the remainder of this Agreement shall continue in effect so long as
it still expresses the intent of the Parties. If it no longer expresses the
intent of the Parties, the Parties will negotiate a satisfactory alternative to
such provision; if, after reasonable efforts, such alternative cannot be found,
this Agreement shall be terminated.

12.12 This Agreement and all exhibits or attachments hereto shall be executed in
English, and such English text shall prevail over any translation thereof. All
notices referred to hereunder shall also be written in English, or joined to an
English translation made under the sender's responsibility and at its cost,
which English translation shall

<PAGE>

IBM/MULTILINK CONFIDENTIAL                                               PAGE 26
JOINT DEVELOPMENT AGREEMENT

then prevail over the corresponding original, each Party being entitled to
disregard any document sent under this Agreement in any language other than
English.

12.13 No action, regardless of form, arising out of this Agreement may be
brought by either Party more than two (2) years after the date the cause of
action has arisen.

12.14 Either Party hereto shall be excused from the fulfillment of any
obligation under this Agreement with the exception of payment obligations for so
long as and to the extent such fulfillment may be hindered or prevented by any
circumstance of force majeure, such as but not limited to, acts of God, war
whether declared or not, riot, lockout, fire, shortages of materials or
transportation, power failures, national or local government regulations, or any
other circumstances outside its control.

12.15 Headings used in this Agreement are for convenience of reference only and
are not intended to be part of, or to affect the meaning or interpretation of
this Agreement. References to any given section of this Agreement are intended
by the Parties to include any subsections of such section.

12.16 If there is a conflict between this Agreement and a Statement of Work, the
terms and conditions of the Statement of Work shall prevail.

12.17 This Agreement may be executed in two (2) counterparts, each of which
shall be deemed an original, but both of which together shall constitute one and
the same agreement.

                  ARTlCLE 13 - GOVERNING LAW AND JURISDICTION
                  -------------------------------------------

This Agreement shall be construed, and the legal relations created herein
between the Parties shall be determined, in accordance with the laws of the
United States of America and, specifically, the State of Delaware, as if said
agreement were executed in, and to be fully performed within, the State of
Delaware. Any proceeding to enforce or to resolve disputes relating to this
Agreement shall be brought before a court of competent jurisdiction in the
United States. In any proceedings no Party shall assert that such a court lacks
jurisdiction over it or the subject matter of the proceeding. The Parties hereby
expressly waive any right to a jury trial and agree that any proceeding
hereunder shall be tried by a judge without a jury.

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
by their duly authorized representatives as of the day and year first above
written.

INTERNATIONAL BUSINESS MACHINES     MULTILINK TECHNOLOGY
CORPORATION                         CORPORATION

By: /s/ Christine King              By: /s/ Richard N Nottenburg
   ----------------------              -------------------------

<PAGE>

IBM/MULTILINK CONFIDENTIAL                                               PAGE 27
JOINT DEVELOPMENT AGREEMENT

Name:   CHRISTINE KING                          Name:   Richard N Nottenburg
     ---------------------                           --------------------------
Title: VP Networking & Optical Communications   Title: President and CEO
      ----------------------------------------        -------------------------
Date:     5/18/00                               Date:      5/12/00
      ----------------------------------------        -------------------------

Exhibits:
--------

A.1 - A.X - Statements of Work
B. IBM Design Kit License Agreement
C. Certificate of Originality

<PAGE>

IBM/MULTILINK CONFIDENTIAL                                                PAGE 1
JOINT DEVELOPMENT AGREEMENT

                         EXHIBIT A, STATEMENT OF WORK
                         ----------------------------

                                  Exhibit A-*
                         Statement of Work: fill in name

 1.0 Scope
     -----

 fill in general description of project

 2.0 Major Milestones & Project Descriptions
     ---------------------------------------

 Target Schedule

 Design Pass Assumptions

 Prelim Specs - Data Sheet

 Final Specification
 Interim Design Review (Pre
 Layout)
 Final Design Review
 Net List
 GDSII Tape out
 Prototype Delivery to
 Characterization
 FinalTest and Characterization
 Report

 Reference Platform Prototype
 Available
 Reference Platform Test and
 Characterization Report
 Reference Platform App Notes
 and Prototype release

 2.1 ... 2.XX

<PAGE>

IBM/MULTILINK CONFIDENTIAL                                                PAGE 2
JOINT DEVELOPMENT AGREEMENT

fill in description, responsibilities and key checkpoints for each major
milestone

3.0   Design Review Deliverables
This section describes the Design Review process and deliverables. A Design
Review shall mean a meeting of the parties to review the design work to date to
determine compliance to all agreed-to specification parameters. The location of
the Design Reviews will alternate between IBM and MTC facilities. The Design
Review process may be modified based on the complexity of the design with the
mutual agreement of the IBM and MTC Technical Coordinators.

3.1   Preliminary Design Review (PDR)(Interim Design Review)
The goal of the Preliminary Design Review (PDR) is to review the design work to
date to determine that the design effort is on track and that no major issues
exist with the design simulation or design methodology, predicted performance,
chip layout (floor plan), or product assembly and test. This review should
address predicted performance of the circuit.

Preliminary Design Reviews will include as applicable:
i.    Review final specifications
ii.   Schematic diagrams
iii.  Simulation results for key parameters
iv.   Thermal analysis
v.    Compliance Matrix: Simulated Performance vs.. Specification
vi.   Preliminary chip layout (floor plan)
vii.  Test approach
viii. Design Review documentation package
ix.   Risk analysis and mitigation plan

3.2   Detailed Design Review (DDR) (Final Design Review)
The goal of the Detailed Design Review (DDR) is to comprehensively review all
aspects of the design and layout to assure compliance to specifications and
manufacturability prior to tape out. The design must be Design Rule Checking
(DRC) and Layout vs. Schematic (LVS) verified and free of errors at this point.
Details of the final simulations, accounting for all relevant layout parasitics,
should be covered extensively. Predicted performance, yield, and parameter
sensitivity analysis should be reviewed. Final plots of the top level, major
blocks or sections and critical signals or paths should be reviewed. Final
assembly drawings of the packaged and/or assembled product are to be reviewed.
Test methodologies and test plans for engineering characterization should also
be reviewed.

Detailed Design Reviews will include as applicable:

<PAGE>

IBM/MULTILINK CONFIDENTIAL                                                PAGE 3
JOINT DEVELOPMENT AGREEMENT

i.    Completed PDR action items
ii.   Schematic diagrams
iii.  Detailed simulation and measured results for all key parameters outlined
in the jointly developed chip specifications including:
iv.   - simulation over temperature, supply variations, and process variations
      - yield analysis / histograms or other yield estimates
      - parasitic extraction / analysis
      - chip wiring and package modeled and simulated
v.    Compliance Matrix: Simulated Performance vs.. Specification
vi.   Thermal analysis
vii.  Detailed chip layout and reticle plan
viii. Physical design
      - Floor plan / block placement
      - Critical nodes / blocks
      - Shielding
      - Multiple power domains
      - Power distribution
ix.   Manufacturability
      - ESD / Latch-up robustness
      - Testability
      - Assembly issues
      - Yield issues
      - Process issues
x.    Clean DRC log file plot
xi.   Clean LVS log file plot
xii.  DC/High Speed characterization/test plan
xiii. Packaging and assembly plan
xiv.  Common Reference Platform and test fixture plan
xv.   Design Review documentation package
xvi.  Update risk analysis and mitigation plan
xvii. Update project status summary (schedule, dependencies, and Deliverables)

4.0  Staffing

<TABLE>
<CAPTION>
----------------------------------------------------------------------------------------
              IBM est. headcount  IBM projected    MTC est. headcount   MTC projected
              effort              location of      effort               location of
                                  headcount                             headcount
----------------------------------------------------------------------------------------
<S>           <C>                 <C>              <C>                  <C>

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

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

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

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

----------------------------------------------------------------------------------------
</TABLE>

(P) primary location
(S) secondary location

<PAGE>

IBM/MULTILINK CONFIDENTIAL                                                PAGE 4
JOINT DEVELOPMENT AGREEMENT

5.0  Deliverables
-----------------

5.1  Introduction.
     The following list describes in detail the information which will be made
     available to both Parties The party creating or primarily responsible for
     the portion of the Joint Product related to each deliverable shall be
     responsible to create and provide that deliverable.

5.2  Guidelines.
     The following guidelines apply for deliverables delivered by one Party to
     the other under this Agreement:

     5.2.1     A delivering Party will not deliver any licensed hardware or
               software items to the receiving Party, when delivering such items
               would violate the license agreement of a third party.

     5.2.2     The delivering Party is only required to make available items on
               the following list in the form and format they are used by the
               delivering Party and as they become available. The delivering
               Party will provide reasonably requested support information
               necessary to render an item useful.

     5.2.3     A delivering Party will make any written information created by
               it (or under subcontract for it) available to the receiving Party
               in both electronic as well as printed versions, when reasonably
               feasible.

5.3  Product Deliverables
     Items from the following Sections 5.4 through 5.10 shall be made available
     to the receiving Party by the delivering Party for the Joint Product in
     this SOW as soon as is reasonably practical in accordance with the target
     major milestones in section 2.0
     The Joint Product for this SOW that the deliverables refer to are:

5.4....5.X
     fill in deliverables

6.0  Technical Sales Support Training

     fill in description of training plan

7.0  Initial Budget

<PAGE>

IBM/MULTILINK CONFIDENTIAL                                                PAGE 5
JOINT DEVELOPMENT AGREEMENT

       fill in budget

8.0  Term

The term of this Joint Project shall commence on _________ and end on _________.

Agreed:

INTERNATIONAL BUSINESS MACHINES         MULTILINK TECHNOLOGY CORPORATION
      CORPORATION

By:____________________________         By:____________________________

Name:__________________________         Name:__________________________

Title:_________________________         Title:_________________________

Date:__________________________         Date:__________________________

<PAGE>

IBM/MULTILINK CONFIDENTIAL                                                PAGE 6
JOINT DEVELOPMENT AGREEMENT

                                   EXHIBIT B
                                   ---------

                            IBM DESIGN KIT LICENSE

This IBM Design Kit License ("Exhibit B) is an exhibit to the Joint Development
Agreement "Agreement"), dated as of April ___, 2000 between International
Business Machines Corporation ("IBM") and Multilink Technology Corporation
("MTC), (collectively the "Parties") and sets forth the terms and conditions
applicable to the IBM Design Kit, as defined below. In addition to the terms set
forth herein, the terms of Articles 6 and 9 - 13 of the Agreement apply to the
IBM Design Kit.

The Parties agree that the following terms and conditions will apply to any IBM
Design Kit provided to MTC under the Agreement. Capitalized terms used herein
that are not herein defined shall have the meaning set forth in the Agreement.

The IBM Design Kit is licensed and not sold. IBM retains all the right and title
to all copies of any IBM Design Kit provided to MTC and any copy that MTC makes.

The term "IBM Design Kit" includes the following information and materials as
may be listed in a separate document accompanying the IBM Design Kit:

 .    design automation software, and related support documentation (individually
and collectively "ASIC Tool Kit");
 .    design-tool specific logical and physical design data and design rules
(e.g., NDR, EDIF, GL/1, or GDS2 models) for all library and data path elements,
macros, hard cores, soft cores, synthesizable cores, and MTC Licensed Products
of such soft cores and synthesizable cores, and related support documentation
(individually and collectively "ASIC Model Kit"); materials sent to MTC
separately as documented in one or more Addendum's to the IBM Design Kit License
("Addendum"); and
 .    machine-readable and printed related materials, including training
materials, and listings as may be provided by IBM to MTC under this Agreement.

The "IBM Design Kit" includes all copies and derivatives of such IBM Design Kit;
and may include information, materials, and/or designs owned or provided by
third parties, including but without limitation SSM. The "IBM Design Kit" also
includes any semiconductor manufacturing process information and any
semiconductor packaging information delivered to MTC pursuant to the Agreement.

<PAGE>

IBM/MULTILINK CONFIDENTIAL                                                PAGE 7
JOINT DEVELOPMENT AGREEMENT

"SSM" shall mean Swift Simulation Models or any portion which is an output of a
Verilog Foundry Model tool (a Synopsys, Inc. product).

"Use", when referring to the machine-readable portion of the IBM Design Kit,
means copying any portion of the IBM Design Kit into a machine for processing,
transmitting it to a machine for processing, or performing such processing; and
when referring to the printed portion of the IBM Design Kit, means use solely in
furtherance of the Licensed Use set forth below.

LICENSE

The IBM Design Kit is provided to MTC as an IBM customer solely for MTC's Use.
Under IBM's intellectual property rights in the IBM Design Kit, (including know-
how, trade secrets, and other information, copyrights and mask works, but
excluding patents, trademarks and trade names), IBM hereby grants to MTC a non-
exclusive, non-transferable, royalty-free, revocable, limited license to use,
perform, display, and make copies of the IBM Design Kit, solely and exclusively
in accordance with this Agreement.

MTC may:

 . use the IBM Design Kit only for purposes of (i) conducting an evaluation of
the IBM Design Kit solely for the purpose of determining whether or not to carry
out the design activities of (ii) below, and/or (ii) designing Joint Products
and MTC Licensed Products to be manufactured solely by IBM (both (i) and (ii)
collectively referred to hereafter as "Licensed Use");
 . create MTC Licensed Products of any soft cores or synthesizable cores provided
to MTC as part of an ASIC Model Kit, solely for the purpose of creating a
derivative design to be included in Joint Products and MTC Licensed Products to
be manufactured solely by IBM; and
  .  copy or translate the IBM Design Kit's machine-readable portion into any
machine-readable or printed form to provide sufficient copies only to support
MTC's Licensed Use as well as reasonable storage and backup of the IBM Design
Kit, and copy the printed related materials to support MTC's Licensed Use.

MTC may not

  .  reverse assemble or reverse compile any portion of any machine-readable
representation of the IBM Design Kit elements without IBM's prior written
consent;
  .  create any derivatives of the IBM Design Kit other than the derivative
soft cores or synthesizable cores as set forth above; nor
  .  sublicense, lease, or otherwise distribute the IBM Design Kit to any other
persons, including other licensees, without IBM's prior written consent.

<PAGE>

IBM/MULTILINK CONFIDENTIAL                                                PAGE 8
JOINT DEVELOPMENT AGREEMENT

MTC acknowledges that IBM retains all ownership rights in and to the
intellectual property licensed pursuant to this Exhibit B, and that no license,
immunity, or other right is hereby granted under any IBM intellectual property
rights, express or implied, other than as specifically set forth herein.

SUPPORT AND SUBSEQUENT RELEASES

IBM may provide support to MTC by answering reasonable technical questions MTC
may have regarding the IBM Design Kit. Such support is not applicable to any
derivative soft cores or synthesizable cores MTC creates pursuant to this
Exhibit. All such questions should be coordinated through the IBM contact person
designated by IBM for this purpose. IBM may make a subsequent IBM Design Kit
release available to MTC for MTC's Licensed Use. While MTC may continue Licensed
Use of a previous release, IBM may not continue support for previous releases of
the IBM Design Kit.

PROTECTION AND SECURITY, CONFIDENTIALITY

Any information required to be exchanged in connection with the performance of
this Agreement which either party desires to have treated as confidential shall
be exchanged and treated in accordance with the terms and conditions of Section
6 of the Agreement.

Notwithstanding the foregoing, MTC agrees that any logical and physical design
data, design rules, macros, hard cores, soft cores, synthesizable cores, MTC's
derivatives of such soft cores and synthesizable cores, and training materials
supplied to MTC by IBM are IBM Confidential, and MTC agrees to protect such
information and materials for seven (7) years from the date of disclosure to MTC
as provided in Section 6 of the Agreement.

MTC agrees to use the training materials provided by IBM with the IBM Design Kit
only for MTC's internal training requirements and for those employees, together
with those subcontractors engaged by MTC who are individuals at MTC's facilities
and who are performing tasks substantially similar to MTC's regular employees,
who require training in order to carry out MTC's Licensed Use. The training
materials shall not be used to train any other third party in the use and
operation of the IBM Design Kit.

MTC agrees that SSM and information in SSM provided under this Agreement may
contain or be derived from information or portions of materials owned or
provided by a third party supplier, and shall be treated as IBM Confidential.
MTC acknowledges and agrees that Synopsys as such

<PAGE>

IBM/MULTILINK CONFIDENTIAL                                                PAGE 9
JOINT DEVELOPMENT AGREEMENT

a third party supplier is an intended third party beneficiary of this
Agreement, having all the rights to enforce the terms and conditions of this
Agreement that govern the use and protection of Synopsys' intellectual property
rights contained in the SSM.

MTC agrees that it will not make IBM Confidential materials available to any
third party. In addition, MTC agrees to take the following precautions with
respect to the IBM Design Kit components licensed under this Agreement:

  .  MTC will take appropriate action, by instruction, agreement or otherwise,
with any persons permitted access to any IBM Design Kit, to satisfy its
obligations under this Exhibit.
  .  MTC will reproduce and include the copyright notices and any other legend
on all copies, modifications, or portions merged into any other IBM Design Kit;
no such copyright notices, legend, or other marking on or in any materials
distributed under this Exhibit shall be tampered with or removed from any
licensed item, and
  .  MTC will ensure, before disposing of any media, that the IBM Design Kit or
any portion contained thereon has been erased or destroyed.

For purposes specifically related to MTC's Licensed Use of the IBM Design Kit,
MTC may make the IBM Design Kit available to any of the following: (1) its
Affiliates; (2) Representatives of MTC or MTC Affiliates; (3) Subcontractors of
MTC or its Affiliates; and (4) IBM's employees (a) during the period they are on
MTC's premises, or (b) whom MTC authorizes to have remote access to the IBM
Design Kit. For purposes of this paragraph, "Subcontractors" shall mean, and
shall be limited to, those persons who are contractually engaged full time on a
temporary basis by MTC to perform the same semiconductor device design services
as MTC's regular employees who have rightful access to the IBM Design Kit(s)
hereunder and who perform such services only on the premises of MTC or its
Affiliates.

Before making the IBM Design Kit available, all such Representatives,
Affiliates, and Subcontractors must be obligated to protect the IBM Design
Kit(s) according to a prior written agreement of confidentiality with MTC having
terms which are no less restrictive than set forth herein.

TERM

The license granted herein is effective for so long as the Agreement is in
effect. Upon termination or expiration of the Agreement, the licenses set forth
herein shall terminate. MTC agrees upon such termination to destroy (and certify
to such destruction) the IBM Design Kit together with all elements (including
SSM), copies, modifications and merged portions in any form.

<PAGE>

IBM/MULTILINK CONFIDENTIAL                                               PAGE 10
JOINT DEVELOPMENT AGREEMENT

                                   EXHIBIT C

                          CERTIFICATE OF ORIGINALITY

This questionnaire must be completed by any Party furnishing any software under
an SOW under this Agreement. The completed questionnaire is to be sent to the
Technical Coordinator for the Party submitting the software under the Agreement.

Please leave no questions blank. Write "not applicable" or N/A if a question is
not relevant to the furnished software material.

________________________________________________________________________________

1. Name of the software (include version, release and modification numbers for
programs and documentation) ____________________________________________________

Business address of employee making Certification ______________________________

_______________________________
_______________________________

Citizenship of employee making Certification ___________________________________

2. Was the software or any portion thereof:

a. Written by any person(s) other than the employee working within his/her job
assignment?

YES____ NO____

If YES, indicate if the whole software or only a portion thereof was written by
such person(s), and identify such portion.

<PAGE>

IBM/MULTILINK CONFIDENTIAL                                               PAGE 11
JOINT DEVELOPMENT AGREEMENT

b. If 2a. is NO, was the software or any portion thereof furnished to the
submitting Party by:

COMPANY(IES)_______ INDIVIDUAL(S)________ UNIVERSITY____________

c. If 2b. is COMPANY (IES), or UNIVERSITY provide for each Company and/or
University the following information:

1) Name:

2) Address:

3) How the Company/University acquired title to the software (e.g., Software was
written by Company's/University employees as part of their job assignment)?

4) Did the Company/University have each non-U.S. author who contributed to the
software sign a waiver of moral rights agreement?

YES____ NO____ N/A____

If YES, please attach a copy of the waiver agreement(s).

d. If 2b. is INDIVIDUAL(S), provide for each person the following information

1) Name:

<PAGE>

IBM/MULTILINK CONFIDENTIAL                                               PAGE 12
JOINT DEVELOPMENT AGREEMENT

2) Citizenship

3) Address:

4) Did the person create the software while employed by or under contractual
relationship with another party?
YES_____ NO_____.

If YES, provide name and address of the other party.

5) Did the person create the software in a country other than the United States?
YES____ NO____.

6) If d.5) is YES, did that person sign a waiver of moral rights agreement?
YES____ NO____.

If YES, please attach a copy of the waiver agreement.

3. Was the software or any portion thereof registered at any Copyright Office?
YES____ NO____.

4. Was the software or any portion thereof published?
YES____ NO____.

If YES, provide the following information:

<PAGE>

IBM/MULTILINK CONFIDENTIAL                                               PAGE 13
JOINT DEVELOPMENT AGREEMENT

a. When and where was it published?

b. Was any copyright notice present on the published material(s)?
YES____ NO____.

If YES, provide the copyright notice.

5. Was the software or any portion thereof released to any outside person or
company other than a Party hereto?
YES____ NO____.

If YES, provide the following information:

a. When and where was the software released?

b. Why was the software released?

c. Under what conditions (e.g., contract) was the software released?

6. Was the software or any portion thereof derived from preexisting material(s)?
YES____ NO____.

If YES, provide the following information for each of the preexisting materials.
a. Name of the material:

<PAGE>

IBM/MULTILINK CONFIDENTIAL                                               PAGE 14
JOINT DEVELOPMENT AGREEMENT

b. Author (if known):

c. Owner:

d. Copyright notice appearing on the material (if any):

e. Was any new function added to the preexisting software?
YES____ NO____.

If YES, briefly describe (or attach a brief description) of the new function(s).

f. State approximately

1) ____percent of preexisting material used

2) ____percent of preexisting material modified

3) ____percent of new material consisting of or deriving from preexisting
materials

<PAGE>

IBM/MULTILINK CONFIDENTIAL                                               PAGE 15
JOINT DEVELOPMENT AGREEMENT

g. Briefly describe (or attach a brief description of) how the preexisting
material has been used:

7. Were the "external characteristics" of this software or any portion thereof
copied or derived from the "external characteristics" of another program or
product? "External characteristics" include display screens, data formats,
instruction or command format, operator messages, interfaces, etc.
YES____ NO____.

If YES, provide the following information for each of the preexisting materials:

a. Name of material

b. Author (if known):

c. Owner:

d. Copyright notice relating to the preexisting "externals" (if any)

e. Have the preexisting "externals" been modified?
YES____ NO____.

If YES, briefly explain how such "externals" have been modified?

<PAGE>

IBM/MULTILINK CONFIDENTIAL                                               PAGE 16
JOINT DEVELOPMENT AGREEMENT

                        CERTIFICATION AS TO ENTIRE FORM

I hereby certify that all of the information set forth above and in any
attachment(s) to this form is, to the best of my knowledge, complete and
accurate.

___________________________________________________________
Signature Date

Witness:___________________________________________________
Signature Date

___________________________________________________________
Address

Witness:___________________________________________________
Signature Date

___________________________________________________________
Address

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